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Sino-Global Announces Fiscal 2019 Second Quarter Financial Results Highlighted by 101.4% Increase to $10.5 Million in Total Revenues

Sino-Global Shipping America, Ltd.
2019-02-14 05:05 10636

ROSLYN, N.Y., Feb. 14, 2019 /PRNewswire/ -- Sino-Global Shipping America, Ltd. (NASDAQ: SINO) ("Sino-Global", the "Company", "our", "we" or "us"), a logistics integrated solutions provider engaged in non-asset based global shipping, freight logistics, and inland transportation management and related services, today announced its financial and operating results for the second quarter and six months ended December 31, 2018 ("Fiscal 2019").

The Company has also provided an update on its Quarterly report on Form 10-Q filed with the U.S. Securities and Exchange Commission the same day. Management encourages investors to review this filing for more details of the Company's financial results for the period.

Management Comments – Highlights in Second Quarter of Fiscal 2019

Mr. Lei Cao, Chairman and Chief Executive Officer of Sino-Global commented, "We delivered multiple shipments totaling approximately $0.89 million in revenue for the Company for November and December 2018 as part of our expanded shipping agency business and our freight logistics business generated revenue of approximately $8.98 million during the second quarter of 2019. The second quarter reflected the full impact of our costs associated with the transition to a shipping agency and logistics focus without the corresponding revenue, which we believe will be expressed in the second half of Fiscal 2019. The Company has signed multiple contracts over the past year with large import / export agencies throughout China and anticipates an increase in revenues in this business segment."

Mr. Cao continued, "Our plan is to develop a shipping agency network in China and South East Asia for the next three years and to expand our shipping agency network worldwide. We plan to build the network through acquisitions or strategic partnership with other shipping agencies. Our shipping agency business will be mostly conducted through our subsidiaries in China, Hong Kong and Australia, where we have over 20 years of experience. Our initial strategy was to expand our partnerships gradually during 2018 with agencies that have a strong track-record throughout 2018 and then to increase sales and cash generation throughout 2019. We began seeing a considerable shift in sales in the fiscal 2019 second quarter and expect this to continue throughout the remainder of 2019."

Fiscal 2019 Second Quarter and Subsequent Operating Highlights

  • On November 1, 2018, the Company signed a five-year strategic cooperation agreement with a Hong Kong listed Company, Sinco Pharmaceuticals Holdings Ltd ("Sinco"), pursuant to which both companies will contribute resources and expertise to develop cold chain logistics in China.
  • On January 1, 2019, the Company signed a shipment service agreement with Chongqing Iron and Steel Company ("Chongqing Iron and Steel") which appointed the Company to ship 1 million tons of iron ore and coal to their designated port with service period from January 1, 2019 to December 31, 2019. The business relationship Sino-Global has with Chongqing Iron and Steel will further enhance and develop its freight logistics business.
  • During the three months ended December 31, 2018, the Company signed a shipping agency agreement with Y&D Marine Limited Co.. On January 30, 2019, Sino-Global signed an agency agreement with Zhejiang Baoming International Shipping Agency Co., Ltd. and assigned them as the port agent, due to the aforementioned shipping agency agreement with Y&D Marine Limited Co. We will cooperate with more port agents in the near future to further expand our shipping agency business.

Fiscal Year 2019 Second Quarter Financial Review

  • Total revenues increased by 101.4% to approximately $10.5 million for the three month period ended December 31, 2018, compared to approximately $5.2 million in the period ended December 31, 2017. This increase was due to the Company's business development efforts in freight logistics. In addition, as the Company decided to transit back to the shipping agency business, we had generated approximately $0.9 million of revenue from providing shipping agency services in the second quarter of fiscal year 2019.
  • The Company's gross profit for the three month period ended December 31, 2018 was approximately $1.96 million, compared to approximately $1.84 million for the same period in the prior year. Gross profit margin during the period was 18.6% compared to 35.3% for the same period last year. 
  • Sino-Global's selling, general and administrative expenses (SG&A expenses) were approximately $2.1 million for the three month period ended December 31, 2018, compared to approximately $1.9 million in the same period of the prior year. As a percentage of revenue, SG&A expenses decreased to 19.8% from 36.0% in the prior year period, largely due to greater efficiency on higher revenues. 
  • The Company's provision for doubtful accounts was $416,706 for the three months ended December 31, 2018, compared with a provision for doubtful accounts of $861,967 for the same period in 2017. The decrease was due to faster collections from customers. As the Company continues its business relationship with several large customers, it will continue to monitor the collection closely with respect to trade accounts receivable.
  • For the three months ended December 31, 2018, the Company reported a net loss attributable to the Company of approximately $1.5 million, or $(0.11) per diluted share based on weighted average diluted shares outstanding of 13,769,918, compared to a net income attributable to the Company of approximately $0.3 million, or $0.03 per diluted share based on weighted average diluted shares outstanding of 10,415,503, for the same period in the prior year.

The following tables present summary information by segments for the three months ended December 31, 2018 and 2017:

For the three months ended December 31, 2018


Shipping
Agency
Services

Inland
Transportation
Management
Services

Freight
Logistics
Services

Container
Trucking
Services

Total

Revenues















- Related party

$

-

$

75,000

$

-

$

-

$

75,000

- Third parties

$

889,070

$

345,000

$

8,978,923

$

227,294

$

10,440,287

Total revenues

$

889,070

$

420,000

$

8,978,923

$

227,294

$

10,515,287

Cost of revenues

$

809,040

$

20,000

$

7,497,666

$

229,891

$

8,556,597

Gross profit

$

80,030

$

400,000

$

1,481,256

$

(2,596)

$

1,958,690

Depreciation and amortization

$

-

$

20,339

$

475

$

4,751

$

25,565

Total capital expenditures

$

-

$

-

$

-

$

8,534

$

8,534

Gross margin%

9.0

%

95.2

%

16.5

%

(1.1%)

18.6

%





















































For the three months ended December 31, 2017


Shipping
Agency
Services

Inland
Transportation
Management
Services

Freight
Logistics
Services

Container
Trucking
Services

Total

Revenues















- Related party

$

-

$

555,246

$

-

$

-

$

555,246

- Third parties

$

-

$

838,595

$

3,699,775

$

126,865

$

4,665,235

Total revenues

$

-

$

1,393,841

$

3,699,775

$

126,865

$

5,220,481

Cost of revenues

$

-

$

174,025

$

3,152,005

$

49,848

$

3,375,878

Gross profit

$

-

$

1,219,816

$

547,770

$

77,017

$

1,844,603

Depreciation and amortization

$

-

$

12,736

$

476

$

5,327

$

18,539

Total capital expenditures

$

-

$

-

$

2,721

$

42,480

$

45,201

Gross margin%

-

87.5

%

14.8

%

60.7

%

35.3

%

Balance Sheet Information

  • As of December 31, 2018, the Company had approximately $2.5 million in cash, working capital of apporximately $12.5 million and stockholders' equity of approximately $18.6 million.
  • The Company had no long-term debt as of December 31, 2018.

About Sino-Global Shipping America, Ltd.

Founded in the United States in 2001, Sino-Global Shipping America, Ltd. is a company engaged originally in shipping, chartering, logistics and related business services. Headquartered in New York, Sino-Global has offices in mainland China, Australia, Canada and Hong Kong. The Company's current service offerings consist of shipping agency, inland transportation management, freight logistics and container trucking services. Additional information about Sino-Global can be found on the Company's corporate website at www.sino-global.com. The Company routinely posts important information on its website.

Forward Looking Statements

No statement made in this press release should be interpreted as an offer to sell or a solicitation of an offer to purchase any security. Such an offer can only be made in accordance with the Securities Act of 1933, as amended, and applicable state securities laws. Any statements contained in this release that relate to future plans, events or performance are forward-looking statements that involve risks and uncertainties as identified in Sino-Global's filings with the U.S. Securities and Exchange Commission. Actual results, events or performance may differ materially. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date hereof. Sino-Global undertakes no obligation to publicly release the results of any revisions to these forward-looking statements that may be made to reflect the events or circumstances after the date hereof or to reflect the occurrence of unanticipated events unless required by applicable law or regulations.

Contact Information

The Equity Group Inc.
Adam Prior
Senior Vice-President
(212)-836-9606 / aprior@equityny.com

 

 

 

SINO-GLOBAL SHIPPING AMERICA, LTD. AND AFFILIATES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS)

(UNAUDITED)


For the Three Months Ended

For the Six Months Ended

December 31,

December 31,

2018

2017

2018

2017








Net revenues - third parties

$

10,440,287

$

4,665,235

$

16,617,820

$

9,480,086

Net revenues - related party

75,000

555,246

397,000

1,120,406

Total revenues

10,515,287

5,220,481

17,014,820

10,600,492

Cost of revenues

(8,556,597)

(3,375,878)

(13,640,429)

(7,041,796)

Gross profit

1,958,690

1,844,603

3,374,391

3,558,696












Selling expenses

(258,229)

(335,261)

(366,598)

(357,727)

General and administrative expenses

(1,831,746)

(1,546,305)

(3,676,579)

(2,247,289)

Stock-based compensation

(1,047,376)

(280,709)

(1,864,584)

(343,082)

Total operating expenses

(3,137,351)

(2,162,275)

(5,907,761)

(2,948,098)












Operating income (loss)

(1,178,661)

(317,672)

(2,533,370)

610,598












Financial income, net

782

137,799

1,494

222,595












Net income (loss) before provision for income taxes

(1,177,879)

(179,873)

(2,531,876)

833,193












Income tax benefit (expense)

(244,979)

571,121

(178,513)

274,692












Net income (loss)

(1,422,858)

391,248

(2,710,389)

1,107,885












Net income attributable to non-controlling interest

51,114

93,545

80,345

192,993












Net income (loss) attributable to Sino-Global Shipping America, Ltd.

$

(1,473,972)

$

297,703

$

(2,790,734)

$

914,892












Comprehensive income (loss)










Net income (loss)

$

(1,422,858)

$

391,248

$

(2,710,389)

$

1,107,885

Other comprehensive income (loss) - foreign currency

(106,762)

97,600

(568,924)

145,317

Comprehensive income (loss)

(1,529,620)

488,848

(3,279,313)

1,253,202

Less: Comprehensive income attributable to non-controlling interest

26,930

20,618

133,655

61,365

Comprehensive income (loss) attributable to Sino-Global Shipping America Ltd.

$

(1,556,550)

$

468,230

$

(3,412,968)

$

1,191,837












Earnings (loss) per share










Basic

$

(0.11)

$

0.03

$

(0.21)

$

0.09

Diluted

$

(0.11)

$

0.03

$

(0.21)

$

0.09












Weighted average number of common shares used in computation










Basic

13,769,918

10,367,492

13,457,726

10,236,513

Diluted

13,769,918

10,415,503

13,457,726

10,286,683

 

 

SINO-GLOBAL SHIPPING AMERICA, LTD. AND AFFILIATES

CONDENSED CONSOLIDATED BALANCE SHEETS

(UNAUDITED)


December 31,

June 30,

2018

2018





Assets



Current assets



Cash

$

2,454,226

$

7,098,259

Accounts receivable, less allowance for doubtful accounts of $3,080,328 and $1,682,228 as of December 31, 2018 and June 30, 2018, respectively

12,148,934


8,428,853

Other receivables, less allowance for doubtful accounts of $145,186 and $145,176 as of December 31, 2018 and June 30, 2018, respectively

35,040


69,239

Advances to suppliers-third parties

934,824


704,878

Advances to suppliers-related party

-


3,414,619

Prepaid expense and other current assets

354,969


588,439

Due from related party

1,105,775


2,087,994

Total Current Assets

17,033,768


22,392,281







Property and equipment, net

900,455


956,429

Intangible assets, net

121,389


153,056

Prepaid expenses

1,267,005


1,878,258

Other long-term assets - deposits

3,048,586


143,303

Deferred tax assets, net

755,000


634,500

Total Assets

$

23,126,203

$

26,157,827







Liabilities and Equity












Current Liabilities





Advances from customers

$

126,395

$

415,385

Accounts payable

770,077


3,225,661

Taxes payable

3,015,104


2,700,619

Accrued expenses and other current liabilities

594,082


280,888

Total current liabilities

4,505,658


6,622,553







Total liabilities

4,505,658


6,622,553







Commitments and Contingencies












Equity





Preferred stock, 2,000,000 shares authorized, no par value, none issued

-


-

Common stock, 50,000,000 shares authorized, no par value; 15,421,200 and 13,271,032 shares issued as of December 31, 2018 and June 30, 2018, respectively; 15,245,703 and 13,095,535 outstanding as of December 31, 2018 and June 30, 2018, respectively

25,791,830


23,717,330

Additional paid-in capital

2,045,657


1,755,573

Treasury stock, at cost, 175,497 shares  as of December 31, 2018 and June 30, 2018

(417,538)


(417,538)

Accumulated deficit

(3,225,590)


(434,856)

Accumulated other comprehensive loss

(894,641)


(272,407)

Total Sino-Global Shipping America Ltd. Stockholders' Equity

23,299,718


24,348,102







Non-controlling Interest

(4,679,173)


(4,812,828)







Total Equity

18,620,545


19,535,274







Total Liabilities and Equity

$

23,126,203

$

26,157,827

 

 

SINO-GLOBAL SHIPPING AMERICA, LTD. AND AFFILIATES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(UNAUDITED)


For the Six Months Ended

December 31,

2018

2017




Operating Activities


Net income (loss)

$

(2,710,389)

$

1,107,885

Adjustments to reconcile net income (loss) to net cash used in operating activities:




Stock-based compensation

1,864,584

343,082

Depreciation and amortization

51,280

31,742

Provision for doubtful accounts

1,287,787

837,431

Deferred tax benefit

(120,500)

(1,073,700)

Changes in assets and liabilities




Accounts receivable

(5,044,123)

(2,210,485)

Other receivables

79,773

(234,751)

Advances to suppliers-third parties

(220,166)

50,465

Advances to suppliers-related party

3,294,701

-

Prepaid expenses and other current assets

408,642

80,952

Other long-term assets - deposits

(2,489,067)

-

Due from related parties

1,091,355

(921,532)

Advances from customers

(295,619)

(23,001)

Accounts payable

(2,508,225)

288,283

Taxes payable

305,603

731,456

Due to related parties

-

(206,323)

Accrued expenses and other current liabilities

286,613

(61,218)

Net cash used in operating activities

(4,717,751)

(1,259,714)






Investing Activities




Acquisition of property and equipment

(9,357)

(50,278)

Acquisition of intangible assets

-

(190,000)

Prepayment for acquisition of intangible assets

-

(10,000)

Net cash used in investing activities

(9,357)

(250,278)






Financing Activities




Proceeds from issuance of common stock

500,000

-

Net cash provided financing activities

500,000

-






Effect of exchange rate fluctuations on cash

(416,925)

(3,902)






Net decrease in cash

(4,644,033)

(1,513,894)






Cash at beginning of period

7,098,259

8,733,742






Cash at end of period

$

2,454,226

$

7,219,848






Supplemental information




Income taxes paid

$

16,536

$

60,162

Cision View original content:http://www.prnewswire.com/news-releases/sino-global-announces-fiscal-2019-second-quarter-financial-results-highlighted-by-101-4-increase-to-10-5-million-in-total-revenues-300795289.html

Source: Sino-Global Shipping America, Ltd.
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