Sino-Global Announces Fiscal Year 2018 Second Quarter Financial Results

Highlights include 145% Increase in Revenues for the Quarter

ROSLYN, N.Y., Feb. 14, 2018 /PRNewswire/ -- Sino-Global Shipping America, Ltd. (NASDAQ: SINO) ("Sino-Global," the "Company" or "we"), a logistics integrated solution provider engaged in non-asset based global shipping, freight logistics, and inland transportation management and related services, today announced its financial results for the fiscal year 2018 second quarter ended December 31, 2017. The Company has also provided extensive information on its quarterly report on Form 10-Q filed this afternoon with the U.S. Securities and Exchange Commission and Company management encourages investors to review this document for more details of the Company's financial results for the second quarter of fiscal year 2018, background on Sino-Global's business and history, as well as Company strategy for the coming fiscal year.

Tax Cuts and Jobs Act

On December 22, 2017, the Tax Cuts and Jobs Act (the "Act") was signed into law. Among the changes was a permanent reduction in the federal corporate income tax rate. Under the provisions of the Act, the U.S. corporate tax rate decreased from 35% to 21%. Since the Company has a June 30 fiscal year-end, a blended U.S. statutory federal rate of approximately 28% for the fiscal year ending June 30, 2018 is applied to the provision for income tax, and a 21% will be applied in the subsequent fiscal years.

Fiscal Year 2018 Second Quarter Operating and Financial Highlights

(as compared to the same period of the prior year)

• Total revenues increased 145.3% to $5.2 million, compared to $2.1 million.  The increase was primarily due to the Company's efforts to diversify its business in freight logistics services and bulk cargo container services. The Company separately presents bulk cargo container services as a new segment during the three months ended December 31, 2017,. 
• Net income for the second quarter of fiscal year 2018 was $0.39 million, as compared to a net income of $0.79 million for the same period of the prior year. The decrease was the result of a rise in expenses relating to the growth of the Company which were offset by a $0.57 million tax benefit recognized during the period.
• Earnings was $0.03 per basic and diluted share for the three-month period.
• In December 2017, the Company signed a contract to develop a more complete logistics system based on the Company's current container trucking platform.
• At December 31, 2017, the Company had cash and cash equivalents of $7.2 million, and holds no long-term debt.

Management Commentary

Mr. Lei Cao, Chairman and Chief Executive Officer of Sino-Global commented, "We achieved significant growth in the quarter. The increase in revenues for the three-month period was primarily the result of an increase in business for our freight logistics and newly segmented bulk container services. The revenues generated for the three-month period from the freight logistics segment of our business increased by $3.1 million over the prior year period. However, due to the varying degrees of freight logistics services we provide, gross profit margin can differ drastically between the current quarter and the same period of the prior year."

"This quarter we ended our joint venture with Jetta Global on ACH Trucking Center and created a new segment of our operations, bulk cargo container services. As of quarter end, I am pleased to report that we have shipped 120 containers with 18 tons per container of sulfur from our Long Beach, California location to our customers in China. We expect to continue the build out of this portion of our operations, as profit margins are generally higher than other segments of our operations and are currently seeking new relationships with suppliers."

Chairman Cao concluded, "A little over a year ago, we launched our web-based short-haul container truck service platform and during the quarter, we entered into a new agreement to further the growth of this portal. With it further development we hope to attract and retain additional clients to the platform. We anticipate that the momentum started in the first half of the fiscal year will continue throughout 2018. In the months ahead, we will proceed with the rollout of our inland transportation management, freight logistics and container trucking and bulk cargo container services; as well as continue to foster and develop strong relationships with strategic partners and draw upon our in-depth industry knowledge to develop innovative value-added logistics solutions for our customers."

Fiscal Year 2018, Second Quarter Financial Review

• Revenues increased by $3.1 million, or 145.3%, to $5.2 million from $2.1 million for the three months ended December 31, 2016 for the same period of the prior year. This increase was primarily attributable to the Company diversifying its business in freight logistics services. Revenues generated from freight logistics services increased by $3.1 million, or 595.5%, from the three months ended December 31, 2016. 
• The Company's gross profit during the period remained relatively unchanged as compared to the prior year at $1.8 million. The reason for gross profit remaining unchanged despite a significant increase in total revenue for the quarter was due to majority of revenues generated for the three-month period ended December 31, 2017 stemmed from freight logistics services which is less profitable than inland transportation services which generated majority of the revenues for the prior year period. Increases in cost of revenue also contributed to the reduction in profit as a percentage of total revenues.
• Total operating expenses increased to $2.2 million for the three months ended December 31, 2017 from $0.82 million for the prior year period. The increase was attributable to several factors primarily focused on the build out of the business which included a rise in the cost of revenue, general and administrative expense and selling expenses.  
• Operating loss for the three months ended December 31, 2017 was approximately $0.32 million, compared to an operating income of approximately $1.0 million for the comparable period ended December 31, 2016. The decrease was due to the above mentioned rise in operating expenses relating to the ramp up of the Company's business. 
• Income tax benefit for the three months ended December 31, 2017 was $0.57 million, compared to an income tax expense of approximately $0.07 million for the same period of the prior year. The income tax benefit for the fiscal 2018 second quarter was due to an increased allowance for doubtful accounts which was partly offset by an increased income tax expense.
• For the three months ended December 31, 2017, the Company reported a net income of $0.39 million, compared to net income of $0.79 million for the three months ended December 31, 2016.  The decrease was due to a rise in business and development costs as described above which was partially offset by an increase in income tax benefit for the period.

Balance Sheet Information

• As of December 31, 2017, the Company had $7.2 million in cash and cash equivalents, working capital of $14.4 million and shareholder equity of $21.0 million; compared to $8.7 million, $13.7 million, and $19.5 million, respectively, as of June 30, 2017.
• The Company holds no long-term debt.  

About Sino-Global Shipping America, Ltd.

Founded in the United States in 2001, Sino-Global Shipping America, Ltd. is a company engaged 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 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

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