VANCOUVER, BRITISH COLUMBIA--(Marketwire - Dec. 28, 2012) - China Keli Electric Co. Ltd. (TSX VENTURE:ZKL) ("Keli" or the "Company") today announced the financial and operating results for the three and six months ended October 31, 2012.
For the three months ended October 31, 2012 ("Q2 FY2013"), total revenue was $4,527,803, an increase of 11.6% over Q2 FY2012 revenues of $4,055,778. The newly developed installation business contributed $1.1 million revenue in Q2 FY2013. Gross profit in Q2 FY2013 was $1,532,199, a decrease of 8.7% over Q2 FY2012 gross profit of $1,678,513, which was mainly caused by the lower grow margin of installation services. To develop the installation business and expand the market shares of product sales, the Company continuously increased its investment in marketing activities in Q2 FY2013 ($591,921 in Q2 FY2013 compared to $435,080 in Q2 FY2012). Meanwhile, the Company carefully managed its general and administration expenses, which resulted in a slight decrease of general and administration expenses from Q2 FY2012 ($679,541 in Q2 FY2013 compared to $742,248 in Q2 FY2012). As a result, the Company's net profit was $143,897 in Q2 FY2013 compared to $343,144 in Q2 FY2012. Basic and diluted earnings per share ("EPS") were $0.002 compared with $0.004 in Q2 FY2012. The decreased net profit and EPS were due primarily to decreased gross profit and increased marketing expenses. EBITDA was $231,467 in Q2 FY2013, a decrease from $426,957 in Q2 FY2012. After accounting for an unrealized foreign exchange translation gain of $277,535, the Company reported total comprehensive income of $421,432 in Q2 FY2013, compared with a total comprehensive income of $1,059,510 in Q2 FY2012. The Company's unrealized foreign exchange income on translation of the Group's functional currency to its reporting currency is subject to fluctuations in the exchange rate between the RMB and the Canadian dollar in each reporting period.
For the First Half FY2013, total revenue was $9,304,675, an increase of 14.7% over $8,110,129 in the First Half FY2012.The Company recorded a net profit of $433,343, compared to $724,016 in the First Half FY2012.
"The high voltage equipment market has changed significantly in the last few years from customers looking for single products to customers demanding complete solutions. We've modified Keli's business model to adapt to the new environment," said Lou Meng Cheong, Keli's CEO. "We're very pleased that our financial results have held up well during this transition. We've had to invest in new services, partnerships and marketing, and now these investments are paying off. We look forward to further growth for the balance of FY2013 and beyond."
As of October 31, 2012, the Company had total cash and cash equivalents of $1,319,350 compared with $1,486,664 as of April 30, 2012. Accounts receivable were $11,326,953 as at October 31, 2012, an increase of $717,513 compared with $10,609,440 as at April 30, 2012. The Company's working capital was $9,098,398 as at October 31, 2012, an increase from $8,535,065 as at April 30, 2012.
The functional currency of the Company and its subsidiaries is Chinese Yuan (also known as "Renminbi" or "RMB"). The financial and operating results of the relevant periods have been translated into Canadian dollars. Depending on the magnitude of changes in foreign currency exchange rates, the impact on the financial and operating results may or may not be material.
Full financial results of the Company for the three and six months ended October 31, 2012 are available on SEDAR at www.sedar.com.
About China Keli Electric Company Ltd.
China Keli Electric Company Ltd. specializes in the manufacturing of electrical components and equipment, including pre-assembled mini substations, electrical controllers, pressurized and vacuumed switchgears and circuit breakers.
For further company information please access our website: www.zkl.cc
This press release contains forward-looking statements based on current expectations. These forward-looking statements entail various risks and uncertainties that could cause actual results to differ materially from those reflected in these forward-looking statements. Risks and uncertainties about Keli's business are more fully discussed in the Company's disclosure materials filed with the securities regulatory authorities in Canada. All amounts are stated in Canadian dollars unless noted otherwise.
Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this press release.