VANCOUVER, BRITISH COLUMBIA--(Marketwire - Aug. 8, 2012) - Hanwei Energy Services Corp. (TSX:HE) ("Hanwei" or the "Company"), today reported its financial results for the three months ending June 30, 2012. All amounts are in Canadian Dollars unless otherwise noted.
Hanwei is pleased to announce continued and very positive advancements in its operating results for the first quarter of Fiscal 2013 (the three months ending June 30, 2012). These results continue the positive trend from the Company's enhanced operating performance and financial results from Fiscal 2012 (for the year ended March 31, 2012). Specific financial highlights for the three months ending June 30, 2012 include:
- Revenue doubled to $9.6 million as compared to revenues for the same period of the prior year of $4.9 million. Of this increase: sales to clients in the China market were $5.6 million versus $3.2 million for the same period of the prior year representing a 77% increase; sales to clients in the Middle Asia market for Kazakhstan were $3.2 million versus $1.3 million for the same period of the prior year representing a 146% increase; and sales to clients in the Middle East market were $786,000 versus $428,000 for the same period of the prior year representing an 84% increase.
- Of the above noted revenues 59% were to clients in the China market and 41% to clients outside of China in international markets.
- Gross profit was $3.3 million or 34% of revenues consistent with the Company's goal of maintaining a minimum annualized gross profit margin of 30% and primarily driven by continued focus on manufacturing processes and logistics;
- Positive EBITDA (earnings before interest, income taxes, depreciation and amortization) was $1.7 million, or 18% of revenues, and representing a $2.3 million improvement as compared to negative EBITDA of approximately $600,000 for the same period of the prior year. The substantial increase in EBITDA from continuing operations was primarily driven through efficiencies in sales and marketing and reductions in general and administrative expenses.
- The EBITDA gain also translated into a net profit of $900,000 as compared to a net loss of $1.4 million for the same period of the prior year representing a net profit increase of $2.3 million.
- The Company generated positive cash flow from operations of $1.7 million for the period.
- Income from continuing operations was $900,000 for the three months ended June 30, 2012 as compared to loss from continuing operations of $1.3 million for the same period in 2011, representing an improvement of $2.2 million. The Company had basic and diluted earnings per share from continuing operations of $0.01 for the three months ended June 30, 2012 as compared to basic and diluted loss per share from continuing operations of $0.02 for the same period of 2011.
- The Company continues to effectively manage its debt facilities. Total principal amount of all bank loans reduced to $19.5 million as of June 30, 2012 compared to a total principal amount of $20.8 million as of March 31, 2012 and $23.4 million as at June 30, 2011. Bank loans have successfully been repaid, renewed or extended when they became due.
Hanwei will host a conference call to discuss its operational and financial results for the three months ended June 30, 2012. Graham Kwan, Executive Vice President and Rick Huang, Chief Financial Officer of Hanwei will host the call. Management invites analysts and investors to participate on the conference call:
||Friday, August 10, 2012
||11:00 a.m., Eastern Time
|Dial in number:
||1-888-401-4668 or 1-719-325-2429
||1-877-870-5176 or 1-858-384-5517 (available for 14 days)
|Taped Replay Pass Code:
|Live Webcast Link:
About Hanwei Energy Services Corp.
Hanwei Energy Services Corp. is a world leader in the manufacturing of high pressure, fiberglass reinforced plastic ("FRP") pipe products, and associated technologies and services, for the international oil and gas and infrastructure industries. Hanwei serves major energy customers in the Chinese and global energy markets.
FORWARD-LOOKING INFORMATION AND NON-GAAP MEASURES
Certain information in this press release is forward-looking within the meaning of certain securities laws, and is subject to important risks, uncertainties and assumptions a description of which is set out in the risk factors section of the Company's Annual Information Form dated June 20, 2012 and Management Discussion and Analysis for the year ended March 31, 2012 both of which are filed with Canadian securities regulators and available on SEDAR at www.sedar.com. The forward-looking information in this press release describes the Company's expectations as of the date of this press release.
THE FORWARD-LOOKING INFORMATION CONTAINED IN THIS PRESS RELEASE PRESENTS THE EXPECTATIONS OF THE COMPANY AS OF THE DATE OF THIS PRESS RELEASE AND, ACCORDINGLY, IS SUBJECT TO CHANGE AFTER SUCH DATE. READERS SHOULD NOT PLACE UNDUE IMPORTANCE ON FORWARD-LOOKING INFORMATION AND SHOULD NOT RELY UPON THIS INFORMATION AS OF ANY OTHER DATE. WHILE THE COMPANY MAY ELECT TO, THE COMPANY DOES NOT UNDERTAKE TO UPDATE THIS INFORMATION AT ANY PARTICULAR TIME, EXCEPT AS REQUIRED BY APPLICABLE SECURITIES LEGISLATION.
Neither the TSX nor its Regulation Services Provider (as that term is defined in the policies of the TSX) accepts responsibility for the adequacy or accuracy of this release.