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Plastec Technologies Reports Unaudited Fiscal 2012 4th Quarter Results
Aug 01, 2012 (Close-Up Media via COMTEX) -- Copyright Close-Up Media, Inc. 2012. All Rights reserved

Plastec Technologies, PLTWF (warrants), PLTEF (units), an integrated plastic manufacturing services provider that operates in the People's Republic of China, on July 27 announced unaudited financial results for the Company's fiscal 2012 fourth quarter and audited results for its full year ended April 30.

Kin Sun Sze-To, Chairman and Chief Executive Officer of Plastec, noted, "We were very pleased to report profitable results and strong cash generation during fiscal 2012 despite difficult and unusual circumstances surrounding our industry. In addition to a general slowdown in exports, the Japanese earthquake and tsunami, along with the floods in Thailand, affected many of our larger electronics customers. This delayed new product cycles for our 2012 fiscal year, which are typically our highest margin line of business."

Sze-To continued, "Once again, we feel that the primary reason for our consistent profitability despite the headwinds throughout the year was Plastec's continued strong relationships with its clients. We have maintained these relationships, many of which have been clients for over five years, largely and demonstrably due to our focuses on high-precision molding solutions and quality control, with our rate of goods returned having been improved further to 0.34 percent in fiscal 2012 from 0.74 percent in the prior year. The plastic injection molding business in China and Hong Kong is extremely fragmented, and we believe that our continued strong track record of performance will help in both cultivating our existing relationships while also adding potential new business."

In a release, the company noted that fiscal year 2012 fourth quarter financial review highlights include:

Revenues

-The Company's total sales for the three months ended April 30, decreased 1.8 percent to $40.7 million from $41.4 million. The decrease in revenues is largely due to a general slowdown in the markets that Plastec serves, namely consumer electronics, and the unusual global events mentioned above.

Gross Profit / Margin

-The Company reported gross profit of $4.7 million during the period, compared to $6.7 million in the fourth quarter of fiscal 2011. Plastec's gross profit margin for the three months ended April 30, decreased to 11.6 percent from 16.2 percent in the prior-year period. The decrease in gross margin was largely the result of higher wages and inflation. In addition, the Company typically records a higher margin during the "first run" of product cycles. As a result of the general slowdown in consumer electronic buying across the world, there were fewer first generation products.

EBITDA / Net Income

-EBITDA for the three months ended April 30, was $7.3 million, compared to $8.7 million in the prior three-month period.

-Net income for the three months ended April 30, was $2.1 million, or $0.14 per share based on a weighted average number of diluted shares outstanding of 14.6 million, compared to net income of $2.0 million, or $0.22 per share based on 9.3 million weighted average number of diluted shares, in the prior-year period.

Fiscal Year 2012 Year-end Financial Review

Revenues

For the year ended April 30, Plastec's total sales were $165.5 million, a decrease of 2.4 percent compared to $169.7 million from the prior year. This decrease was primarily a result of the slowdown mentioned above.

Gross Profit / Margin

-The Company's gross profit for the 2012 fiscal year was $19.0 million, compared to $31.9 million in the prior year. Gross margin was 11.5 percent and 18.8 percent for the year ended April 30, and April 30, 2011, respectively.

EBITDA / Net Income

-EBITDA decreased 27.3 percent to $28.7 million for the year ended April 30, compare to $39.6 million in the prior year.

-For the year ended April 30, net income was $6.5 million, or $0.41 per share based on a weighted average number of diluted shares outstanding of 15.9 million, compared to $17.1 million, or $2.17 per share based on a weighted average number of diluted shares of 7.9 million in the prior year.

Sze-To concluded, "We remain focused on improving our profit margin and exploring methods to streamlining our costs further during what likely to be a difficult period ahead for our industry. We will continue to re-invest in our machinery, which strategy served us well during the last economic downturn in 2008. In addition, we are continuing to re-evaluate our current capacity to achieve greater cost savings and improve efficiency. To that end and underpinned by our strong financial position with no long-term debt, the Company will step up efforts in exploring potential areas of expansion in countries where labor costs and overhead would be even more favorable than where we are now operating as well as potential acquisition possibilities in new markets to broaden our revenue streams. Throughout any challenges, we will, and as always, continue to remain focused on our customers."

Plastec is an integrated plastic manufacturing services provider.

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