NEW YORK, March 26, 2015 /PRNewswire/ -- Global
Sources Ltd. (NASDAQ: GSOL) reported financial results for the
fourth quarter and year-ended Dec. 31,
2014.
"Our fourth quarter results were driven by the strong
performance of our China Sourcing Fairs in Hong Kong and effective cost management,"
stated Merle A. Hinrich, Global
Sources' executive chairman. "I am pleased with our overall results
for the year, during which we launched several new trade shows and
enhanced the value of our fully integrated offering of online
marketplaces and exhibitions. Looking ahead, we intend to continue
focusing on improving our competitive position with specialized
vertical offerings of online and trade show services for our buyer
and supplier communities."
Financial highlights -- Fourth quarter: 2014 compared to
2013
- Revenue was $62.9 million, as
compared to $60.1 million.
- Online revenue was $19.5 million,
as compared to $21.7 million.
- Exhibitions revenue was $38.2
million, as compared to $33.2
million.
- Print revenue was $2.9 million,
as compared to $3.3 million.
- The company recorded a foreign exchange loss of $1.3 million due to the devaluation of the yuan
during the fourth quarter of 2014.
- IFRS net income was $9.3 million,
or $0.29 per diluted share, as
compared to fourth quarter 2013 IFRS net income of $5.0 million, or $0.14 per diluted share.
- Non-IFRS net income was $9.9
million, or $0.31 per diluted
share, as compared to $10.9 million,
or $0.30 per diluted share, for the
fourth quarter of 2013.
- Adjusted EBITDA was $12.2
million, as compared to $13.1
million for the fourth quarter of 2013.
- Total deferred income and customer prepayments were
$88.8 million as at Dec. 31, 2014, as compared to $90.4 million as at Dec.
31, 2013.
Financial highlights -- Full year 2014 ended Dec. 31: 2014 compared to 2013
- Revenue was $198.2 million, as
compared to $197.5 million.
- IFRS net income was $18.3
million, or $0.55 per diluted
share, as compared to $32.7 million,
or $0.91 per diluted
share.
- Non-IFRS net income was $22.5
million, or $0.67 per diluted
share, as compared to $30.2 million,
or $0.84 per diluted share, for
2013.
- Adjusted EBITDA was $37.3
million, as compared to $40.4
million for 2013.
Global Sources' CFO, Connie Lai,
stated: "For the fourth quarter, we delivered strong bottom line
results. We reported a 15 percent increase in exhibition revenue,
which was partially offset by a 10 percent decline in online
services, and we closely managed costs. Our balance sheet
remains strong with a cash balance of $98.5
million and no debt."
Financial expectations for the first half of 2015 under
IFRS
- For the first half of 2015 ending June
30, 2015:
- Revenue is expected to be in the range of $90.0 million to $92.0 million, as compared to
$92.8 million for the first half of
2014.
- IFRS EPS is expected to be in the range of $0.15 to $0.19, as compared to $0.20 per diluted share in the first half of
2014. SBC and the amortization of intangibles as it relates to
certain equity compensation plans are estimated to be an expense of
$0.04 per diluted share for the first
half of 2015.
- Non-IFRS EPS is expected to be in the range of $0.19 to $0.23, as compared to $0.28 per diluted share for the same period in
2014.
- Adjusted EBITDA is expected to be between $12.9 million and $14.1 million, as compared to
$17.7 million in the first half of
2014.
"We expect the revenue mix for the first half of 2015 to range
between 50% and 51% for exhibitions, 38% and 39% for online, 5% and
6% for print, and approximately 4% for miscellaneous, which
reflects the growing contribution of our specialized vertical trade
show offerings. This compares to a first half of 2014 revenue mix
of approximately 45% for online, 45% for exhibitions, 6% for print,
and 4% for miscellaneous," Lai added.
Recent Corporate Highlights
- In February, launched an enhanced version of Mobile
Electronics plus three new vertically specialized websites for
consumer electronics, security products and electronic components.
- Consumer Electronics
http://www.consumerelectronics.globalsources.com/
- Security Products http://www.security.globalsources.com/
- Electronic Components
http://www.electroniccomponents.globalsources.com/
- China Sourcing Fairs were held in Johannesburg in November 2014.
- China Sourcing Fairs were held in October 2014 at Hong
Kong's AsiaWorld-Expo. The fall shows had more than 7,500
booths. Total attendance exceeded 75,000 and included buyers from
more than 148 countries and territories.
- Held the China Sourcing Fair: Electronics &
Components in Hong
Kong, which featured more than 3,700 booths.
- Held the inaugural Mobile Electronics Fair in
Hong Kong, which featured more
than 1,500 booths and fully launched its suite of services for the
mobile electronics industry.
- Received the Gold corporate award for excellence in corporate
governance and investor relations in The Asset's
December 2014 issue. The company
received The Asset's Gold and Titanium corporate award for
the previous five years.
- Private Sourcing Events were held from October 2014 through January 2015 for more than 110 sourcing teams
from very large buying organizations including Canadian Tire,
Clas Ohlson, Dick Smith, Groupe Beaumanoir, Halfords, Mophie,
O'STIN, Sears, Skyworth and others. These events created more than
420 high-quality, one-on-one selling opportunities for Global
Sources suppliers.
Conference call for Global Sources fourth quarter 2014
earnings
Executive chairman Merle A.
Hinrich and CFO Connie Lai
are scheduled to conduct a conference call at 8:00 a.m. ET on March 26,
2015 (8:00 p.m. on
March 26, 2015 in Hong Kong) to review these results in more
detail. Investors in the United
States may participate in the call by dialing (888)
765-5574, and non-Hong Kong
international participants may dial (1-913) 312-1269. Investors in
Hong Kong may participate by
dialing (852) 3008-0382. The conference ID is 9303522 and
participants are encouraged to dial 10 minutes prior to the call to
prevent a delay in joining. A live webcast of the conference call
is scheduled to be available on Global Sources' corporate site at
http://www.investor.globalsources.com.
For those who cannot listen to the live broadcast, a webcast
replay of the call is scheduled to be available on the company's
corporate site for 30 days. A telephone replay of the call is also
scheduled to be available through April 2,
2015. To listen to the telephone replay dial (888) 203-1112
or dial (1-719) 457-0820 outside the
United States, and enter pass code 9303522. For those in the
Hong Kong area, the replay dial-in
number is (800) 901-108, and the pass code is 9303522.
About Global Sources
Global Sources is a leading business-to-business media company
and a primary facilitator of trade with Greater China.
The core business facilitates trade between Asia and the world using English-language
media such as online marketplaces (GlobalSources.com), print and
digital magazines, sourcing research reports, private sourcing
events, and trade shows.
More than 1 million international buyers, including 95 of the
world's top 100 retailers, use these services to obtain product and
company information to help them source more profitably from
overseas supply markets. These services also provide suppliers with
integrated marketing solutions to build corporate image, generate
sales leads and win orders from buyers in more than 240 countries
and territories.
Global Sources' other businesses provide Chinese-language media
to companies selling to and within Greater China. These services include online
web sites, print and digital magazines, seminars and trade shows.
In mainland China, Global Sources
has a network of more than 30 office locations and a community of
more than 5 million registered online users and magazine readers of
its Chinese-language media.
Now in its fifth decade, Global Sources has been publicly listed
on the NASDAQ since 2000.
Global Sources' non-IFRS metrics
Management believes non-IFRS metrics are useful measures of
operations and provides IFRS to non-IFRS reconciliation tables at
the end of this press release. Global Sources defines non-IFRS net
income as net income excluding non-cash, SBC expense or credit,
amortization of intangibles as it relates to certain equity
compensation plans, profits or losses on acquisitions and
investments net of transaction costs and related tax expenses,
and/or impairment charges net of related taxes, for all historical
and future references to non-IFRS metrics. Non-IFRS EPS is defined
as non-IFRS net income divided by the weighted average of diluted
common shares outstanding. Adjusted EBITDA is defined as earnings
before interest, taxes, depreciation, amortization, stock-based
compensation, impairment of goodwill and intangible assets, and
profits or losses on acquisitions and investments net of
transaction costs and related tax expenses.
Safe Harbor Statement
This news release contains forward-looking statements within the
meaning of Section 27-A of the Securities Act of 1933, as amended
and Section 21-E of the Securities Exchange Act of 1934, as
amended. The company's actual results could differ materially from
those set forth in the forward-looking statements as a result of
the risks associated with the company's business, changes in
general economic conditions, and changes in the assumptions used in
making such forward-looking statements.
- Tables Follow -
GLOBAL SOURCES
LTD. AND SUBSIDIARIES
|
CONSOLIDATED
BALANCE SHEETS
|
(In U.S. Dollars
Thousands, Except Number of Shares and Per Share
Data)
|
|
|
|
|
|
|
As at
December 31,
|
As at December
31,
|
|
|
2014
|
|
2013
|
|
|
(Unaudited)
|
|
|
ASSETS
|
|
|
|
|
Current
assets
|
|
|
|
|
Cash and cash
equivalents
|
|
$
90,223
|
|
$ 137,359
|
Term deposits with
banks
|
|
4,285
|
|
106
|
Financial assets,
available-for-sale
|
|
3,952
|
|
6,367
|
Accounts receivables,
net
|
|
2,269
|
|
3,122
|
Receivables from
sales representatives
|
|
7,900
|
|
10,630
|
Inventories
|
|
154
|
|
266
|
Prepaid expenses and
other current assets
|
|
17,027
|
|
18,544
|
|
|
125,810
|
|
176,394
|
Non-current
assets
|
|
|
|
|
Property and
equipment
|
|
63,519
|
|
49,701
|
Investment
properties
|
|
85,546
|
|
89,615
|
Intangible
assets
|
|
37,732
|
|
21,423
|
Long term
investment
|
|
100
|
|
100
|
Deferred income tax
assets
|
|
196
|
|
98
|
Other non-current
assets
|
|
1,108
|
|
1,766
|
|
|
188,201
|
|
162,703
|
Total
assets
|
|
$
314,011
|
|
$
339,097
|
|
|
|
|
|
LIABILITIES AND
SHAREHOLDERS' EQUITY
|
|
|
|
|
Current
liabilities
|
|
|
|
|
Accounts
payable
|
|
$
9,418
|
|
$
8,779
|
Deferred income and
customer prepayments
|
|
84,869
|
|
84,704
|
Accrued
liabilities
|
|
19,100
|
|
19,166
|
Income tax
liabilities
|
|
3,848
|
|
2,635
|
|
|
117,235
|
|
115,284
|
Non-current
liabilities
|
|
|
|
|
Accounts
payable
|
|
889
|
|
-
|
Deferred income and
customer prepayments
|
|
3,971
|
|
5,660
|
Deferred income tax
liabilities
|
|
6,842
|
|
4,591
|
|
|
11,702
|
|
10,251
|
Total
liabilities
|
|
128,937
|
|
125,535
|
|
|
|
|
|
Equity attributable
to Company's shareholders
|
|
|
|
|
Common
shares
|
|
529
|
|
525
|
Treasury
shares
|
|
(200,089)
|
|
(150,089)
|
Other
reserves
|
|
161,242
|
|
161,950
|
Retained
earnings
|
|
209,924
|
|
191,594
|
Total Company
shareholders' equity
|
|
171,606
|
|
203,980
|
Non-controlling
interests
|
|
13,468
|
|
9,582
|
Total
equity
|
|
$
185,074
|
|
$
213,562
|
Total liabilities
and equity
|
|
$
314,011
|
|
$
339,097
|
|
|
|
|
|
GLOBAL SOURCES
LTD. AND SUBSIDIARIES
|
CONSOLIDATED
INCOME STATEMENTS
|
(In U.S. Dollars
Thousands, Except Number of Shares and Per Share
Data)
|
|
|
|
|
|
|
|
Three months ended
December 31,
|
|
Year
ended December
31,
|
|
|
2014
|
|
2013
|
|
2014
|
|
2013
|
|
|
(Unaudited)
|
|
(Unaudited)
|
|
(Unaudited)
|
|
|
Revenue:
|
|
|
|
|
|
|
|
|
Online
and other media services (Note 1)
|
$
22,465
|
|
$ 25,036
|
|
$
93,252
|
|
$ 104,629
|
Exhibitions
|
|
38,183
|
|
33,237
|
|
97,017
|
|
85,636
|
Miscellaneous
|
|
2,219
|
|
1,791
|
|
7,943
|
|
7,257
|
|
|
62,867
|
|
60,064
|
|
198,212
|
|
197,522
|
Operating
Expenses:
|
|
|
|
|
|
|
|
|
Sales
(Note 2)
|
|
20,749
|
|
20,540
|
|
60,805
|
|
61,958
|
Event
production
|
|
9,728
|
|
9,322
|
|
25,080
|
|
24,403
|
Community and content (Note 2)
|
|
7,800
|
|
7,079
|
|
26,843
|
|
27,481
|
General
and administrative (Note 2 & 3)
|
|
12,375
|
|
16,126
|
|
52,631
|
|
50,272
|
Information and technology (Note 2)
|
|
3,171
|
|
3,090
|
|
12,683
|
|
12,729
|
Total Operating
Expenses
|
|
53,823
|
|
56,157
|
|
178,042
|
|
176,843
|
Profit
on sale of property
|
|
-
|
|
-
|
|
-
|
|
15,410
|
Profit from
Operations
|
|
9,044
|
|
3,907
|
|
20,170
|
|
36,089
|
Interest
income
|
|
268
|
|
384
|
|
1,314
|
|
1,472
|
Gain on
sale of available-for-sale securities
|
|
-
|
|
64
|
|
11
|
|
64
|
Interest
expenses
|
|
(47)
|
|
-
|
|
(186)
|
|
-
|
Profit before
Income Taxes
|
|
9,265
|
|
4,355
|
|
21,309
|
|
37,625
|
Income tax
expense
|
|
(625)
|
|
(427)
|
|
(2,468)
|
|
(4,753)
|
Net
Profit
|
|
$
8,640
|
|
$
3,928
|
|
$
18,841
|
|
$
32,872
|
Net (profit)/loss
attributable to non-controlling
interests
|
|
641
|
|
1,056
|
|
(511)
|
|
(137)
|
Net profit
attributable to the Company's
|
|
|
|
|
|
|
|
|
shareholders
|
|
$
9,281
|
|
$
4,984
|
|
$
18,330
|
|
$
32,735
|
Diluted net profit
per share attributable to
|
|
|
|
|
|
|
|
|
the Company's
shareholders
|
|
$
0.29
|
|
$
0.14
|
|
$
0.55
|
|
$
0.91
|
Shares used in
diluted net profit per share
|
|
|
|
|
|
|
|
|
calculations
|
|
31,516,581
|
|
36,196,122
|
|
33,482,371
|
|
36,068,326
|
|
|
|
|
|
|
|
|
|
Note: 1. Online and
other media services consists of:
|
|
|
|
|
|
|
|
Three months ended December 31,
|
|
Year ended December 31,
|
|
|
2014
|
|
2013
|
|
2014
|
|
2013
|
|
|
(Unaudited)
|
|
(Unaudited)
|
|
(Unaudited)
|
|
|
Online
services
|
|
$
19,525
|
|
$
21,712
|
|
$
81,873
|
|
$
91,422
|
Print
services
|
|
2,940
|
|
3,324
|
|
11,379
|
|
13,207
|
|
|
$
22,465
|
|
$
25,036
|
|
$
93,252
|
|
$
104,629
|
|
|
|
|
|
|
|
|
|
Note: 2. Non-cash
compensation expenses associated with the several equity
compensation plans and Global Sources Directors Share Grant Award
Plan included under various categories of expenses are as
follows:
|
|
|
|
|
|
|
|
Three months ended December
31,
|
|
Year ended December 31,
|
|
|
2014
|
|
2013
|
|
2014
|
|
2013
|
|
|
(Unaudited)
|
|
(Unaudited)
|
|
(Unaudited)
|
|
|
Sales
|
|
$
123
|
|
$
153
|
|
$
409
|
|
$
539
|
Community
and content
|
|
21
|
|
31
|
|
16
|
|
43
|
General
and administrative
|
319
|
|
369
|
|
1,215
|
|
1,340
|
Information
and technology
|
|
45
|
|
55
|
|
217
|
|
248
|
|
|
$
508
|
|
$
608
|
|
$
1,857
|
|
$
2,170
|
|
|
|
|
|
|
|
|
|
Note: 3. General and
administrative expenses consist of:
|
|
|
|
|
|
|
|
Three months ended December 31,
|
|
Year ended December 31,
|
|
|
2014
|
|
2013
|
|
2014
|
|
2013
|
|
|
(Unaudited)
|
|
(Unaudited)
|
|
(Unaudited)
|
|
|
General and administrative expenses before
amortization of intangible assets, impairment
charge on intangible assets and foreign
exchange losses (gains)
|
|
$
9,957
|
|
$
9,814
|
|
$
40,307
|
|
$
39,960
|
Amortization
of intangible assets
|
|
1,149
|
|
1,138
|
|
7,496
|
|
3,235
|
Impairment
charge on intangible assets
|
|
4
|
|
5,994
|
|
2,242
|
|
8,525
|
Foreign
exchange losses (gains)
|
|
1,265
|
|
(820)
|
|
2,586
|
|
(1,448)
|
|
|
$
12,375
|
|
$
16,126
|
|
$
52,631
|
|
$
50,272
|
GLOBAL SOURCES
LTD. AND SUBSIDIARIES
|
ACTUAL IFRS to
NON-IFRS RECONCILIATION
|
(In U.S. Dollars
Thousands, Except Number of Shares and Per Share
Data)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three months ended December 31,
|
|
Year ended December 31,
|
|
|
|
2014
|
|
2013
|
|
2014
|
|
2013
|
|
|
|
|
|
|
|
|
|
|
IFRS
EPS
|
|
$
0.29
|
|
$
0.14
|
|
$
0.55
|
|
$
0.91
|
|
|
|
|
|
|
|
|
|
|
IFRS Net
Profit
|
|
$
9,281
|
|
$
4,984
|
|
$
18,330
|
|
$
32,735
|
|
|
|
|
|
|
|
|
|
|
Non-cash stock based
compensation expense (Note 1)
|
|
508
|
|
608
|
|
1,857
|
|
2,170
|
|
|
|
|
|
|
|
|
|
|
Amortization of
intangibles (Note 2)
|
|
86
|
|
154
|
|
594
|
|
748
|
|
|
|
|
|
|
|
|
|
|
Impairment of
goodwill and intangibles (Note 3)
|
|
4
|
|
5,109
|
|
1,682
|
|
7,640
|
|
|
|
|
|
|
|
|
|
|
Profit on sale of
property, net of transaction costs & related tax
expenses
|
|
-
|
|
-
|
|
-
|
|
(13,124)
|
|
|
|
|
|
|
|
|
|
|
Non-IFRS Net
Profit
|
|
$
9,879
|
|
$
10,855
|
|
$
22,463
|
|
$
30,169
|
|
|
|
|
|
|
|
|
|
|
Non-IFRS diluted
net profit per share
|
|
$
0.31
|
|
$
0.30
|
|
$
0.67
|
|
$
0.84
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total shares used in
non-IFRS diluted net profit
|
|
|
|
|
|
|
|
|
per share calculations
|
|
31,516,581
|
|
36,196,122
|
|
33,482,371
|
|
36,068,326
|
|
|
|
|
|
|
|
|
|
|
Notes:
|
|
|
|
|
|
|
|
|
(1) Actual SBC is
calculated based on actual share price on date of the
awards.
|
(2) Amortization of
intangible assets relating to certain non-compete
agreements.
|
(3) Impairment of
intangibles are net of related taxes.
|
|
|
|
|
|
|
|
|
|
|
GLOBAL SOURCES
LTD. AND SUBSIDIARIES
|
ADJUSTED EBITDA
RECONCILIATION
|
(In U.S. Dollars
Thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three months ended December 31,
|
|
Year ended December 31,
|
|
|
|
2014
|
|
2013
|
|
2014
|
|
2013
|
|
|
|
|
|
|
|
|
|
|
IFRS profit from
operations
|
|
$
|
9,044
|
|
$
|
3,907
|
|
$
|
20,170
|
|
$
|
36,089
|
|
|
|
|
|
|
|
|
|
|
Depreciation and
amortization
|
|
2,614
|
|
2,542
|
|
13,061
|
|
9,029
|
|
|
|
|
|
|
|
|
|
|
EBITDA
|
|
11,658
|
|
6,449
|
|
33,231
|
|
45,118
|
|
|
|
|
|
|
|
|
|
|
Non-cash stock based
compensation expense
|
|
508
|
|
608
|
|
1,857
|
|
2,170
|
|
|
|
|
|
|
|
|
|
|
Impairment of
goodwill and intangibles
|
|
4
|
|
5,994
|
|
2,242
|
|
8,525
|
|
|
|
|
|
|
|
|
|
|
Profit on sale of
property, net of transaction costs
|
|
-
|
|
-
|
|
-
|
|
(15,410)
|
|
|
|
|
|
|
|
|
|
|
Adjusted
EBITDA
|
|
$
|
12,170
|
|
$
|
13,051
|
|
$
|
37,330
|
|
$
|
40,403
|
|
|
|
|
|
|
|
|
|
|
GLOBAL SOURCES
LTD. AND SUBSIDIARIES
|
GUIDANCE IFRS to
NON-IFRS RECONCILIATION
|
(In U.S. Dollars
Million, Except Number of Shares and Per Share Data)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GUIDANCE
|
|
ACTUAL
|
|
|
Six
months
|
|
Six
months
|
|
|
ended June
30,
|
|
ended June
30,
|
|
|
2015
|
|
2014
|
|
|
|
|
|
|
|
Revenue
|
|
$90.0
|
to
|
$92.0
|
|
$92.8
|
|
|
|
|
|
|
|
IFRS EPS
|
|
$0.15
|
to
|
$0.19
|
|
$0.20
|
|
|
|
|
|
|
|
Non-cash stock based
compensation expense (Note 1)
|
|
$0.03
|
|
$0.03
|
|
$0.02
|
|
|
|
|
|
|
|
Amortization of
intangibles (Note 2)
|
|
$0.01
|
|
$0.01
|
|
$0.01
|
|
|
|
|
|
|
|
Impairment of
goodwill and intangibles
|
|
-
|
|
-
|
|
$0.05
|
|
|
|
|
|
|
|
Non-IFRS diluted
net income per share
|
|
$0.19
|
to
|
$0.23
|
|
$0.28
|
|
|
|
|
|
|
|
Total shares used in
non-IFRS diluted net income
|
|
|
|
|
|
|
per share
calculations
|
|
31,740,000
|
|
31,740,000
|
|
35,672,551
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Notes:
|
|
|
|
|
|
|
(1) Actual SBC is
calculated based on actual share price on date of the
awards.
|
(2) Amortization of
intangible assets relating to certain non-compete
agreements.
|
For financial matrix, please visit:
http://photos.prnasia.com/prnk/20150326/8521501903
Press Contact in
Asia
|
Investor Contact
in Asia
|
Camellia
So
|
Connie Lai
|
Tel: (852)
2555-5021
|
Tel: (852)
2555-4747
|
e-mail:
cso@globalsources.com
|
e-mail:
investor@globalsources.com
|
|
|
Press Contact in
U.S.
|
Investor Contact
in U.S.
|
Brendon
Ouimette
|
Cathy
Mattison
|
Tel: (1-480)
664-8309
|
LHA
|
e-mail:
bouimette@globalsources.com
|
Tel: (1-415)
433-3777
|
|
e-mail:
cmattison@lhai.com
|
|
|
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To view the original version on PR Newswire,
visit:http://www.prnewswire.com/news-releases/global-sources-reports-fourth-quarter-and-year-end-2014-results-300056396.html
SOURCE Global Sources