NEW YORK, Sept. 15, 2016 /PRNewswire/ -- Global Sources
Ltd. (NASDAQ: GSOL) reported financial results for the six-month
period Jan. 1, 2016 through
June 30, 2016.
Merle A. Hinrich, Global Sources'
executive chairman stated: "In the first half of 2016, our April
series of trade shows in Hong Kong
performed very well, delivering growth in attendance and revenue.
Global Sources Electronics, our flagship show, featured
5,500 booths from Greater China,
Korea and across Asia, with the
second phase, Mobile Electronics, growing by more than 100
percent in just two years to become the world's largest mobile
electronics sourcing show. Now in its second year,
Startup Launchpad is a conference track and pavilion
integrated within both phases of the Global Sources
Electronics show. Startup Launchpad is also the largest
collection of consumer electronics startups in Asia.
"Global Sources is focused on connecting buyers worldwide with
suppliers in mainland China and
Asia. We continue to evolve our
offering to address the significant changes that both buyers and
suppliers are experiencing. Key initiatives in our continuing
integration of the trade show and online experience include our
buyer and supplier apps, and Analyst's Choice, the
industry's only curated product content."
Financial highlights --
First half: 2016 compared to 2015
- Revenue from continuing operations was $81.8 million, as compared to $85.9 million.
- Exhibitions revenue was $47.4
million, as compared to $46.2
million.
- Online and other media services revenue was $30.7 million, as compared to $35.7 million.
- IFRS net profit from continuing operations was $8.8 million, or $0.35 per diluted share, as compared to
$8.8 million, or $0.28 per diluted share from continuing
operations.
- Non-IFRS net profit from continuing operations was $11.3 million, or $0.45 per diluted share, as compared to
$10.2 million, or $0.32 per diluted share from continuing
operations.
- Adjusted EBITDA from continuing operations was $16.3 million, as compared to $17.8 million from continuing operations for the
first half of 2015.
- Total deferred income and customer prepayments were
$79.5 million as at June 30, 2016, as compared to $86.2 million as at June
30, 2015.
- Cash and cash equivalents at June 30,
2016 was $87.9 million and the
company remains debt free.
Global Sources' CFO, Connie Lai,
said: "During the first half of 2016, our April series of trade
shows in Hong Kong delivered
stronger than expected revenue. While the performance of our
Shenzhen International Machinery Manufacturing Industry
Exhibition (SIMM) for the domestic market was in line with
expectations, we recorded a write-down of approximately
$1.4 million in consideration of
impairment charges net of associated taxes related to the China
International Fashion Brand Fair - Shenzhen
(FashionSZshow). Our efforts to drive efficiencies throughout
the organization, combined with the recognition of deferred tax
assets, drove our better-than-anticipated bottom line
performance."
Financial expectations for the second half of 2016 under
IFRS
- For the second half of 2016 ending Dec.
31, 2016:
- Revenue from continuing operations is expected to be in the
range of $74.0 million to $76.0
million, as compared to $85.1
million from continuing operations for the second half of
2015.
- IFRS EPS from continuing operations is expected to be in the
range of $0.24 to $0.29, as compared
to $0.58 per diluted share from
continuing operations in the second half of 2015. SBC and the
amortization of intangibles as it relates to certain equity
compensation plans are estimated to be an expense of $0.05 per diluted share for the second half of
2016.
- Non-IFRS EPS from continuing operations is expected to be in
the range of $0.29 to $0.34, as
compared to $0.33 per diluted share
from continuing operations for the same period in 2015.
- Adjusted EBITDA from continuing operations is expected to be
between $10.7 million and $11.9
million, as compared to $13.1
million from continuing operations in the second half of
2015.
Recent Corporate Highlights
- Appointed Ms. Fumbi Chima and Mr. Michael Scown as new members to its Board of
Directors effective Sept. 12,
2016.
- The 16th China International Fashion Brand
Fair - Shenzhen (FashionSZshow) was held
in Shenzhen in July 2016.
- Joined the Russell Global Index and the broad-market Russell
3000® Index in June
2016.
- Global Sources series of spring trade shows were held in
April 2016 at Hong Kong's AsiaWorld-Expo, including
Global Sources Electronics, the world's largest
electronics sourcing trade show.
- In total, the spring trade shows had more than 7,500
booths.
- Total attendance exceeded 88,400 and included buyers from 150
countries and territories.
- Launched Smart Living, a new industry specialized
website.
- Launched Global Sources Startup Tech Investments to
focus on consumer electronics startups.
- The Shenzhen International Machinery Manufacturing Industry
Exhibition and its related shows, known as the SIMM
machinery shows, were held on March 29-April
1, 2016.
- Announced retirement of board members Messrs. Roderick Chalmers and Peter Yam effective March
31, 2016.
- Announced CEO Spenser Au plans
to retire after 39 years of service to the Company. He will remain
engaged until the end of 2016 to assist in the transition to a
successor.
Conference call for Global Sources first half 2016
earnings
Executive chairman Merle A.
Hinrich and CFO Connie Lai
are scheduled to conduct a conference call at 8:00 a.m. ET on Sept. 15,
2016 (8:00 p.m. on
Sept. 15, 2016 in Hong Kong) to review these results in more
detail. Investors in the United
States may participate in the call by dialing (866)
293-8970, and non-Hong Kong
international participants may dial (1-913) 312-0702. Investors in
Hong Kong may participate by
dialing (800) 903-317. The conference ID is 5438015 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 Sept. 23,
2016. To listen to the telephone replay dial (888) 203-1112
or dial (1-719) 457-0820 outside the
United States, and enter pass code 5438015. For those in the
Hong Kong area, the replay dial-in
number is (800) 901-108, and the pass code is 5438015.
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), trade shows,
magazines and apps.
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.
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
profit as IFRS net profit excluding non-cash stock based
compensation expense or credit, amortization of intangibles assets
as it relates to certain equity compensation plans, profits or
losses on acquisitions and disposals of 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 diluted net profit per
share is defined as non-IFRS net profit divided by the weighted
average of diluted common shares outstanding. Adjusted EBITDA is
defined as profit before interest, taxes, depreciation,
amortization, non-cash stock based compensation expense or credit,
profits or losses on acquisitions and disposals of investments, net
of transaction costs and impairment of goodwill and intangible
assets.
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 June
30,
|
|
As at December
31,
|
|
|
2016
|
|
2015
|
|
|
(Unaudited)
|
|
|
ASSETS
|
|
|
|
|
Current
assets
|
|
|
|
|
Cash and cash
equivalents
|
$
|
79,476
|
$
|
70,356
|
Term deposits with
banks
|
|
8,462
|
|
9,097
|
Accounts receivables,
net
|
|
710
|
|
849
|
Receivables from
sales representatives
|
|
14,018
|
|
8,802
|
Inventories
|
|
102
|
|
176
|
Prepaid expenses and
other current assets
|
|
16,188
|
|
16,268
|
|
|
118,956
|
|
105,548
|
Non-current
assets
|
|
|
|
|
Property and
equipment
|
|
64,084
|
|
59,064
|
Investment
properties
|
|
60,585
|
|
69,726
|
Intangible
assets
|
|
22,023
|
|
26,309
|
Long term
investment
|
|
-
|
|
100
|
Deferred income tax
assets
|
|
2,035
|
|
389
|
Other non-current
assets
|
|
1,322
|
|
951
|
|
|
150,049
|
|
156,539
|
Total
assets
|
$
|
269,005
|
$
|
262,087
|
|
|
|
|
|
LIABILITIES AND
SHAREHOLDERS' EQUITY
|
|
|
|
|
Current
liabilities
|
|
|
|
|
Accounts
payable
|
$
|
5,924
|
$
|
7,383
|
Deferred income and
customer prepayments
|
|
75,257
|
|
75,265
|
Accrued
liabilities
|
|
16,880
|
|
15,183
|
Income tax
liabilities
|
|
2,692
|
|
2,990
|
|
|
100,753
|
|
100,821
|
Non-current
liabilities
|
|
|
|
|
Accounts
payable
|
|
-
|
|
289
|
Deferred income and
customer prepayments
|
|
4,269
|
|
2,917
|
Deferred income tax
liabilities
|
|
3,512
|
|
4,493
|
|
|
7,781
|
|
7,699
|
Total
liabilities
|
|
108,534
|
|
108,520
|
|
|
|
|
|
Equity attributable
to Company's shareholders
|
|
|
|
|
Common
shares
|
|
536
|
|
533
|
Treasury
shares
|
|
(250,089)
|
|
(250,089)
|
Other
reserves
|
|
156,252
|
|
157,562
|
Retained
earnings
|
|
248,637
|
|
239,812
|
Total Company
shareholders' equity
|
|
155,336
|
|
147,818
|
Non-controlling
interests
|
|
5,135
|
|
5,749
|
Total
equity
|
$
|
160,471
|
$
|
153,567
|
Total liabilities
and equity
|
$
|
269,005
|
$
|
262,087
|
GLOBAL SOURCES
LTD. AND SUBSIDIARIES
CONSOLIDATED INCOME STATEMENTS
(In U.S. Dollars Thousands, Except Number of Shares and Per Share
Data)
|
|
|
|
|
|
|
|
|
|
|
|
Six months ended
June 30,
|
|
|
|
2016
|
|
2015
|
|
|
|
(Unaudited)
|
|
(Unaudited)
|
Revenue:
|
|
|
|
|
|
|
Exhibitions
|
|
$
|
47,413
|
|
$
|
46,171
|
Online and other media services (Note 1)
|
|
|
30,694
|
|
|
35,730
|
Miscellaneous
|
|
|
3,711
|
|
|
4,015
|
|
|
|
81,818
|
|
|
85,916
|
Operating
Expenses:
|
|
|
|
|
|
|
Sales (Note 2)
|
|
|
22,909
|
|
|
24,693
|
Event production
|
|
|
13,066
|
|
|
12,224
|
Community and content (Note 2)
|
|
|
9,011
|
|
|
10,203
|
General and administrative (Note 2 & 3)
|
|
|
22,334
|
|
|
20,752
|
Information and technology (Note 2)
|
|
|
5,774
|
|
|
6,452
|
Total Operating
Expenses
|
|
|
73,094
|
|
|
74,324
|
Profit from
Operations
|
|
|
8,724
|
|
|
11,592
|
Interest income
|
|
|
293
|
|
|
566
|
Gain on sale of available-for-sale securities
|
|
|
67
|
|
|
136
|
Profit on sale of
investment
|
|
|
43
|
|
|
-
|
Interest expenses
|
|
|
(16)
|
|
|
(59)
|
Profit before
Income Taxes
|
|
|
9,111
|
|
|
12,235
|
Income tax credit /
(expense)
|
|
|
576
|
|
|
(2,188)
|
Net Profit from
continuing operations
|
|
$
|
9,687
|
|
$
|
10,047
|
Net Profit from
discontinued operations, net of income tax (Note 4)
|
|
|
-
|
|
|
5,406
|
Net
profit
|
|
$
|
9,687
|
|
$
|
15,453
|
Net (profit)/loss
attributable to non-controlling interests
from:
|
|
|
|
|
|
|
Continuing
operations
|
|
|
(862)
|
|
|
(1,222)
|
Discontinued operations
|
|
|
-
|
|
|
264
|
Total
|
|
|
(862)
|
|
|
(958)
|
Net profit
attributable to the Company's
shareholders from:
|
|
|
|
|
|
|
Continuing
operations
|
|
$
|
8,825
|
|
$
|
8,825
|
Discontinued operations
|
|
|
-
|
|
|
5,670
|
Total
|
|
$
|
8,825
|
|
$
|
14,495
|
Diluted net profit
per share attributable to the
Company's shareholders from:
|
|
|
|
|
|
|
Continuing
operations
|
|
$
|
0.35
|
|
$
|
0.28
|
Discontinued operations
|
|
|
-
|
|
|
0.18
|
Total
|
|
$
|
0.35
|
|
$
|
0.46
|
Shares used in
diluted net profit per share
calculations
|
|
|
25,358,358
|
|
|
31,534,448
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Note:
|
1. Online and other media services
consists of:
|
|
|
|
|
|
|
|
|
|
|
|
Six months ended
June 30,
|
|
|
|
2016
|
|
2015
|
|
|
|
(Unaudited)
|
|
(Unaudited)
|
|
Online
services
|
|
$
|
27,686
|
|
$
|
33,201
|
|
Print
services
|
|
|
3,008
|
|
|
2,529
|
|
|
|
$
|
30,694
|
|
$
|
35,730
|
|
|
|
|
|
|
|
|
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:
|
|
|
|
|
|
|
|
|
|
|
|
Six months ended
June 30,
|
|
|
|
2016
|
|
2015
|
|
|
|
(Unaudited)
|
|
(Unaudited)
|
|
Sales
|
|
$
|
73
|
|
$
|
178
|
|
Community and
content
|
|
|
18
|
|
|
41
|
|
General and
administrative
|
|
|
736
|
|
|
768
|
|
Information and
technology
|
|
|
119
|
|
|
133
|
|
|
|
$
|
946
|
|
$
|
1,120
|
|
|
|
|
|
|
|
|
Note:
|
3. General and administrative
expenses consist of:
|
|
|
|
|
|
|
|
|
|
|
|
Six months ended
June 30,
|
|
|
|
2016
|
|
2015
|
|
|
|
(Unaudited)
|
|
(Unaudited)
|
|
General and administrative expenses before amortization
of intangible assets, impairment charge on intangible assets and
foreign
exchange losses
|
|
$
|
17,979
|
|
$
|
18,305
|
|
Amortization of
intangible assets
|
|
|
2,042
|
|
|
2,107
|
|
Impairment charge
on intangible assets
|
|
|
1,902
|
|
|
-
|
|
Foreign exchange
losses
|
|
|
411
|
|
|
340
|
|
|
|
$
|
22,334
|
|
$
|
20,752
|
|
|
|
|
|
|
|
|
Note:
|
4. Net Profit from discontinued operations, net of income tax consist of:
|
|
|
|
|
|
|
|
|
|
|
|
Six months ended
June 30,
|
|
|
|
2016
|
|
2015
|
|
|
|
(Unaudited)
|
|
(Unaudited)
|
|
Profit on sale of
subsidiary
|
|
$
|
-
|
|
$
|
6,159
|
|
Income tax
expense
|
|
|
-
|
|
|
(361)
|
|
Profit on sale of
subsidiary, net of income tax
|
|
|
-
|
|
|
5,798
|
|
Loss from discontinued operations, net of income tax
|
|
|
-
|
|
|
(392)
|
|
|
|
$
|
-
|
|
$
|
5,406
|
GLOBAL SOURCES
LTD. AND SUBSIDIARIES
|
ACTUAL IFRS to
NON-IFRS RECONCILIATION
|
(In U.S. Dollars
Thousands, Except Number of Shares and Per Share
Data)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Six months ended
June 30,
|
|
|
2016
|
|
2015
|
|
|
|
|
|
|
|
IFRS diluted net profit per share from continuing operations
|
|
$
|
0.35
|
|
$
|
0.28
|
|
|
|
|
|
|
|
IFRS Net Profit from
continuing operations
|
|
$
|
8,825
|
|
$
|
8,825
|
|
|
|
|
|
|
|
Non-cash stock based
compensation expense (Note 1)
|
|
|
946
|
|
|
1,120
|
|
|
|
|
|
|
|
Amortization of
intangibles (Note 2)
|
|
|
184
|
|
|
293
|
|
|
|
|
|
|
|
Profit on sale of
investment
|
|
|
(43)
|
|
|
-
|
|
|
|
|
|
|
|
Impairment of
goodwill and intangibles (Note 3)
|
|
|
1,426
|
|
|
-
|
|
|
|
|
|
|
|
Non-IFRS Net
Profit continuing operations
|
|
$
|
11,338
|
|
$
|
10,238
|
|
|
|
|
|
|
|
Non-IFRS diluted
net profit per share from continuing operations
|
|
$
|
0.45
|
|
$
|
0.32
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total shares used in non-IFRS diluted net profit
per share calculations
|
|
|
25,358,358
|
|
|
31,534,448
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Six months ended
June 30,
|
|
|
2016
|
|
2015
|
|
|
|
|
|
|
|
IFRS profit from
continuing operations
|
|
$
|
8,724
|
|
$
|
11,592
|
|
|
|
|
|
|
|
Depreciation and amortization from continuing operations
|
|
|
4,767
|
|
|
5,038
|
|
|
|
|
|
|
|
EBITDA
|
|
|
13,491
|
|
|
16,630
|
|
|
|
|
|
|
|
Non-cash stock based
compensation expense
|
|
|
946
|
|
|
1,120
|
|
|
|
|
|
|
|
Impairment of
goodwill and intangibles
|
|
|
1,902
|
|
|
-
|
|
|
|
|
|
|
|
Adjusted EBITDA from
continuing operations
|
|
$
|
16,339
|
|
$
|
17,750
|
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 December
31,
|
|
ended December 31,
|
|
|
2016
|
|
2015
|
|
|
|
|
|
|
|
Revenue from
continuing operations
|
|
$74.0
|
to
|
$76.0
|
|
$85.1
|
|
|
|
|
|
|
|
IFRS EPS from
continuing operations
|
|
$0.24
|
to
|
$0.29
|
|
$0.58
|
|
|
|
|
|
|
|
Non-cash stock based
compensation expense (Note 1)
|
|
$0.04
|
|
$0.04
|
|
$0.04
|
|
|
|
|
|
|
|
Amortization of
intangibles (Note 2)
|
|
$0.01
|
|
$0.01
|
|
$0.00
|
|
|
|
|
|
|
|
Profit on sale of property, net of transaction costs & related tax expenses
|
|
$0.00
|
|
$0.00
|
|
($0.29)
|
|
|
|
|
|
|
|
Non-IFRS diluted
net income per share from continuing operations
|
|
$0.29
|
to
|
$0.34
|
|
$0.33
|
|
|
|
|
|
|
|
Total shares used in non-IFRS diluted net income
per share
calculations
|
|
25,536,000
|
|
25,536,000
|
|
26,249,657
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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/20160915/8521605826
Press
Contact
|
Investor Contact
in Asia
|
Camellia
So
|
Connie Lai
|
Tel: (852)
2555-5021
|
Tel: (852)
2555-4747
|
e-mail:
GSpress@globalsources.com
|
e-mail:
investor@globalsources.com
|
|
|
|
Investor Contact
in U.S.
|
|
Cathy
Mattison
|
|
LHA
|
|
Tel: (1-415)
433-3777
|
|
e-mail:
cmattison@lhai.com
|
Logo - http://photos.prnewswire.com/prnh/20030303/LNM011LOGO-b
To view the original version on PR Newswire,
visit:http://www.prnewswire.com/news-releases/global-sources-reports-financial-results-for-the-first-half-of-2016-300328551.html
SOURCE Global Sources