Press Release

Sino-Global Announces 2019 Year End Financial Results; Company Continues Transition to Shipping Agency Focus

Company Release - 9/30/2019 4:05 PM ET

ROSLYN, N.Y., Sept. 30, 2019 /PRNewswire/ -- Sino-Global Shipping America, Ltd. (NASDAQ: SINO) ("Sino-Global", the "Company", "we", "our", or "us"), a non-asset based global logistics service provider, announced its financial and operating results for the fiscal year ended June 30, 2019.

The Company has also provided more detailed information on its annual report on Form 10-K filed this morning with the U.S. Securities and Exchange Commission. Management encourages investors to review this filing for more details of the Company's financial results for the fiscal year 2019, background on Sino-Global's business and history, as well as the Company's strategies for the coming fiscal year.

Management Comments – Strategy Moving into Fiscal 2020

Mr. Lei Cao, Chairman and Chief Executive Officer of Sino-Global commented, "We continue to pay greater attention to expanding our ship services following a challenging year due to the intense U.S./China trade relations. Throughout the year, current trade dynamics increased the expense for shipping carrier clients to ship cargo into U.S. ports, resulting in lower shipping volumes and lower utilization of our online platform, which has caused us to shift our focus back to the global shipping agency business. The shipping agency industry in the world has improved in the past years and the number of shipping agencies overall has decreased due to the failure to provide a competitive price and to embrace technology as a resource in serving client needs. We already have a network that covers the U.S. east coast, west coast, Canada, Australia, Hong Kong, Beijing, and Ningbo, and we intend to utilize our previous investments in technology to provide a broader base of services to our customers. We maintain strong relationships with customers and market resources. The current shipping agency market is more competitive yet enable companies like us who have better resources in this market niche to expand."

Mr. Cao concluded, "While we were pleased with higher sales this year, we understand that the Company needs to collect revenues from larger shipping agencies to take advantage of our cash generating potential. In addition, in fiscal year 2020, we expect to provide shipping management service, which includes ship insurance arrangements and operations; ship maintenance and inspection; crew recruitment, training and supply and ship technical services. We will focus on expanding our business to increase sales revenue in the United States and get more customers who can settle in U.S. dollars. Overall, we believe that the Company has properly positioned itself to take advantage of another revenue growth opportunity. As we move forward into fiscal 2020, we will be focusing on leveraging our growing infrastructure to improve operating margins and the bottom line. We expect to provide a shareholder letter to outline our growth strategy for the coming year prior to our next annual meeting."

Fiscal Year 2019 Financial Review

  • Total revenues increased by approximately 81.1% to approximately $41.8 million during the year, compared to approximately $23.1 million in the prior fiscal year. This increase was due to the Company's continuing efforts to diversify its business perspectives, resulting in the rise in revenues generated from its freight logistics services segment. Freight logistics services consist primarily of cargo forwarding, brokerage and other freight services in China.
  • In the second quarter of 2019, the Company decided to transition back into the shipping agency business, because it now has an integrated online logistics platform that allows it to handle a wider base of customers in China and other ports of the world. For the years ended June 30, 2019 and 2018, shipping agency services generated revenues of $2,093,680 and $0, respectively, and gross profit of $199,348 and $0, respectively, representing a 100.0% increase in both revenues and gross profit.
  • The increase of revenue in the shipping agency services segment was due to the increase in the total number of ships the Company served. For the year ended June 30, 2019, the Company served 57 ships.
  • The Company's gross profit for the 2019 fiscal year was approximately $5.8 million, compared to approximately $7.5 million in the prior fiscal year. Gross profit margin during the year decreased to approximately 13.8% from approximately 32.4%, which was largely attributed to a greater portion of revenues coming from providing freight logistics services and shipping agency business with relative low gross profit margins. Gross profit margin decreased as a result of significiantly increased cost of revenues, mainly from the freight logistics services segment due to an increase in freight cost of carriers resulting from the increase in shipping volume.

The following tables present summary information by segments mainly regarding the top-line financial results for the years ended June 30, 2019 and 2018:


For the Year Ended June 30, 2019




Shipping
Agency
Services


Inland
Transportation
Management
Services


Freight
Logistics
Services


Container
Trucking
Services


Total


Revenues
















  - Related party

$

-


$

433,383


$

-


$

-


$

433,383


  - Third parties

$

2,093,680


$

1,036,416


$

37,725,136


$

482,432


$

41,337,664


  Total revenues

$

2,093,680


$

1,469,799


$

37,725,136


$

482,432


$

41,771,047


  Cost of revenues

$

(1,894,332)


$

(128,624)


$

(33,556,109)


$

(427,445)


$

(36,006,510)


  Gross profit

$

199,348


$

1,341,175


$

4,169,027


$

54,987


$

5,764,537


  Depreciation and amortization

$

-


$

110,821


$

1,902


$

18,197


$

130,920


  Total capital expenditures

$

-


$

-


$

125,817


$

17,675


$

143,493


  Gross margin%


9.5

%


91.2

%


11.1

%


11.4

%


13.8

%


















For the Year Ended June 30, 2018



Shipping
Agency
Services


Inland
Transportation
Management
Services


Freight
Logistics
Services


Container
Trucking
Services


Total


Revenues
















  - Related party

$

-


$

2,059,406


$

-


$

-


$

2,059,406


  - Third parties

$

-


$

3,441,001


$

16,467,671


$

1,096,485


$

21,005,157


  Total revenues

$

-


$

5,500,407


$

16,467,671


$

1,096,485


$

23,064,563


  Cost of revenues

$

-


$

(874,760)


$

(14,013,935)


$

(696,998)


$

(15,585,693)


  Gross profit

$

-


$

4,625,647


$

2,453,736


$

399,487


$

7,478,870


  Depreciation and amortization

$

-


$

72,954


$

1,902


$

20,063


$

94,919


  Total capital expenditures

$

-


$

-


$

778,182


$

44,595


$

822,777


  Gross margin%


-



84.1

%


14.9

%


36.4

%


32.4

%

  • Operating loss for the year ended June 30, 2019 was approximately $6.0 million, compared to an operating income of approximately $0.8 million in the prior year. The decrease was largely due to a provision for doubtful accounts of $3,978,893 for the year ended June 30, 2019 compared to the provision for doubtful accounts of $1,726,599 for the year ended June 30, 2018. The increase was due to slower collections from customers. As the Company continues its business relationships with several large customers, it continues to improve its collection efforts to improve its accounts receivable.
  • For the fiscal year ended June 30, 2019, the Company reported net loss attributable to Sino-Global Shipping America, Ltd. of approximately $6.5 million, or loss of $0.45 per diluted share based on approximately 14.4 million weighted average shares outstanding, compared to net income attributable to Sino-Global Shipping America, Ltd. of $0.5 million, or earning of $0.04 per diluted share based on approximately 12.0 million weighted average shares outstanding, for the prior year.

Balance Sheet Information

  • As of June 30, 2019, the Company had approximately $3.1 million in cash, working capital of approximately $10.7 million and stockholders' equity of approximately $20.5 million; compared to approximately $7.1 million, $15.8 million, and $24.3 million, respectively, as of June 30, 2018.
  • The Company's allowance for doubtful accounts was approximately $5.7 million as of June 30,2019 compared with allowance of doubtful accounts of approximately $1.7 million as of June 30, 2018. As the Company continues to maintain long-standing relationships with its customers, it will work with these parties to monitor their payments closely and does not believe that there are any significant collection issues with respect to trade accounts receivable.
  • The Company holds no long-term debt.

About Sino-Global Shipping America, Ltd.

Founded in the United States in 2001, Sino-Global Shipping America, Ltd. is a company engaged originally in shipping, chartering, logistics and related business services. Headquartered in New York, Sino-Global has offices in mainland China, Australia, Canada and Hong Kong. The Company's current service offerings consist of shipping agency, inland transportation management, freight logistics and container trucking services. Additional information about Sino-Global can be found on the Company's corporate website at www.sino-global.com. The Company routinely posts important information on its website.

Forward Looking Statements

No statement made in this press release should be interpreted as an offer to sell or a solicitation of an offer to purchase any security. Such an offer can only be made in accordance with the Securities Act of 1933, as amended, and applicable state securities laws. Any statements contained in this release that relate to future plans, events or performance are forward-looking statements that involve risks and uncertainties as identified in Sino-Global's filings with the U.S. Securities and Exchange Commission. Actual results, events or performance may differ materially. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date hereof. Sino-Global undertakes no obligation to publicly release the results of any revisions to these forward-looking statements that may be made to reflect the events or circumstances after the date hereof or to reflect the occurrence of unanticipated events unless required by applicable law or regulations.

Contact Information

The Equity Group Inc.
Adam Prior
Senior Vice-President
(212)-836-9606 / aprior@equityny.com 

 

 

SINO-GLOBAL SHIPPING AMERICA, LTD. AND AFFILIATES

CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME (LOSS)


For the Years Ended


June 30,


2019


2018





Net revenues - third parties

$

41,337,664


$

21,005,157

Net revenues - related party


433,383



2,059,406

Total revenues


41,771,047



23,064,563

Cost of revenues


(36,006,510)



(15,585,693)

Gross profit


5,764,537



7,478,870







Selling expenses


(718,754)



(458,166)

General and administrative expenses


(4,344,435)



(2,812,457)

Impairment loss of deposit for leasehold improvement


(425,068)



-

Provision for doubtful accounts


(3,978,893)



(1,726,599)

Stock-based compensation


(2,267,833)



(1,663,499)

Total operating expenses


(11,734,983)



(6,660,721)







Operating (loss) income


(5,970,446)



818,149







Financial (expenses) income, net


(179,827)



79,502

Other income, net


59,029



575,115

Total other (expenses) income, net


(120,798)



654,617







Net (loss) income before provision for income taxes


(6,091,244)



1,472,766







Income tax expense


(920,869)



(949,659)







Net (loss) income


(7,012,113)



523,107







Net (loss) income attributable to non-controlling interest


(478,269)



64,056







Net (loss) income attributable to Sino-Global Shipping America, Ltd.

$

(6,533,844)


$

459,051







Comprehensive (loss) income






Net (loss) income

$

(7,012,113)


$

523,107

Other comprehensive (loss) income - foreign currency


(281,224)



65,981

Comprehensive (loss) income


(7,293,337)



589,088

Less: Comprehensive loss attributable to non-controlling interest


(360,794)



(12,120)

Comprehensive (loss) income attributable to Sino-Global Shipping America, Ltd.

$

(6,932,543)


$

601,208







Earnings (loss) per share






Basic

$

(0.45)


$

0.04

Diluted

$

(0.45)


$

0.04







Weighted average number of common shares used in computation






Basic


14,419,435



11,037,343

Diluted


14,419,435



12,023,036

 

 

SINO-GLOBAL SHIPPING AMERICA, LTD. AND AFFILIATES

CONSOLIDATED BALANCE SHEETS


June 30,
2019


June 30,
2018

Assets




Current assets




Cash

$

3,142,650


$

7,098,259

Notes receivable


383,792



-

Accounts receivable, less allowance for doubtful accounts of $5,670,274 and $1,682,228 as of June 30, 2019 and 2018, respectively


7,045,846



8,428,853

Other receivables, less allowance for doubtful accounts of $145,176 as of June 30, 2018


98,445



69,239

Advances to suppliers-third parties


4,361,410



704,878

Advances to suppliers-related party


-



3,414,619

Prepaid expenses and other current assets


105,054



588,439

Due from related party, net


807,965



2,087,994

Total Current Assets


15,945,162



22,392,281







Property and equipment, net


989,910



956,429

Intangible assets, net


89,722



153,056

Prepaid expenses


519,503



1,878,258

Other long-term assets - deposits


3,054,706



143,303

Deferred tax assets, net


-



634,500

Total Assets

$

20,599,003


$

26,157,827







Liabilities and Equity












Current Liabilities






Advances from customers

$

68,590


$

415,385

Accounts payable


567,619



3,225,661

Taxes payable


3,184,895



2,700,619

Accrued expenses and other current liabilities


1,418,129



280,888

Total current liabilities


5,239,233



6,622,553







Total liabilities


5,239,233



6,622,553







Commitments and Contingencies












Equity






Preferred stock, 2,000,000 shares authorized, no par value, none issued


-



-

Common stock, 50,000,000 shares authorized, no par value; 16,054,534 and 13,271,032 shares issued as of June 30, 2019 and 2018, respectively; 15,879,037 and 13,095,535 outstanding as of June 30, 2019 and 2018, respectively


26,523,830



23,717,330

Additional paid-in capital


2,066,906



1,755,573

Treasury stock, at cost, 175,497 shares as of June 30, 2019 and 2018


(417,538)



(417,538)

Accumulated deficit


(6,968,700)



(434,856)

Accumulated other comprehensive loss


(671,106)



(272,407)

Total Sino-Global Shipping America Ltd. Stockholders' Equity


20,533,392



24,348,102







Non-controlling Interest


(5,173,622)



(4,812,828)







Total Equity


15,359,770



19,535,274







Total Liabilities and Equity

$

20,599,003


$

26,157,827


 

 

SINO-GLOBAL SHIPPING AMERICA, LTD. AND AFFILIATES

 CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY












Additional










Accumulated
other








Preferred Stock


Common Stock


paid-in


Treasury Stock


 Accumulated


comprehensive


Noncontrolling





Shares


Amount


Shares


Amount


capital


Shares


Amount


deficit


income (loss)


interest


Total

BALANCE, June 30, 2017

-


$

-


10,281,032


$

20,535,379


$

688,934


(175,497)


$

(417,538)


$

(893,907)


$

(414,564)


$

(4,768,779)


$

14,729,525

Issuance of common stock

-



-


2,000,000



1,510,951



1,074,140


-



-



-



-



-



2,585,091

Stock based compensation to management and board

-



-


660,000



759,000



-


-



-



-



-



-



759,000

Stock based compensation to employee

-



-


130,000



364,000



(91,000)


-



-



-



-



-



273,000

Amortization of stock compensation

-



-


-



-



9,665


-



-



-



-



-



9,665

Shares issued for professional services

-



-


200,000



548,000



73,834


-



-



-



-



-



621,834

Disposition of joint venture

-



-


-



-



-


-



-



-



-



(31,929)



(31,929)

Foreign currency translation

-



-


-



-



-


-



-



-



142,157



(76,176)



65,981

Net income

-



-


-



-



-


-



-



459,051



-



64,056



523,107

BALANCE, June 30, 2018

-


$

-


13,271,032


$

23,717,330


$

1,755,573


(175,497)


$

(417,538)


$

(434,856)


$

(272,407)


$

(4,812,828)


$

19,535,274

Stock based compensation to employees

-



-


1,580,000



1,382,500



-


-



-



-



-



-



1,382,500

Stock based compensation to consultants

-



-


550,000



574,000



(127,500)


-



-



-



-



-



446,500

Issuance of common stock to private investors

-



-


653,502



850,000



-


-



-



-



-



-



850,000

Amortization of shares to management and employees

-



-


-



-



91,000


-



-



-



-



-



91,000

Amortization of shares issued to consultants

-



-


-



-



347,833


-



-



-



-



-



347,833

Foreign currency translation

-



-


-



-



-


-



-



-



(398,699)



117,475



(281,224)

Net loss

-



-


-



-



-


-



-



(6,533,844)



-



(478,269)



(7,012,113)

BALANCE, June 30, 2019

-


$

-


16,054,534


$

26,523,830


$

2,066,906


(175,497)


$

(417,538)


$

(6,968,700)


$

(671,106)


$

(5,173,622)


$

15,359,770

 

 

SINO-GLOBAL SHIPPING AMERICA, LTD. AND AFFILIATES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS



For the Years Ended


June 30,


2019


2018





Operating Activities




Net (loss) income

$

(7,012,113)


$

523,107

Adjustments to reconcile net (loss) income to net cash used in operating activities:






Stock-based compensation


2,267,833



1,663,499

Depreciation and amortization


130,920



94,919

Provision for doubtful accounts


3,978,893



1,726,599

Impairment loss of deposit for leasehold improvement


425,068



-

Deferred tax provision


634,500



114,900

Changes in assets and liabilities






Notes receivable


(386,233)



-

Accounts receivable


(2,553,973)



(7,421,179)

Other receivables


161,057



(31,328)

Advances to suppliers-third parties


(3,671,931)



(662,144)

Advances to suppliers-related party


3,312,666



-

Prepaid expenses and other current assets


1,407,599



(280,627)

Other long-term assets - deposits


(2,928,775)



(470,319)

Due from related parties


1,422,254



(604,863)

Advances from customers


(353,432)



38,174

Accounts payable


(2,709,194)



3,064,257

Taxes payable


487,197



754,512

Due to related parties


-



(206,323)

Accrued expenses and other current liabilities


1,114,597



(110,836)

Net cash used in operating activities


(4,273,067)



(1,807,652)







Investing Activities






Acquisition of property and equipment


(143,493)



(822,777)

Acquisition of intangible assets


-



(190,000)

Prepayment for intangible assets


-



(1,440,107)

Net cash used in investing activities


(143,493)



(2,452,884)







Financing Activities






Proceeds from issuance of common stock


850,000



2,585,091

Net cash provided by financing activities


850,000



2,585,091







Effect of exchange rate fluctuations on cash


(389,049)



39,962







Net decrease in cash


(3,955,609)



(1,635,483)







Cash at beginning of year


7,098,259



8,733,742







Cash at end of year

$

3,142,650


$

7,098,259







Supplemental information






Income taxes paid

$

166,960


$

68,268

Interest paid

$

-


$

-

 

Cision View original content:http://www.prnewswire.com/news-releases/sino-global-announces-2019-year-end-financial-results-company-continues-transition-to-shipping-agency-focus-300927911.html

SOURCE Sino-Global Shipping America, Ltd.


Copyright 2019, © S&P Global Market Intelligence  Terms of Use