Toronto, Ontario--(Newsfile Corp. - March 2, 2015) - Liuyang Fireworks Limited (TSXV: FWK) ("Liuyang" or "the Company") today announced financial results for its second quarter and first six months ended December 31, 2014. All amounts are in Canadian dollars unless otherwise indicated.
Highlights for the second quarter:
- Stronger international and domestic sales resulted in improved financial performance in the second quarter;
- Revenues were $5.3 million representing a 16.5% improvement over the second quarter of last year. 86% of total revenues during the quarter were attributable to sales to international markets.
- EBITDA for the quarter improved to $34 thousand compared to negative $232 thousand a year earlier;
- The Company incurred a net loss of $36 thousand for the quarter, compared to a net loss of $209 thousand for the same period a year earlier.
"Stronger sales, both our internationally and domestically, resulted in improved financial performance for the quarter," said Mr. Hu, Liuyang's president and CEO. "With continued success in the international market and improving market conditions in China, we achieved double digit growth in revenue and gross profit, and a return to positive EBITDA during the quarter. We remain focused on growth in both of our key markets.
Summary Financial Statements
| In thousands except per share and % data | 3 months ended Dec. 31 | 6 months ended Dec. 31 |
| 2014 | 2013 | 2014 | 2013 |
| Revenue | $5,316 | $4,565 | $7,667 | $7,687 |
| Gross profit | $1,963 | $1,624 | $2,820 | $2,633 |
| Gross margins | 36.9% | 35.6% | 36.3% | 34.3% |
| EBITDA | $34 | $(232) | $(75) | $(443) |
| Net income | $(36) | $(410) | $(246) | $(787) |
| Net income per share Basic | $(0.001) | $(0.007) | $(0.002) | $(0.014) |
| Diluted | $(0.001) | $(0.007) | $(0.002) | $(0.014) |
| In thousands except ratio data | 3 months ended Dec. 31 |
| 2014 | 2012 |
| Cash | $2,060 | $1,750 |
| Current ratio | 1.73:1 | 1.82:1 |
| Working capital | $7,623 | $7,194 |
| Total assets | $20,420 | $19,900 |
| Debt to equity ratio | 1.04:1 | 0.78:1 |
Review of Second Quarter Results
Revenue for the quarter was $5.32 million, which represented an increase of $0.75 million (or 16.5%) compared to the same period a year ago. The increase was attributable to a $0.53 million increase in international sales and a $0.22 million improvement in domestic revenue during the quarter. During the quarter the Company earned 86% of its revenues from international markets.
Gross profit for the quarter was $1.96 million, representing an increase of $0.34 million (or 20.9%) compared to a year earlier. Gross margin as a percentage of sales increased to 36.9% from 35.6% during the same period last year.
EBITDA for the quarter was $34 thousand, representing an increase of $266 thousand (or 115%) compared with the second quarter of fiscal 2014. The improvement was attributable to the higher revenue and gross profit during the quarter as well as a $155 thousand reduction in sales expenditures, partially offset by a $120 thousand increase in general and administrative expenses.
The Company had a net loss of $36 thousand, or $0.001 per share, compared to a net loss of $410 thousand, or $0.007 per share, for the second quarter of last year.
At December 31, 2014, the Company had cash of $2.06 million and working capital of $7.62 million. These figures compare to cash of $1.75 million and working capital of $7.19 million at December 31, 2013.
Liuyang's consolidated financial statements for the three and six months ended December 31, 2014 and related management's discussion and analysis (MD&A) will be filed with securities regulatory authorities within applicable timelines and will be available via SEDAR at www.sedar.com.
Resignation of Auditors
The Company also announced that its auditors, Calvista LLP Professional Accountants, have resigned effective February 2nd, 2015. The Company also reports that there are no unresolved differences of opinion between the Company and its former auditor. The Company has already commenced a search for a replacement auditor
About Liuyang Fireworks Limited
Liuyang Fireworks Limited is a leading China-based manufacturer of fireworks distributed both domestically and within more than 15 countries in North America, South America and Europe. The Company has more than 17 years of experience in the fireworks industry and is a supplier to the world's top five fireworks wholesalers and retailers. Liuyang's ISO9001-certified manufacturing facilities are located in the Liuyang area of Hunan, China, where more than half of the world's fireworks are produced.
For further information, contact:
Jacky Long
Chief Financial Officer
Liuyang Fireworks Limited
Tel : 647 350 8818
jackylong@farocean.com
Forward-Looking Statements
The forward-looking information contained in this news release represents the expectations of the Company as of the date of this news 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, it does not undertake to update this information at any particular time except as required in accordance with applicable securities legislation.
Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
© 2024 Canjex Publishing Ltd. All rights reserved.