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Section 1: 8-K (CURRENT REPORT)

 

 

United States

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

FORM 8-K

 

CURRENT REPORT

 

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

 

Date of Report (Date of earliest event reported): November 14, 2018

 

Sino-Global Shipping America, Ltd.

(Exact name of Registrant as specified in charter)

 

Virginia   001- 34024   11-3588546
(State or other jurisdiction
of Incorporation)
  (Commission File No.)   (IRS Employer
Identification No.)


1044 Northern Boulevard, Suite 305

Roslyn, New York 11576-1514

(Address of principal executive offices) (Zip Code)

 

Registrant's telephone number, including area code: (718) 888-1814

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

 

☐     Written communications pursuant to Rule 425 under the Securities Act (17CFR230.425)

 

☐     Soliciting material pursuant to Rule14a-12 under the Exchange Act (17CFR240.14a-12)

 

☐     Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17CFR240.14d-2(b))

 

☐     Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17CFR240.13e-4(c))

 

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

 

Emerging growth company ☐

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

 

 

 

 

Item 2.02. Results of Operations and Financial Condition.

 

On November 14, 2018, Sino-Global Shipping America, Ltd. (the “Company”) issued a press release announcing certain financial results for the first quarter of fiscal year 2019. A copy of the press release is attached hereto as Exhibit 99.1.

 

The information provided in this Current Report on Form 8-K, including Exhibit 99.1, shall not be deemed “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liability of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, except as shall be expressly set forth by specific reference in such a filing.

 

Item 9.01. Financial Statements and Exhibits.

 

(d) Exhibits.

 

Exhibit No.   Description
     
99.1   Press release of Sino-Global Shipping America, Ltd.

_________

 

 

SIGNATURES

 

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 

Date: November 14, 2018

 

  Sino-Global Shipping America, Ltd.
     
  By: /s/ Lei Cao
  Name: Lei Cao
  Title: Chief Executive Officer

 

 

 

EXHIBIT INDEX

 

Exhibit No.   Description
     
99.1   Press release of Sino-Global Shipping America, Ltd.

 

 

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Section 2: EX-99.1 (PRESS RELEASE OF SINO-GLOBAL SHIPPING AMERICA, LTD.)

Exhibit 99.1

 

 

Sino-Global Announces Fiscal 2019 First Quarter Financial Results

 

Roslyn, New York, November 14, 2018 – Sino-Global Shipping America, Ltd. (NASDAQ: SINO) (“Sino-Global”, the “Company”, “our”, “we” or “us”), a logistics integrated solutions provider engaged in non-asset based global shipping, freight logistics, and inland transportation management and related services, today announced its financial and operating results for the first quarter of the fiscal year 2019.

 

The Company has also provided an update on its Quarterly report on Form 10-Q 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 period.

 

Management Comments – Highlights in First Quarter of Fiscal 2019

 

Mr. Lei Cao, Chairman and Chief Executive Officer of Sino-Global commented, “We were pleased to maintain solid revenue growth while concentrating on the expansion of our shipping agency business. Over the past years, we have examined global trading environments, and feel that this adjustment in our business provides the most upside potential considering the impact of trade policy changes. Our unique relationships and capabilities provide Sino-Global with a distinctive competitive advantage given the fragmented nature of the industry. We are one of the few shipping agents specialized in providing a full range of general shipping agency services in China and the only shipping agency company listed on a major stock exchange in the U.S. We have an excellent online logistics platform that we have developed and feel that we can align this use of technology with expertise and relationships with larger global shippers. Our plan is to develop a shipping agency network in China and South East Asia for the next three years and to expand our shipping agency network worldwide through acquisitions or strategic partnerships with other shipping agencies. In the first quarter, we continued to pursue new partnership arrangements and will continue to update investors as we progress.”

 

Fiscal 2019 First Quarter and Subsequent Operating Highlights

 

·On November 1, 2018, the Company signed a five-year strategic cooperation agreement with a Hong Kong listed Company, Sinco Pharmaceuticals Holdings Ltd (“Sinco”), pursuant to which both companies will contribute resources and expertise to develop cold chain logistics in China.

 

·On September 3, 2018, Sino-Global entered into a co-operation agreement with Ningbo Far-East Universal Shipping Agency Co., Ltd (“Ningbo Far-East”) to set up a joint venture in Hong Kong to engage in worldwide shipping agency and management business. The Company shall have 51% ownership in the joint venture. Ningbo Far-East is one of the top ranking shipping agencies for private enterprises in Ningbo and Zhoushan ports.

 

Fiscal Year 2019 First Quarter Financial Review

 

·Total revenues increased by 20.8% to approximately $6.5 million for the three month period ended September 30, 2018, compared to approximately $5.4 million in the period ended September 30, 2017. This increase was due to the Company’s business development efforts in freight logistics.

 

·The Company’s gross profit for the period was approximately $1.4 million, compared to $1.7 million for the same period in the prior year. Gross profit margin during the period was 21.8% compared to 31.9% for the same period last year.

 

·The operating loss for the three months ended September 30, 2018 was approximately $1.4 million, compared to an operating income of approximately $0.9 million for the same period ended September 30, 2017. The operating loss was mainly due to increases in selling, general and administrative expenses (SG&A expenses), which included increases in stock compensation and certain provisions for double accounts due to slower collections from customers in the inland transportation segment. The Company has maintained long-term relationships with certain large customers and continues to monitor the collection closely with respect to its trade accounts receivable. For the three months ended September 30, 2018, provision for doubtful accounts was $871,081. For the same period in 2017, recovery of doubtful accounts $24,536 was reocrded due to collection of accounts receivable which the Company made a provision during previous period. As the Company continues to maintain long-standing relationships with its customers, monitor payments closely and does not believe there are any significant collection issues with respect to trade accounts receivable.

 

·For the three months ended September 30, 2018, the Company reported a net loss of approximately $1.3 million, or $(0.10) per diluted share based on weighted average diluted shares outstanding of 13,145,535, compared to a net income of approximately $0.6 million, or $0.07 per diluted share based on weighted average diluted shares outstanding of 10,157,625, for the same period in prior year. The decrease was due to the increase in SG&A expenses discussed above.

 

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The following tables present summary information by segments for the three months ended September 30, 2018 and 2017:

 

    For the Three Months Ended September 30, 2018  
    Inland
Transportation
Management
Services
    Freight
Logistics
Services
    Container
Trucking
Services
    Total  
Revenues                        
- Related party   $ 322,000     $ -     $ -     $ 322,000  
- Third parties   $ 598,000     $ 5,487,553     $ 91,980     $ 6,177,533  
Total   $ 920,000     $ 5,487,553     $ 91,980     $ 6,499,533  
Cost of revenues   $ 59,874     $ 4,965,992     $ 57,966     $ 5,083,832  
Gross profit   $ 860,126     $ 521,561     $ 34,014     $ 1,415,701  
Depreciation and amortization   $ 20,488     $ 476     $ 4,751     $ 25,715  
Total capital expenditures   $ -     $ -     $ 830     $ 830  
                                 
Gross profit margin     93.5 %     9.5 %     37.0 %     21.8 %

 

    For the Three Months Ended September 30, 2017  
    Inland
Transportation
Management
Services
    Freight
Logistics
Services
    Container
Trucking
Services
    Total  
Revenues                        
- Related party   $ 565,160     $ -     $ -     $ 565,160  
- Third parties   $ 853,306     $ 3,508,704     $ 452,841     $ 4,814,851  
Total revenues   $ 1,418,466     $ 3,508,704     $ 452,841     $ 5,380,011  
Cost of revenues   $ 182,150     $ 3,140,592     $ 343,176     $ 3,665,918  
Gross profit   $ 1,236,316     $ 368,112     $ 109,665     $ 1,714,093  
Depreciation and amortization   $ 7,661     $ 475     $ 5,067     $ 13,203  
Total capital expenditures   $ -     $ 5,077     $ -     $ 5,077  
                                 
Gross profit margin     87.2 %     10.5 %     24.2 %     31.9 %

 

  Balance Sheet Information

 

·As of September 30, 2018, the Company had approximately $1.0 million in cash, working capital of apporximately $11.8 million and stockholders’ equity of $23.3 million.

 

·The Company had 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 in shipping, chartering, logistics and related business services originally. Headquartered in New York, Sino-Global has offices in mainland China, Australia, Canada and Hong Kong. The Company’s current service offerings consist of 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

 

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SINO-GLOBAL SHIPPING AMERICA, LTD. AND AFFILIATES

CONSOLIDATED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS)

(UNAUDITED)

 

   For the Three Months Ended 
   September 30, 
   2018   2017 
         
Net revenues - third parties  $6,177,533   $4,814,851 
Net revenues - related party   322,000    565,160 
Total revenues   6,499,533    5,380,011 
Cost of revenues   (5,083,832)   (3,665,918)
Gross profit   1,415,701    1,714,093 
           
General and administrative expenses   (2,662,041)   (763,357)
Selling expenses   (108,369)   (22,466)
Total operating expenses   (2,770,410)   (785,823)
           
Operating income (loss)   (1,354,709)   928,270 
           
Financial income, net   712    84,796 
           
Net income (loss) before provision for income taxes   (1,353,997)   1,013,066 
           
Income tax benefit (expense)   66,466    (296,429)
           
Net income (loss)   (1,287,531)   716,637 
           
Net income attributable to non-controlling interest   29,231    99,448 
           
Net income (loss) attributable to Sino-Global Shipping America, Ltd.  $(1,316,762)  $617,189 
           
Comprehensive income (loss)          
Net income (loss)  $(1,287,531)  $716,637 
Other comprehensive income (loss) - foreign currency   (462,162)   47,717 
Comprehensive income (loss)   (1,749,693)   764,354 
Less: Comprehensive income attributable to non-controlling interest   106,725    40,747 
Comprehensive income (loss) attributable to Sino-Global Shipping America, Ltd.  $(1,856,418)  $723,607 
           
Earnings (loss) per share          
Basic  $(0.10)  $0.07 
Diluted  $(0.10)  $0.07 
           
Weighted average number of common shares used in computation          
Basic   13,145,535    10,105,535 
Diluted   13,145,535    10,157,625 

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SINO-GLOBAL SHIPPING AMERICA, LTD. AND AFFILIATES

CONDENSED CONSOLIDATED BALANCE SHEETS

(UNAUDITED)

   September 30,   June 30, 
   2018   2018 
         
Assets          
Current assets          
Cash  $987,031   $7,098,259 
Accounts receivable, less allowance for doubtful accounts of $2,635,206 and $1,682,228 as of September 30, 2018 and June 30, 2018, respectively   11,200,914    8,428,853 
Other receivables, less allowance for doubtful accounts of $145,231 and $145,176 as of September 30, 2018 and June 30, 2018, respectively   47,274    69,239 
Advances to suppliers-third parties   1,492,091    704,878 
Advances to suppliers-related party   -    3,414,619 
Prepaid expenses   453,858    588,439 
Due from a related party   1,361,330    2,087,994 
Total Current Assets   15,542,498    22,392,281 
           
Property and equipment, net   908,298    956,429 
Intangible assets, net   137,222    153,056 
Prepaid expenses and other assets   1,862,359    1,878,258 
Other long-term assets - deposits   3,053,182    143,303 
Deferred tax assets, net   829,000    634,500 
Total Assets  $22,332,559   $26,157,827 
           
Liabilities and Equity          
           
Current Liabilities          
Advances from customers  $170,239   $415,385 
Accounts payable   470,720    3,225,661 
Taxes payable   2,658,947    2,700,619 
Accrued expenses and other current liabilities   429,864    280,888 
Total current liabilities   3,729,770    6,622,553 
           
Total liabilities   3,729,770    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; 13,751,032 and 13,271,032 shares issued as of September 30, 2018 and June 30, 2018, respectively; 13,575,535 and 13,095,535 outstanding as of September 30, 2018 and June 30, 2018, respectively   24,253,830    23,717,330 
Additional paid-in capital   2,036,281    1,755,573 
Treasury stock, at cost, 175,497 shares  as of September 30, 2018 and June 30, 2018   (417,538)   (417,538)
Accumulated deficit   (1,751,618)   (434,856)
Accumulated other comprehensive loss   (812,063)   (272,407)
Total Sino-Global Shipping America Ltd. Stockholders' Equity   23,308,892    24,348,102 
           
Non-controlling Interest   (4,706,103)   (4,812,828)
           
Total Equity   18,602,789    19,535,274 
           
Total Liabilities and Equity  $22,332,559   $26,157,827 

 

 

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SINO-GLOBAL SHIPPING AMERICA, LTD. AND AFFILIATES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

 (UNAUDITED)

   For the Three Months Ended 
   September 30, 
   2018   2017 
         
Operating Activities          
Net income (loss)  $(1,287,531)  $716,637 
Adjustments to reconcile net income (loss) to net cash used in operating activities:          
Stock-based compensation - employees   473,000    - 
Stock-based compensation - consultants   63,500    52,709 
Amortization of stock - based compensation to management and employees   91,000    9,665 
Amortization of stock - based compensation to consultants   189,708    - 
Depreciation and amortization   25,715    13,203 
Provision for (recovery of) doubtful accounts   871,081    (24,536)
Deferred tax provision (benefit)   (194,500)   99,900 
Changes in assets and liabilities          
Accounts receivable   (3,709,059)   (1,711,154)
Other receivables   67,499    (60,396)
Advances to suppliers-third parties   (789,150)   20,481 
Advances to suppliers-related party   3,322,210    - 
Prepaid expenses   (290,651)   (50,390)
Other long-term assets - deposits   (2,510,665)   - 
Due from related parties   807,405    (570,000)
Advances from customers   (250,650)   17,410 
Accounts payable   (2,804,782)   661,628 
Taxes payable   (35,535)   146,104 
Due to related parties   -    (73,462)
Accrued expenses and other current liabilities   122,962    (68,288)
Net cash used in operating activities   (5,838,443)   (820,489)
           
Investing Activities          
Acquisition of property and equipment   (830)   (5,077)
Net cash used in investing activities   (830)   (5,077)
           
Effect of exchange rate fluctuations on cash   (271,955)   19,210 
           
Net decrease in cash   (6,111,228)   (806,356)
           
Cash at beginning of period   7,098,259    8,733,742 
           
Cash at end of period  $987,031   $7,927,386 
           
Supplemental information          
Income taxes paid  $9,108   $60,162 

 

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