Exhibit 99.1

 

 

 

Sino-Global Announces Fiscal 2020 Third Quarter Financial Results

 

Roslyn, New York, July 6, 2020 – Sino-Global Shipping America, Ltd. (NASDAQ: SINO) (“Sino-Global”, the “Company”, “we”, “our”, or “us”), a global logistics service provider, announced its financial and operating results for its fiscal 2020 third quarter ended March 31, 2020. The Company has also provided more detailed information in its quarterly report on Form 10-Q filed today with the U.S. Securities and Exchange Commission.

 

Management Comments

 

Mr. Lei Cao, Chairman and Chief Executive Officer of Sino-Global commented, “Over the past several weeks, we have greatly expanded our ability to service the demand for exported products to China from the U.S., and have done so in a cost-effective manner with a focus on streamlined operations and free cash flow. We strengthened our management team through the appointment of Kelin Wu, secured shipping agency agreements, and chartered two vessels to meet this demand. Finally, we signed a significant MOU with a long-time partner of Sino-Global, which helps to secure potential purchases of material. We believe all of this will greatly increase the Company’s revenue with high-margins, and do so with long term customers in which we have successfully worked and collected cash from in the past. The quarter ended March 31, 2020 was largely impacted by the impact on trade from delays in a U.S. / China trade agreement and COVID-19. While this confluence of factors led to a slight delay in our reporting timing, we are pleased to again become current with our filings. Going forward, we feel very well positioned to increase sales and begin to deliver profitability for our shareholders.”

 

Recent Highlights

 

June 29, 2020: Signs Agreements to Charter Two Ships to Meet Export Product Demand to China from the U.S.
   
June 25, 2020: Signs MOU with Yunnan Jingyifeng Supply Chain Management to Address Growing Need for Exported Fuel and Agricultural Products to China
   
June 8, 2020: Signs Two Year General Agency Service Agreement; Expected to Add Approximately $12 Million in Revenue Annually
   
April 27, 2020: Appoints Mr. Kelin Wu as Chief Marketing Officer

 

Fiscal Third Quarter 2020 Financial Review

 

The Company reported total revenues of $1,353,979 for the quarter ended March 31, 2020, compared to $22,773,139 reported in the same period last year. The decrease was largely due to the fact that in certain freight logistics contracts that the Company entered into with customers starting from the first quarter of fiscal year 2020, only acted as an agent and did not control the services rendered to the customers, as Sino-Global was not the primary responsible party to fulfill the services. As such revenues on these contracts are accounted for on a net basis. The decrease was also due to the decrease in revenues from inland transportation management services as service contracts with customers have expired and there was no new business for this segment.

 

The Company’s gross profit for the 2020 fiscal third quarter was $464,872, compared to $1,697,944 in the same period last year. Gross profit margin during the quarter was approximately 34.3%, compared to approximately 7.5% in the same period last year. The increase was largely due to the Company’s shifting of business focus towards its agency business for providing freight logistics services where the Company acted solely as an agent and did not control the services rendered to its customers.

 

 

 

The following tables present summary information by segment for the three months ended March 31, 2020 and March 31, 2019, respectively:

 

   For the Three Months Ended March 31, 2020 
   Shipping
Agency and Management Services
  

Inland

Transportation Management Services

   Freight
Logistics
Services
   Container Trucking Services   Total 
Revenues                    
- Related party  $-   $     -   $     -   $      -   $       - 
- Third parties  $500,000   $-   $853,979*  $-   $1,353,979 
Total revenues  $500,000   $-   $853,979   $-   $1,353,979 
Cost of revenues  $67,841   $-   $821,266*  $-   $889,107 
Gross profit  $432,159   $-   $32,713   $-   $464,872 
Depreciation and amortization  $79,732   $-   $3,421   $-   $83,153 
Total capital expenditures  $-   $-   $-   $-   $- 
Gross margin%   86.4%   -%   3.8%   -%   34.3%

 

  * For certain freight logistics contracts that the Company entered into with customers starting from first quarter of fiscal year 2020, the Company (i) acts as an agent in arranging the relationship between the customer and the third-party service provider and (ii) does not control the services rendered to the customers, revenues related to these contracts are presented net of related costs. For the three months ended March 31, 2020, gross revenues and gross cost of revenues related to these contracts amounted to approximately $2.0 million and $2.0 million, respectively.

 

   For the Three Months Ended March 31, 2019 
   Shipping
Agency and Management Services
  

Inland

Transportation Management Services

   Freight
Logistic
Services
   Container Trucking Services   Total 
Revenues                    
- Related party  $      -   $36,380   $      -   $        -   $36,380 
- Third parties  $956,583   $93,407   $21,599,675   $87,094   $22,736,759 
Total revenues  $956,583   $129,787   $21,599,675   $87,094   $22,773,139 
Cost of revenues  $862,970   $48,750   $20,098,417   $65,058   $21,075,195 
Gross profit  $93,613   $81,037   $1,501,258   $22,036   $1,697,944 
Depreciation and amortization  $-   $39,109   $476   $4,448   $44,033 
Total capital expenditures  $-   $-   $125,806   $8,317   $134,123 
Gross margin%   9.8%   62.4%   7.0%   25.3%   7.5%

 

The Company had an operating loss of $4,034,743 for the three months ended March 31, 2020, compared to an operating loss of $1,229,233 for the same period in 2019.

 

For the fiscal quarter ended March 31, 2020, the Company reported net loss attributable to Sino-Global Shipping America, Ltd. of $3,818,094, or a loss of approximately $0.22 per diluted share based on approximately 17.7 million weighted average shares outstanding, compared to net loss attributable to Sino-Global Shipping America, Ltd. of $1,388,790, or a loss of approximately $0.09 per diluted share based on approximately 15.2 million weighted average shares outstanding, for the same period last year.

 

Balance Sheet Information

 

The Company holds no long-term debt.

 

As of March 31, 2020, the Company’s working capital was $3,525,468 and the Company had cash of $143,112.

 

The Company’s allowance for doubtful accounts was approximately $6.7 million as of March 31, 2020 compared with allowance of doubtful accounts of approximately $5.7 million as of June 30, 2019. As the Company continues to maintain long-standing relationships with its customers, it will work with these parties to monitor their payments closely and it does not believe that there are any significant collection issues with respect to accounts receivables, net of allowance.

 

2

 

 

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 and management, 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

 

3

 

 

SINO-GLOBAL SHIPPING AMERICA, LTD. AND AFFILIATES

CONSOLIDATED STATEMENTS OF OPERATION AND COMPREHENSIVE LOSS

(UNAUDITED)

 

   For the Three Months Ended   For the Nine Months Ended 
   March 31,   March 31, 
   2020   2019   2020   2019 
Net revenues - third parties  $1,353,979   $22,736,759   $5,161,329   $39,354,579 
Net revenues - related party   -    36,380    -    433,380 
Total revenues   1,353,979    22,773,139    5,161,329    39,787,959 
Cost of revenues   (889,107)   (21,075,195)   (2,328,156)   (34,715,624)
Gross profit   464,872    1,697,944    2,833,173    5,072,335 
                     
Selling expenses   (79,099)   (140,601)   (335,253)   (507,199)
General and administrative expenses   (952,661)   (1,053,903)   (2,746,180)   (3,442,695)
Impairment loss of fixed assets and intangible asset   -    -    (327,632)   - 
Provision for doubtful accounts   (3,121,416)   (1,583,965)   (4,289,170)   (2,871,752)
Stock-based compensation   (346,439)   (148,708)   (1,252,756)   (2,013,292)
Total operating expenses   (4,499,615)   (2,927,177)   (8,950,991)   (8,834,938)
                     
Operating loss   (4,034,743)   (1,229,233)   (6,117,818)   (3,762,603)
                     
Other income, net   21,260    2,499    7,103    3,993 
                     
Net loss before provision for income taxes   (4,013,483)   (1,226,734)   (6,110,715)   (3,758,610)
                     
Income tax expense   (189,510)   (248,820)   (204,257)   (427,333)
                     
Net loss   (4,202,993)   (1,475,554)   (6,314,972)   (4,185,943)
                     
Net loss attributable to non-controlling interest   (384,899)   (86,764)   (462,192)   (6,419)
                     
Net loss attributable to Sino-Global Shipping America, Ltd.  $(3,818,094)  $(1,388,790)  $(5,852,780)  $(4,179,524)
                     
Comprehensive loss                    
Net loss  $(4,202,993)  $(1,475,554)  $(6,314,972)  $(4,185,943)
Other comprehensive income (loss) - foreign currency   (112,671)   262,467    (360,132)   (306,457)
Comprehensive loss   (4,315,664)   (1,213,087)   (6,675,104)   (4,492,400)
Less: Comprehensive (loss) income attributable to non-controlling interest   (322,135)   (96,210    (350,693)   37,445 
Comprehensive loss attributable to Sino-Global Shipping America, Ltd.  $(3,993,529)  $(1,116,877)  $(6,324,411)  $(4,529,845)
                     
Loss per share                    
Basic and diluted  $(0.22)  $(0.09)  $(0.35)  $(0.30)
                     
Weighted average number of common shares used in computation                    
Basic and diluted   17,738,157    15,245,703    16,875,173    14,045,018 

 

4

 

 

SINO-GLOBAL SHIPPING AMERICA, LTD. AND AFFILIATES

CONSOLIDATED BALANCE SHEETS

(UNAUDITED)

 

   March 31,   June 30, 
   2020   2019 
Assets        
Current assets        
Cash  $143,112   $3,142,650 
Notes receivable   -    383,792 
Accounts receivable, net   1,745,672    7,045,846 
Other receivables   6,486,140    4,335,715 
Advances to suppliers - third parties   112,037    124,140 
Prepaid expenses and other current assets   239,830    105,054 
Due from related party, net   435,898    807,965 
Total Current Assets   9,162,689    15,945,162 
           
Property and equipment, net   588,514    989,910 
Right-of-use assets   337,899    - 
Intangible assets, net   42,222    89,722 
Prepaid expenses   -    519,503 
Other receivables - noncurrent   3,549,958    - 
Other long-term assets - deposits   2,956,802    3,054,706 
Total Assets  $16,638,084   $20,599,003 
           
Liabilities and Equity          
           
Current Liabilities          
Advances from customers  $66,987   $68,590 
Accounts payable   637,489    567,619 
Lease liabilities - current   156,190    - 
Taxes payable   3,290,812    3,184,895 
Accrued expenses and other current liabilities   1,485,743    1,418,129 
Total current liabilities   5,637,221    5,239,233 
           
Lease liabilities - noncurrent   177,495    - 
           
Total liabilities   5,814,716    5,239,233 
           
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; 18,139,037 and 16,054,534 shares issued as of March 31, 2020 and June 30, 2019, respectively; 18,139,037 and 15,879,037 shares outstanding as of March 31, 2020 and June 30, 2019, respectively   28,090,992    26,523,830 
Additional paid-in capital   2,334,962    2,066,906 
Subscription receivable   (114,054)   - 
Treasury stock, at cost, 0 and 175,497 shares as of March 31, 2020 and June 30, 2019   -    (417,538)
Accumulated deficit   (12,821,480)   (6,968,700)
Accumulated other comprehensive loss   (1,142,737)   (671,106)
Total Sino-Global Shipping America Ltd. Stockholders’ Equity   16,347,683    20,533,392 
           
Non-controlling Interest   (5,524,315)   (5,173,622)
           
Total Equity   10,823,368    15,359,770 
           
Total Liabilities and Equity  $16,638,084   $20,599,003 

 

5

 

 

SINO-GLOBAL SHIPPING AMERICA, LTD. AND AFFILIATES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(UNAUDITED)

 

   For the Nine Months Ended 
   March 31, 
   2020   2019 
Operating Activities        
Net loss  $(6,314,972)  $(4,185,943)
Adjustments to reconcile net loss to net cash used in operating activities:          
Stock-based compensation   1,252,756    2,013,292 
Depreciation and amortization   320,272    95,313 
Non-cash lease expense   113,985    - 
Provision for doubtful accounts   4,289,170    2,871,752 
Impairment loss of fixed assets and intangible asset   327,632    - 
Deferred tax benefit   -    (208,047)
Changes in assets and liabilities          
Notes receivable   386,233    (732,826)
Accounts receivable   1,051,299    (8,341,650)
Other receivables   (5,882,569)   36,014 
Advances to suppliers - third parties   11,820    (410,886)
Advances to suppliers - related party   -    3,312,375 
Prepaid expenses and other current assets   165,939    821,662 
Other long-term assets - deposits   89,274    (2,502,946)
Due from related parties   413,408    1,552,918 
Advances from customers   (1,496)   (353,696)
Accounts payable   72,772    1,336,453 
Taxes payable   116,520    837,641 
Lease liabilities   (118,256)   - 
Accrued expenses and other current liabilities   65,094    535,921 
Net cash used in operating activities   (3,641,119)   (3,322,653)
           
Investing Activities          
Acquisition of property and equipment   (6,979)   (143,480)
Net cash used in investing activities   (6,979)   (143,480)
           
Financing Activities          
Proceeds from issuance of common stock   885,946    500,000 
Net cash provided by financing activities   885,946    500,000 
           
Effect of exchange rate fluctuations on cash   (237,386)   (608,219)
           
Net decrease in cash   (2,999,538)   (3,574,352)
           
Cash at beginning of period   3,142,650    7,098,259 
           
Cash at end of period  $143,112   $3,523,907 
           
Supplemental information          
Income taxes paid  $38,557   $144,018 
           
Non-cash transactions of operating and investing activities          
Transfer of prepayment to intangible asset  $218,678   $- 
Initial recognition of right-of-use assets and lease liabilities  $452,119   $- 

 

 

6

 

 


The following information was filed by Sinoglobal Shipping America, Ltd. (SINO) on Monday, July 6, 2020 as an 8K 2.02 statement, which is an earnings press release pertaining to results of operations and financial condition. It may be helpful to assess the quality of management by comparing the information in the press release to the information in the accompanying 10-K Annual Report statement of earnings and operation as management may choose to highlight particular information in the press release.

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