AutoChina International Reports Revised Financial Results for the Second Quarter and Six Months Ended June 30, 2009
BEIJING--AutoChina International Limited (“AutoChina” or the “Company”) (OTCBB: AUCLF, AUCWF, AUCUF), a leading one-stop commercial vehicle sales and leasing company in China offering its customers affordable lease-to-own options, reported revised financial results for its second quarter and six months ended June 30, 2009. A summary of financial results is included below.
On September 10, 2009, the Company previously reported its results of operations for the second quarter and six months ended June 30, 2009 and 2008. The Company has revised the disclosures throughout the original press release to correct the financial information contained therein, as well as the presentation of such financial information. Net income, total assets, total equity and Adjusted EBITDA did not change. This revised press release, and the financial information included herein, replaces the September 10, 2009 press release in its entirety.
The Company’s Chairman and CEO, Mr. Yong Hui Li, noted, “The first six months of 2009 was a transformational period in AutoChina’s history, as we became a public company, agreed to sell our passenger auto dealership business, and reported rapid growth of our commercial vehicle sales and leasing business. Although we expect to initially generate lower revenues following the sale of the auto dealership business, we believe that the commercial vehicle business model that we have created provides a significant opportunity for growth, and the capital received from the sale of our auto-dealership business will allow for our Company to accelerate this process. We continue to expand our operations, having grown the total number of branches related to our leasing business from 103 at December 31, 2008 to 142 at August 31, 2009, and we expect to open an additional 8 branches by the end of 2009. We believe that we are well-positioned to capitalize on the commercial vehicle expansion in China and to build on our position in this highly fragmented market. We had approximately $21.4 million in cash as of June 30, 2009, which does not incorporate the pending sale of the auto dealership business.”
2009 Second Quarter Financial Review
The financial results prior to April 9, 2009 reflect those of the Company’s operating subsidiary, AutoChina Group, Inc. (“ACG”) on a stand-alone basis, without adjustment, prior to its acquisition by Spring Creek Acquisition Corp. on April 9, 2009. In addition, the financial results through June 30, 2009 include those of the automotive dealership business, which is in the process of being sold.
| In USD thousands, except share numbers and EPS | (unaudited) | (unaudited) | ||||||||||||||
|
Three Months Ended June 30, 2009 |
Three Months Ended June 30, 2008 |
|||||||||||||||
| Amount |
% of Revenue |
Amount |
% of Revenue |
Y-O-Y % CHANGE | ||||||||||||
| Revenues | $ | 196,217 | 100.0 | % | $ | 115,648 | 100.0 | % | 69.7 | % | ||||||
| New automobiles | $ | 120,189 | 61.3 | % | $ | 85,863 | 74.2 | % | 40.0 | % | ||||||
| Commercial vehicles | $ | 61,022 | 31.1 | % | $ | 20,193 | 17.5 | % | 202.2 | % | ||||||
| Parts and service | $ | 12,832 | 6.5 | % | $ | 8,773 | 7.6 | % | 46.3 | % | ||||||
| Finance and insurance | $ | 2,174 | 1.1 | % | $ | 819 | 0.7 | % | 165.4 | % | ||||||
| Gross profit | $ | 12,235 | 6.2 | % | $ | 6,523 | 5.6 | % | 87.6 | % | ||||||
| SG&A | $ | 4,732 | 2.4 | % | $ | 3,846 | 3.3 | % | 23.0 | % | ||||||
|
Income from operations |
$ | 7,812 | 4.0 | % | $ | 2,854 | 2.5 | % | 173.7 | % | ||||||
| Net income attributable to shareholders | $ | 3,792 | 1.9 | % | $ | 1,823 | 1.6 | % | 108.0 | % | ||||||
| Adjusted EBITDA | $ | 8,659 | 4.4 | % | $ | 3,555 | 3.1 | % | 143.6 | % | ||||||
| Earnings per share | ||||||||||||||||
| Basic | $ | 0.43 | $ | 0.24 | 79.2 | % | ||||||||||
| Diluted | $ | 0.38 | $ | 0.24 | 58.3 | % | ||||||||||
| Weighted average shares outstanding | ||||||||||||||||
| Basic | 8,741,952 | 7,745,625 | - | |||||||||||||
| Diluted | 9,860,828 | 7,745,625 | - | |||||||||||||
The Company reported revenues for the 2009 second quarter of $196.2 million, up 69.7% year-over-year from $115.6 million in the second quarter of 2008. The Company’s revenues by sales category were as follows:
- $120.2 million, or 61.3%, related to new automobiles
- $61.0 million, or 31.1%, related to commercial vehicles
- $12.8 million, or 6.5%, related to parts and service
- $2.2 million, or 1.1%, related to finance and insurance
The Company’s commercial vehicle sales and leasing business recorded 1,535 vehicle financing agreements and sales in the second quarter of 2009, compared to 580 vehicle financing agreements and sales in the second quarter of 2008. In addition, the Company did not realize any losses on any lease-to-own loans on its commercial vehicles during the first half of 2009.
As a percentage of revenues, overall gross margin increased slightly to 6.2% for the three months ended June 30, 2009, from 5.6% for the prior fiscal year period, which is in line with the increase in revenues. The Company expects continued improvement in margins due to the increased contribution to revenues from the commercial vehicle sales and leasing business, which has higher margins than the dealership business.
For the three months ended June 30, 2009, selling, general and administrative (SG&A) expenses were $4.7 million, compared to $3.8 million for the same period of the prior year. As a percentage of revenues, SG&A expenses decreased to 2.4% in the second quarter of 2009, from 3.3% in the prior year period, despite growth in the number of employees, commercial vehicle sales and leasing branches, and additional expenses incurred to operate as a public company since April 2009.
Net income attributable to shareholders for the second quarter of 2009 increased to $3.8 million, or $0.38 per diluted share based on 9.9 million weighted average diluted shares outstanding, compared to $1.8 million, or $0.24 per diluted share based on 7.7 million weighted average diluted shares outstanding in the second quarter of 2008. Adjusted EBITDA for the quarter ended June 30, 2009 increased to $8.7 million from $3.6 million in the prior year quarter. A table reconciling Adjusted EBITDA to net income can be found at the end of this press release.
Six Months Ended June 30, 2009 Financial Review
A summary of financial results is included below:
| In USD thousands, except share numbers and EPS | (unaudited) | (unaudited) | ||||||||||||
|
Six Months Ended
June 30, 2009 |
Six Months Ended
June 30, 2008 |
|||||||||||||
| Amount | % of Revenue | Amount | % of Revenue | Y-O-Y % CHANGE | ||||||||||
| Revenues | $ | 323,225 | 100.0 | % | $ | 217,405 | 100.0 | % | 48.7 | % | ||||
| New automobiles | $ | 225,094 | 69.6 | % | $ | 178,337 | 82.0 | % | 26.2 | % | ||||
| Commercial vehicles | $ | 70,958 | 22.0 | % | $ | 21,674 | 10.0 | % | 227.4 | % | ||||
| Parts and service | $ | 24,041 | 7.4 | % | $ | 16,575 | 7.6 | % | 45.0 | % | ||||
| Finance and insurance | $ | 3,132 | 1.0 | % | $ | 819 | 0.4 | % | 282.4 | % | ||||
| Gross profit | $ | 20,154 | 6.2 | % | $ | 12,245 | 5.6 | % | 69.6 | % | ||||
| SG&A | $ | 9,674 | 3.0 | % | $ | 6,478 | 3.0 | % | 49.3 | % | ||||
| Income from operations | $ | 11,012 | 3.4 | % | $ | 6,004 | 2.8 | % | 83.4 | % | ||||
| Net income attributable to shareholders | $ | 5,493 | 1.7 | % | $ | 3,067 | 1.4 | % | 79.1 | % | ||||
| Adjusted EBITDA | $ | 12,854 | 4.0 | % | $ | 7,208 | 3.3 | % | 78.3 | % | ||||
| Earnings per share | ||||||||||||||
| Basic | $ | 0.67 | $ | 0.40 | 67.5 | % | ||||||||
| Diluted | $ | 0.62 | $ | 0.40 | 55.0 | % | ||||||||
| Weighted average shares outstanding | ||||||||||||||
| Basic | 8,246,541 | 7,745,625 | - | |||||||||||
| Diluted | 8,809,069 | 7,745,625 | - | |||||||||||
For the six months ended June 30, 2009, revenues increased 48.7% to $323.2 million, from $217.4 million in the comparable prior year period. The Company’s revenues by sales category were as follows:
- $225.1 million, or 69.6%, related to new automobiles
- $71.0 million, or 22.0%, related to commercial vehicles
- $24.0 million, or 7.4%, related to parts and service
- $3.1 million, or 1.0%, related to finance and insurance
As a percentage of revenues, overall gross margin increased slightly to 6.2% for the six months ended June 30, 2009, from 5.6% for the prior fiscal year period, which is in line with the increase in revenues.
For the six months ended June 30, 2009, SG&A expenses were $9.7 million, compared to $6.5 million for the same period of the prior year. As a percentage of revenues, SG&A expenses remained flat at 3.0% for the six months ended June 30, 2009 and June 30, 2008, respectively.
Net income attributable to shareholders was $5.5 million, or $0.62 per diluted share based on 8.8 million weighted average diluted shares outstanding, for the six months ended June 30, 2009, compared to $3.1 million, or $0.40 per diluted share based on 7.7 million weighted average diluted shares outstanding in the prior year period. Adjusted EBITDA for the six months ended June 30, 2009 increased to $12.9 million from $7.2 million in the prior year period. A table reconciling Adjusted EBITDA to net income can be found at the end of this press release.
Pro forma statements of income for the six months ended June 30, 2009 and the year ended December 31, 2008 and a pro forma balance sheet as of June 30, 2009, to present the pending sale of the automotive dealership business segment as a discontinued operation, are presented below.
Balance Sheet Highlights
As of June 30, 2009, the Company had cash and cash equivalents of $21.4 million, working capital of $15.6 million, and equity of $72.8 million. These totals do not incorporate the impact of the Company’s pending agreement to sell its consumer auto dealership business to Xinjiang Guanghui Industry Investment (Group) Co. for a cash payment of approximately $68.8 million (RMB470 million), which is expected to close in October 2009. The Company does not expect to recognize a loss on this transaction.
Additional information with respect to the Company, including its business and operations, is available in the Company’s filings with the SEC (available without charge at www.sec.gov).
About AutoChina International Limited
AutoChina International Limited (OTCBB: AUCLF, AUCWF, AUCUF) is a leading one-stop commercial auto financing and sales company in China. AutoChina’s operating subsidiary was founded in 2005 by nationally recognized Chairman and CEO, Yong Hui Li.
Safe Harbor Statement
This press release may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 about the Company. Forward-looking statements are statements that are not historical facts. Such forward-looking statements, based upon the current beliefs and expectations of the Company's management, are subject to risks and uncertainties, which could cause actual results to differ from the forward-looking statements. The following factors, among others, could cause actual results to meaningfully differ from those set forth in the forward-looking statements:
- Continued compliance with government regulations;
- Changing legislation or regulatory environments;
- Requirements or changes affecting the businesses in which the Company is engaged;
- Industry trends, including factors affecting supply and demand;
- Labor and personnel relations;
- Credit risks affecting the Company's revenue and profitability;
- Changes in the automobile industry;
- The Company’s ability to effectively manage its growth, including implementing effective controls and procedures and attracting and retaining key management and personnel;
- Changing interpretations of generally accepted accounting principles;
- Whether the transaction to sell the automobile dealership business is consummated;
- General economic conditions; and
- Other relevant risks detailed in the Company’s filings with the Securities and Exchange Commission.
The information set forth herein should be read in light of such risks. The Company does not assume any obligation to update the information contained in this press release.
Use of Non-GAAP Measures
AutoChina defines Adjusted EBITDA as net income before interest expense, income taxes, depreciation and amortization, as well as certain other adjustments, including net income attributable to noncontrolling interests, equity in earnings (loss) of unconsolidated subsidiaries, accretion of share repurchase obligations and acquisition-related costs. Adjusted EBITDA excludes certain financial information that would be included in net income (loss), the most directly comparable GAAP financial measure. Users of this financial information should consider the type of material events and transactions that are excluded from Adjusted EBITDA, and the material limitations of Adjusted EBITDA, such as: Adjusted EBITDA does not include net interest expense, but because AutoChina has borrowed money to finance its operations, interest expense is a necessary and ongoing part of its costs and has assisted AutoChina in generating revenue; Adjusted EBITDA does not include taxes, although payment of taxes is a necessary and ongoing part of AutoChina’s operations; and Adjusted EBITDA does not include depreciation and amortization expense, but because AutoChina uses capital assets to generate revenue, depreciation and amortization expense is a necessary element of its cost structure. Therefore, Adjusted EBITDA should not be considered an alternative to, or more meaningful than, net income, as determined in accordance with GAAP, since it omits the impact of these expenses incurred by AutoChina.
AutoChina believes that the presentation of this non-GAAP financial measure is warranted and useful to its shareholders because it provides an additional analytical tool for understanding the Company’s financial performance by excluding certain items that may obscure trends in the core operating performance of the Company’s business. Using Adjusted EBITDA also facilitates management's internal comparisons to AutoChina's historical performance and liquidity. AutoChina computes Adjusted EBITDA using the same consistent method from quarter to quarter. The accompanying table has more details on the reconciliations between GAAP financial measures that are most directly comparable to Non-GAAP financial measures.
|
CONDENSED CONSOLIDATED STATEMENTS OF INCOME (In thousands, except share and per share data) |
||||||||||||
|
Three months ended June 30, |
Six months ended June 30, |
|||||||||||
| 2009 | 2008 | 2009 | 2008 | |||||||||
| (unaudited) | (unaudited) | (unaudited) | (unaudited) | |||||||||
| Revenues | ||||||||||||
| New automobiles | $ | 120,189 | $ | 85,863 | $ | 225,094 | $ | 178,337 | ||||
| Commercial vehicles | 61,022 | 20,193 | 70,958 | 21,674 | ||||||||
| Parts and service | 12,832 | 8,773 | 24,041 | 16,575 | ||||||||
| Finance and insurance | 2,174 | 819 | 3,132 | 819 | ||||||||
| Total revenues | 196,217 | 115,648 | 323,225 | 217,405 | ||||||||
| Cost of sales | ||||||||||||
| New automobiles | 115,409 | 83,415 | 216,439 | 172,108 | ||||||||
| Commercial vehicles | 58,241 | 19,275 | 67,782 | 20,676 | ||||||||
| Parts and service | 10,332 | 6,435 | 18,850 | 12,376 | ||||||||
| Total cost of sales |
183,982 |
109,125 | 303,071 | 205,160 | ||||||||
| Gross profit | 12,235 | 6,523 | 20,154 | 12,245 | ||||||||
| Operating expenses | ||||||||||||
| Selling and marketing | 2,328 | 1,984 | 4,908 | 3,280 | ||||||||
| General and administrative | 2,404 | 1,862 | 4,766 | 3,198 | ||||||||
| Other income, net | (309) | (177) | (532) | (237) | ||||||||
| Total operating expenses | 4,423 | 3,669 | 9,142 | 6,241 | ||||||||
| Income from operations | 7,812 | 2,854 | 11,012 | 6,004 | ||||||||
| Other income (expense) | ||||||||||||
| Floor plan interest expense | (201) | (209) | (428) | (452) | ||||||||
| Other interest expense | (630) | (387) | (923) | (863) | ||||||||
| Other interest expense, related parties | (221) | - | (221) | - | ||||||||
| Interest income | 117 | 89 | 219 | 228 | ||||||||
| Accretion of share repurchase obligations | (310) | - | (310) | - | ||||||||
| Equity in earnings (loss) of | ||||||||||||
| unconsolidated subsidiaries | 37 | (6) | 37 | (17) | ||||||||
| Acquisition-related costs | (287) | - | (295) | - | ||||||||
| Other income (expense), net | (1,495) | (513) | (1,921) | (1,104) | ||||||||
| Income from continuing operations before | ||||||||||||
| income taxes | 6,317 | 2,341 | 9,091 | 4,900 | ||||||||
| Income tax provision | 1,855 | 261 | 2,539 | 1,065 | ||||||||
| Income from continuing operations | 4,462 | 2,080 | 6,552 | 3,835 | ||||||||
| Income (loss) from discontinued | ||||||||||||
| operations, net of taxes | - | 16 | - | (151) | ||||||||
| Net income | 4,462 | 2,096 | 6,552 | 3,684 | ||||||||
| Less: Net income attributable to | ||||||||||||
| noncontrolling interests | (670) | (273) | (1,059) | (617) | ||||||||
| Net income attributable to shareholders | $ | 3,792 | $ | 1,823 | $ | 5,493 | $ | 3,067 | ||||
|
CONDENSED CONSOLIDATED STATEMENTS OF INCOME - Continued
|
|||||||||||||
| Three months ended June 30, | Six months ended June 30, | ||||||||||||
| 2009 | 2008 | 2009 | 2008 | ||||||||||
| (unaudited) | (unaudited) | (unaudited) | (unaudited) | ||||||||||
| Earnings per share | |||||||||||||
| Basic | |||||||||||||
| Continuing operations | $ | 0.43 | $ | 0.24 | $ | 0.67 | $ | 0.42 | |||||
| Discontinued operations | - | - | - | (0.02 | ) | ||||||||
| $ | 0.43 | $ | 0.24 | $ | 0.67 | $ | 0.40 | ||||||
| Diluted | |||||||||||||
| Continuing operations | $ | 0.38 | $ | 0.24 | $ | 0.62 | $ | 0.42 | |||||
| Discontinued operations | - | - | - | (0.02 | ) | ||||||||
| $ | 0.38 | $ | 0.24 | $ | 0.62 | $ | 0.40 | ||||||
| Weighted average shares outstanding | |||||||||||||
| Basic | 8,741,952 | 7,745,625 | 8,246,541 | 7,745,625 | |||||||||
| Diluted | 9,860,828 | 7,745,625 | 8,809,069 | 7,745,625 | |||||||||
| Amounts attributable to shareholders | |||||||||||||
| Income from continuing operations, | |||||||||||||
| net of taxes | $ | 3,792 | $ | 1,807 | $ | 5,493 | $ | 3,218 | |||||
| Discontinued operations, net of taxes | - | 16 | - | (151 | ) | ||||||||
| Net income | $ | 3,792 | $ | 1,823 | $ | 5,493 | $ | 3,067 | |||||
|
CONDENSED CONSOLIDATED BALANCE SHEETS (In thousands, except share data) |
||||||
| June 30, | December 31, | |||||
| 2009 | 2008 | |||||
| (unaudited) | ||||||
| ASSETS | ||||||
| Current assets | ||||||
| Cash and cash equivalents | $ | 21,404 | $ | 17,406 | ||
| Restricted cash | 53,348 | 40,824 | ||||
| Restricted cash held in escrow | 4,987 | - | ||||
| Note receivable | 769 | - | ||||
| Accounts receivable | 3,238 | 4,272 | ||||
| Inventories | 35,032 | 37,463 | ||||
| Deposits for inventories | 34,640 | 21,621 | ||||
| Prepaid expenses and other current assets | 4,955 | 5,474 | ||||
| Due from unconsolidated subsidiary | 220 | 529 | ||||
| Current maturities of net investment in sales-type leases | 43,907 | 14,867 | ||||
| Deferred income tax assets | 2,066 | 1,020 | ||||
| Total current assets | 204,566 | 143,476 | ||||
| Investment in unconsolidated subsidiaries | 266 | 229 | ||||
| Property, equipment and leasehold improvements, net | 28,541 | 26,907 | ||||
| Net investment in sales-type leases, net of current maturities | 28,730 | 8,492 | ||||
| Goodwill | 941 | 941 | ||||
| Total assets | $ | 263,044 | $ | 180,045 | ||
| LIABILITIES AND EQUITY | ||||||
| Current liabilities | ||||||
| Floor plan notes payable - manufacturer affiliated | $ | 12,010 | $ | 12,379 | ||
| Notes payable | 21,814 | 3,921 | ||||
| Note payable to EarlyBird Capital | 429 | - | ||||
| Trade notes payable | 70,368 | 60,134 | ||||
| Accounts payable | 5,364 | 1,270 | ||||
| Accounts payable, related parties | 27,761 | 2,272 | ||||
| Other payables and accrued liabilities | 8,867 | 5,189 | ||||
| Share repurchase obligations | 8,218 | - | ||||
| Due to affiliates | 10,592 | 5,894 | ||||
| Customer deposits | 6,269 | 3,224 | ||||
| Customer deposits, related party | 14,696 | 16,095 | ||||
| Income tax payable | 2,923 | 1,674 | ||||
| Total current liabilities | 189,311 | 112,052 | ||||
|
CONDENSED CONSOLIDATED BALANCE SHEETS - Continued (In thousands, except share data) |
||||||
| June 30, | December 31, | |||||
| 2009 | 2008 | |||||
| (unaudited) | ||||||
| Long term debt | ||||||
| Net deferred income tax liabilities | $ | 973 | $ | 405 | ||
| Total liabilities | 190,284 | 112,457 | ||||
| Equity | ||||||
| Ordinary shares | 11 | 9 | ||||
| Additional paid-in capital | 34,625 | 35,912 | ||||
| Statutory reserves | 741 | 741 | ||||
| Retained earnings | 23,284 | 17,791 | ||||
| Accumulated other comprehensive income | 6,228 | 6,185 | ||||
| Total shareholders’ equity | 64,889 | 60,638 | ||||
| Noncontrolling interests | 7,871 | 6,950 | ||||
| Total equity | 72,760 | 67,588 | ||||
| Total liabilities and equity | $ | 263,044 | $ | 180,045 | ||
|
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOW (In thousands) |
||||||
| Six months ended June 30, | ||||||
| 2009 | 2008 | |||||
| (unaudited) | (unaudited) | |||||
| Cash flow from operating activities: | ||||||
| Net income attributable to shareholders | $ | 5,493 | $ | 3,067 | ||
| Adjustments to reconcile net income to net cash provided by (used in) operating activities: | ||||||
| Depreciation and amortization | 1,842 | 1,355 | ||||
| Loss on disposal of property, equipment and leasehold improvements | 90 | - | ||||
| Deferred income taxes | (478 | ) | (105 | ) | ||
| Equity in earnings of unconsolidated subsidiaries | (37 | ) | (17 | ) | ||
| Gain on disposal of equity in subsidiary | - | (2,516 | ) | |||
| Accretion of share repurchase obligations | 310 | - | ||||
| Noncontrolling interests | 1,059 | 617 | ||||
| Changes in operating assets and liabilities, net of acquisitions and divestitures: | ||||||
| Accounts receivable | 1,034 | (559 | ) | |||
| Net investment in sales-type leases | (49,278 | ) | (19,828 | ) | ||
| Inventories | 2,431 | (26,235 | ) | |||
| Deposits for inventories | (13,019 | ) | 5,007 | |||
| Prepaid expense and other current assets | 583 | 427 | ||||
| Floor plan notes payable – manufacturer affiliated | (369 | ) | (189 | ) | ||
| Trade notes payable | 10,234 | 17,257 | ||||
| Accounts payable | 4,094 | 9,146 | ||||
| Other payables and accrued liabilities | 542 | (2,650 | ) | |||
| Customers deposits | 3,045 | (1,488 | ) | |||
| Customers deposits, related party | (1,399 | ) | - | |||
| Income tax payable | 1,249 | 432 | ||||
| Net cash provided by discontinued operations | - | 10,553 | ||||
| Net cash used in operating activities | $ | (32,574 | ) | $ | (5,726 | ) |
|
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOW - Continued (In thousands) |
||||||
| Six months ended June 30, | ||||||
| 2009 | 2008 | |||||
| (unaudited) | (unaudited) | |||||
| Cash flow from investing activities: | ||||||
| Business acquisitions, net of cash acquired | $ | - | $ | 542 | ||
| Purchase of property, equipment and leasehold improvements | (2,126 | ) | (6,051 | ) | ||
| Proceeds from the sale of property, equipment and leasehold improvements | 1,024 | 68 | ||||
| Cash received from sale of equity in subsidiary | 2,928 | - | ||||
| Cash relinquished upon sale of equity in discontinued subsidiary | - | (5,432 | ) | |||
| Increase in note receivable | (769 | ) | - | |||
| Increase in restricted cash | (12,524 | ) | (5,361 | ) | ||
| Net cash used in investing activities | (11,467 | ) | (16,234 | ) | ||
| Cash flow from financing activities: | ||||||
| Floor plan borrowings - non-manufacturer affiliated, net | - | 44 | ||||
| Proceeds from borrowings | 35,960 | 2,076 | ||||
| Repayments of borrowings | (18,067 | ) | - | |||
| Proceeds from affiliates | 4,548 | 17,801 | ||||
| Proceeds from accounts payable, related party | 25,489 | - | ||||
| Notes payable, related parties | - | (12,538 | ) | |||
| Capital contributions | - | 10,838 | ||||
| Cash acquired in reverse merger | 1,697 | - | ||||
| Repurchase of warrants subsequent to closing of reverse merger | (449 | ) | ||||
| Dividends paid to noncontrolling interest | (1,250 | ) | - | |||
| Net cash provided by financing activities | 47,928 | 18,221 | ||||
| Effect of foreign currency translation on cash | 111 | (1 | ) | |||
| Net increase (decrease) in cash and cash equivalents | 3,998 | (3,740 | ) | |||
| Cash and cash equivalents, beginning of the period | 17,406 | 12,820 | ||||
| Cash and cash equivalents, end of the period | $ | 21,404 | $ | 9,080 | ||
| Supplemental Disclosure of Cash Flow Information: | ||||||
| Interest paid | $ | 1,572 | $ | 1,355 | ||
| Income taxes paid | $ | 1,617 | $ | 1,104 | ||
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PRO FORMA CONDENSED CONSOLIDATED BALANCE SHEET (Reclassified For Discontinued Operations) (In thousands, except share and per share data) |
||||
| June 30, | ||||
| 2009 | ||||
| (unaudited) | ||||
| Assets: | ||||
| Current assets: | ||||
| Cash and cash equivalents | $ | 5,589 | ||
| Restricted cash | 12,444 | |||
| Restricted cash held in escrow | 4,987 | |||
| Note receivable | 769 | |||
| Accounts receivable | 1,583 | |||
| Inventories | 245 | |||
| Deposits for inventories | 14,332 | |||
| Prepaid expenses and other current assets | 1,194 | |||
| Current maturities of net investment in sales-type leases | 43,907 | |||
| Deferred income tax assets | 1,700 | |||
| Assets of discontinued operations | 145,816 | |||
| Total current assets | 232,566 | |||
| Property, equipment and leasehold improvements, net | 28,730 | |||
| Net investment in sales-type leases, net of current maturities | 1,748 | |||
| $ | 263,044 | |||
| Total assets |
|
PRO FORMA CONDENSED CONSOLIDATED BALANCE SHEET (Reclassified For Discontinued Operations) (In thousands, except share and per share data) |
||||
|
June 30,
2009 |
||||
| (unaudited) | ||||
| Current liabilities: | ||||
| Trade notes payable | $ | 12,444 | ||
| Notes payable to EarlyBird Capital | 429 | |||
| Accounts payables | 3,569 | |||
| Accounts payables, related parties | 27,761 | |||
| Other payables and accrued liabilities | 5,036 | |||
| Share repurchase obligations | 8,218 | |||
| Due to affiliates | 10,842 | |||
| Customer deposits | 2,159 | |||
| Customer deposits, related parties | 14,696 | |||
| Income tax payable | 709 | |||
| Liabilities of discontinued operations | 103,448 | |||
| Total current liabilities | 189,311 | |||
| Long term debt: | ||||
| Net deferred income tax liabilities | 973 | |||
| Total liabilities | 190,284 | |||
| Equity: | ||||
| Ordinary shares | 11 | |||
| Additional paid-in capital | 34,625 | |||
| Statutory reserves | 741 | |||
| Retained earnings | 23,284 | |||
| Accumulated other comprehensive income | 6,228 | |||
| Total shareholders’ equity | 64,889 | |||
| Noncontrolling interests | 7,871 | |||
| Total equity | 72,760 | |||
| Total liabilities and equity | $ | 263,044 | ||
|
PRO FORMA CONDENSED CONSOLIDATED STATEMENTS OF INCOME (Reclassified For Discontinued Operations) (In thousands, except share and per share data) |
||||||
|
Six Months
Ended June 30, |
Year Ended December 31, |
|||||
| 2009 | 2008 | |||||
| (unaudited) | ||||||
| Revenues: | ||||||
| Commercial vehicles | $ | 70,958 | $ | 34,059 | ||
| Finance and insurance | 2,916 | 2,239 | ||||
| 73,874 | 36,298 | |||||
| Cost of sales: | ||||||
| Commercial vehicles | 67,782 | 31,970 | ||||
| Gross profit | 6,092 | 4,328 | ||||
| Operating expenses: | ||||||
| Selling and marketing | 920 | 965 | ||||
| General and administrative | 1,991 | 2,177 | ||||
| Other income, net | (50 | ) | (162 | ) | ||
| Total operating expenses | 2,861 | 2,980 | ||||
| Income from operations | 3,231 | 1,348 | ||||
| Other income (expense) : | ||||||
| Other interest expense | (207 | ) | (5 | ) | ||
| Other interest expense, related parties | (221 | ) | - | |||
| Interest income | 12 | 14 | ||||
| Accretion of share repurchase obligations | (310 | ) | - | |||
| Acquisition-related costs | (295 | ) | - | |||
| Other income (expense), net | (1,021 | ) | 9 | |||
|
Income from continuing operations before
income taxes |
2,210 | 1,357 | ||||
| Income tax provision | 342 | 185 | ||||
| Income from continuing operations | 1,868 | 1,172 | ||||
|
Income from discontinued operations, net of
income taxes |
3,625 | 6,871 | ||||
| Net income attributable to shareholders | $ | 5,493 | $ | 8,043 | ||
| Earnings per share | ||||||
| Basic | ||||||
| Continuing operations | $ | 0.23 | $ | 0.15 | ||
| Discontinued operations | 0.44 | 0.89 | ||||
| $ | 0.67 | $ | 1.04 | |||
| Diluted | ||||||
| Continuing operations | $ | 0.21 | $ | 0.15 | ||
| Discontinued operations | 0.41 | 0.89 | ||||
| $ | 0.62 | $ | 1.04 | |||
| Weighted average shares outstanding | ||||||
| Basic | 8,246,541 | 7,745,625 | ||||
| Diluted | 8,809,069 | 7,745,625 | ||||
|
RECONCILIATION OF NON-GAAP FINANCIAL MEASURE (In thousands) |
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|
A reconciliation of Adjusted EBITDA to net income attributable to
shareholders is provided below: |
|||||||||||||
| In USD thousands (unaudited) | Three months ended | Six months ended | |||||||||||
| June 30, | June 30, | ||||||||||||
| 2009 | 2008 | 2009 | 2008 | ||||||||||
| Net income attributable to shareholders | $ | 3,792 | $ | 1,823 | $ | 5,493 | $ | 3,067 | |||||
| Net income attributable to noncontrolling interests | 670 | 273 | 1,059 | 617 | |||||||||
| Interest expense | 1,052 | 596 | 1,572 | 1,315 | |||||||||
| Interest income | (117 | ) | (89 | ) | (219 | ) | (228 | ) | |||||
| Equity in earnings (loss) of unconsolidated subsidiaries | (37 | ) | 6 | (37 | ) | 17 | |||||||
| Income tax provision | 1,855 | 261 | 2,539 | 1,065 | |||||||||
| Accretion of share repurchase obligations | 310 | - | 310 | - | |||||||||
| Acquisition-related costs | 287 | - | 295 | - | |||||||||
| Depreciation and amortization | 847 | 685 | 1,842 | 1,355 | |||||||||
| Adjusted EBITDA | $ | 8,659 | $ | 3,555 | $ | 12,854 | $ | 7,208 | |||||