HONG KONG, June 5, 2020 /PRNewswire/ -- Euro Tech Holdings
Company Limited (Nasdaq: CLWT) today reported financial results for
the 12-month period ended December 31,
2019 ("Fiscal 2019").
The Company's revenues for Fiscal 2019 were approximately
US$17,399,000, an approximate 13.5%
decrease compared to approximately US$20,104,000 in the Company's fiscal year ended
December 31, 2018 ("Fiscal 2018").
Revenues from trading and manufacturing activities, and engineering
activities decreased by US$1,893,000
and US$812,000, respectively.
Gross profits increased by 19.4% to approximately US$4,417,000 for Fiscal 2019 as compared to
approximately US$3,699,000 for Fiscal
2018. The increase was primarily due to the drop in contracts of
low profit margin.
Selling and administrative expenses increased by 2.1% to
approximately US$4,853,000 for Fiscal
2019 as compared to approximately US$4,751,000 for Fiscal 2018 as a result of
general inflation.
Operating loss decreased by 41.5% to approximately US$440,000 for Fiscal 2019 as compared to
approximately US$1,059,000 for Fiscal
2018. This was primarily due to the increase in gross profits.
The profit contribution from the affiliates was
approximately US$137,000 for Fiscal
2019, as compared to negative contribution of approximately
(US$932,000) for Fiscal 2018.
The result for Fiscal 2018 included a loss contribution from
Zhejiang Tianlan Environmental Protection Technology Co. Ltd.
("Blue Sky") of approximately (US$786,000) principally caused by a decrease in
sales revenue as a result of the filing for bankruptcy liquidation
of one of Blue Sky's major customers.
The Company had net loss of approximately US$146,000 in Fiscal 2019, as compared to net
income of approximately US$88,000 in
Fiscal 2018. This was primarily due to there was a non-recurrent
net gain on disposal of an affiliate of approximately US$1,522,000 in Fiscal 2018.
The Company's operating results in Fiscal 2019 was adversely
affected by the economic slowdown in China and Hong
Kong resulting from the China-US escalating trade war and
technology tensions, and the ongoing social unrest in Hong Kong. The outbreak of coronavirus since
December 2019 also has further
material adverse impact on the Company's business, operating
results and financial condition in year 2020.
The Company is still positive about the future Ballast Water
Treatment Systems ("BWTS") business from port services and
commercial ships. The development of the ballast water port
solution prototype is now completed and under system and operation
tests in various ports. The port solution system is a system
installed in port to offer ballast water treatment services for
ocean going ships without their own BWTS and for those with damaged
BWTS. The Company is now embarking on promotion activities for port
solution systems in China and
South East Asia. The International
Maritime Organization ("IMO") convention stipulates that type
approval for revised G8 requirements must be obtained for all BWTS
installed on or after October 28,
2020. To comply with these requirements, the Company is
going to start the land based test for our BWTS to
obtain such type approval certification in China.
About Blue Sky
Zhejiang Tianlan Environmental Protection Technology Co. Ltd.,
("Blue Sky"), found in 2000, is a fast growing company which
provides a comprehensive service for design, general contract,
equipment manufacturing, installation, testing and operation
management of the treatment of waste gases emitted from various
boilers and industrial furnaces of power plants, steel works and
chemical plants. It has listed its shares on the New Third Board
in the People's Republic of
China ("PRC") since November 17,
2015. The New Third Board is a national over-the-counter
market in the PRC regulated by China Securities Regulatory
Commission, and managed by the National Equities Exchange and
Quotations, which serves as a platform for the sale of existing
shares or directed share placements for small and medium-sized
enterprises.
About BWTS
BWTS are an imminent requirement by The International Maritime
Organization ("IMO") to prevent the biological unbalance caused by
the estimated 12 billion tons of ballast water transported across
the seas by ocean-going vessels when their ballast water tanks are
emptied or refilled. In 2012, ballast water discharge standard
became a law in the US. Any vessel constructed in December 2013 or later will need to comply when
entering US waters, and existing vessels will follow shortly after.
IMO's Ballast Water Management Convention entered into force for
new-built vessels on September 8,
2017 after ratification by 52 States, representing 35.1441%
of world merchant shipping tonnage. In July
2017, IMO decided that the phase-in period for ballast water
system retrofits started on 8 September 2019.
The company obtained type approval certificate from China's Classification Society for its 200,
300, 500, 750, 1200 and 1250 Cubic Meters per hour BWTS and
Alternate Management Systems ('AMS") acceptance for its full range
BWTS in 2016.
About AMS
AMS acceptance by the U.S. Coast Guard is a temporary
designation given to BWTS approved by a foreign administration. It
enables BWTS to be used on vessels for a period of up to 5 years,
while the treatment system undergoes approval testing to U.S. Coast
Guard standards.
Forward Looking Statements
Certain statements in this news release regarding the Company's
expectations, estimates, present view of circumstances or events,
and statements containing words such as estimates, anticipates,
intends, or expects, or words of similar import, constitute forward
looking statements within the meaning of the Private Securities
Litigation Reform Act of 1995. Such statements indicate uncertainty
and the Company can give no assurance with regard to actual
outcomes. Specific risk factors may include, without limitation,
having the Company's offices and operations situated in
Hong Kong and China, doing business in China, competing with Chinese manufactured
products, competing with the Company's own suppliers, dependence on
vendors, and lack of long term written agreements with suppliers
and customers, development of new products, entering new markets,
possible downturns in business conditions, increased competition,
loss of significant customers, availability of qualified personnel,
negotiating definitive agreements, new marketing efforts and the
timely development of resources. See the "Risk Factor" discussions
in the Company's filings with the Securities and Exchange
Commission, including its Annual Report on Form 20-F for its fiscal
year ended December 31, 2019.
CONDENSED
STATEMENTS OF OPERATIONS
|
(Dollar amounts in
US$ thousands, except share and per share data)
|
|
|
|
Year Ended December
31,
|
|
2019
|
2018
|
Revenues
|
17,399
|
20,104
|
|
|
|
Net (Loss) / Income
Attributable to the
Company
|
(146)
|
88
|
|
|
|
Net (Loss) / Income
Per Ordinary Share –
Basic
|
$(0.06)
|
$0.04
|
Weighted Average
Number of
Ordinary Shares Outstanding –Basic
|
2,301,993
|
2,061,909
|
|
|
|
|
|
|
SELECTED BALANCE
SHEET DATA
|
|
|
As of December
31,
|
|
2019
|
2018
|
Cash and Cash
Equivalents
|
5,991
|
5,267
|
Total Current
Assets
|
12,010
|
13,533
|
Total
Assets
|
22,213
|
23,065
|
Total Current
Liabilities
|
6,660
|
7,520
|
Total
Liabilities
|
6,876
|
7,520
|
Total Euro Tech
Shareholders' Equity
|
14,459
|
14,589
|
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SOURCE Euro Tech Holdings Company Limited