Zindart Year End Results: Revenues of $43.2 Million for Corgi Operating Division, Balance Sheet Improvement
11 Agosto 2005 - 12:22PM
Business Wire
Zindart Limited (NASDAQ:ZNDT) today announced results of operations
for the fiscal year ended March 31, 2005. Zindart announced that
revenues for the fiscal year ended March 31, 2005 were $43.2
million, compared to $49.7 million for the previous year ended
March 31, 2004. Net loss for the year ended March 31, 2005 was $7.1
million, or $0.75 per share, compared to a loss of $5.3 million, or
$0.60 per share, in the previous year. Due to the planned sale of
the Zindart Manufacturing division, the revenues for both fiscal
2005 and fiscal 2004 reported above reflect only the results of
Zindart's Corgi operating division. Operating results of Zindart
Manufacturing division and Hua Yang Printing have been reclassified
in Zindart's financial statements and reported as losses from
discontinued operations for both fiscal 2005 and fiscal 2004.
Losses from discontinued operations, net of tax, were $115,000 in
fiscal 2005 and $1.5 million in fiscal 2004. Zindart announced that
several facets of its balance sheet have improved, as a function of
the company's focus on working capital management. The ratio of
cash and cash equivalents to current liabilities of continuing
operations as of March 31, 2005 was 0.61, up from 0.04 as of March
31, 2004. The company's current ratio (the ratio of current assets
to current liabilities) at year-end was 1.55, a 32 percent
improvement compared to 1.17 at the end of fiscal 2004. "While
volatile conditions in the toy and collectibles markets caused
revenues to fall short of targets, we made advances on the strategy
we set out four years ago," said Peter Gardiner, Chairman, Zindart.
"We have stayed focused on increasing the intrinsic value of the
company for our shareholders over the long term," "During this very
difficult period, solid working capital management has allowed us
to invest in new product development, and we have several
innovative new lines from Corgi Classics shipping to mass retailers
for the holiday season," Gardiner continued. "We are now free of
any long-term debt, and our global marketing strategy is starting
to have a beneficial impact on sales." In March 2005, Zindart's
Board of Directors resolved to sell the company's Zindart
Manufacturing division. "Negotiations are underway and an update on
the sale effort will be announced as soon as discussions have
concluded and/or a definitive agreement for the sale has been
executed by the parties," Gardiner said. In May 2004, the company
sold its Hua Yang operating unit for $24 million, less debt of $10
million, thereby strengthening the balance sheet through the sale
of a non-strategic asset, generating approximately $14 million of
cash. Other positive improvements to the balance sheet since
Gardiner assumed control of the company five years ago include the
paying off of the company's long-term debt, a reduction of $18
million. "Marketing and sales personnel have been located in local
markets worldwide. This has resulted in the acquisition of new
customers for each region in fiscal 2005, including several of the
big five mass merchandisers in the U.S., which control a major
portion of the consumer goods retail market. Orders from the bigger
chains are starting to grow," Gardiner said. During fiscal year
2005, Zindart installed new top management at Corgi, the company's
branded die-cast collectible vehicles unit. After reviewing the
company's status, Corgi CEO George Volanakis, a former senior
executive with Hasbro, quickly began initiating change, including
acquiring more highly visible product licenses and investing in the
development of new product lines. Successes to date include the
introduction of a line of 12 high quality, authentically produced
Batman(TM) vehicles that hit stores this summer in time to take
advantage of Warner Bros.' promotional activities for its new
movie, "Batman Begins," starring Christian Bale as Bruce
Wayne/Batman, Michael Caine, Liam Neeson and Katie Holmes.
Volanakis also authorized the development of several new product
lines to broaden Corgi into the toy market. For the holiday season,
Corgi will be selling Streakerz,(TM) a line of micro racing cars
that speed around their own miniature track at high speeds. Special
wheels give the toy cars better traction on Corgi's action track
sets. In addition to the basic set, Corgi will sell extra Streakerz
cars in a blister pack - perfect for a stocking stuffer. "While
maintaining operating expenses near previous levels, George has
managed to make significant investments in new products," Gardiner
said. "These products, combined with new marketing strategies, are
expected to improve fiscal year 2006 sales in both the U.K. and
U.S., even in a difficult toy environment. I am pleased to say that
customer reaction to these new products has been encouraging."
Zindart's 20-F (2005 Annual Report) is available on Zindart's
website, at http://www.zindart.com. About Zindart Zindart's current
divisions include Corgi Classics Limited and Zindart Manufacturing,
which is classified as discontinued. Corgi Classics Limited
develops and markets high-quality lines of die-cast collectible
products sold through retail channels in Europe, Canada, Mexico,
the United States and elsewhere. Zindart Manufacturing provides
both product design and high quality turnkey manufacturing for
multi-national companies requiring rapid, high-volume production of
intricate die-cast and plastic promotional items, collectibles and
gift items. Founded in 1978, Zindart is based in Hong Kong with
offices in the United States and the United Kingdom. Zindart has a
website at www.zindart.com. Collectors can find more information at
www.corgiclassics.com or by calling 1-800-800 CORGI. Certain
statements in this release are forward-looking. These statements
are subject to risks and uncertainties that could cause actual
results to differ materially from those anticipated. Such risks and
uncertainties include, in addition to those discussed above and
without limitation, changes in market demand for Zindart's
products, changes in economic conditions, dependence on certain
customers and other risks described in the company's annual report
on Form 20-F for the fiscal year ended March 31, 2005. The company
undertakes no obligation to revise these forward-looking statements
to reflect subsequent events or circumstances.
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