HONG KONG, August 14, 2003 (PRIMEZONE) -- Pacific CMA Inc. (OTCBB:PCCM), a global freight forwarding/supply chain logistics services company, today announced that its operating results for the second quarter showed improvements over last year.
For the three months ended June 30, 2003, revenue rose 60.5%, to $17.0 million, from $10.6 million in the 2002 second quarter. Net income was $203,793, up slightly from $200,254 a year ago. On a per diluted share basis, net income equaled $0.009, versus $0.01 in the year-earlier period, based on a 10% increase in fully diluted shares outstanding this year.
For the first six months ended June 30, 2003, revenue rose 129%, to $31.0 million, from $13.5 million in the 2002 first half. Net income was $95,820, equal to $.004 per diluted share, compared with $181,424, or $.009 per diluted share, in last year's six month period.
The strong increase in revenue for both the second quarter and first half of 2003 reflect the organic growth of both Pacific's wholly owned subsidiary, AGI Logistics (HK) Ltd., and its subsidiary, Airgate International Corp. Pacific acquired Airgate on April 30, 2002. The revenue of Airgate represented approximately 70% of Pacific's total revenue for the second quarter of 2003.
Airgate, which was founded in 1990, is based in New York and primarily handles import air and ocean shipments from the Far East and Southwest Asia to the United States. AGI is based in Hong Kong and focuses on integrated logistics, freight forwarding and warehousing services in the Far East region and Mainland China.
During the second quarter and first half of 2003, Pacific CMA experienced increases in revenue both from air freight and sea freight operations: 50% and 112%, respectively, in each period versus a year ago for air freight; and 85% and 167% in each respective period versus a year earlier for sea freight. The Company's revenue growth in both the first and second quarters of 2003, however, was less than budgeted because of impacts from the second Gulf War and the outbreak of the SARS virus this spring. Both of these factors have dissipated today. Also, during the 2003 second quarter and first half, Pacific CMA incurred increased operating costs primarily resulting from the addition of Airgate's operations.
During the first half of 2003, important new operating expansions included agreements that Pacific CMA entered into with new agency partners in Dubai and Sri Lanka (in addition to recently added agents in Japan and Turkey), as well as planned investment to expand the Company's penetration of the rapidly growing Shanghai marketplace.
"Looking ahead," said Alfred Lam, Pacific CMA Chairman, "we expect continued strong organic growth and to capitalize on our Company's well established base in Asia, which includes five joint venture/representative offices in the Peoples Republic of China. We are confident that 2003 will be another year of record earnings and revenue, derived from existing operations, for Pacific CMA." Mr. Lam added, "we also plan to make more strategic, accretive acquisitions, both in China and the United States."
Pacific CMA Inc. is a non-asset based logistics/freight forwarder providing supply-chain logistics services. Pacific CMA's services include freight forwarding and warehousing services, which encompass the coordination of shipping and the storage of raw materials, supplies, components and finished goods. The Company facilitates the movement of freight to and from anywhere in the world either by air, sea or land, with particular focus on business between the Far East and the United States.
PACIFIC CMA, INC.
(CONDENSED CONSOLIDATED BALANCE SHEETS)
(Unaudited)
June 30, December 31,
2003 2002
$ $
----------- -----------
ASSETS
Current assets
Cash and cash equivalents 654,443 441,657
Restricted cash 3,031,798 2,655,589
Trade receivables, net of allowance for
doubtful accounts of $137,970 5,961,096 6,464,141
Deposits, prepayments and other 1,980,968 1,116,007
Loan receivable 12,600 249,600
Deferred income taxes 82,350 82,350
----------- -----------
Total current assets 11,723,255 11,009,344
Property, plant and equipment, net 307,604 361,578
Goodwill 2,683,768 2,683,768
Intangible asset, net 2,192,667 2,478,667
Deferred taxes 2,613 2,613
Loan receivable 64,934 66,224
Certificate of deposit 50,000 50,000
----------- -----------
Total assets 17,024,841 16,652,194
=========== ===========
LIABILIITES AND STOCKHOLDERS' EQUITY
Current liabilities
Bank overdrafts 2,110,968 742,914
Trade payables 7,767,762 7,855,965
Accrued charges and other creditors 253,332 509,316
Due to a director 97,868 411,667
Obligations under finance leases 36,150 38,124
Debt maturing within one year 187,858 479,607
Tax payable 222,779 240,845
----------- -----------
Total current liabilities 10,676,717 10,278,438
Obligations under finance leases 45,068 37,820
Deferred tax liability 452,047 580,747
----------- -----------
Total liabilities 11,173,832 10,897,005
----------- -----------
Commitments and contingencies (Note 9) -- --
Stockholders' equity
Common stock with no par value 1,551,865 1,551,865
Additional paid-in capital 1,786,718 1,786,718
Other comprehensive loss (8,325) (8,325)
Retained earnings 2,520,751 2,424,931
----------- -----------
Total stockholders' equity 5,851,009 5,755,189
----------- -----------
Total liabilities
and stockholders' equity 17,024,841 16,652,194
=========== ===========
See notes to condensed consolidated financial statements.
PACIFIC CMA, INC.
(CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS)
(Unaudited) (Unaudited)
Three months ended Six months ended
June 30, June 30,
2003 2002 2003 2002
$ $ $ $
----------- ----------- ----------- -----------
Freight
forwarding
income 16,961,821 10,569,264 30,988,201 13,546,135
----------- ----------- ----------- -----------
Operating
expenses
Cost of
forwarding (14,309,698) (8,896,061) (26,003,696) (11,244,767)
Selling and
administrative
expenses (2,284,107) (1,282,752) (4,590,107) (1,873,974)
Depreciation and
amortization (193,635) (148,384) (386,736) (198,226)
----------- ----------- ----------- -----------
Total operating
expenses (16,787,440) (10,327,197) (30,980,539) (13,316,967)
----------- ----------- ----------- -----------
Income from
operations 174,381 242,067 7,662 229,168
----------- ----------- ----------- -----------
Non-operating
income
(expense)
Net gain on
disposal of a
subsidiary -- 11,390 -- 11,390
Interest and
other
income 38,643 39,450 86,143 53,534
Interest expense (39,235) (25,363) (82,961) (40,117)
----------- ----------- ----------- -----------
Net non-
operating income
(expense) (592) 25,477 3,182 24,807
----------- ----------- ----------- -----------
Income before
income taxes 173,789 267,544 10,844 253,975
Provision for
income taxes 30,004 (67,290) 84,976 (72,551)
----------- ----------- ----------- -----------
Net income 203,793 200,254 95,820 181,424
=========== =========== =========== ===========
Net income per
share
Weighted average
number of shares
outstanding
Basic 22,423,350 20,368,713 22,422,812 20,368,713
=========== =========== =========== ===========
Diluted 22,596,778 20,552,380 22,596,240 20,552,380
=========== =========== =========== ===========
Net income per
share of
common stock
Basic and Diluted 0.009 0.010 0.004 0.009
=========== =========== =========== ============
A full copy of a recent research report on the Company is available online at http://www.barrowstreet.com and additional information on Pacific CMA is available on the Company's own web site at http://www.pacificcma.com.
Certain statements contained herein are "forward-looking'' statements (as such term is defined in the Private Securities Reform Act of 1995). Because such statements include risks and uncertainties, actual results may differ materially from those expressed or implied by such forward-looking statements.