TORONTO, ONTARIO -- (Marketwire) -- 02/15/13 -- Migao Corporation (TSX: MGO), a China-based specialty potash fertilizer producer, today reported financial results for the three and nine-month periods ended December 31, 2012.
Revenues for the third quarter were $60.4 million for third quarter of fiscal 2013, representing a decrease from the same period one year ago, however it is a dramatic increase compared to the recent second quarter revenues of $11.7 million. For the quarter, the Company reported a net loss of $4.5 million or $0.09 per basic share as compared to net income of $3.8 million or $0.07 per basic share for the same period one year ago. The decline in earnings continues to be a result of weakness in the hydrochloric acid market and overall lower average selling prices.
SUMMARY FINANCIAL STATEMENTS 3 months ended 3 months ended Dec. 31, 2012 Dec. 31, 2011($'000 except EPS)Sales 60,362 97,360Gross Profit 1,302 15,704Gross Profit (% of revenue) (i)2.5% 16.1%Net Income (loss) (4,514) 3,838EBITDA (982) 8,046EPS (0.09) 0.07(i)excluding $222 inventory write-downWeighted average number of shares (in millions of shares) 52.5 52.5Balance Sheet Highlights($'000) Dec. 31, 2012 March 31, 2012Current ratio 1.89:1 2.56:1Cash and restricted cash 73,566 68,924Working Capital 189,070 205,483Total Assets 545,400 479,163Total Liabilities 217,397 136,747Total Equity 328,003 342,416Long Term Bank Debt to Equity Ratio 0.01:1 0.01:1
"The increased focus on sales and marketing resulted in significant revenue growth compared to the previous quarter. We anticipate this revenue ramp-up to continue into the fourth quarter," said Mr. Liu Guocai, CEO of Migao. "Returning to profitability is also a priority focus and commitment. We saw a slight improvement to gross margin in the third quarter however we are still far from acceptable levels. We continue to address the ongoing hydrochloric acid situation and we are working with international experts to expand the potential customer and industry opportunities for the hydrochloric acid. We are also looking at our processes to determine if we can achieve further efficiencies. At the same time, we are aware of China's evolving agricultural markets and Migao will pursue opportunities that best match imbalances in China's supply and demand of agricultural goods and services."
For the nine months ended December 31, 2012 Migao reported revenues of $108.8 million as compared to revenues of $263.9 million for the nine-month period ended December 31, 2011. The Company reported a net loss of $16.5 million or $0.31 per basic share for the most recent nine-month period as compared to net income of $17.6 million or $0.33 per basic share for the same nine-month period one year ago.