Sino-Global Announces Fiscal Year 2018 Third Quarter Financial Results

ROSLYN, N.Y., May 14, 2018 /PRNewswire/ -- Sino-Global Shipping America, Ltd. (NASDAQ: SINO) ("Sino-Global," the "Company" or "we"), a logistics integrated solution provider engaged in non-asset based global shipping, freight logistics, and inland transportation management and related services, today announced its financial results for the third quarter of the fiscal year 2018 ended March 31, 2018. The Company has also provided extensive information on its quarterly report on Form 10-Q filed this morning with the U.S. Securities and Exchange Commission. Management encourages investors to review this filing for more details of the Company's financial results for the third quarter of fiscal year 2018, background on Sino-Global's business and history, as well as Company strategy for the coming fiscal year.

Fiscal Year 2018 Third Quarter Operating and Financial Highlights
(as compared to the same period of the prior year)

• Total revenues of this quarter increased 89.3% or $2.5 million to $5.2 million, compared to $2.7 million. The increase was primarily due to the Company's efforts to diversify its business in freight logistics services.
• Gross margin decreased from 58.8% to 34.5% as a result of lower margin fragmented freight logistics services have been provided to customers in the current period in comparison with the corresponding period in 2017. The Company strategically allocated its resources to develop new businesses and markets in the U.S. as the focus for its growth.
• Net income for the third quarter of fiscal year 2018 was $0.24 million, as compared to a net income of $1.3 million for the same period of the prior year. The decrease was due to higher cost of revenues associated with our fragmented freight logistics services which reduced the gross margin. In addition, our general and administrative expenses increased as a result of increased bad debt reserve and increased professional fee , and increased income tax expense of $0.26 million as compared to a tax benefit of $0.30 million recognized during the prior year period.
• On March 14, 2018, the Company closed a $3 million registered direct offering of its common stock and concurrent private placement of its Series A Warrants and Series B Warrants.
• At March 31, 2018, the Company had cash and cash equivalents of $9.5 million, and holds no long-term debt.

Management Commentary

Mr. Lei Cao, Chairman and Chief Executive Officer of Sino-Global commented, "We continue to ramp up and expand our business with our focus on our inland transportation, freight logistics and container trucking services. We were pleased with our growth for the quarter. However, there were several factors that adversely affected our bottom line. These factors included a change in our product mix towards freight logistics services which generates higher revenues but has lower profit margins than our other services. We also recognized an income tax expense for the quarter of $0.26 million due to changes in deferred tax assets for the three-month period."

Mr. Cao continued. "Also during the quarter, we completed a capital raise that resulted in net proceeds of $2.6 million, after related costs. We intend to use the money raised towards the further development of our business. In the remaining period of fiscal year 2018, we will continue to focus on increasing revenue and cash flow in the U.S. We will continue to use our bulk cargo container business in partnership with COSCO to seek solutions for empty containers between container shipping lines from the U.S. to China and view this aspect of our operations as a major part of our growth."

In addition to the growth of Sino-Global's bulk cargo container business segment, management continues to focus on growth of the Company's container truck business in the United States and anticipates further positive developments of this segment of the Company's operations in the coming months.

Fiscal Year 2018, Third Quarter Financial Review

• Revenues increased by $2.5 million, or 89.3%, to $5.2 million from $2.7 million for the three months ended March 31, 2017. This increase was primarily attributable to the Company diversifying its business in freight logistics services. Revenues generated from freight logistics services increased by $2.7 million, or 332.1%, from the three months ended March 31, 2017.
• The Company's gross profit during the period was $1.8 million as compared to the prior year period at $1.6 million.
• Total operating costs and expenses increased to $4.9 million for the three months ended March 31, 2018 from $1.8 million for the prior year period. The increase was attributable to several factors primarily focused on the diversification of the business which included a rise in the cost of revenue attributable to different segments, general and administrative expenses.
• Operating income for the three months ended March 31, 2018 was approximately $0.28 million, compared to an operating income of approximately $0.96 million for the comparable period ended March 31, 2017. The decrease was due to the above-mentioned rise in operating expenses relating to the ramp up of the Company's business.
• Income tax expense for the three months ended March 31, 2018 was $0.22 million, compared to an income tax benefit of approximately $0.30 million for the same period of the prior year. Current income tax incurred from operations in China and Hong Kong remained approximately the same compared to the same period last year, while income tax benefit decreased due to changes in in allowance for bad debts, net operating loss carryover and the increase in the valuation allowance against the deferred tax assets, based on the Company's latest projected taxable income.
• As a result of the factors discussed above, for the three months ended March 31, 2018, the Company reported a net income of $0.24 million, compared to net income of $1.3 million for the three months ended March 31, 2017.

Balance Sheet Information

• As of March 31, 2018, the Company had $9.5 million in cash and cash equivalents, working capital of $17.5 million and shareholder equity of $24.3 million; compared to $8.7 million, $13.7 million, and $19.5 million, respectively, as of June 30, 2017.
• The Company holds no long-term debt.

About Sino-Global Shipping America, Ltd.

Founded in the United States in 2001, Sino-Global Shipping America, Ltd. is a company engaged in shipping, chartering, logistics and related business services. Headquartered in New York, Sino-Global has offices in mainland China, Australia, Canada and Hong Kong. The Company's current service offerings consist of inland transportation management, freight logistics and container trucking services. Additional information about Sino-Global can be found on the Company's corporate website at www.sino-global.com. The Company routinely posts important information on its website.

Forward Looking Statements

No statement made in this press release should be interpreted as an offer to sell or a solicitation of an offer to purchase any security. Such an offer can only be made in accordance with the Securities Act of 1933, as amended, and applicable state securities laws. Any statements contained in this release that relate to future plans, events or performance are forward-looking statements that involve risks and uncertainties as identified in Sino-Global's filings with the U.S. Securities and Exchange Commission. Actual results, events or performance may differ materially. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date hereof. Sino-Global undertakes no obligation to publicly release the results of any revisions to these forward-looking statements that may be made to reflect the events or circumstances after the date hereof or to reflect the occurrence of unanticipated events unless required by applicable law or regulations.

Contact Information

The Equity Group Inc.
Terry Downs
Senior Associate
(212)-836-9615 / tdowns@equityny.com

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SOURCE Sino-Global Shipping America, Ltd.