6-K 1 v352810_6k.htm FORM 6-K

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

______________

 

FORM 6-K

 

REPORT OF FOREIGN PRIVATE ISSUER

PURSUANT TO RULE 13a-16 OR 15d-16 UNDER THE

SECURITIES EXCHANGE ACT OF 1934

 

For the month of: August 2013

 

Commission File Number: 000-53826

 

PLASTEC TECHNOLOGIES, LTD.

(Translation of registrant’s name into English)

 

Unit 01, 21/F, Aitken Vanson Centre, 61 Hoi Yuen Road, Kwun Tong, Kowloon, Hong Kong

(Address of Principal Executive Offices)

 

Indicate by check mark whether the registrant files or will file annual reports under cover Form 20-F or Form 40-F. Form 20-F x  Form 40-F o

 

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1): _____

 

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7): _____

 

Indicate by check mark whether the registrant by furnishing the information contained in this Form is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934. Yes o  No x

 

If “Yes” is marked, indicate below the file number assigned to the registrant in connection with Rule 12g3-2(b): 82-___________.

 

 
 

 

Unaudited Financial Statements

 

This Report of Foreign Private Issuer on Form 6-K by Plastec Technologies, Ltd. (“we, “us”, “our” or the “Company”) contains the Company’s unaudited financial results for its fiscal year 2013 second quarter and six months ended June 30, 2013. A copy of the press release issued by the Company announcing such financial results is attached to this report as Exhibit 99.1.

 

Forward Looking Statement

 

This Report of Foreign Private Issuer on Form 6-K contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, and Section 21E of the Securities Exchange Act of 1934. These statements relate to future events or the Company’s future financial performance. The Company has attempted to identify forward-looking statements by terminology including “anticipates”, “believes”, “expects”, “can”, “continue”, “could”, “estimates”, “intends”, “may”, “plans”, “potential”, “predict”, “should” or “will” or the negative of these terms or other comparable terminology. These statements are only predictions, uncertainties and other factors may cause the Company’s actual results, levels of activity, performance or achievements to be materially different from any future results, levels of activity, performance or achievements expressed or implied by these forward-looking statements. The information in this Report on Form 6-K is not intended to project future performance of the Company. Although the Company believes that the expectations reflected in the forward-looking statements are reasonable, the Company cannot and does not guarantee future results, levels of activity, performance or achievements. The Company’s expectations are as of the date this Report on Form 6-K is filed, and the Company does not intend to update any of the forward-looking statements after the date this Report on Form 6-K is filed to conform these statements to actual results, unless required by law.

 

The forward-looking statements included in this Report on Form 6-K are subject to risks, uncertainties and assumptions about our businesses and business environments. These statements reflect our current views with respect to future events and are not a guarantee of future performance. Actual results of our operations may differ materially from information contained in the forward-looking statements as a result of risk factors some of which include, among other things: continued compliance with government regulations; changing legislation or regulatory environments; requirements or changes affecting the business in which the Company is engaged; industry trends, including factors affecting supply and demand; labor and personnel relations; credit risks affecting the Company's revenue and profitability; changes in the plastic industry; the Company’s ability to effectively manage its growth, including implementing effective controls and procedures and attracting and retaining key management and personnel; changing interpretations of generally accepted accounting principles; general economic conditions; and other relevant risks detailed in the Company’s filings with the Securities and Exchange Commission.

 

 
 

  

PLASTEC TECHNOLOGIES, LTD.

 

CONSOLIDATED BALANCE SHEETS

(Hong Kong dollars in thousands, except number of shares, per share data and unless otherwise stated)

 

   (Unaudited)
 
June 30,
   (Audited)
 
December 31,
 
   2013   2012 
   HK$   HK$ 
         
ASSETS        
         
Current assets        
Cash and cash equivalents   297,848    309,862 
Trade receivables, net of allowances for doubtful accounts of HK$nil, and HK$nil as of December 31, 2012 and June 30, 2013, respectively   251,316    257,299 
Inventories   88,811    97,467 
Deposits, prepayment and other receivables   58,160    35,471 
Total current assets   696,135    700,099 
           
Property, plant and equipment, net   400,379    440,383 
Prepaid lease payments, net   22,943    23,719 
Other assets   10,883    14,503 
Deferred tax assets   2,732    - 
Intangible assets   438    438 
Total assets   1,133,510    1,179,142 

LIABILITIES AND SHAREHOLDERS’ EQUITY        
Current liabilities        
Bank borrowings   54,975    96,892 
Trade payables   134,219    151,436 
Other payables and accruals   95,909    115,715 
Tax payable   39,206    25,225 
Total current liabilities   324,309    389,268 
           
Deferred tax liabilities   -    11,629 
Total liabilities   324,309    400,897 
           
Commitments and contingencies   -    - 
           
Shareholders’ equity          
Ordinary shares (US$0.001 par value; 100,000,000 authorized 14,292,228 and 13,598,128 shares issued and outstanding as of December 31, 2012 and June 30, 2013, respectively)   107    112 
Additional paid-in capital   57,340    85,332 
Accumulated other comprehensive income   16,821    14,524 
Retained earnings   734,933    678,277 
Total shareholders’ equity   809,201    778,245 
           
Total liabilities and shareholders’ equity   1,133,510    1,179,142 

 

 
 

 

PLASTEC TECHNOLOGIES, LTD.

 

CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME (Unaudited)

(Hong Kong dollars in thousands, except number of shares, per share data and unless otherwise stated)

 

   For the 3-month
period ended June 30,
   For the 6-month
period ended June 30,
 
   2013   2012   2013   2012 
   HK$   HK$   HK$   HK$ 
                 
                 
Revenues   300,381    353,510    595,067    613,643 
Cost of revenues   (223,637)   (313,966)   (457,409)   (549,598)
Gross profit   76,744    39,544    137,658    64,045 
                     
Operating expenses, net                    
Selling, general and administrative expenses   (41,781)   (21,991)   (79,725)   (42,697)
Other income   2,644    530    2,730    1,117 
Gain/(loss) on disposal of property, plant and equipment   (2,705)   (511)   (2,772)   38 
Total operating expenses, net   (41,842)   (21,972)   (79,767)   (41,542)
                     
Income from operations   34,902    17,572    57,891    22,503 
                     
Interest income   54    49    105    94 
Interest expense   (290)   (554)   (678)   (1,214)
Income before income tax expense   34,666    17,067    57,318    21,383 
                     
Income tax expense   9,812    (3,044)   (662)   (4,618)
Net income   44,478    14,023    56,656    16,765 
                     
Other comprehensive income                    
Foreign currency translation adjustment   979    -    2,297    119 
Comprehensive income attributable to Plastec Technologies, Ltd.   45,457    14,023    58,953    16,884 
                     
Net income per share:                    
                     
Weighted average number of ordinary shares   13,666,376    14,342,697    13,725,640    14,685,790 
                     
Weighted average number of diluted
    ordinary shares
   13,666,376    14,342,697    13,725,640    14,685,790 
                     
Basic income per share
    attributable to Plastec Technologies, Ltd.
   

 

HK$3.3

    

 

HK$1.0

    

 

HK$4.1

    

 

HK$1.1

 
                     
Diluted income per share
    attributable to Plastec Technologies, Ltd.
   

 

HK$3.3

    

 

HK$1.0

    

 

HK$4.1

    

 

HK$1.1

 

 

 
 

 

PLASTEC TECHNOLOGIES, LTD.

 

CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY (Unaudited)

(Hong Kong dollars in thousands, except number of shares, per share data and unless otherwise stated)

 

   Ordinary shares       Accumulated         
   Number of shares
outstanding
   Amount   Additional
paid-in
capital
  

other
comprehensive

income

   Retained
earnings
  

Shareholders’

equity

 
       HK$   HK$   HK$   HK$   HK$ 
Balance at April 30, 2012
    and at May 1, 2012
   14,352,903    112    77,967    15,514    618,454    712,047 
                               
Net income for the year   -    -    -    -    59,823    59,823 
Share repurchases   (60,675)   -    (2,840)   -    -    (2,840)
Capital contribution   -    -    10,205    -    -    10,205 
Cumulative translation
     adjustment
   -    -    -    (990)   -    (990)
 
Balance at December 31, 2012
and at January 1, 2013
   14,292,228    112    85,332    14,524    678,277    778,245 
                               
Net income for the period   -    -    -    -    56,656    56,656 
Share repurchases   (694,100)   (5)   (32,479)   -    -    (32,484)
Warrant repurchases (Note)             (31)             (31)
Capital contribution   -    -    4,518    -    -    4,518 
Cumulative translation
    adjustment
   -    -    -    2,297    -    2,297 
 
Balance at June 30, 2013
   13,598,128    107    57,340    16,821    734,933    809,201 

 

Note: 80,000 warrants were re-purchased during the period

 

 
 

 

PLASTEC TECHNOLOGIES, LTD.

 

CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)

 

(Hong Kong dollars in thousands, except number of shares, per share data and unless otherwise stated)

 

   For the 6-month
period ended June 30,
 
   2013   2012 
   HK$   HK$ 
Operating activities        
Net income   56,656    16,765 
Adjustments to reconcile net income to net cash provided by operating activities:          
Depreciation and amortization   64,509    78,238 
Loss/(gain) on disposal of property, plant and equipment   2,772    (38)
Deferred tax credit   (14,361)   - 
Changes in operating assets and liabilities:          
Trade receivables   5,983    (82,937)
Inventories   8,655    12,398 
Deposits, prepayment and other receivables   (22,690)   (10,551)
Trade payables   (17,217)   9,865 
Other payables and accruals   (19,805)   14,487 
Tax payables   13,981    4,945 
Net cash provided by operating activities   78,483    43,172 
           
Investing activities          
Purchase of property, plant and equipment   (19,842)   (32,352)
Proceeds from disposal of property, plant and equipment   1,833    5,997 
Deposits for purchase of property, plant and equipment   (353)   (10,883)
Net cash used in investing activities   (18,362)   (37,238)
           
Financing activities          
Repurchases of shares and/or warrants   (32,515)   (2,840)
Net repayment of bank borrowings   (41,917)   (10,204)
Repayment of capital lease obligations   -    (1,423)
Net cash used in financing activities   (74,432)   (14,467)
           
           
Net decrease in cash and cash equivalents   (14,311)   (8,533)
           
Effect of exchange rate changes on cash and cash equivalents   2,297    119 
           
Cash and cash equivalents, beginning of period   309,862    187,072 
Cash and cash equivalents, end of period   297,848    178,658 
           
Supplementary disclosures of cash flow information:
          
Interest paid, net   573    1,120 
Income taxes paid/(refunded)   1,043    (327)

 

 
 

 

Plastec Technologies, Ltd.

Management discussion and analysis

 

General

 

The unaudited consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“US GAAP”). The preparation of financial statements in conformity with US GAAP requires management to make estimates and assumptions that reported amounts of assets and liabilities at the date of the financial statements and the amount of expenses reported during the period. Actual results could differ from those estimates. Unless otherwise indicated, all financial information presented in HK$ may be converted to US$ using the exchange rate of 7.8 HK$ for every 1 US$.

 

Results of Operations

 

Operating results for the second quarter ended June 30, 2013 compared to the second quarter ended June 30, 2012

 

We recorded an approximately 15% decline in revenue for the second quarter ended June 30, 2013 to HK$300.4 million compared to the corresponding period in the prior year. Whilst we continued our efforts in soliciting sales orders from existing customers for their new products launchings as well as orders from new customers, overall our sales declined during the period due to a reduction in lower margin products orders from our existing customers.

 

Despite the foregoing revenue decline, we recorded increased gross profit by approximately 94.1% to HK$76.7 million compared to the corresponding period in the prior year. The increased gross profit was attributable to better margins for those new products launched by our customers compared to lower margins product mix in the corresponding period in the prior year due to the difficult economic environment during that time, and also our on-going efforts in streamlining our manufacturing process and controlling direct wages and factory overheads, within the product mix requirements. As a result, our gross profit margin improved to 25.5% from 11.2% compared to the corresponding period in the prior year.

 

Total selling, general and administrative expenses increased by approximately 90.0% to HK$41.8 million compared to the corresponding period in the prior year, mainly as a result of increased salary and allowances for supervisory and administration staff during the period.

 

We recorded a tax credit of HK$9.8 million in the second quarter ended June 30, 2013 compared to an income tax expense of HK$3.0 million in the corresponding period in the prior year. The tax credit resulted from disposals of certain fixed assets associated with deferred tax liabilities that had to be eliminated and credited to the income statement.

 

Net income after tax increased by approximately 217.2% to HK$44.5 million in the second quarter ended June 30, 2013, compared to net income after tax of HK$14.0 million in the corresponding period in prior year.

 

Operating results for the six months ended June 30, 2013 compared to the six months ended June 30, 2012

 

Revenue for the six months ended June 30, 2013 decreased by approximately 3.0% to HK$595.1 million compared to the corresponding period in the prior year. However, we reported an increased and improved gross profit to HK$137.7 million in the six months ended June 30, 2013 compared to HK$64.0 million in the corresponding period in the prior year. In addition to our efforts in reducing costs of revenue, the improvement resulted from better margins for those new products launched by our customers compared to lower margins product mix in the corresponding period in the prior year due to the difficult economic environment during that time. Accordingly, our gross profit margin improved to 23.1% compared to 10.4% in the corresponding period in the prior year.

 

Total selling, general and administrative expenses increased by approximately 86.7% to HK$79.7 million compared to the corresponding period in the prior year mainly as a result of increased salary and allowances for supervisory and administration staff during the six month period.

 

 
 

 

Income tax expense, after the tax credit, was HK$0.7 million compared to HK$4.6 million in the corresponding period in the prior year.

 

We recorded net income after tax of HK$56.7 million in the six months ended June 30, 2013, compared to net income after tax of HK$16.8 million in the corresponding period in prior year, or increased by approximately 237.9%.

 

Balance sheet positions as at June 30, 2013 compared to December 31, 2012

 

Total assets decreased by HK$45.6 million or approximately 3.9% to HK$1,133.5 million as at June 30, 2013 compared to HK$1,179.1 million in the corresponding period in the prior year. This decrease was mainly attributed to a HK$40.0 million decrease in net book value of fixed assets, a HK$12.0 million decrease in cash and cash equivalents after paying for shares and publicly held warrants repurchased during the period, and a HK$8.7 million decrease in inventories, against a HK$22.7 million increase in deposits, prepayment and other receivables.

 

Total liabilities decreased by HK$76.6 million or approximately 19.1% to HK$324.3 million as at June 30, 2013 compared to HK$400.9 million in the corresponding period in the prior year. This decrease was mainly attributed to a HK$41.9 million decrease in bank borrowing, a HK$19.8 million decrease in other payables and accruals, a HK$17.2 million decrease in trade payables, and a HK$11.7 million elimination in deferred tax liabilities, against a HK$14.0 million increase in tax payable.

 

Cashflow analysis

 

We have relied primarily upon internally generated funds and bank borrowings to finance our operations and expansion.

 

For the six months ended June 30, 2013, we recorded HK$14.3 million cash outflow as compared to HK$8.5 million cash outflow in the same corresponding period in the prior year. We generated HK$78.5 million cash inflow from operating activities as compared to HK$43.2 million cash inflow in the same corresponding period in the prior year. The increase was mainly offset by net cash used in financing activities of HK$74.4 million including HK$32.5 million used in shares and publicly held warrants repurchases and HK$41.9 million for net repayment of bank borrowings during the period, while our net cash used in financing activities was HK$14.5 million mainly for net repayment of bank borrowings in the same corresponding period in the prior year. Net cash used in investing activities for the period was HK$18.4 million for purchase of property, plant and equipment, compared to HK$37.2 million in the same corresponding period in the prior year which included the new buildings construction in our Shenzhen plant in the PRC.

 

Off-Balance Sheet Arrangements

 

The Company has not entered into any financial guarantees or other commitments to guarantee the payment obligations of third parties. The Company has not entered into any derivative contracts that are indexed to its shares and classified as shareholder’s equity or that are not reflected in its combined financial statements. Furthermore, the Company does not have any retained or contingent interest in assets transferred to an unconsolidated entity that serves as credit, liquidity or market risk support to such entity. The Company does not have any variable interest in any unconsolidated entity that provides financing, liquidity, market risk or credit support to it or that engages in leasing, hedging or research and development services with the Company. There are no off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on the Company’s financial condition, net sales or expenses, results of operations, liquidity, capital expenditures or capital resources that are material to an investor.

 

 
 

 

SIGNATURE

 

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 

  PLASTEC TECHNOLOGIES, LTD.
   
   
  By: /s/ Kin Sun Sze-To
  Name: Kin Sun Sze-To
  Title: Chief Executive Officer

 

Dated: August 14, 2013