SOURCE: ACL Semiconductors, Inc.

June 14, 2010 16:00 ET

ACL Semiconductors Reports Record First Quarter 2010 Performance

Positioned as Leading Distributor of Samsung Memory Products in Southern China

HONG KONG--(Marketwire - June 14, 2010) -  ACL Semiconductors (OTCBB: ACLO)

Quarterly Highlights:

  • Net revenue up 58.4% year over year to $99.01 million
  • Net income grew 23% over last year to $1.4 million
  • Gross margin at 2.9%
  • Diluted earnings per share at $0.05 compared to $0.04 a year ago

ACL Semiconductors (OTCBB: ACLO), a leading China-based distributor of Samsung memory electronic products, reported financial results for the first quarter ended March 31, 2010.

Mr. Alan Yang, Chairman and Chief Executive Officer of ACL Semiconductors, commented, "These outstanding financial results reflect the success of our business model and the macro economic factors across Hong Kong and Southern China. Revenues for the quarter reflect both increased prices and robust demand for electronic components. Fundamental to our continuing growth is our strong relationship with Samsung, which depends on ACL for continuing research and market intelligence to manage their product production and allocation. 

"Momentum in the electronic sector particularly for memory products continued into the second quarter as demand for consumer electronics remained robust. We are also gaining increased confidence in our outlook as we continue to benefit from the broader rebound in the semiconductor sector. The electronics business is expected to grow in the forthcoming year and we are ready to take advantage of the foreseeable growth in China's market."

For the first quarter of 2010, ACL Semiconductors reported net revenue of $99.01 million, up 58.4% over $62.5 million for the first quarter 2009. The year over year revenue growth was primarily due to an increase of the average selling prices and continuous demand in memory products in the PRC market. Net income for the first quarter ended March 31, 2010 was $1.4 million compared to net income of $1.2 million for the first quarter of 2009. Earnings per diluted share was $0.05 for the first quarter 2009, as compared to $0.04 in the year ago quarter.

Gross profit for the first quarter 2010 was $2.8 million, down 1% from $2.9 million for the first quarter 2009 impacted by increased cost of sales as the rebound in the electronics market continued and saturization occurred. Gross margin for the first quarter of 2010 was 2.9%, down from 4.6% for the first quarter 2009. The decrease in gross margins for the first quarter 2010 compared to the first quarter 2009 is partially due to the increase in cost of sales when compared to the cost of sales in the corresponding quarter in 2009. During the first quarter of 2009 we experienced increased gross profit as a consequence of higher average selling prices and lower cost of sales as the market experienced a rebound in increased demand together with reduced supply.

Mr. Yang continued, "We are proud of the distribution and product research we continue to supply to Samsung and the role we play in assuring that Samsung receives up to date information on macro market trends and specific data regarding the overall memory product demand and specific product details.

"During the first quarter we took initiatives and reviewed policy changes to improve internal financial controls. Specific steps include evaluation of board composition and new procedures to oversee purchase and disbursements. We expect that these initiatives will increase the reliance and responsibility of our financial planning group and the ability to stay in compliance with SEC regulations."

About ACL Semiconductors
ACL Semiconductors distributes electronic components under the "Samsung" brand name to the Hong Kong and South China markets. The memory chips are used from everything from a mobile phone, digital camera and laptop computer to an MP3 player or Wi-Fi product. For more information about ACL Semiconductors please visit ACL Semiconductors' corporate website at http://www.acl-semicon.com.

Forward-Looking Statements
This information contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. In particular, when used in the preceding discussion, the words "plan," "confident that," "believe," "scheduled," "expect," or "intend to," and similar conditional expressions are intended to identify forward-looking statements within the meaning of the Act and are subject to the safe harbor created by the Act. Such statements are subject to certain risks and uncertainties and actual results could differ materially from those expressed in any of the forward-looking statements. Such risks and uncertainties include, but are not limited to, market conditions, the availability of components and successful production of the company's products, general acceptance of the company's products and technologies, competitive factors, timing, and other risks described in the company's SEC reports and filings.

ACL SEMICONDUCTORS INC. AND SUBSIDIARIES
Condensed Consolidated Statements of Income (Unaudited)

               
    Three Months Ended  
    March 31, 2010   March 31, 2009  
           
          (Restated)  
               
Net sales              
  Related parties   $ 781,896   $ 316,422  
  Other     98,229,166     62,190,706  
  Less discounts to customers     --     (6,989 )
               
               
      99,011,062     62,500,139  
               
               
Cost of sales     96,184,458     59,642,180  
               
               
  Gross profit     2,826,604     2,857,959  
               
Operating expenses              
  Selling     24,802     22,177  
  General and administrative     1,057,869     1,355,453  
               
               
Income from operations     1,743,933     1,480,329  
               
Other income (expenses)              
  Rental income     30,000     22,308  
  Interest expense     (95,164 )   (166,892 )
  Management and service income     8,321     6,538  
  Net income on cash flow hedge     15,410     20,349  
  Interest income     93     33,631  
  Loss on disposal of fixed assets     (308 )   --  
  Exchange differences     (6,203 )   (9,029 )
  Miscellaneous     960     7  
               
               
Income before income taxes provision     1,697,042     1,387,241  
               
Income taxes provision     256,066     217,949  
               
               
Net Income   $ 1,440,976   $ 1,169,292  
               
               
Earnings per share - basic and diluted   $ 0.05   $ 0.04  
               
               
Weighted average number of shares - basic and diluted     28,729,936     28,534,380  
               

ACL SEMICONDUCTORS INC. AND SUBSIDIARIES
Condensed Consolidated Balance Sheets (Unaudited)
LIABILITIES AND STOCKHOLDERS' EQUITY

               
    As of March 31, 2010 (Unaudited)   As of December 31, 2009  
           
Current liabilities:              
  Accounts payable   $ 19,802,763   $ 23,838,753  
  Accrued expenses     603,583     527,582  
  Lines of credit and loan facilities     10,230,089     9,013,813  
  Current portion of long-term debt     318,046     318,972  
  Current portion of capital lease     328,292     318,135  
  Income tax payable     732,807     505,078  
  Due to stockholders for converted pledged collateral     112,385     112,385  
  Other current liabilities     297,829     282,475  
               
               
    Total current liabilities     32,425,794     34,917,193  
               
Long-term liabilities              
  Long-term debts, less current portion     2,669,597     2,747,981  
  Capital lease, less current portion     128,556     146,117  
  Deferred tax liabilities     19,468     19,468  
               
               
    Total long-term liabilities     2,817,621     2,913,566  
               
               
Total Liabilities     35,243,415     37,830,759  
               
               
Stockholders' equity:              
  Common stock - $0.001 par value; 50,000,000 shares authorized; 28,729,936 issued and outstanding as of March 31, 2010 and December 31, 2009 respectively     28,730     28,730  
  Additional paid in capital     3,658,627     3,658,627  
  Retained earnings     2,395,161     954,185  
               
               
    Total stockholders' equity     6,082,518     4,641,542  
               
               
Total Liabilities and Stockholders' equity     41,325,933     42,472,301  
               

ACL SEMICONDUCTORS INC. AND SUBSIDIARIES
Condensed Consolidated Balance Sheets (Unaudited)

               
    As of March 31, 2010 (Unaudited)   As of December 31, 2009  
           
               
Current assets:              
  Cash and cash equivalents   $ 3,330,275   $ 2,001,805  
  Restricted cash     2,088,170     2,086,504  
  Accounts receivable, net of allowance for doubtful accounts of $0 for 2010 and 2009     13,492,554     12,434,386  
  Inventories, net     3,365,179     6,048,116  
  Other current assets     163,358     274,351  
               
               
    Total current assets     22,439,536     22,845,162  
               
Property, equipment and improvements, net of accumulated depreciation and amortization     8,221,617     8,179,765  
               
Other deposits     182,116     213,535  
               
Amount due from Aristo / Mr. Yang     10,482,664     11,233,839  
               
               
Total Assets     41,325,933     42,472,301  
               

 

Contact Information

  • Investor Contacts:
    Kenneth Lee
    Vice President
    ACL Semiconductors, Inc.
    +1 415-812-8626
    Email Contact

    Joseph Villalta
    The Ruth Group
    +1 646-536-7003
    Email Contact

    Media Contact:
    Jason Rando
    The Ruth Group
    +1-646-536-7025
    Email Contact