Grand Power Logistics Group Inc.
TSX VENTURE : GPW

Grand Power Logistics Group Inc.

June 01, 2015 17:17 ET

Grand Power Logistics Reports Financial Results for Q1 2015

HONG KONG, CHINA and CALGARY, ALBERTA--(Marketwired - June 1, 2015) - Grand Power Logistics Group Inc. ("Grand Power" or the "Corporation") (TSX VENTURE:GPW), a leading international logistics provider based in Hong Kong, is pleased to announce its consolidated financial results for the quarter ended March 31, 2015. All amounts are expressed in the US dollar (US$) except where noted.

Selected Q1 2015 Financial Highlights

(in thousands except per share or % data) Mar. 31, 2015 Mar. 31, 2014 Change
Revenue $12,478 $15,873 -21.39%
Gross profits $1,391 $1,211 +14.79%
Gross margins 11.14% 7.63% +3.51%
Net profit (loss) for the period $25 $437 -$411
Net profit (loss) (owners of the Corporation) $26 $433 -$406
Earnings (loss) per share $0.0003 $0.006 -$0.0057
Mar. 31, 2015 Dec. 31, 2014 Change
Total assets $24,770 $33,731 -26.57%
Working capital $740 $1,111 -33.39%
Total liabilities $12,184 $21,131 -42.34%
Shareholders' Equity (owners of Corporation) $12,492 $12,472 +0.16%

"The company experienced lower sales revenue for the quarter due to a transitional shift in focus by the company from some lower margin to higher margin business and slightly weaker demand. Therefore, the company correspondingly experienced a 14.79% increase in its gross profit due to improved gross profit margin. As well, the company also experienced an increase in its income from operations. The income from operations for the quarter was $101,946 compared to a loss of $113,768 in 2014. The company's income for the quarter decreased to $25,265 from $436,683 in 2014 primarily due to a decrease of the gain on revaluation of investment property and other non-operating incomes," said Mr. Ricky Chiu, President and CEO of Grand Power.

Q1 2015 Financial Results

Sales revenue for the three months ended March 31, 2015 decreased by $3,394,929 (21.39%) to $12,477,642 from $15,872,571 in 2014. The decrease in sales revenue is due to a transitional shift in focus by the company from some lower margin to higher margin business and slightly weaker demand.

Gross profit for the three months ended March 31, 2015 increased by 14.79% to $1,390,527 compared to $1,211,401 in 2014, and gross profit margin increased to 11.14% compared to 7.63% for 2014.

The income from operations for the three months ended March 31, 2015 increased to $101,946 compared to a loss of $113,768 for 2014. The improvement is primarily due to a higher gross profit margin and a decrease in general operating expenses.

General operating expenses for the three months ended March 31, 2015 decreased by 2.76% to $1,288,581 compared to $1,325,169 in 2014.

The net profit for the three months ended March 31, 2015 was $25,265 compared to $436,683 in 2014. The decrease in net profit for the year was primarily due to the decrease of the gain on revaluation of investment property and other non-operating incomes. The net profit attributable to the owners of the Corporation for the three months ended March 31, 2015 was $26,386 compared to a net profit of $432,539 in 2014.

Tonnage shipped decreased by 1,674 tonnes (23.72%) to 5,383 tonnes for the three months ended March 31, 2015 compared to 7,057 tonnes in 2014.

For the three months ended March 31, 2015, the Corporation generated $11,350,002 (91.0%) of its revenue from its traditional co-loading air freight business, $210,119 (1.7%) of revenue from its direct sales air freight business and $917,521 (7.4%) of revenue from its ocean freight business. During the corresponding period of 2014, the Corporation generated $11,715,562 (90.2%) of its revenue from its traditional co-loading air freight business, $641,945 (4.9%) of revenue from its direct sales air freight business and $636,964 (4.9%) of revenue from its ocean freight business.

Hong Kong is still the Corporation's largest operating centre during the first quarter of 2015, generating $10,772,458 (86.3%) of the Corporation's total revenue whereas China and other regions accounted for $1,654,206 (13.3%) and $50,978 (0.4%) respectively. For the corresponding period in 2014, Hong Kong, China and other regions accounted for $11,281,652 (86.8%), $1,384,237 (10.7%), and $328,582 (2.5%), respectively, of the Corporation's total revenue.

Outlook

"In 2014, the company received approval from its shareholders to diversify its business by making acquisitions and investments in various industry sectors in addition to the core logistics business of the company. Since then, the company had made one investment in a commercial property in Macau and will continue to seek for more investment opportunities in the future," said Ricky Chiu, President and CEO of Grand Power. He added "In addition, we are aiming to increase our higher margin business, and expand and develop multiple additional streams of revenue within our core business, both in Hong Kong and within China."

About Grand Power Logistics Group Inc.

Grand Power operates principally through its wholly owned Hong Kong based subsidiary, Grand Power Express International Limited (GP Express), and provides air-freight forwarding and sea-freight services, customs brokerage, logistics, warehousing and distribution, as well as other value added services. GP Express has established operations in various regions, particularly in the Greater Pearl River Delta (GPRD), China's largest economic region. GP Express' Subsidiaries or Branch Offices in this region are located in Macau, Shenzhen and Guangzhou. GP Express also operates in other regions through Subsidiaries and Branch Offices or Supporting Offices in Shanghai, Beijing, Tianjin and Xiamen. For more information, please visit http://www.grandpowerlogistics.com.

Forward-looking Information

Statements included in this press release that are not historical facts may be considered "forward looking statements." All estimates and statements that describe the Company's objectives, goals or future plans are forward looking statements. Forward-looking statements involve inherent risks and uncertainties where actual results could differ materially from those currently anticipated.

Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

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