TORONTO, Sept. 29 /CNW/ - Kingsway International Holdings Limited (TSX:
KIH), a leading Hong Kong based provider of international financial services,
today reported its financial results for the fourth quarter and the 2008
fiscal year ended June 30, 2008, and a restatement of balances for the first
three quarters of the fiscal year ended June 30, 2008. All figures are in U.S.
dollars unless otherwise specified.
The financial performance for Kingsway International Holdings Limited
("Kingsway" or the "Company") and its subsidiaries (collectively the "Group")
for the fourth quarter were negatively impacted by the weak markets in Hong
Kong, the People's Republic of China and internationally.
Financial highlights for the fiscal year include:
- Net loss was $15.3 million, or $0.191 per share, compared with a net
income of $17.4 million, or $0.218 per share, for the same period last
- Revenue from services and other income increased to $23.8 million
compared with $19.6 million for the same period last year; and
- Trading loss on investment in marketable securities was $15.6 million
compared with a profit of $36.4 million for the same period last year.
Financial Results for the Fourth Quarter
The Group reported negative total revenue for the fourth quarter of
$7.2 million compared with revenue of $30.5 million for the corresponding
quarter of fiscal 2007. Revenue from service and other income decreased to
$3.7 million from $8.3 million for the fourth quarter of last year. Trading
loss on investment in marketable securities was $10.8 million compared to a
gain of $22.2 million for the corresponding quarter last year, with the
decrease being attributable primarily to the continued weakness of the Hong
Net loss for the quarter was $9.1 million, or $0.113 per share, compared
with a net income of $8.6 million, or $0.107 per share for the same period
Financial Results for the Fiscal Year
Total revenue for the fiscal year decreased to $8.2 million from $56.0
million in fiscal 2007. Revenue from services and other income increased to
$23.8 million from $19.6 million for the same period last year. The service
revenue benefited from an active and volatile Hong Kong market. Trading loss
on investment in marketable securities was $15.6 million for fiscal 2008
compared to a profit of $36.4 million for fiscal 2007. This was the result of
the continued drop in market value of investments since November 2007.
Selling and administrative expenses increased 7% to $25.0 million from
$23.4 million for the same period in fiscal 2007. The increase was due to the
combined effects of a reduction in discretionary staff cost as a result of the
loss incurred, and offset by higher operation overheads due to an increase in
recurring business volumes.
In the fiscal year, the Group disposed of its 100% interest in Golden
China Management Inc., the subsidiary company that managed Golden China
Resources Corporation, a mining company focused on China that was listed on
the TSX until it was taken over by SinoGold Mining Ltd. in December 2007. The
Group realized a gain of $1.4 million.
For the fiscal year, the Group recorded a loss before income taxes,
non-controlling interests and income from discontinued operations of $18.5
million compared with income of $32.6 million a year ago.
The Company declared a final dividend for fiscal 2008 in the amount of
CDN$0.02 per share that will be paid on or about November 26, 2008.
Restatement of Balances for the First Three Quarters of 2008
During the preparation of the annual financial statements for the fiscal
year ended June 30, 2008, it was determined that certain foreign currency
translation differences in respect of investment property holdings were
incorrectly included in the determination of income in each of the Company's
quarters ended September 2007, December 2007 and March 2008. The impact on the
consolidated balance sheets and consolidated statements of operations is
summarized in the management's discussion and analysis for the year ended June
30, 2008, which is available on SEDAR at www.sedar.com.
The Company is in the process of implementing a business plan to create
an internationally focused proprietary investment and advisory services group.
The new group will concentrate on the natural resource and energy sectors and
the developing business opportunities being created in these sectors in Asia,
particularly China. The recent turmoil in the financial sector has resulted in
a significant loss of value in all markets but will also create investment
opportunities. Both Management and the Board of the Company take a long term
view of the Group's growth potential in Asia and believe that the Company is
well positioned to benefit from continuing growth of China and South-east Asia
and their ongoing need for natural resources.
About Kingsway International Holdings Limited
The Company is listed on the main board of the Toronto Stock Exchange
(TSX) under the symbol KIH. The Group is a leading middle tier financial
services provider, linking the global investment community with PRC's high
growth economy. In addition to engaging in proprietary investment activities,
the Group offers a variety of complementary, client focused services through
its investment banking, brokerage and asset management divisions.
Founded in 1990, the Group operates from offices in Hong Kong, Beijing,
Shanghai, Shenzhen and Toronto.
Forward-Looking (Safe harbour) Statements
This press release contains forward-looking statements that are based on
the beliefs of Management and reflect the Group's current expectations. In
certain cases, forward-looking information can be identified by the use of
words such as "estimate", "project", "belief", "anticipate", "intend",
"expect", "plan", "predict", "may", "should", "will," or variations of such
words and phrases or state that certain actions, events or results "may",
"could", "would", "might" or "will be taken", "occur" or "be achieved."
Forward-looking information involves known and unknown risks, uncertainties
and other factors that may cause actual results, performance or achievements
to be materially different from any future results, performance or
achievements expressed or implied by the forward-looking information. There
can be no assurance that forward-looking information will prove to be
accurate, as actual results and future events could differ materially from
those anticipated in such statements. Accordingly, investors should not place
undue reliance on forward-looking information. Forward-looking information is
provided as of the date of this press release, and the Company assumes no
obligation to update or revise them to reflect new events or circumstances.
For further information:
For further information: Gary Quedado, Kingsway Group, (416) 861-3099
Ext. 238, firstname.lastname@example.org