TORONTO, Nov. 13, 2015 /CNW/ - Sunwah International Limited,TSX: SWH (the "Company"), an Asian based financial services firm, today announced its financial results for the quarter ended September 30, 2015. All figures quoted are in U.S. dollars.
Sunwah International and its subsidiaries (collectively "the Group") recorded a net loss attributable to the owners of $2.3 million for the first quarter of its 2016 fiscal year, comparing with $0.8 million in Q1 FY2015. The period's shortfall was the product of a sharp drop in trading income following a worldwide stock market correction during the quarter, resulting in unrealized mark-to-market losses within the Group's proprietary trading portfolio of $4.3 million (Q1 FY2015: loss of $0.7 million).
The diminished market conditions, which were felt particularly severely in China, predictably had an impact on the Group's fee generating business. Commission and fee income decreased to $2.1 million in Q1 FY2016 from $2.9 million in the same quarter of FY2015, the result of a drop in advisory service revenues within the Company's corporate finance group and reduced commission and margin financing income from its brokerage division. Interest and dividend income increased slightly year-over-year from $0.4 million to $0.6 million in the current quarter while selling and administrative expenses decreased to $3.8 million (Q1 FY2015: $4.2 million) in line with the flow of revenue.
Despite depressed markets worldwide and dampened activities within Sunwah International's Capital Markets Group during the quarter, the Company is pleased to report improved financial performances overall within its brokerage and corporate finance/equity capital markets (ECM) groups. Alongside a recent stock market revival, the Company is also optimistic that the vibrant activity achieved within its corporate finance and ECM division prior to the market correction will resume, particularly following the November 6th lifting of a suspension on IPOs in China (initially put in place in July to help soften the market correction). China's IPO market is a lucrative area of business for the Company as a globally focused financial services provider based in Hong Kong.
Financial highlights for Q1 Fiscal 2016 include:
- Loss attributable to owners of the Company of $2.3 million (Q1 FY2015: $0.8 million).
- Commission and fee income of $2.1 million (Q1 FY2015: $2.9 million).
- Interest and dividend income of $0.6 million (Q1 FY2015: $0.4 million).
- Net loss of $4.3 million on the disposal and mark-to-market gains of financial assets/liabilities (Q1 FY2015: loss of $0.7 million).
- General and administrative expenses of $3.8 million (Q1 FY2015: $4.2 million).
"While we are of course less than pleased with our overall financial performance, during the period Sunwah International's fee generating businesses managed to remain more or less stable relative to the extraordinary market conditions that served as this quarter's backdrop," said Michael Choi, Chief Executive Officer of Sunwah International. "As stock markets continue in their recovery, this gives us cause for optimism while underscoring the validity of our revenue diversification strategies. We will continue to strengthen our fee generating prospects throughout Fiscal 2016 in order to help stabilize future earnings amid uncertain markets."
Sunwah International represents the financial services division of Sunwah Group, a highly reputable Asian based, international conglomerate.
Sunwah International's growth strategy focuses on China and parts of Southeast Asia. Specifically, the Company is positioning itself to capitalize on China's continued long-term potential and anticipated solid growth in the industries affected most by its development, including infrastructure and real estate, where the Company offers unique and targeted expertise as well as an extensive strategic investor network.
For more information on Sunwah International's first quarter operating results, please see the Management's Discussion and Analysis (MD&A) and compete financial statements, which are filed on SEDAR and also available on the Company's website at www.sunwahinternational.com.
About Sunwah International Limited
Sunwah International Limited (TSX: SWH) is a strategically positioned asset-based financial services provider, linking the global investment community with China's high growth economy. Founded in 1990 and backed by prominent Hong Kong based conglomerate, Sunwah Group, a key element of the Company's growth strategy involves identifying and advancing select international opportunities that are poised to benefit from proliferating consumerism in China and development in key areas of Southeast Asia. Sunwah International is uniquely positioned to capitalize on this demand and the global economic changes stemming from this shift, leveraging a 24-year track record and an extensive relationship/strategic investor network throughout Asia. The Company operates from six offices located in Hong Kong, Beijing, Shanghai, Shenzhen, Macau and Toronto.
The organization's primary Hong Kong based subsidiary, Sunwah Kingsway Capital Holdings Limited, is listed on the Stock Exchange of Hong Kong under the stock code 00188. Sunwah Kingsway is licensed to provide a range of financial solutions in Hong Kong and abroad that include award-winning brokerage services and innovative corporate finance offerings.
This press release announcing the financial results for Sunwah International's fiscal quarter ended September 30, 2015 should be read in conjunction with the audited consolidated financial statements and management's discussion and analysis of Sunwah International Limited (the "Company") and its subsidiaries. This press release contains "forward-looking statements" as defined under applicable Canadian securities laws. These statements include, but are not limited to, statements made concerning our 2016 objectives, our strategies to achieve those objectives, as well as statements with respect to management's beliefs, plans, estimates, and intentions, and similar statements concerning anticipated future events, results, circumstances, performance or expectations that are not historical facts. Forward-looking statements generally can be identified by the use of forward-looking terminology such as "outlook", "objective", "may", "will", "expect", "intend", "estimate", "anticipate", "believe", "should", "plan" or "continue", or similar expressions suggesting future outcomes or events. Such forward-looking statements reflect management's current beliefs and are based on information currently available to management. 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.
Except as required by applicable law, management and the board of directors of the Company (the "Board of Directors") undertake no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events or otherwise.
SOURCE Sunwah International Limited
For further information: Kristen Humphrey, Sunwah International Limited, (416) 888-2323, [email protected]