TORONTO, Feb. 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 December 31, 2014. All figures quoted are in U.S. dollars.
The Group (Sunwah International and its subsidiaries) recorded a net loss of $1.8 million in the second quarter of its 2015 fiscal year against a loss of $0.2 million in last year's comparable period, bringing the year-to-date net loss to $2.7 million (FY2014: $0.1 million). The quarter's shortfall was principally the result of unrealized mark-to-market losses in the Group's proprietary investments totaling $1.7 million, down substantially from a gain of $1.6 million last year, owing to widespread stock market volatility during the period and the underperformance of several small cap equities in Sunwah International's portfolio. To help stabilize returns in the future, the Company is focused on increasing the proportion of its listed debt securities in order to diversify investment risk.
Commission and fee income increased slightly from $5.4 million to $5.5 million for the first half of Fiscal 2015 and totaled $2.7 million for the second quarter (Q2 FY2014: $3.1 million). While down year-over-year, the current period's figure is consistent with recent quarters and reflects steady activity within Sunwah International's fee generating businesses. Interest and dividend income increased slightly from $0.4 million in Q2 FY2014 to $0.5 million in Q2 FY2015, attributable to gains in the brokerage division's margin loans portfolio. General and administrative expenses increased to $4.4 million from $4.2 million due to elevated commission expenses in line with the Group's recent heightened capital markets participation.
Sunwah International continued to amplify its equity capital markets (ECM) activities during the quarter, increasing revenues within this segment by 17%. With a strengthened team and capital base moving into the second half of FY2015, the corporate finance/ECM division is positioned to take on increased business and to capitalize on new regulatory changes and schemes that promote Asian financial market growth, including the Shanghai Hong Kong Stock Connect program (designed to open capital flows in and out of China and viewed by experts as a key step in integrating this economy with the global financial system).
Financial highlights for Q2 Fiscal 2015 include:
- Net loss of $1.8 million (Q2 FY2014: Net loss of $0.2 million).
- Total revenues of $1.5 million (Q2 FY2014: $5.1 million).
- Commission and fee income of $2.7 million (Q2 FY2014: $3.1 million).
- Increased interest and dividend income to $0.5 million (Q2 FY2014: $0.4 million).
- Net loss of $1.7 million on the disposal and mark-to-market losses of financial assets/liabilities (Q2 FY2014: Net gain of $1.6 million).
- General and administrative expenses of $4.4 million (Q2 FY2014: $4.2 million).
"Despite this quarter's lackluster financial performance, Sunwah International continues to see solid operational improvements, particularly related to our corporate finance and ECM teams where we are successfully implementing strategies to capture greater transaction volumes," said Douglas Betts, President and Chief Executive Officer of Sunwah International. "While guiding the Group with caution amid changing economic times, as we move forward we will continue to focus efforts where we excel and to define our unique niche in order to bring our undervalued share price more in line with the Company's intrinsic value."
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. Particularly in the nearer term, Sunwah International is also focused on Malaysia, Vietnam and the Philippines, countries that are increasing in strength alongside China's development. Management believes these Southeast Asian nations will follow China's lead and show significant growth and investment opportunities in coming years.
For more information on Sunwah International's year end 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 period ended December 31, 2014 should be read in conjunction with the audited consolidated financial statements for the quarter ended December 31, 2014 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 2015 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]