HONG
KONG, Dec. 23, 2022 /PRNewswire/ -- Euro Tech
Holdings Company Limited (Nasdaq: CLWT) today reported its
unaudited financial results for the six months ended June 30, 2022.
The Company's business for the six months ended
June 30, 2022 ("1H 2022") was
severely affected by the COVID-19 pandemic-control measures in
China and Hong Kong, especially the strict lockdown
measures imposed in Shanghai from
March to May 2022.
The Company's revenues for 1H 2022 were US$6,730,000, a 33.1% decrease as compared
to US$10,054,000 for the six
months ended June 30, 2021 ("1H
2021"). Revenues from trading and manufacturing activities, and
engineering activities decreased by US$305,000 and US$3,019,000, respectively.
Gross profits decreased by 37.5% to US$1,888,000 for 1H 2022 as compared to
US$3,022,000 for 1H 2021. The
decrease was primarily due to the decrease in revenues from
engineering activities which is of higher gross profit margin
%.
Selling and administrative expenses decreased by US$142,000 to US$2,372,000 for 1H 2022 as compared to
US$2,514,000 for 1H 2021. The
decrease was principally due to the decrease in selling expenses
resulting from the decrease in revenues.
The Company's net loss for 1H 2022 was US$184,000 as compared to net income of
US$490,000 for 1H 2021 resulting from
decrease in revenues.
Mr. David, CEO of the company commented,
"China's severe "zero-COVID"
policy and the recent relaxation of COVID policy has significantly
affected our business performance for 2022. China's economy
had slowed amid macroeconomic headwinds and a slumping property
market. Global markets have been falling in the wake of the
Covid-19 pandemic, which has caused global supply chain disruption
for many industries. Russia-Ukraine war also set off an inflationary
spiral for many countries, leading to higher interest rates. Weak
overseas demand and the strict zero-COVID policy combined to reduce
our sales orders. The market could still be very uncertain and
challenging due to the high interest rates, global economic
slowdown and the likelihood of a recession in major economies.
In view of the poor economic environment, we have ceased the
business operations of Shanghai Euro Tech Limited ("SET") on
September 30, 2022 because SET has
suffered loss for the past few years during which it focused on the
manufacturing of analytical and testing instruments.
Although the overall business has been dropped in the first half
year of 2022, there are more shipowners and distributors in
overseas and China purchasing our
Ballast Water Treatment Systems ("BWTS") than in year 2021.
We have been receiving repeated orders from Thailand and Dubai for BWTS and industrial wastewater
business from a respectful food and beverage clients from
USA.
We are still positive to see more sales contracts from both BWTS
and industrial waste water treatment activities, especially after
the transition period of easing COVID policy in China and a new biodiversity policy (i.e.
which is in line with new global framework of United Nation
COP 15) has been launched in
China recently."
About BWTS
BWTS are an imminent requirement by The International Maritime
Organization ("IMO") to prevent the biological unbalance caused by
the estimated 12 billion tons of ballast water transported across
the seas by ocean-going vessels when their ballast water tanks are
emptied or refilled. In 2012, ballast water discharge standard
became a law in the US. Any vessel constructed in December 2013 or later will need to comply when
entering US waters, and existing vessels will follow shortly after.
IMO's Ballast Water Management Convention entered into force for
new-built vessels on September 8,
2017 after ratification by 52 States, representing 35.1441%
of world merchant shipping tonnage. In July
2017, IMO decided that the phase-in period for ballast water
system retrofits started on 8 September 2019.
The company obtained type approval certificate from China's Classification Society for its 200,
300, 500, 750, 1200 and 1250 Cubic Meters per hour BWTS in
2016.
The IMO convention stipulates that type approval for revised G8
requirements must be obtained for all BWTS installed on or after
October 28, 2020, and the company
have been in compliance with such requirements.
The ballast water port solution system is a system installed in
port to offer ballast water treatment services for ocean going
ships without their own BWTS and for those with damaged BWTS.
Certain statements in this news release regarding the Company's
expectations, estimates, present view of circumstances or events,
and statements containing words such as estimates, anticipates,
intends, or expects, or words of similar import, constitute forward
looking statements within the meaning of the Private Securities
Litigation Reform Act of 1995. Such statements indicate uncertainty
and the Company can give no assurance with regard to actual
outcomes. Specific risk factors may include, without limitation,
having the Company's offices and operations situated in
Hong Kong and China, doing business in China, competing with Chinese manufactured
products, competing with the Company's own suppliers, dependence on
vendors, and lack of long term written agreements with suppliers
and customers, development of new products, entering new markets,
possible downturns in business conditions, increased competition,
loss of significant customers, availability of qualified personnel,
negotiating definitive agreements, new marketing efforts and the
timely development of resources. See the "Risk Factor" discussions
in the Company's filings with the Securities and Exchange
Commission, including its Annual Report on Form 20-F for its fiscal
year ended December 31, 2021.
EURO TECH HOLDINGS COMPANY LIMITED
CONSOLIDATED BALANCE SHEETS
|
|
As of
June
30,
2022
(Unaudited)
|
As of
December
31,
2021
(Audited)
|
|
|
US$'000
|
US$'000
|
Assets
|
|
|
|
Current
assets:
|
|
|
|
Cash and cash
equivalents
|
|
5,805
|
5,269
|
Restricted
cash
|
|
1,537
|
1,411
|
Accounts receivable,
net
|
|
1,646
|
3,631
|
Prepayments and other
current assets
|
|
509
|
572
|
Contract
assets
|
|
4
|
74
|
Inventories
|
|
416
|
547
|
|
|
──────
|
──────
|
Total current
assets
|
|
9,917
|
11,504
|
|
|
──────
|
──────
|
|
|
|
|
Property, plant and
equipment, net
|
|
198
|
215
|
Investments in
affiliates
|
|
8,059
|
8,077
|
Goodwill
|
|
1,071
|
1,071
|
Operating
lease right-of-use assets
|
|
138
|
238
|
Deferred tax
assets
|
|
143
|
145
|
|
|
──────
|
──────
|
Total non-current
assets
|
|
9,609
|
9,746
|
|
|
──────
|
──────
|
Total
assets
|
|
19,526
|
21,250
|
|
|
══════
|
══════
|
|
|
|
|
Liabilities and
shareholders' equity
|
|
|
|
Current
liabilities:
|
|
|
|
Bank
borrowings
|
|
-
|
376
|
Accounts
payable
|
|
2,505
|
3,151
|
Contract
liabilities
|
|
1,354
|
1,076
|
Other payables and
accrued expenses
|
|
1,449
|
1,585
|
Current portion of
long-term operating lease obligations
|
|
117
|
175
|
Income tax
payable
|
|
42
|
42
|
|
|
──────
|
──────
|
Total current
liabilities
|
|
5,467
|
6,405
|
|
|
──────
|
──────
|
|
|
|
|
Deferred tax
liabilities
|
|
-
|
3
|
Long-term operating
lease obligations, net of current maturities
|
|
-
|
41
|
|
|
──────
|
──────
|
Total
non-current liabilities
|
|
-
|
44
|
|
|
──────
|
──────
|
Total
liabilities
|
|
5,467
|
6,449
|
|
|
──────
|
──────
|
Commitments and
contingencies
|
|
|
|
Shareholders'
equity:
|
|
|
|
Ordinary
share,
20,000,000 shares
authorized as of June 30, 2022 and December 31, 2021,
respectively
7,899,832 no par value
shares issued as of June 30, 2022 and December 31,
2021
|
|
123
|
123
|
Additional paid-in
capital
|
|
9,691
|
9,670
|
Treasury stock,
167,700 shares at cost as of June 30, 2022 and December 31,
2021, respectively
|
|
(786)
|
(786)
|
PRC statutory
reserves
|
|
316
|
316
|
Accumulated other
comprehensive income
|
|
771
|
787
|
Retained
earnings
|
|
3,126
|
3,774
|
|
|
──────
|
──────
|
Total shareholders'
equity attributable to Euro Tech Holdings Company
Limited
|
|
13,241
|
13,884
|
Non-controlling
interests
|
|
818
|
917
|
|
|
──────
|
──────
|
Total shareholders'
equity
|
|
14,059
|
14,801
|
|
|
──────
|
──────
|
Total liabilities
and shareholders' equity
|
|
19,526
|
21,250
|
|
|
══════
|
══════
|
EURO TECH HOLDINGS COMPANY LIMITED
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE
INCOME
FOR THE SIX MONTHS ENDED JUNE 30, 2022 AND 2021
|
|
2022
(Unaudited)
|
2021
(Unaudited)
|
|
|
|
US$'000
|
US$'000
|
|
|
|
|
|
|
Revenues
|
|
|
|
|
Trading and
manufacturing
|
|
3,986
|
4,291
|
|
Engineering
|
|
2,744
|
5,763
|
|
|
|
────────
|
────────
|
|
Total
revenues
|
|
6,730
|
10,054
|
|
|
|
|
|
|
Cost of
revenues
|
|
|
|
|
Trading and
manufacturing
|
|
(3,044)
|
(3,031)
|
|
Engineering
|
|
(1,798)
|
(4,001)
|
|
|
|
────────
|
────────
|
|
Total
cost of revenues
|
|
(4,842)
|
(7,032)
|
|
|
|
────────
|
────────
|
|
Gross profit
|
|
1,888
|
3,022
|
|
|
|
|
|
|
Finance
costs
|
|
(3)
|
(1)
|
|
Selling
and administrative expenses
|
|
(2,372)
|
(2,514)
|
|
Gain on disposal of
property, plant and equipment
|
|
-
|
-
|
|
|
|
────────
|
────────
|
|
Operating (loss) /
income
|
|
(487)
|
507
|
|
Interest
income
|
|
8
|
8
|
|
Other
income, net
|
|
(7)
|
59
|
|
|
|
|
|
|
Equity in
income of affiliates
|
|
221
|
205
|
|
|
|
────────
|
────────
|
|
Net (loss) /
income before income taxes
|
|
(265)
|
779
|
|
|
|
|
|
|
Income
taxes expense
|
|
7
|
(17)
|
|
|
|
────────
|
────────
|
|
Net (loss) /
income
|
|
(258)
|
762
|
|
|
|
|
|
|
Net loss / (income)
attributable to non-controlling interests
|
|
74
|
(272)
|
|
|
|
────────
|
────────
|
|
Net (loss) / income
attributable to Euro Tech Holdings Company Limited's
shareholders
|
|
(184)
|
490
|
|
|
|
════════
|
════════
|
|
Other comprehensive
(loss) / income
|
|
|
|
|
Net (loss) / income
|
|
(258)
|
762
|
|
Foreign exchange translation
Adjustments
|
|
(41)
|
(22)
|
|
|
|
────────
|
────────
|
|
Comprehensive (loss)
/ income
|
|
(299)
|
740
|
|
Comprehensive loss/
(income) attributable to non-controlling
interests
|
|
99
|
(275)
|
|
|
|
────────
|
────────
|
|
Comprehensive
(loss) / income attributable to the
Company
|
|
(200)
|
465
|
|
|
|
════════
|
════════
|
|
|
|
|
|
|
|
|
|
|
|
|
Net (loss) /
income per ordinary share
attributable to Euro Tech Holdings Company Limited's
shareholders
|
|
|
|
|
|
|
- Basic
|
|
$
US(0.02)
|
$
US0.06
|
|
|
$
US0.23
|
|
|
════════
|
════════
|
|
|
════════
|
- Diluted
|
|
$
US(0.02)
|
$
US0.06
|
|
|
$
US0.23
|
|
|
════════
|
════════
|
|
|
════════
|
Weighted average
number of ordinary shares outstanding
|
|
|
|
|
|
|
- Basic
|
|
7,732,132
|
7,732,132
|
|
|
2,061,909
|
|
|
════════
|
════════
|
|
|
════════
|
- Diluted
|
|
7,732,132
|
7,732,132
|
|
|
2,061,909
|
|
|
════════
|
════════
|
|
|
════════
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
View original
content:https://www.prnewswire.com/news-releases/euro-tech-holdings-company-limited-reports-interim-results-for-the-six-months-ended-june-30-2022-301709550.html
SOURCE EURO TECH HOLDINGS COMPANY LIMITED