Ossen Innovation Q3 revenues decreased to $28.5 million
Staff Writer |
Ossen Innovation announced its financial results for the third quarter ended September 30, 2016.
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For the three months ended September 30, 2016, revenues decreased by $1.4 million, or 4.8%, to $28.5 million from $30 million for the same period of last year.
This decrease was primarily due to decreases in sales from plain surface PC strands and other products and partially offset by increased sales from coated PC steel materials.
The sales of coated PC steel materials, including both rare earth and zinc coated products, increased by $3.5 million, or 14.5%, to $27.2 million and accounted for 95% of total sales for the three months ended September 30, 2016 from $23.8 million, or 79% of total sales, for the same period of last year.
The increase in sales of coated PC steel materials was mainly due to the increase in sales volume of rare earth coated products and partially offset by decrease in average selling price for rare earth coated products.
Sales of rare earth coated products increased by $3.4 million, or 14.5%, to $27.2 million for the three months ended September 30, 2016 from $23.8 million for the same period of last year. Sales of zinc coated products was $25.5 thousand for the three months ended September 30, 2016, compared to $nil for the same period of last year.
Sales of plain surface PC strands and others decreased by $4.9 million, or 79.3%, to $1.3 million and accounted for 5% of total sales for the three months ended September 30, 2016 from $6.2 million, or 21% of total sales, for the same period of last year.
Gross profit decreased by $1.7 million, or 35.0%, to $3.2 million for the three months ended September 30, 2016 from $4.9 million for the same period of last year.
Gross margin decreased to 11.2% for the three months ended September 30, 2016 from 16.5% for the same period of last year. Gross margins for rare earth and zinc coated products were 12.3% and 34.6%, respectively, for the three months ended September 30, 2016, compared to 16.1% and nil%, respectively, for the same period of last year.
The decrease in gross margins of rare earth coated products was primarily due to switching to higher price raw materials. Gross loss margin for plain surface PC strands and others was 11.2% for the three months ended September 30, 2016, compared to gross margin of 17.8% for the same period of last year.
Selling expenses decreased by $0.02 million, or 12.4%, to $0.1 million for the three months ended September 30, 2016 from $0.2 million for the same period of last year. The decrease was due to lower commission fees.
General and administrative expenses were $1.0 million for the three months ended September 30, 2016, compared to general and administrative expenses of negative $0.2 million for the same period of last year. The increase was mainly due to the fact that the company switched back the allowance for assets impairment in the third quarter of 2015.
As a result, total operating expenses were $1.1 million for the three months ended September 30, 2016, compared to total operating expenses of negative $0.02 million for the same period of last year.
Operating income decreased by $2.9 million, or 57.9%, to $2.1 million for the three months ended September 30, 2016 from $5.0 million for the same period of last year.
Operating margin was 7.3% for the three months ended September 30, 2016, compared to 16.5% for the same period of last year.
Net income decreased by $2.5 million, or 64.4%, to $1.4 million for the three months ended September 30, 2016 from $3.8 million for the same period of last year.
After deducting net income attributable to non-controlling interest, net income attributable to Ossen Innovation decreased by $1.9 million, or 59.1%, to $1.3 million for the three months ended September 30, 2016 from $3.3 million for the same period of last year. Earnings per share, both basic and diluted, were $0.07 for the three months ended September 30, 2016, compared to $0.16 for the same period of last year. ■