Global-Tech Advanced Innovations Inc. (NASDAQ:GAI) today announced its net sales and earnings for the quarter ended June 30, 2010 (the Company’s first quarter of fiscal 2011).
Net sales for the quarter ended June 30, 2010 were $25.8 million, compared to $25.7 million for the corresponding quarter in fiscal 2010. While there was less than a 1% increase in net sales, first quarter results revealed significant changes in sales trends when compared to the prior fiscal year. In the first quarter of fiscal 2011, net sales of home appliances declined 19%, electronic components increased 19% and electronic manufacturing service (EMS) revenues more than doubled, compared to corresponding net sales in the first quarter of fiscal 2010. In addition, sales to Asia markets in the first quarter of fiscal 2011 represented 48% of total net sales.
Net income for the first quarter of fiscal 2011 was $0.8 million, or $0.26 per share, compared to a net income of $1.2 million, or $0.38 per share, for the first quarter of fiscal 2010.
John C.K. Sham, President and Chief Executive Officer, said, “Our financial results in the first quarter of fiscal 2011 were indicative of the changes taking place within our business segments. While our electronic component and EMS businesses resumed their growth and maintained profitability, operating margins in our home appliance business continued to decline as a result of increases in material cost and wage inflation. The trend of increasing raw material cost and decreasing margins are threatening the continued viability of our home appliance business.”
Mr. Sham continued, “As we continue to diversify and refocus our efforts on the telecommunications business in China, weakening of the export markets we have been serving is having less of an impact on our overall business prospects. We plan to place less emphasis on our home appliance business as we continue to expand our capabilities and sales efforts on the EMS and electronic component businesses.”