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HONG KONG, Jan. 31, 2011 (GLOBE NEWSWIRE) -- Highway Holdings Limited (Nasdaq:HIHO) today reported solid results for its third fiscal quarter ended December 31, 2010, reflecting continued sales momentum and increased profitability.
Net income for the fiscal 2011 third quarter climbed 59 percent to $407,000, or $0.11 per diluted share, from $256,000, or $0.07 per diluted share, in the third quarter a year earlier. Net sales for the same period increased 51.4 percent to $9.0 million from $5.9 million a year ago.
Net income for the nine-month period of fiscal 2011 increased more than three-fold to $861,000, or $0.23 per diluted share, from $259,000, or $0.07 per diluted share, a year earlier. Net sales for the nine months ended December 31, 2010 increased 48 percent to $23.3 million from $15.8 million in the comparable period a year earlier.
"Results for the quarter reflect the benefits of an improving business environment, as our major customers have become more confident in the sustainability of the global economic recovery and have increased their production orders," said Roland Kohl, chairman, president and chief executive officer of Highway Holdings.
He noted that sales also increased due to the previously announced order from a U.S.-based supplier of protective phone cases for a popular mobile phone. The full ramp-up of the manufacture of the protective cases, however, has been impacted by expected design changes to meet the requirements of another major service provider. Kohl added that he expects production for these protective phone cases to resume in February/March 2011.
Gross profit for the nine-month period ended December 31, 2010 was 20.5 percent compared with 20.9 percent a year earlier – reflecting the impact of higher labor costs, higher raw material costs and the overtime charges incurred to accommodate the manufacture of the protective phone cases. However, because of the substantial increase in net sales, the company's operating income for the three-month period ended December 31, 2010 increased to $481,000 from $306,000 in the prior year, and the nine-month operating income in 2010 increased to a profit of $951,000 from a loss of $33,000 in 2009.