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HONG KONG, Jan. 28, 2013 (GLOBE NEWSWIRE) -- Highway Holdings Limited (Nasdaq:HIHO) today reported results for its fiscal third quarter ended December 31, 2012 -– reflecting net income and margin improvement for the nine-month period.
Net income for the fiscal 2013 third quarter was $18,000, or $0.01 per diluted share, compared with $75,000, or $0.02 per diluted share, in the third quarter a year earlier. Net sales for the same period were $5.6 million compared with $7.3 million a year ago.
Net income for the nine-month period of fiscal 2013 increased 89 percent to $174,000, or $0.05 per diluted share, compared with $92,000, or $0.02 per diluted share, a year earlier. Net sales for the nine months were $16.4 million compared with $19.4 million in the comparable period a year earlier.
"Despite reduced year-over-year sales and continued increases in labor and other costs in China, gross margin for the quarter and nine months improved slightly due to further streamlining initiatives and improved product mix. The sales reduction in the fiscal 2013 third quarter compared with the same period a year earlier was due entirely to the loss of low margin mobile phone case business.
"Excluding the lost sales from the mobile phone case business, net sales on a year-over-year comparison were essentially flat, which suggests that business overall has stabilized and the company is poised to regain momentum," said Roland Kohl, chairman, president and chief executive officer of Highway Holdings.
Gross profit margin for the three- and nine-month periods ended December 31, 2012 increased to 22.2 percent and 21.9 percent, respectively, compared with 18.2 percent and 19.5 percent, respectively, a year earlier. Gross profit margin increased, in part, due to the termination of the low-margin mobile phone case business, which negatively impacted gross margins last year. Kohl also noted that management remains focused on further streamlining initiatives to offset escalating overhead costs in China without sacrificing quality and future business development. Operating income for the three-month period ended December 31, 2012 was $8,000 compared with $6,000 in the prior year. Operating income for the nine months was $255,000 compared with $52,000 a year earlier.