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CY provides update on Production Volume at Tengzhou Plant
04 Apr '08
3 min read
Based on preliminary financial results, which have yet to be audited, the Company is expecting a net loss for fiscal 2007 in the range of $1.5 million to $1.8 million, including a bad debt expense of $2.0 million. Total cash and restricted cash balances at December 31, 2007 amounted to approximately $944,000, which is similar to the $1,052,000 at September 30, 2007 and $888,000 at December 31, 2006.
Net working capital and debt to equity ratios at December 31, 2007 were 1.35:1 and 34.1%, respectively, compared to 1.36:1 and 34.2%, respectively, at September 30, 2007 and 1.04:1 and 66.1%, respectively, at December 31, 2006.
"We are taking action to bring our accounts receivable down to improve our working capital position," stated Clarence Kwong, Chief Financial Officer of the Company. "While we have been patient and understanding of our customers' situations and believe they are committed to meeting their obligations, we feel it is prudent to include a significant allowance for doubtful accounts with our year-end financial statements.
We are focused on improving our working capital position and in this respect, in March we have replaced one of our mortgage loans amounting to approximately $2.0 million with a new one-year mortgage loan amounting to approximately $3.2 million.
The new loan is secured by the land and factory building at our Shanghai facility, the same collateral that had secured the loan being replaced. We remain positive on our outlook for 2008 and continue to work towards the successful execution of our growth plans."
The Company also announced that production at its new manufacturing facility in Tengzhou continues to ramp up, with the facility producing approximately 405,000 pieces of apparel in the fourth quarter of 2007, representing about 40% capacity utilization for the two sewing workshops currently in operation. During the fourth quarter, the Company's Shanghai facility continued to operate at maximum capacity.
The Company's fourth quarter and fiscal 2007 year-end financial results are expected to be reported in the latter half of April 2008.
Net working capital and debt to equity ratios at December 31, 2007 were 1.35:1 and 34.1%, respectively, compared to 1.36:1 and 34.2%, respectively, at September 30, 2007 and 1.04:1 and 66.1%, respectively, at December 31, 2006.
"We are taking action to bring our accounts receivable down to improve our working capital position," stated Clarence Kwong, Chief Financial Officer of the Company. "While we have been patient and understanding of our customers' situations and believe they are committed to meeting their obligations, we feel it is prudent to include a significant allowance for doubtful accounts with our year-end financial statements.
We are focused on improving our working capital position and in this respect, in March we have replaced one of our mortgage loans amounting to approximately $2.0 million with a new one-year mortgage loan amounting to approximately $3.2 million.
The new loan is secured by the land and factory building at our Shanghai facility, the same collateral that had secured the loan being replaced. We remain positive on our outlook for 2008 and continue to work towards the successful execution of our growth plans."
The Company also announced that production at its new manufacturing facility in Tengzhou continues to ramp up, with the facility producing approximately 405,000 pieces of apparel in the fourth quarter of 2007, representing about 40% capacity utilization for the two sewing workshops currently in operation. During the fourth quarter, the Company's Shanghai facility continued to operate at maximum capacity.
The Company's fourth quarter and fiscal 2007 year-end financial results are expected to be reported in the latter half of April 2008.
CY Oriental Holdings Ltd
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