Ossen Innovation Co Ltd a China based manufacturer of an array of plain surface, rare earth and zinc coated pre stressed steel materials, announced its financial results for the three months and nine months ended September 30, 2012.
Dr Liang Tang chairman of Ossen Innovation said that "We had positive revenue growth for a second consecutive quarter. More importantly, we generated positive net income. These developments indicate a rebound in the industry and strong execution from our team. As the market demand improves further, we anticipate our margins to gradually return to historical levels."
Third Quarter 2012 Financial Results
Revenue for the three months ended September 30, 2012 was USD 41.1 million, an increase of USD 10 million, or 32%, from the same period a year ago. Sales of coated pre-stressed steel materials, including rare earth coated products, were USD 29.7 million, up 178% compared to USD 10.7 million in the third quarter of 2011 due to overall higher demand of coated pre-stressed steel materials in the market.
Gross profit decreased from USD 4.2 million to USD 2.9 million, a 31% year over year decline. Gross margin was 7.1%, flat from the second quarter of 2012 and down from 13.6% in the third quarter of 2011. Gross profit and gross margin were down as a result of lower pricing during the market recovery stage.
Gross margin for the third quarter of 2012 were 9.2% and 3.4% for coated pre-stressed steel products and for plain surface pre-stressed steel products, respectively.
Selling expenses increased 19% to USD 0.3 million due to higher sales. General and administrative expenses increased 58% to USD 0.5 million mainly due to the increase in R&D expenses. Operating income fell 42% to USD 2.1 million in the third quarter of 2012 with operating margin of 5.1% compared to USD 3.6 million and 11.7%, respectively, in the third quarter of 2011.
Net income attributable to controlling interest decreased 63% to USD 0.7 million in the third quarter of 2012 from USD 2 million in the year-ago period. Earnings per share were USD 0.04 versus USD 0.10 a year ago. The weighted average diluted shares outstanding was 19.9 million compared to 20.0 million a year ago as a result of 88,616 shares repurchased by Ossen as of September 30, 2012.