BETHESDA, MD--(Marketwire - Feb 13, 2013) - India Globalization Capital, Inc. (
Ram Mukunda, CEO of India Globalization Capital, said, "We are pleased to report profitability this quarter due to our considerable efforts to realign and focus our equipment, processes, and people on the iron ore mining business, cut costs from unprofitable construction contracts, and renegotiate or extinguish expense liabilities and debt. Our revenues for the quarter rose dramatically to nearly $4 million and we achieved earnings of $0.01 per share."
Total revenue for IGC was $3,933,906 for the three months ended December 31, 2012, compared to $986,799 for the corresponding three months ended December 31, 2011. The increase in revenue comes from increased trading activity as we gear up for production from our mines. The revenue also has a component, $802,746, which comes from the closing out of a construction contract that our Indian subsidiary TBL was engaged in. In our next fiscal year, which starts in April, we project revenue and margins to rise as iron ore prices are anticipated to trend up from increased infrastructure activity in China, India, U.S.A. and other parts of the world. It is our current expectation that after the Chinese New Year and winter, we will begin purchasing low-grade iron ore and transporting it to our plants for further beneficiation, and or for sale to our customers. We have four mines in Inner Mongolia and three beneficiation plants with over $500 million of estimated reserves measured at $125 per ton.
In the three months ended December 31, 2012, the Company reported a GAAP net income of $310,892 and a GAAP EPS of $0.01 compared to a consolidated net loss of ($1,901,375) and a GAAP EPS loss of ($0.09) for the corresponding three months ended December 31, 2011. The significant shift in earnings is attributed to four factors, a) a drastic cut in SG&A as we align our resources for mining and trading and shed unprofitable construction activity, b) redeployment of our construction equipment for mining, c) a significant decrease in high interest loans and liability, and d) an increase in iron ore trading revenue and revenue attributed to the closure of a construction contract. As we beneficiate iron ore by converting low grade iron ore to high grade iron ore, in an environment with iron prices trending higher, the arbitrage between low and high grade iron ore will increase thus driving our margins and earnings higher. As we have spent considerable energy aligning our resources and integrating the mining business, we project, based on the current trend in iron ore pricing, the next fiscal year to be profitable.
Selling, general and administrative expenses were $153,789 for the three months ended December 31, 2012 as compared to $968,890 for the corresponding three months ended December 31, 2011. The Company has substantially cut its employees, overheads, and eliminated recurring contracts associated with construction activity.
For the period ended December 31, 2012, our cash and cash equivalents along with restricted cash was approximately $2.1 million.
As of December 31, 2012, the Company's stockholders' equity was approximately $15.6 million compared to about $15.8 million for the period ended March 31, 2012.
The Company reported total assets of approximately $21.4 million as of December 31, 2012 versus about $25.3 million as of March 30, 2012.
Mukunda added, "We are now filling orders from our Chinese customers through our trading operations. We expect to increase this activity as we expand our suppliers beyond India and China. In the future the lower margin trading business is expected to transition to higher margins as we supply high-grade iron ore from our beneficiation plants. As reported in Bloomberg, in September, 2012 China approved $158 billion for infrastructure as part of a stimulus plan that is expected to boost the demand for commodities. Iron ore prices have started to recover from their lows of $86 per ton in September 2012 to around $125 per ton. We have about $500 million of iron ore deposits, four mine sites, and three beneficiation plants. Our short term strategy is three pronged: 1) start supplying high grade iron ore from our beneficiation plants, 2) expand the supply chain for raw materials beyond India and China, and 3) actively look at consolidating more mines in the Inner Mongolia region that can be accretive to the Company."
Based in Bethesda, Maryland, India Globalization Capital, Inc. (IGC) is a materials and infrastructure company operating in India and China. We currently supply Iron ore to Steel Companies operating in China. For more information about IGC, please visit IGC's Web site at www.indiaglobalcap.com. For information about Ironman, please visit www.hfironman.com.
Some of the statements contained in this press release that are not historical facts constitute forward-looking statements under the federal securities laws. Forward-looking statements can be identified by the use of the words "may," "will," "should," "could," "expects," "post", "plans," "anticipates," "believes," "estimates," "predicts," "intends," "potential," "proposed," "confident" or "continue" or the negative of those terms. These statements are not a guarantee of future developments and are subject to risks, uncertainties and other factors, some of which are beyond IGC's control and are difficult to predict. Consequently, actual results may differ materially from information contained in the forward-looking statements as a result of future changes or developments in our business, our competitive environment, infrastructure demands, Iron ore availability and governmental, regulatory, political, economic, legal and social conditions in China and India.
The Company undertakes no obligation to publicly update any forward-looking statements, whether as a result of new information, future events, or otherwise. Other factors and risks that could cause or contribute to actual results differing materially from such forward-looking statements have been discussed in greater detail in IGC's Schedule 14A, Form 10-K for FYE 2012, Form 10-Q for the quarter ended September 30, 2012, Form S-3, and the Post-effective Amendment No. 1 on Form S-3 to Form S-1 filed with the Securities and Exchange Commission on December 9, 2011, July 16, 2012, November 14, 2012, December 14, 2012, and December 26, 2012 respectively.
|INDIA GLOBALIZATION CAPITAL, INC. AND SUBSIDIARIES|
|CONSOLIDATED BALANCE SHEETS|
|Cash and cash equivalents||$||2,108,326||$||562,948|
|Accounts receivable, net of allowances||588,602||1,641,868|
|Prepaid expenses and other current assets||2,385,798||2,586,514|
|Total current assets||$||5,606,841||$||5,220,263|
|Property, plant and equipment, net||8,026,307||8,491,796|
|Investments in affiliates||5,109,057||5,109,058|
|Intangible Assets and Goodwill||1,472,460||4,803,828|
|Other non-current assets||977,496||997,513|
|LIABILITIES AND STOCKHOLDERS' EQUITY|
|Dues to related parties||0||310,681|
|Deferred tax liabilities||135,980||135,980|
|Loans - others||414,437||222,389|
|Other current liabilities||494,841||563,105|
|Total current liabilities||$||3,865,877||$||4,496,020|
|Deferred Income taxes||713,897||713,897|
|Other non-current liabilities||1,199,284||4,233,978|
|Common stock - $.0001 par value; 150,000,000 shares authorized; 60,061,737 issuedand outstanding as of Dec 31, 2012 and 60,061,737 issued and outstanding as of March 31, 2012||$||6,007||$||6,007|
|Additional paid-in capital||54,821,952||54,821,952|
|Accumulated other comprehensive income||(2,464,818||)||(2,542,453||)|
|Retained earnings (Deficit)||(37,804,966||)||(37,444,832||)|
|Total equity attributable to Parent||$||14,558,175||$||14,840,674|
|Total stockholders' equity||15,660,305||15,816,183|
|Total liabilities and stockholders' equity||$||21,439,363||$||25,260,078|
|INDIA GLOBALIZATION CAPITAL, INC. AND SUBSIDIARIES|
|CONSOLIDATED STATEMENTS OF OPERATIONS|
|Three months ended December 31,||Nine months ended December 31,|
|Cost of revenues (excluding depreciation)||(3,189,950||)||(1,024,817||)||(5,235,751||)||(2,902,650||)|
|Selling, general and administrative expenses||(153,789||)||(968,890||)||(936,348||)||(2,354,405||)|
|Operating income (loss)||455,382||(1,049,268||)||(82,550||)||(2,467,113||)|
|Equity in (gain)/loss of joint venture||-||(33,588||)||-||28,463|
|Other income, net||43,641||(716,364||)||(120,595||)||(706,440||)|
|Income before income taxes and minority interest attributable to non-controlling interest||$||498,423||$||(1,913,944||)||$||(229,207||)||$||(3,583,115||)|
|Income taxes benefit/ (expense)||(453||)||-||21,522||-|
|Non-controlling interests in earnings of subsidiaries||(187,078||)||12,569||(152,449||)||23,284|
|Net income / (loss) attributable to common stockholders||$||310,892||$||(1,901,375||)||$||(360,134||)||$||(3,559,831||)|
|Earnings/(loss) per share attributable to common stockholders:|
|Weighted-average number of shares used in computing earnings per share amounts:|