HONG KONG, April 30, 2024 /PRNewswire/ -- Euro Tech Holdings Company Limited (Nasdaq: CLWT) today reported financial results for the 12-month period ended December 31, 2023 ("Fiscal 2023").
The Company had net income of US$1,828,000 in Fiscal 2023, as compared to US$369,000 for the fiscal year ended December 31, 2022 ("Fiscal 2022"). This increase was because of increase in equity in income of affiliates as its affiliates had a non-recurrent gain on disposal of 2 desulfurization treatment plants for a "Build-operate-transfer" project located in Shanxi, China.
The Company's revenues for Fiscal 2023 were US$17,940,000, an approximate 20.0% increase compared to US$14,949,000 for Fiscal 2022. The increase was principally due to increase in revenues from trading activities as a result of recovery after the COVID-19 pandemic disruption.
Gross profits decreased by 16.4% to US$3,861,000 for Fiscal 2023 as compared to approximately US$4,618,000 for Fiscal 2022. The decrease was primarily due to the decrease in gross margin % of engineering activities as affected by the continuous economy slowdown in Mainland China and adverse impacts of the COVID-19 pandemic.
Selling and administrative expenses decreased by 8.6% to approximately US$4,103,000 for Fiscal 2023 as compared to approximately US$4,490,000 for Fiscal 2022. The decrease was principally due to cessation of the business operations of Shanghai Euro Tech Limited since September 2022.
Mr. David Leung, CEO of the company commented,
"In 2023, all COVID-19 related policies have been cancelled. However, the pace of economic recovery in China remains slow and below growth expectations.
Despite these challenges in 2023, we managed to increase sales orders for Ballast Water Treatment Systems ("BWTS") from the maritime industry, and continue expanding our sales regions and deepening our sales networks in Dubai, Singapore, Thailand, and Turkey.
In the upcoming days, we will anticipate a surge in the demand for smaller sized BWTS retrofits. We believe certain countries with small and medium sized ships will experience high growth in demand, especially since we have recently signed an agreement with ERMA FIRST from Greece to become our exclusive distributor & OEM partner. This agreement covers the distribution of our BWTS systems across 20 countries in Europe strengthening our sales and accelerating our penetration into this region. Moreover, we aim to seek more strategic partners or distributors to capitalize on growth opportunities in certain countries, such as UAE and Turkey. We will actively promote our mobile port BWTS reception facility to key ports worldwide, as this is also aligned with IMO guidelines as well and we are well positioned in this niche market. In fact, we are going to promote our system at the well-known maritime exhibition in Germany, SMM Hamburg 2024, which will take place in September 2024.
As for the industrial wastewater treatment business, we will continue to develop sales channels for the overseas market, especially in high growth industrial regions of South East Asia, such as the Philippines and Vietnam to secure our growth."
About BWTS
BWTS are an imminent requirement by The International Maritime Organization ("IMO") to prevent the biological unbalance caused by the estimated 12 billion tons of ballast water transported across the seas by ocean-going vessels when their ballast water tanks are emptied or refilled. In 2012, ballast water discharge standard became a law in the US. Any vessel constructed in December 2013 or later will need to comply when entering US waters, and existing vessels will follow shortly after. IMO's Ballast Water Management Convention entered into force for new-built vessels on September 8, 2017 after ratification by 52 States, representing 35.1441% of world merchant shipping tonnage. In July 2017, IMO decided that the phase-in period for ballast water system retrofits started on 8 September 2019.
The company obtained type approval certificate from China's Classification Society for its 200, 300, 500, 750, 1200 and 1250 Cubic Meters per hour BWTS in 2016.
The IMO convention stipulates that type approval for revised G8 requirements must be obtained for all BWTS installed on or after October 28, 2020, and the company have been in compliance with such requirements.
Its ballast water port solution, HarborBallast, is a system installed in port to offer ballast water treatment services for ocean-going ships without their own BWTS and for those with damaged BWTS.
Forward Looking Statements
Certain statements in this news release regarding the Company's expectations, estimates, present view of circumstances or events, and statements containing words such as estimates, anticipates, intends, or expects, or words of similar import, constitute forward looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements indicate uncertainty and the Company can give no assurance with regard to actual outcomes. Specific risk factors may include, without limitation, having the Company's offices and operations situated in Hong Kong and China, doing business in China, competing with Chinese manufactured products, competing with the Company's own suppliers, dependence on vendors, and lack of long term written agreements with suppliers and customers, development of new products, entering new markets, possible downturns in business conditions, increased competition, loss of significant customers, availability of qualified personnel, negotiating definitive agreements, new marketing efforts and the timely development of resources. See the "Risk Factor" discussions in the Company's filings with the Securities and Exchange Commission, including its Annual Report on Form 20-F for its fiscal year ended December 31, 2023.
CONDENSED STATEMENTS OF OPERATIONS | |||
(Dollar amounts in US$ thousands, except share and per share data) | |||
Year Ended December 31, | |||
2023 | 2022 | ||
Revenues | 17,940 | 14,949 | |
Net Income Attributable to the Company | 1,828 | 369 | |
Net Income Per Ordinary Share - Basic | $0.24 | $0.05 | |
| Weighted Average Number of Ordinary Shares Outstanding -Basic |
7,726,118 |
7,732,132 | |
SELECTED BALANCE SHEET DATA | |||
As of December 31, | |||
2023 | 2022 | ||
Cash and Cash Equivalents | 5,453 | 5,628 | |
Total Current Assets | 10,545 | 9,450 | |
Total Assets | 22,120 | 19,363 | |
Total Current Liabilities | 5,596 | 4,470 | |
Total Liabilities | 5,640 | 4,557 | |
Total Euro Tech Shareholders' Equity | 15,641 | 13,772 | |
SOURCE EURO TECH HOLDINGS COMPANY LIMITED
