SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM 6-K
REPORT OF FOREIGN PRIVATE ISSUER
Pursuant to Rule 13a-16 or 15d-16 of the
Securities Exchange Act of 1934
For the month of July 2003
Commission File Number: 0-16673
Nam Tai Electronics, Inc.
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(Exact name of registrant as specified in charter)
British Virgin Islands
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(Jurisdiction of organization)
116 Main Street, Road Town, Tortola, British Virgin Islands
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(Address of principal executive offices)
Registrant's telephone number, international: +852-2341-0273
Indicate by check mark whether the registrant files or will file annual
reports under cover Form 20-F or Form 40-F.
Form 20-F X Form 40-F
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Indicate by check mark if the registrant is submitting the Form 6-K in
paper as permitted by Regulation S-T Rule 101(b)(1):
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Indicate by check mark if the registrant is submitting the Form 6-K in
paper as permitted by Regulation S-T Rule 101(b)(7):
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Indicate by check mark whether the registrant by furnishing the information
contained in this Form is also thereby furnishing the information to the
Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.
Yes No X
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If "Yes" is marked, indicate below the file number assigned to the
registrant in connection with Rule 12g3-2(b): 82-
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This Form 6-K consists of the following:
1. Press release of Nam Tai Electronics, Inc., dated July 25, 2003, announcing
its financial results for the second quarter of its 2003 fiscal year.
NAM TAI ELECTRONICS, INC. SECOND QUARTER NEWS RELEASE
REPRESENTED BY PAN PACIFIC I.R. LTD. CONTACT: Lorne Waldman
1790-999 WEST HASTINGS STREET President
VANCOUVER, BC, CANADA V6C 2W2 E-MAIL: shareholder@namtai.com
TEL: (604) 669-7800 FAX: (604) 669-7816 WEB: www.namtai.com
TOLL FREE TEL/FAX: 1-800-661-8831
NAM TAI ELECTRONICS, INC.
Q2 Net Income Up 200% to $11.5 Million vs. $3.8 Million, EPS $0.31 vs. $0.12
VANCOUVER, CANADA -- July 25, 2003 -- Nam Tai Electronics, Inc. ("Nam Tai" or
the "Company") (NYSE Symbol: NTE; CBOE Symbol: QNA) today announced unaudited
results for the second quarter ended June 30, 2003.
KEY HIGHLIGHTS
(In millions of US Dollars, except as otherwise stated)
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Quarterly Results Half-Year Results
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2Q2003 2Q2002 YoY(%) 2H2003 2H2002 YoY(%)
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Net sales 116.7 52.3 123.1 204.7 103.5 97.7
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Income from operations 10.9 7.0 55.8 19.8 10.1 95.1
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per share(diluted) $0.30 $0.22 36.4 $0.54 $0.32 68.8
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Net income 11.5 3.8 200.5 21.7 8.0 171.3
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% of sales 9.8% 7.3% 10.6% 7.7%
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Basic earnings per share $0.32 $0.12 166.7 $0.60 $0.26 130.8
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Diluted earning per share $0.31 $0.12 158.3 $0.59 $0.25 136.0
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(Note: All share and earnings per share data have been adjusted for the 3 for 1 stock split effective June 30, 2003.)
Nam Tai's growth this quarter was mainly due to an increase in the sales of
telecommunication components assemblies.
The Company continues to maintain a strong financial position, with
approximately $69.6 million of cash on hand.
Supplementary Information (Unaudited) for the Second Quarter of 2003
1. Quarterly Sales Breakdown
(In Thousands of US Dollars)
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Quarter 2002 2003 YoY(%) YoY(%)
(Quarterly) (Quarterly accumulated)
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1st Quarter (a)51,217 87,981 71.8% 71.8%
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2nd Quarter (a)52,311 116,714 123.1% 97.7%
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3rd Quarter 56,872
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4th Quarter 75,616
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Total 236,016 204,695
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Note (a):
Sales of battery packs for the first and second quarter of 2002 were
$5,096K and $2,753K respectively. Upon disposal of BPC on April 30, 2002,
revenue from battery packs was no longer included in the total sales.
2. Net Sales Breakdown by Product Segment
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2003 2002
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Segment 2nd Quarter YTD 2nd Quarter YTD
(%) (%) (%) (%)
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Assembling:
- LCD Consumer Products 29% 34% 36% 36%
- Telecom. Components Assembly 61% 55% 46% 49%
Software Development Services 1% 1% 1% 1%
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Parts & Components :
- LCD Panels 7% 7% 12% 9%
- Transformers 2% 3% 5% 5%
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100% 100% 100% 100%
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Note: In June 2003, we sold our transformers operation to a third party.
Assembling included finished goods and modules, together with Software
Development Services collectively termed as Consumer Electronic Products
("CEP"), while parts and components including LCD panels and transformers
are termed ("LPT") for business segment classification.
3. Financial Position
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(unaudited) (audited)
As at June 30 As at December 31
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2003 2002 2002
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Cash on Hand $69.6 million $55.2 million $82.5 million
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Cash/Current Liabilities 1.00 1.28 1.21
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Current Ratio 2.39 2.73 2.29
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Total Assets/Total Liabilities 4.14 4.03 3.88
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Debtors Turnover 60 days 79 days 79 days
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Inventory Turnover 16 times 12 times 10 times
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*Adjusted for the 3 for 1 stock split effective June 30, 2003.
Second Quarter Results Analyst Conference Call
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The Company will hold a conference call on Monday, July 28, 2003 at 10:00 a.m.
Eastern Time for analysts to discuss the second quarter results with management.
Shareholders, media, and interested investors are invited to listen to the live
conference over the internet by going to www.namtai.com/news/news.htm and
clicking on the conference call link or over the phone by dialing (612) 288-0329
just prior to its start time. Callers will be asked to register with the
conference call operator.
Dividends
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The record date for the third quarter dividend of $0.05 per share is September
30, 2003 and the payment date is October 21, 2003.
About Nam Tai Electronics, Inc.
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We are an electronics manufacturing and design services provider to original
equipment manufacturers of telecommunications and consumer electronic products.
Through the electronics manufacturing services operations, we manufacture
electronic components and subassemblies, including LCD panels, LCD modules, and
radio frequency modules. These components are used in numerous electronic
products, including cellular phones, laptop computers, digital cameras, copiers,
fax machines, electronic toys, handheld video game devices and microwave ovens.
We also manufacture finished products, including cellular phones, palm-sized
PCs, personal digital assistants, electronic dictionaries, calculators and
digital camera accessories for use with cellular phones. Further information is
available at www.namtai.com.
Forward-Looking Statements
---------------------------
Certain statements in this press release are "forward-looking statements" within
the meaning of U.S. federal securities laws. Nam Tai intends that these
statements be covered by the safe harbors created under these laws. These
forward-looking statements are subject to risks, uncertainties and other factors
that could cause actual results to differ materially from future results
expressed or implied by the forward-looking statements. There are important
factors that could cause actual results to differ materially from the
information set forth in these forward-looking statements. Many of these factors
are beyond Nam Tai's ability to control or predict. Given these uncertainties,
readers are cautioned not to place undue reliance on the forward-looking
statements which only speak as of the date of this press release. Nam Tai does
not undertake any obligation to release publicly any revisions to these
forward-looking statements to reflect events or circumstances after the date of
this press release or to reflect the occurrence of unanticipated events, except
as may be required under applicable securities laws.
NAM TAI ELECTRONICS, INC.
CONSOLIDATED STATEMENTS OF INCOME (Unaudited)
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FOR THE PERIODS ENDED JUNE 30, 2003 AND 2002
(In Thousands of US Dollars except share data)
Note Unaudited Unaudited
Three months ended Six months ended
June 30 June 30
2003 2002 2003 2002
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Net sales - related parties $ 8,834 $ 2,753 $ 11,765 $ 7,849
Net sales - third parties 107,880 49,558 192,930 95,679
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Total net sales 116,714 52,311 204,695 103,528
Cost of sales (1) 98,393 40,375 171,228 83,841
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Gross profit (1) 18,321 11,936 33,467 19,687
Costs and expenses
Selling, general and administrative expenses 6,490 4,273 11,961 8,225
Research and development expenses 927 663 1,738 1,328
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7,417 4,936 13,699 9,553
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Income from operations (1) 10,904 7,000 19,768 10,134
Interest income 191 189 392 336
Other income (loss) - net (2) 915 (3,824) 2,982 (3,799)
Equity in income of affiliated companies 137 969 212 2,104
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Income before income taxes and minority interests 12,147 4,334 23,354 8,775
Income tax expense (475) (452) (859) (617)
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Income before minority interests 11,672 3,882 22,495 8,158
Minority interests (178) (57) (791) (158)
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Net income (1) & (2) $ 11,494 $ 3,825 $ 21,704 $ 8,000
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Net income per share
Basic (2) & (3) $ 0.32 $ 0.12 $ 0.60 $ 0.26
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Diluted (2) & (3) $ 0.31 $ 0.12 $ 0.59 $ 0.25
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Weighted average number of shares ('000')
Basic (3) 36,431 31,321 36,391 31,121
Diluted (3) 36,906 32,111 36,852 31,771
Note:
(1) The cost of sales for the second quarter of 2002 included a reversal of a
$2.0 million provision for slowing moving raw materials. Excluding the
reversal, the adjusted gross margin for the second quarter of 2002 would
have been $9,936 or 19.0% of net sales, adjusted income from operations
would have been $5,000 or 9.6% of net sales, adjusted net income would have
been $1,825 or 3.5% of net sales.
(2) Result for the second quarter of 2002, as previously announced, were
adjusted for the reallocation and release of $1.5 million unamortized
goodwill due to JIC reverse merger from fourth quarter to second quarter.
(3) All share and earnings per share data have been adjusted to give effect to
the 3 for 1 stock split of June 30, 2003.
NAM TAI ELECTRONICS, INC.
CONSOLIDATED BALANCE SHEETS
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AS AT JUNE 30, 2003 AND DECEMBER 31, 2002
(In Thousands of US Dollars)
Unaudited Audited
June 30 December 31
2003 2002
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ASSETS
Current assets:
Cash and cash equivalents $ 69,633 $ 82,477
Accounts receivable, net 61,484 50,944
Amount due from a related party 5,383 -
Inventories, net 21,289 19,200
Prepaid expenses and other receivables 5,515 1,867
Income taxes recoverable 3,291 855
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Total current assets 166,595 155,343
Investments in affiliated companies 10,212 -
Convertible notes 5,128 5,128
Long term investment 16,366 15,982
Property, plant and equipment, at cost 122,044 116,583
Less: accumulated depreciation and amortization (44,931) (40,669)
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77,113 75,914
Intangible assets 21,061 21,308
Other assets 1,411 1,411
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Total assets $ 297,886 $ 275,086
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LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Notes payable $ 1,301 $ 985
Long term bank loans - current portion 1,125 13,985
Accounts payable 51,481 38,714
Accrued expenses and other payables 12,822 12,609
Dividend payable 1,826 1,442
Income taxes payable 1,028 200
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Total current liabilities 69,583 67,935
Long-term bank loans - non-current portion 2,250 2,812
Deferred income taxes 87 112
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Total liabilities 71,920 70,859
Minority interests 2,932 2,099
Shareholders' equity: **
Common shares 365 360
Additional paid-in capital 150,597 147,754
Retained earnings 72,074 54,016
Accumulated other comprehensive loss (Note 1) (2) (2)
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Total shareholders' equity 223,034 202,128
Total liabilities and shareholders' equity $ 297,886 $ 275,086
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**Shareholders' equity for June 30, 2003 and December 31, 2002 were adjusted for
the 3 for 1 stock split effective June 30, 2003.
NAM TAI ELECTRONICS, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
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FOR THE PERIODS ENDED JUNE 30, 2003 AND 2002
(In Thousands of US Dollars)
Unaudited Unaudited
Three months ended Six months ended
June 30 June 30
2003 2002 2003 2002
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CASH FLOWS FROM OPERATING ACTIVITIES
Net income $ 11,494 $ 3,825 $ 21,704 $ 8,000
Adjustments to reconcile net income to net cash provided
by operating activities:
Depreciation and amortization 3,011 2,507 5,880 5,054
Amortization of advisors' warrants and options - 10 - 10
Net loss (gain) on disposal of property, plant and 50 76 (159) 115
equipment
Gain on disposal of intangible assets - (60) - (60)
Realized gain on marketable securities - - - (642)
Gain on disposal of a subsidiary (2,133) (17) (2,133) (17)
Loss on partial disposal of subsidiaries 151 - 151 -
Loss on reverse merger of subsidiaries - 2,655 - 2,655
Compensation expenses - - 509 -
Equity in income of affiliated companies (137) (969) (212) (2,104)
Dividend income from affiliated companies - 32 - 32
Loss on partial disposal of investment in affiliated - 469 - 469
companies
Minority interests 178 57 791 158
Deferred income taxes (25) - (25) -
Changes in current assets and liabilities, net of effects of
acquisition and disposal:
Proceeds from marketable securities - - - 10,147
(Increase) decrease in accounts receivable (4,316) 84 (10,540) (257)
Increase in amount due from a related party (4,577) - (5,383) -
Decrease (increase) in inventories 10,102 (3,436) (2,811) (2,159)
Decrease (increase) in prepaid expenses and other 1,476 207 (3,796) 167
receivables
(Increase) decrease in income taxes recoverable (2,339) 80 (2,436) (646)
(Decrease) increase in notes payable (729) (512) 316 (1,263)
(Decrease) increase in accounts payable (1,579) 12,729 13,778 4,966
Increase (decrease) in accrued expenses and other 2,197 (616) 378 (1,966)
payables
Decrease in amount due to a related party - (2,975) - (2,766)
Increase in income taxes payable 464 237 828 494
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Total adjustments 1,794 10,558 (4,864) 12,387
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Net cash provided by operating activities $ 13,288 $ 14,383 $ 16,840 $ 20,387
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CASH FLOWS FROM INVESTING ACTIVITIES
Acquisition of long term investment $ - $ (11) $ (384) $ (11,968)
Purchase of property, plant and equipment (5,839) (2,667) (10,057) (13,430)
Proceeds from disposal of property, plant and equipment 251 10 2,578 15
Proceeds from disposal of intangible assets - 800 - 800
Proceeds (cash outflow) from disposal of a subsidiary 2,386 (1,277) 2,386 (1,277)
Proceeds from partial disposal of subsidiaries 293 - 453 -
Acquisition of affiliated companies - - (10,000) -
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Net cash used in investing activities $ (2,909) $ (3,145) $ (15,024) $ (25,860)
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CASH FLOWS FROM FINANCING ACTIVITIES
Share buy-back program $ - $ - $ - $ (3,528)
Dividends paid (2,380) (1,213) (3,822) (2,236)
Repayment of bank loans (281) (535) (13,422) (1,070)
Proceeds from bank loans - 4,500 - 4,500
Proceeds from shares issued on exercise of options and 801 3,522 2,584 4,311
warrants
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Net cash (used in) provided by financing activities $ (1,860) $ 6,274 $ (14,660) $ 1,977
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Foreign currency translation adjustments - 14 - (26)
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Net increase (decrease) in cash and cash equivalents 8,519 17,526 (12,844) (3,522)
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Cash and cash equivalents at beginning of period 61,114 37,628 82,477 58,676
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Cash and cash equivalents at end of period $ 69,633 $ 55,154 $ 69,633 $ 55,154
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NAM TAI ELECTRONICS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)
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FOR THE PERIODS ENDED JUNE 30, 2003 AND 2002
(In Thousands of US Dollars)
1. Accumulated other comprehensive income represents foreign currency
translation adjustments. The comprehensive income of the Company was
$21,704 and $7,983 for the six months ended June 30, 2003 and June 30,
2002, respectively.
2. Business segment information - The Company operates primarily in two
segments, the Consumer Electronic Products ("CEP") segment and the LCD
Panels and Transformers ("LPT") segment.
Unaudited Unaudited
Three months ended Six months ended
June 30 June 30
2003 2002 2003 2002
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NET SALES:
- CEP $ 105,478 $ 43,361 $ 183,059 $ 89,202
- LPT 11,236 8,950 21,636 14,326
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Total net sales $ 116,714 $ 52,311 $ 204,695 $ 103,528
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NET INCOME:
- CEP $ 9,962 $ 4,137 $ 19,994 $ 8,206
- LPT 1,532 (312) 1,710 (206)
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Total net income $ 11,494 $ 3,825 $ 21,704 $ 8,000
==================================================================
Unaudited Audited
June 30, 2003 Dec. 31, 2002
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IDENTIFIABLE ASSETS BY SEGMENT:
- CEP $ 247,761 $ 225,754
- LPT 50,125 49,332
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Total assets $ 297,886 $ 275,086
===============================
3. A summary of the net sales, net income and long-lived assets by geographic
areas is as follows:
Unaudited Unaudited
Three months ended Six months ended
June 30 June 30
2003 2002 2003 2002
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NET SALES FROM OPERATIONS WITHIN:
- Hong Kong:
Unaffiliated customers $ 106,842 $ 48,482 $ 191,228 $ 93,416
Related party 8,834 - 11,765 -
Inter-companies sales 234 447 389 924
- PRC, excluding Hong Kong:
Unaffiliated customers 1,038 1,076 1,702 2,263
Related party - 2,753 - 7,849
Inter-companies sales 101,272 37,594 175,227 75,267
- Inter-companies eliminations (101,506) (38,041) (175,616) (76,191)
--------------- --------------- ---- -------------- ---------------
Total net sales $ 116,714 $ 52,311 $ 204,695 $ 103,528
=============== =============== ==== ============== ===============
NET INCOME FROM OPERATIONS WITHIN:
- PRC, excluding Hong Kong $ 9,496 $ 7,186 $ 18,043 $ 9,421
- Hong Kong 1,998 (3,361) 3,661 (1,421)
--------------- --------------- ---- -------------- ---------------
Total net income $ 11,494 $ 3,825 $ 21,704 $ 8,000
=============== =============== ==== ============== ===============
Unaudited Audited
June 30, 2003 Dec. 31, 2002
----------------------------------------------------------------------- -- --------------- ---------------
LONG-LIVED ASSETS WITHIN:
- PRC, excluding Hong Kong $ 58,761 $ 54,481
- Hong Kong 18,352 21,433
--------------- ---------------
Total long-lived assets $ 77,113 $ 75,914
=============== ===============
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
NAM TAI ELECTRONICS, INC.
Date: August 13, 2003 By: /s/ M.K. Koo
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Name: M. K. Koo
Title: Chief Financial Officer and Director