Zoom Technologies Inc. (ZOOM) filed Quarterly Report for the period ended 2009-09-30.
Zoom Tech is a leading designer, producer and marketer of modems and other personal computer communications products for the home and office. They offer a broad line of modems with top data speeds, available in internal, external and PCMCIA models (PCMCIA models plug into a PCMCIA- standard slot typically found in a notebook or laptop computer). Zoom Technologies Inc. has a market cap of $14.89 million; its shares were traded at around $7.6 with and P/S ratio of 1.03.
Highlight of Business Operations:
28 On November 30, 2007, Gold Lion and GD Industrial Company signed a share transfer agreement pursuant to which GD Industrial Company transferred 60% equity of Nantong Zong Yi Kechuang Digital Camera Technology Co., Ltd. for $10,273 to Gold Lion. In July 2008, the company's name was changed to Jiangsu Leimone Electronic Co., Ltd., or Jiangsu Leimone. In January 2008, Gold Lion invested $5,074,226 (HK$38,800,000) in Jiangsu Leimone to increase Gold Lion's ownership in Jiangsu Leimone to 80%. Pursuant to the share transfer agreement by and between Gold Lion and Nantong Zong Yi Investment Co., Ltd. dated November 26, 2008, Gold Lion acquired the remaining 20% equity interest of Jiangsu Leimone from Nantong Zong Yi Investment Co., Ltd. for cash consideration of $103,214 (HK$800,000). After this transaction, Gold Lion obtained 100% ownership of Jiangsu Leimone. Jiangsu Leimone is engaged in the R&D and production of electronic assemblies, 3G mobile handsets, wireless communication modules, GPS receivers and computer software.
Gold Lion's revenues were $55,290,880 for the quarter ended September 30, 2009, an increase of 204% or $37,127,229 compared to $18,163,651 in the corresponding period in 2008. The increase of revenues in 2009 as compared to 2008 was mainly due to the addition of activities from Jiangsu Leimone Electronics Co., Ltd. and Profit Harvest which were both in ramp up phases in 2008, and a significant increase in orders from one of Gold Lion's existing customers, a major mobile communications original equipment manufacturer in China. For the nine months ended September 30, 2009 and 2008, revenues were $137,240,898 and $41,144,293 respectively, representing a 234% increase.
Gold Lion's other expenses-net was $319,351 for the third quarter of 2009, which was mainly comprised of interest expense of $380,096. For the corresponding 2008 period, other expenses-net was $339,714 which mainly included interest expense of $433,335.
For the quarter ended September 30, 2009, Gold Lion's net income from operations was $1,734,056 or an increase of $1,004,183 or 138% as compared to $729,873 for the 2008 period. Net margins, the ratio of net income over revenues, for the third quarter of 2009 and 2008 were 3.1% and 4.0% respectively. For the nine month periods ended September 30, 2009 and 2008, net incomes were $4,354,153 and $713,681 respectively; while net margins were 3.2% and 1.7% respectively.
Net cash used in operating activities for the nine months ended September 30, 2009 was $6,934,078 as compared to net cash used in operating activities for the 2008 period of $7,954,576. In the first nine months of 2009, operational use of funds included an increase in accounts receivable of $5,909,296 and an increase in advances to suppliers of $20,283,253 while offset by a reduction in inventories of $2,015,176 and an increase in advances from customers of $11,528,554. Other operational uses of cash included a decrease in accounts payable of $860,014 and an increase in advances to related parties of $790,359; while other inflows of cash included a reduction in prepaid expenses of $932,518 and an increase in accrued expenses of $492,578.
Net cash provided by financing activities was $11,945,268 in the first three quarters of 2009 which included proceeds from short-term loans of $18,414,296 and proceeds from notes payable of $6,430,389 and also collection on advances to related parties in the amount of $11,671,204. During this period, there was an outflow due to advance to related parties of $9,846,445 and repayment of short-term loans of $15,067,570 and also an outflow of $1,169,162 for repayment of long-term loans.
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