TRIO-TECH INTERNATIONAL Overview
The following should be read in conjunction with the condensed consolidated
financial statements and notes in Item I above and with the audited consolidated
financial statements and notes, the information under the headings "Risk
Factors" and "Management's discussion and analysis of financial condition and
results of operations" in our Annual Report on Form 10-K for the fiscal year
ended
The Company is a provider of reliability test equipment and services to the semiconductor industry. Our customers rely on us to verify that their semiconductor components meet or exceed the rigorous reliability standards demanded for aerospace, communications and other electronics products.
TTI generated approximately 99.9% of its revenue from its three core business
segments in the test and measurement industry, i.e. manufacturing of test
equipment, testing services and distribution of test equipment during the three
months ended
Manufacturing
TTI develops and manufactures an extensive range of test equipment used in the "front-end" and the "back-end" manufacturing processes of semiconductors. Our equipment includes leak detectors, autoclaves, centrifuges, burn-in systems and boards, HAST testers, temperature-controlled chucks, wet benches and more.
Testing
TTI provides comprehensive electrical, environmental, and burn-in testing
services to semiconductor manufacturers in our testing laboratories in
Distribution
In addition to marketing our proprietary products, we distribute complementary
products made by manufacturers mainly from the
Real Estate
Beginning in 2007, TTI has invested in real estate property in
Impact of COVID-19 on our Business
In
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Subsequent to the quarter ended
The health and safety of our employees and our customers are a top priority for us. In an effort to protect our employees, we took and continue to take proactive and aggressive actions, starting with the earliest signs of the outbreak, to adopt social distancing policies at our locations, including working from home and suspending employee travel. Our operations have been classified as part of the global supply chain and essential businesses in many jurisdictions, and employees who are working onsite are required to adhere to strict safety measures, including the use of masks and sanitizer, wellness screenings prior to accessing work sites, staggered break times to prevent congregation, prohibitions on physical contact with coworkers or customers, restrictions on access through only a single point of entry and exit, and utilizing video conferencing. We have also incorporated other rules such as restricting visitors to any of our facilities that remain open and proactively providing employees with hand sanitizer.
In the opinion of management, all adjustments (consisting of normal recurring
adjustments) considered necessary for fair presentation have been included.
Operating results for the three months ended
As of
While we have implemented safeguards and procedures to counter the impact of the COVID-19 pandemic, the full extent to which the pandemic has and will directly or indirectly impact us, including our business, financial condition, and result of operations, will depend on future developments that are highly uncertain and cannot be accurately predicted. This may include further mitigation efforts taken to contain the virus or treat its impact and the economic impact on local, regional, national and international markets. We will continue to actively monitor the situation and may take further actions that alter our business operations as may be required by the governments or that we determine are in the best interests of our employees, customers, suppliers and stockholders.
Critical Accounting Estimates & Policies
The discussion and analysis of the Company's financial condition presented in
this section are based upon our consolidated financial statements, which have
been prepared in accordance with generally accepted accounting principles in the
In response to the
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Account Receivables and Allowance for Doubtful Accounts
During the normal course of business, we extend unsecured credit to our customers in all segments. Typically, credit terms require payment to be made between 30 to 90 days from the date of the sale. We generally do not require collateral from customers. We maintain our cash accounts at creditworthy financial institutions.
The Company's management considers the following factors when determining the
collectibility of specific customer accounts: customer creditworthiness, past
transaction history with the customer, current economic industry trends, and
changes in customer payment terms. The Company includes any account balances
that are determined to be uncollectible, along with a general reserve, in the
overall allowance for doubtful accounts. After all attempts to collect a
receivable have failed, the receivable is written off against the allowance.
Based on the information available to management, the Company believed that its
allowance for doubtful accounts was adequate as of
Inventory Valuation
Inventories of our manufacturing and distribution segments, consisting principally of raw materials, works in progress, and finished goods, are stated at the lower of cost, using the first-in, first-out ("FIFO") method, or market value. The semiconductor industry is characterized by rapid technological change, short-term customer commitments and swiftly changing demand. Provisions for estimated excess and obsolete inventory are based on regular reviews of inventory quantities on hand and the latest forecasts of product demand and production requirements from our customers. Inventories are written down for not-saleable, excess or obsolete raw materials, works-in-process and finished goods by charging such write-downs to cost of sales. In addition to write-downs based on newly introduced parts, statistics and judgments are used for assessing provisions of the remaining inventory based on salability and obsolescence.
Property, Plant and
Property, plant and equipment and investment properties are stated at cost, less accumulated depreciation and amortization. Depreciation is provided for over the estimated useful lives of the assets using the straight-line method. Amortization of leasehold improvements is provided for over the lease terms or the estimated useful lives of the assets, whichever is shorter, using the straight-line method.
Maintenance, repairs and minor renewals are charged directly to expense as incurred. Additions and improvements to property and equipment are capitalized. When assets are disposed of, the related cost and accumulated depreciation thereon are removed from the accounts and any resulting gain or loss is included in the consolidated statements of operations and comprehensive income or loss.
Foreign Currency Translation and Transactions
The Company translates assets and liabilities of its subsidiaries outside the
Revenue Recognition
The Company adopted Accounting Standards Update ("ASU") No. 2014-09, ASC Topic 606, Revenue from Contracts with Customers ("ASC Topic 606"). This standard outlines a single comprehensive model for entities to use in accounting for revenue arising from contracts with customers.
We apply a five-step approach as defined in ASC Topic 606 in determining the amount and timing of revenue to be recognized: (1) identifying the contract with customer; (2) identifying the performance obligations in the contracts; (3) determining the transaction price; (4) allocating the transaction price to the performance obligations in the contract; and (5) recognizing revenue when the corresponding performance obligation is satisfied.
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Revenue derived from testing services is recognized when testing services are rendered. Revenue generated from sale of products in the manufacturing and distribution segments are recognized when persuasive evidence of an arrangement exists, delivery of the products has occurred, customer acceptance has been obtained (which means the significant risks and rewards of ownership have been transferred to the customer), the price is fixed or determinable and collectibility is reasonably assured. Certain customers can request for installation and training services to be performed for certain products sold in the manufacturing segment. These services are mainly for helping customers with the test runs of the machines sold and are considered a separate performance obligation. Such services can be provided by other entities as well, and these do not significantly modify the product. The Company recognizes the revenue at the point in time when the Company has satisfied its performance obligation.
In the real estate segment: (1) revenue from property development is earned and recognized on the earlier of the dates when the underlying property is sold or upon the maturity of the agreement; if this amount is uncollectible, the agreement empowers the repossession of the property, and (2) rental revenue is recognized on a straight-line basis over the terms of the respective leases. This means that, with respect to a particular lease, actual amounts billed in accordance with the lease during any given period may be higher or lower than the amount of rental revenue recognized for the period. Straight-line rental revenue is commenced when the tenant assumes possession of the leased premises. Accrued straight-line rents receivable represents the amount by which straight-line rental revenue exceeds rents currently billed in accordance with lease agreements.
Investment
The
Equity Method
The Company analyzes its investments in joint ventures to determine if the joint venture should be accounted for using the equity method. Management evaluates both Common Stock and in-substance Common Stock as to whether they give the Company the ability to exercise significant influence over operating and financial policies of the joint venture even though the Company holds less than 50% of the Common Stock and in-substance Common Stock. If so, the net income of the joint venture will be reported as "Equity in earnings of unconsolidated joint ventures, net of tax" in the Company's consolidated statements of operations and comprehensive income or loss.
Cost Method
Investee companies not accounted for under the consolidation or the equity method of accounting are accounted for under the cost method of accounting. Under this method, the Company's share of the earnings or losses of such investee companies is not included in the consolidated balance sheet or consolidated statements of operations and comprehensive income or loss. However, impairment charges are recognized in the consolidated statements of operations and comprehensive income or loss. If circumstances suggest that the value of the investee company has subsequently recovered, such recovery is not recorded.
Long-Lived Assets & Impairment
Our business requires heavy investment in manufacturing facilities and equipment that are technologically advanced but can quickly become significantly underutilized or rendered obsolete by rapid changes in demand. We have recorded intangible assets with finite lives related to our acquisitions.
We evaluate our long-lived assets with finite lives for impairment whenever events or changes in circumstances indicate that the carrying value of such assets may not be recoverable. Factors considered important that could result in an impairment review include significant underperformance relative to expected historical or projected future operating results, significant changes in the manner of use of the assets or the strategy for our business, significant negative industry or economic trends, and a significant decline in our stock price for a sustained period of time. Impairment is recognized based on the difference between the fair value of the asset and its carrying value, and fair value is generally measured based on discounted cash flow analysis if there is significant adverse change.
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While we have not identified any changes in circumstances requiring further
impairment test in fiscal year 2021 other than the circumstances related to the
During the third quarter of 2020, our operation in
During the fourth quarter of fiscal 2021, The Company recorded an impairment
charge of
Fair Value Measurements
Under the standard ASC Topic 820, Fair Value Measurements and Disclosures ("ASC Topic 820"), fair value refers to the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between participants in the market in which the reporting entity transacts its business. ASC Topic 820 clarifies the principle that fair value should be based on the assumptions market participants would use when pricing the asset or liability. In support of this principle, ASC Topic 820 establishes a fair value hierarchy that prioritizes the information used to develop those assumptions. Under the standard, fair value measurements would be separately disclosed by level within the fair value hierarchy.
Income Tax
We account for income taxes using the liability method in accordance with the
provisions of ASC Topic 740, Accounting for Income Taxes ("ASC Topic 740"),
which requires an entity to recognize deferred tax liabilities and assets.
Deferred tax assets and liabilities are recognized for the future tax
consequence attributable to the difference between the tax bases of assets and
liabilities and their reported amounts in the financial statements, which will
result in taxable or deductible amounts in future years. Further, the effects of
enacted tax laws or rate changes are included as part of deferred tax expenses
or benefits in the period that covers the enactment date. Management believed it
was more likely than not that the future benefits from these timing differences
would not be realized. Accordingly, a full allowance was provided as of
The calculation of tax liabilities involves dealing with uncertainties in the
application of complex global tax regulations. We recognize potential
liabilities for anticipated tax audit issues in the
Stock-Based Compensation
We calculate compensation expense related to stock option awards made to employees and directors based on the fair value of stock-based awards on the date of grant. We determine the grant date fair value of our stock option awards using the Black-Scholes option pricing model and for awards without performance condition the related stock-based compensation is recognized over the period in which a participant is required to provide service in exchange for the stock-based award, which is generally four years. We recognize stock-based compensation expense in the consolidated statements of shareholders' equity based on awards ultimately expected to vest. Forfeitures are estimated on the date of grant and revised if actual or expected forfeiture activity differs materially from original estimates.
Determining the fair value of stock-based awards at the grant date requires significant judgment. The determination of the grant date fair value of stock-based awards using the Black-Scholes option pricing model is affected by our estimated common stock fair value as well as other subjective assumptions including the expected term of the awards, the expected volatility over the expected term of the awards, expected dividend yield and risk-free interest rates. The assumptions used in our option-pricing model represent management's best estimates and are as follows:
? Fair Value of Common Stock. We determined the fair value of each share of
underlying common stock based on the closing price of our common stock on the
date of grant.
? Expected Term. The expected term of employee stock options reflects the period
for which we believe the option will remain outstanding based on historical
experience and future expectations.
? Expected Volatility. We base expected volatility on our historical information
over a similar expected term.
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Noncontrolling Interests in Consolidated Financial Statements
We adopted ASC Topic 810, Consolidation ("ASC Topic 810"). This guidance establishes accounting and reporting standards for the noncontrolling interest in a subsidiary and for the deconsolidation of a subsidiary. This guidance requires that noncontrolling interests in subsidiaries be reported in the equity section of the controlling company's balance sheet. It also changes the manner in which the net income of the subsidiary is reported and disclosed in the controlling company's income statement.
Second Quarter Fiscal Year 2022 Highlights
? Total revenue increased by$2,721 , or 33.2%, to$10,922 in the second quarter of fiscal year 2022, compared to$8,201 for the same period in fiscal year 2021. ? Manufacturing segment revenue decreased by$41 , or 1.1%, to$3,528 for the second quarter of fiscal year 2022, compared to$3,569 for the same period in fiscal year 2021. ? Testing segment revenue increased by$1,406 , or 39.5%, to$4,966 for the second quarter of fiscal year 2022, compared to$3,560 for the same period in fiscal year 2021. ? Distribution segment revenue increased by$1,355 , or 127.2%, to$2,420 for the second quarter of fiscal year 2022, compared to$1,065 for the same period in fiscal year 2021. ? Real estate segment rental revenue increased from$7 to$8 for the second quarter of fiscal year 2022, compared to the same period in fiscal year 2021. ? The overall gross profit margin increased by 3.7% to 26.5% for the second quarter of fiscal year 2022, from 22.8% for the same period in fiscal year 2021. ? General and administrative expenses increased by$285 , or 17.1%, to$1,947 for the second quarter of fiscal year 2022, from$1,662 for the same period in fiscal year 2021. ? Selling expenses increased by$34 , or 27.9%, to$156 for the second quarter of fiscal year 2022, from$122 for the same period in fiscal year 2021. ? Other income increased by$238 , or 166.4% to$381 in the second quarter of fiscal year 2022, compared to$143 in the same period in fiscal year 2021. ? Income from operations was$656 for the second quarter of fiscal year 2022, an increase of$693 as compared to loss from operation of$37 for the same period in fiscal year 2021. ? Income tax expenses was$153 in the second quarter of fiscal year 2022, an increase of$153 as compared to an income tax expense of $nil in the same period in fiscal year 2021. ? During the second quarter of fiscal year 2022, income from continuing operations before noncontrolling interest, net of tax was$856 , as compared to income from continuing operations before noncontrolling interest of$72 for the same period in fiscal year 2021. ? Net income attributable to noncontrolling interest for the second quarter of fiscal year 2022 was$1 , an improvement of$185 as compared to net loss attributable to noncontrolling interest of$184 in the same period in fiscal year 2021. ? Basic earnings per share for the second quarter of fiscal year 2022 were$0.22 , as compared to earnings per share of$0.06 for the same period in fiscal year 2021. ? Dilutive earnings per share for the second quarter of fiscal year 2022 were$0.20 , as compared to earnings per share of 0.06 for the same period in fiscal year 2021. ? Total assets increased by$4,246 to$42,552 as ofDecember 31, 2021 , compared to$38,306 as ofJune 30, 2021 . ? Total liabilities increased by$2,479 to$14,732 as ofDecember 31, 2021 , compared to$12,253 as ofJune 30, 2021 .
Results of Operations and Business Outlook
The following table sets forth our revenue components for both three months and
six months ended
Revenue Components Three Months Ended Six Months Ended
Dec. 31, Dec. 31, Dec. 31, Dec. 31,
2021 2020 2021 2020
Manufacturing 32.3 % 43.5 % 33.6 % 41.2 %
Testing Services 45.4 43.4 45.4 43.3
Distribution 22.2 13.0 20.9 15.4
Real Estate 0.1 0.1 0.1 0.1
Total 100.0 % 100.0 % 100.0 % 100.0 %
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Revenue for the three and six months ended
For the three and six months ended
? an increase in the testing segment in theSingapore ,China ,Malaysia andThailand operation; and ? an increase in the distribution segment in theSingapore operation.
These decreases were partially offset by:
? a decrease in the manufacturing segment in theU.S. andSingapore operations.
Total revenue into and within
Total revenue into and within the
Revenue within our four current segments for the three and six months ended
Manufacturing Segment
Revenue in the manufacturing segment was 32.3% and 33.6% as a percentage of
total revenue for the three and six months ended
Revenue in the manufacturing segment from one customer accounted for 44.8% and
42.4% of our total revenue in the manufacturing segment for the three months
ended
The future revenue in our manufacturing segment will be affected by this one customer's purchase and capital expenditure plans if the customer base cannot be increased.
Testing Services Segment
The testing segment's revenue was 45.4% for the three months ended
The revenue in the testing segment from the one customer noted above accounted
for 63.0% and 61.1% of our revenue in the testing segment for the three months
ended
Distribution Segment
Revenue in the distribution segment was 22.2% and 20.9% as a percentage of total
revenue for the three and six months ended
Demand for the distribution segment varies depending on the demand for our customers' products, the changes taking place in the market, and our customers' forecasts. Hence it is difficult to forecast fluctuations in the market accurately.
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Real Estate Segment
The real estate segment accounted for 0.1% of total revenue for both the three
and six months ended
Uncertainties and Remedies
There are several influencing factors which create uncertainties when forecasting performance, such as the constantly changing nature of technology, specific requirements from the customer, decline in demand for certain types of burn-in devices or equipment, decline in demand for testing services and fabrication services, and other similar factors. One factor that influences uncertainty is the highly competitive nature of the semiconductor industry. Another is that some customers are unable to provide a forecast of the products required in the upcoming weeks; hence it is difficult to plan for the resources needed to meet these customers' requirements due to short lead time and last-minute order confirmation. This will normally result in a lower margin for these products as it is more expensive to purchase materials in a short time frame. However, the Company has taken certain actions and formulated certain plans to deal with and to help mitigate these unpredictable factors. For example, in order to meet manufacturing customers' demands upon short notice, the Company maintains higher inventories but continues to work closely with its customers to avoid stockpiling. We believe that we have improved customer service from staff through our efforts to keep our staff up to date on the newest technology and stressing the importance of understanding and meeting the stringent requirements of our customers. Finally, the Company is exploring new markets and products, looking for new customers, and upgrading and improving burn-in technology while at the same time searching for improved testing methods for higher technology chips.
We are in the process of implementing an ERP System as part of a multi-year plan
to integrate and upgrade our systems and processes. The implementation of this
ERP system was scheduled to occur in phases over a few years. The operational
and financial systems in our
The Company's consolidation process was scheduled to be substantially automated using the new system in fiscal 2022. However, after extensive testing, we have decided to discontinue the effort of using the new system for consolidation process since the consolidation module of the system does not meet our requirements. This decision does not have any impact on the existing internal controls over financial reporting in the consolidation process.
The Company's primary exposure to movements in foreign currency exchange rates
relates to non-
In
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The spread of COVID-19 has caused us to modify our business practices (including employee travel, employee work locations, and cancellation of physical participation in meetings, events and conferences), and we may take further actions as may be required by government authorities or that we determine are in the best interest of our employees, customers, partners, and suppliers. There is no certainty that such measures will be sufficient to mitigate the risks posed by the virus and our ability to perform critical functions could be harmed.
The degree to which COVID-19 impacts our results will depend on future developments, which are highly uncertain and cannot be predicted, including but not limited to the duration and spread of the pandemic, its severity, the action to contain the virus or treat its impact, and how quickly and to what extent normal economic and operating conditions can resume. Even after the COVID-19 pandemic has subsided, we may experience material adverse impacts on our business as a result of the global economic impact and any recession that has occurred or may occur in the future. There are no comparable recent events that provide guidance as to the effect the spread of COVID-19 as a global pandemic may have, and, as a result, the ultimate impact of the pandemic on our operations and financial results is highly uncertain and subject to change.
There are legal and operational risks associated with having operations in
The Company and its subsidiaries do not have any variable interest entities
based in
Comparison of the Three Months Ended
The following table sets forth certain consolidated statements of income data as a percentage of revenue for the three months endedDecember 31, 2021 and 2020 respectively: Three Months Ended December 31, 2021 2020 Revenue 100.0 % 100.0 % Cost of sales 73.5 77.2 Gross Margin 26.5 % 22.8 % Operating expenses General and administrative 17.8 % 20.3 % Selling 1.4 1.5 Research and development 1.2 1.5 Total operating expenses 20.4 23.3 Loss from Operations 6.1 % (0.5 )% Overall Gross Margin
Overall gross margin as a percentage of revenue increased by 3.7% to 26.5% for
the three months ended
Gross profit margin as a percentage of revenue in the manufacturing segment
decreased by 3.9% to 18.5% for the three months ended
Gross profit margin as a percentage of revenue in the testing segment increased
by 13.0% to 37.8% for the three months ended
Gross profit margin of the distribution segment is not only affected by the
market price of the products we distribute, but also the mix of products we
distribute, which frequently changes as a result of fluctuations in market
demand. Gross profit margin as a percentage of revenue in the distribution
segment decreased by 4.0% to 15.3% for the three months ended
In absolute dollar amounts, for the three months ended
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Operating Expenses Operating expenses for the three months endedDecember 31, 2021 and 2020 were as follows: Three Months Ended December 31, (Unaudited) 2021 2020 General and administrative$ 1,947 $ 1,662 Selling 156 122 Research and development 131 123 Total$ 2,234 $ 1,907
General and administrative expenses increased by
Selling expenses increased by
Income from Operations
Income from operations was
Interest Expense Interest expense for the three months endedDecember 31, 2021 and 2020 were as follows: Three Months Ended December 31, (Unaudited) 2021 2020 Interest expenses$ 28 $ 34
Interest expense was
Other Income Other income for the three months endedDecember 31, 2021 and 2020 were as follows: Three Months Ended December 31, (Unaudited) 2021 2020 Interest income $ 16 30 Other rental income 29 24 Exchange loss (38 ) (93 ) Dividend income - 30 Government grant 28 106 Commission income 200 - Bad debts recovery 102 - Other miscellaneous income 44 46 Total $ 381 $ 143
Other income increased by
In the three months ended
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Income Tax Expenses
The Company's income tax expense was
Noncontrolling Interest
As of
Net Income Attributable to Trio-Tech International Common Shareholders
Net income attributable to
Earnings per Share
Basic earnings per share from continuing operations were
Diluted earnings per share from continuing operations were
Segment Information
The revenue, gross margin and income or loss from operations for each segment during the second quarter of fiscal year 2022 and fiscal year 2021 are presented below. As the revenue and gross margin for each segment have been discussed in the previous section, only the comparison of income or loss from operations is discussed below.
Manufacturing Segment The revenue, gross margin and income / (loss) from operations for the manufacturing segment for the three months endedDecember 31, 2021 and 2020 were as follows Three Months Ended December 31, (Unaudited) 2021 2020 Revenue$ 3,528 $ 3,569 Gross margin 18.5 % 22.4 %
(Loss) / Income from operations
Loss from operations from the manufacturing segment was
Testing Segment
The revenue, gross margin and loss from operations for the testing segment for
the three months ended
Three Months Ended
December 31,
(Unaudited) 2021 2020
Revenue $ 4,966 $ 3,560
Gross margin 37.8 % 24.8 %
Income / (Loss) from operations
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Income from operations in the testing segment for the three months ended
The increase in general and administrative expenses was mainly due to higher
payroll related expenses in the
Distribution Segment
The revenue, gross margin and income from operations for the distribution
segment for the three months ended
Three Months Ended
December 31,
(Unaudited) 2021 2020
Revenue $ 2,420 $ 1,065
Gross margin 15.3 % 19.2 %
Income from operations $ 277 $ 120 Income from operations was
Real Estate Segment
The revenue, gross margin and loss from operations for the real estate segment
for the three months ended
Three Months Ended
December 31,
(Unaudited) 2021 2020
Revenue $ 8 $ 7
Gross margin (137.5 )% (214.3 )%
Loss from operations $ (28 ) $ (34 ) Loss from operations in the real estate segment for the three months ended
Corporate
The income from operations for Corporate for the three months ended
Three Months Ended
December 31,
(Unaudited) 2021 2020
Income from operations $ (133 ) $ 132 Corporate operating income was
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Comparison of the Six Months Ended
The following table sets forth certain consolidated statements of income data as a percentage of revenue for the six months endedDecember 31, 2021 and 2020, respectively: Six Months Ended Dec. 31, Dec. 31, 2021 2020 Revenue 100.0 % 100.0 % Cost of sales 71.2 77.5 Gross Margin 28.8 % 22.5 % Operating expenses: General and administrative 18.6 % 22.1 % Selling 1.4 1.5 Research and development 1.0 1.3 Gain on disposal of plant and equipment - - Total operating expenses 21.0 % 24.9 % Income / (Loss) from Operations 7.8 % (2.4 )% Overall Gross Margin
Overall gross margin as a percentage of revenue increased by 6.3% to 28.8% for
the six months ended
Gross profit margin as a percentage of revenue in the manufacturing segment
increased by 1.1% to 25.1% for the six months ended
Gross profit margin as a percentage of revenue in the testing segment increased
by 14.4% to 37.6% for the six months ended
Gross profit margin as a percentage of revenue in the distribution segment
decreased by 1.8% to 16.1% for the six months ended
Gross loss margin as a percentage of revenue in the real estate segment
decreased by 154.5% to 100.00% for the six months ended
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Operating Expenses Operating expenses for the six months endedDecember 31, 2021 and 2020 were as follows: Six Months Ended Dec. 31, Dec. 31, 2021 2020 (Unaudited) General and administrative$ 3,927 $ 3,322 Selling 303 233 Research and development 213 198 Gain on disposal of plant and equipment - (1 ) Total$ 4,443 $ 3,752
General and administrative expenses increased by
Selling expenses increased by
Income / (Loss) from Operations
Income from operations was
Interest Expense Interest expense for the six months endedDecember 31, 2021 and 2020 were as follows: Six Months Ended Dec. 31, Dec. 31, 2021 2020 (Unaudited) Interest expense$ 56 $ 71
Interest expense decreased by
Other Income
Other income for the six months ended
Six Months Ended
Dec. 31, Dec. 31,
2021 2020
(Unaudited)
Interest income $ 38 $ 70
Other rental income 58 45
Exchange loss (4 ) (137 )
Bad debt recovery 104 -
Dividend Income - 32
Government grant 98 260
Commission income 200 -
Other miscellaneous income 48 84
Total $ 542 $ 354
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Other income for the six months ended
In the six months ended
Income Tax Expenses
Income tax expenses for the six months ended
Noncontrolling Interest
As of
Net Income Attributable to Trio-Tech International Common Shareholders
Net income was
Earnings per Share
Basic earnings per share from continuing operations was
Diluted earnings per share from continuing operations was
Segment Information
The revenue, gross profit margin, and income or loss from operations in each
segment for the six months ended
Manufacturing Segment
The revenue, gross margin and income from operations for the manufacturing
segment for the six months ended
Six Months Ended
Dec. 31, Dec. 31,
2021 2020
(Unaudited)
Revenue $ 7,090 $ 6,194
Gross margin 25.1 % 24.0 %
Income from operations $ 252 $ 63 Income from operations from the manufacturing segment was
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Testing Segment
The revenue, gross margin and loss from operations for the testing segment for
the six months ended
Six Months Ended
Dec. 31, Dec. 31,
2021 2020
(Unaudited)
Revenue $ 9,566 $ 6,514
Gross margin 37.6 % 23.2 %
Income / (Loss) from operations
Income from operations in the testing segment for the six months ended
The increase in general and administrative expenses was mainly due to higher
payroll related expenses in the
Distribution Segment
The revenue, gross margin and income from operations for the distribution
segment for the six months ended
Six Months Ended
Dec. 31, Dec. 31,
2021 2020
(Unaudited)
Revenue $ 4,418 $ 2,323
Gross margin 16.1 % 17.9 %
Income from operations $ 531 $ 244 Income from operations in the distribution segment for the six months ended
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Real Estate Segment
The revenue, gross loss margin and loss from operations for the real estate
segment for the six months ended
Six Months Ended
Dec. 31, Dec. 31,
2021 2020
(Unaudited)
Revenue $ 19 $ 11
Gross loss margin 111.1 % 254.5 %
Loss from operations $ (51 ) $ (61 ) Loss from operations in the real estate segment for the six months ended
Corporate
The (loss) / income from operations for corporate for the six months ended
Six Months Ended
Dec. 31 , Dec. 31,
2021 2020
(Unaudited)
Loss / Income from operations
The deterioration of
Financial Condition
During the six months ended
Cash and cash equivalents were
Short-term deposits were
As at
As at
Inventories as at
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Prepaid expenses were
Investment properties' net in
Property, plant and equipment decreased by
Restricted term deposits remained consistent at
Other assets decreased by
Lines of credit increased by
Accounts payable increased by
Accrued expenses increased by
Bank loans payable decreased by
Finance leases decreased by
Operating lease right-of-use assets and the corresponding lease liability
increased by
Liquidity Comparison
Net cash provided by operating activities increased by
Net cash used in investing activities increased by
Net cash provided by financing activities for the six months ended
The Company has filed the S3 registration statement on
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