Boston, MA 05/16/2014 (wallstreetpr) – The manufacturer of high quality gold jewelry Kingold Jewelry Inc (NASDAQ:KGJI) reported a strong 1Q2014 that gained support from the increase in production, favorable prices and strong demand. The company expects the momentum to continue throughout 2014. The quarter saw significant growth in revenue and encouraging gain in net income column.
The company also used the quarter to plot its long-term future. The quarter saw Kingold Jewelry entering a joint venture with a Kuwait company that would expand its international market to Middle East. The company also reported progress in its planned site at Wuhan.
A look into 1Q2014
Kingold Jewelry Inc (NASDAQ:KGJI) reported revenue of $307.5 million in the quarter. That indicated 38.9 percent increase over $221.4 million revenue generated in 1Q2013. Revenue gain in 1Q drew support from expanded production that was the highlight of the quarter. The company produced 14.5 metric tons in the three months to March 31. That signaled a significant increase from the production of 8.6 metric tons in 1Q2013.
The gain in the top-line trickled down to support the bottom-line. The company realized a net income of $16.1 million or 24 cents per share based on 66.6 million outstanding diluted shares. That was in sharp contrast with a net income of $3 million or 5 cents per share based on 61.2 million outstanding diluted shares for the same period last year. The bottom-line also gained support from the disciplined cost and expenses management in the company.
The company intends to seek more sale opportunities as it grows production to support higher revenue. At the same time, the company promised to look into its system with the aim of identifying more cost-saving opportunities.
Executive comment
According to Kingold Jewelry Inc (NASDAQ:KGJI) CEO ZhiHong Jia, 1Q marks the start of the company’s aggressive efforts to penetrate more and new markets. He noted that the net income gain realized in the quarter drew support from the high margins that prevailed in 1Q because the company was able to purchase a large amount of gold at prices that were below the market rate in 2013 and early this year.
The Chinese New Year also boosted sales and the company expect its efforts to seek sales opportunities in other international markets will put revenue on a growing trend for the long-term.
As concerns more international markets penetration, Kingold Jewelry Inc (NASDAQ:KGJI) announced a joint venture with Kuwait Support Services Company, a move that will promote the company’s products in Kuwait.
