Market Overview

Plastec Technologies Reports 2018 First Half Financial Results; Announces Extension of Securities Repurchase Plan; Declares Special Cash Dividend of $2.50 Per Share

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Plastec Technologies, Ltd. - (OTC:PLTYF), (the "Company"),
today reported unaudited financial results for the fiscal 2018 six-month
period ended June 30, 2018. See financial tables at the end of this
release in Hong Kong dollars (HKD). All other amounts in this press
release are presented in U.S. dollars (USD) with a conversion rate of
US$1.0: HK$7.8.

2016 Sale of Assets

The Company's financial results reflect the closing of the October 11,
2016 Share Transfer Agreement ("Agreement") with Shanghai Yongli Belting
Co., Ltd. ("SYB") and its wholly-owned subsidiary, Shanghai Yongjing
Investment Management Co., Ltd. As a result, the Company no longer owns
any shareholding in Plastec International Holdings Limited ("Plastec")
or its integrated plastic manufacturing operations, all of which were
being disposed of to SYB.

Since closing of the divestiture transaction, the Company, as a holding
company, has been focused on:

  • completing the construction of its manufacturing plant in Kai Ping,
    China, which it completed and transferred the ownership interest in
    the subsidiaries holding the plant to Plastec on April 20, 2018;
  • collecting rental income from certain property it owns and that is
    being leased to one of Plastec's subsidiaries;
  • collecting any payments it may receive upon Plastec achieving the
    performance target for the year ended December 31, 2018 of
    HK195,408,000, or USD $25,052,308; and
  • exploring any investment opportunities.

Current Balance Sheet Highlights

  • $65.3 million in working capital at June 30, 2018 compared to $71.7
    million at December 31, 2017.
  • Book value per share was $6.30 at June 30, 2018 compared to $7.62 at
    December 31, 2017.

Update on Securities Repurchase Plan

The Company announced today that its Board of Directors has approved a
further extension of its existing securities repurchase plan (as
expanded) through September 25, 2019, allowing it to purchase up to $5
million of its securities in both open market and privately negotiated
transactions at the discretion of the Company's management and as market
conditions allow; which repurchase plan may be suspended, modified or
discontinued without any notice at any time.

Declaration of Special Dividend to Shareholders

Following receipt of a further payment of RMB124,380,000 (or
approximately $18,052,250, at the conversion rate of 6.89 RMB for every
US$1.0) end of May 2018 under the Agreement, the Company's Board of
Directors has declared a special cash dividend of US$2.50 per ordinary
share. The special cash dividend will be paid on or about September 7,
2018 to shareholders of record as of August 31, 2018.

Management Comments

Mr. Kin Sun Sze-To, Chairman of the Company, stated, "We are pleased to
have completed the construction and disposal of the manufacturing plant
during the period, which was one of the key deliverables as we unwind
our legacy business, and to pay this special dividend, which was
generated from the achievement of the performance target by the disposed
line of business for the year ended December 31, 2017. We continue to
evaluate potential opportunities to leverage our strong capital position
while also rewarding our shareholders."

Forward Looking Statements

This press release contains "forward-looking statements." These
forward-looking statements involve significant risks and uncertainties
that could cause the actual results to differ materially from the
expected results. Actual results may differ from expectations, estimates
and projections and, consequently, you should not rely on these forward
looking statements as predictions of future events. Words such as
"expect," "estimate," "project," "budget," "forecast," "anticipate,"
"intend," "plan," "may," "will," "could," "should," "believes,"
"predicts," "potential," "continue," and similar expressions are
intended to identify such forward-looking statements.

PLASTEC TECHNOLOGIES, LTD.

CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME
(Unaudited)

(Hong Kong dollars in thousands, except number of shares, per
share data and unless otherwise stated)

 
    For the 6-month

period ended June 30,

    2018   2017
HK$   HK$
 
 
Revenues - -
 
Operating Income/(expenses), net
Selling, general and administrative expenses (3,155 ) (9,484 )
Other income 8,240 7,562
Gain on disposal of subsidiaries 6,303     -  
Total operating income/(expenses), net 11,388     (1,922 )
 
Income/(loss) from operations 11,388 (1,922 )
 
Interest income 1,229     1,194  
Income/(loss) before income tax expense 12,617 (728 )
 
Income tax expense (1,905 )   (384 )
Net income/(loss) attributable to the Company's

shareholders

10,712 (1,112 )
 
Other comprehensive income/(loss)
Foreign currency translation adjustment 6,673     (811 )
Comprehensive income/(loss) attributable to

the Company's shareholders

17,385

   

(1,923

)

 
Net income per share:
 
Weighted average number of ordinary shares 12,938,128     12,938,128  
 
Weighted average number of diluted ordinary shares 12,938,128     12,938,128  
 
Basic income/(loss) per share attributable

to the Company's shareholders

HK$0.83

 

(HK$0.09)

 
Diluted income/(loss) per share attributable

to the Company's shareholders

HK$0.83

 

(HK$0.09)

 

PLASTEC TECHNOLOGIES, LTD.

CONSOLIDATED BALANCE SHEETS

(Hong Kong dollars in thousands, except number of shares, per
share data and unless otherwise stated)

     

(Unaudited)

June 30,

(Audited)

December 31,

2018   2017
HK$ HK$
 

ASSETS

 
Current assets
Cash and cash equivalents 518,343 395,087
Deposits, prepayment and other receivables 4,252 33,574
Consideration receivable -   141,341  
Total current assets 522,595 570,002
 
Property, plant and equipment, net 110,962 194,712
Prepaid lease payments, net 14,348 15,111
Intangible assets 438   438  
Total assets 648,343   780,263  
 

LIABILITIES AND SHAREHOLDERS' EQUITY

 
Current liabilities
Other payables and accruals 4,856 4,690
Tax payable 8,148   6,243  
Total current liabilities 13,004 10,933
   
Total liabilities 13,004   10,933  
 
Commitments and contingencies - -
 
Shareholders' equity
Ordinary shares (US$0.001 par value; 100,000,000
authorized 12,938,128 and 12,938,128 shares issued and
outstanding as of June 30, 2018 and December 31, 2017,
respectively) 101 101
Additional paid-in capital 26,049 26,049
Accumulated other comprehensive income (31 ) (6,704 )
Retained earnings 609,220   749,884  
Total shareholders' equity 635,339   769,330  
   
Total liabilities and shareholders' equity 648,343   780,263  
 

PLASTEC TECHNOLOGIES, LTD.

CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)

(Hong Kong dollars in thousands, except number of shares, per
share data and unless otherwise stated)

 
      For the 6-month

period ended June 30,

2018   2017
  HK$ HK$
Operating activities
Net income/(loss) 10,712 (1,112 )
Adjustments to reconcile net income to net cash provided by
operating activities:
Depreciation and amortization 4,600 4,280
Gain on disposal of subsidiaries (6,303 ) -
Changes in operating assets and liabilities:
Deposits, prepayment and other receivables (9,486 ) (262 )
Trade payables 35,455 -
Other payables and accruals (18,169 ) (695 )
Tax payables   1,905     270  
Net cash provided by operating activities   (18,714 )   2,481  
 
Investing activities
Disposal/(Purchase) of property, plant and equipment 107,834 (23,223 )
Net proceeds of disposal of subsidiaries 70 -
Proceeds from consideration receivable, net   141,341     128,702  
Net cash provided by investing activities   249,245     105,479  
 
Financing activities
Dividends paid   (151,376 )   (151,376 )
Net cash used in financing activities   (151,376 )   (151,376 )
 
Net increase/(decrease) in cash and cash equivalents 116,583 (43,416 )
 
Effect of exchange rate changes on cash and cash equivalents 6,673 (811 )
Cash and cash equivalents, beginning of period   395,087     486,222  
Cash and cash equivalents, end of period   518,343     441,995  
 
Supplementary disclosures of cash flow information:
Interest received, net 1,229 1,194
Income taxes paid   -     115  

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