Sino-Global Announces Fiscal 2020 Second Quarter Financial Results

ROSLYN,New York,Feb. 20,2020 -- Sino-Global Shipping America,Ltd. (NASDAQ: SINO) ("Sino-Global",the "Company","we","our",or "us"),a global logistics service provider,announced its financial and operating results for its fiscal 2020 second quarter ended December 31,2019.

The Company has also provided more detailed information in its quarterly reporton Form 10-Qfiled today with the U.S. Securities and Exchange Commission. Management encourages investors to review the Company's 10-Q for a detailed discussion of the Company's financial results for the quarter ended December 31,2019.

Management Comments

Mr. Lei Cao,Chairman and Chief Executive Officer of Sino-Global commented,"We continued to maintain a steamlined operating strategy during a time when we were impacted by an uncertain trade climate. We shifted our focus towards higher margin and greater cash generating business while cultivating our business relationships to position Sino-Global for the future. We recently signed a joint-venture agreement to serve as a full logistics services provider for a leading agricultural company where Sino-Global will provide comprehensive supply chain logistic services for agricultural products shiped from the U.S. to China. In addition,we are now focused on pursuing additional ship management contracts as part of our agency services expansion efforts. The Company has a significant advantage of being able to leverage our relationships in both the U.S. and China while cost-effectively expanding the business prospects for our customers in ports throughout China."

Chairman Cao concluded,"While calendar 2019 was a challenging period due to the trade climate,we believe that the Company is well-positioned to grow sales now as phase one of the trade negotiations have been completed. While the fiscal third quarter was seasonally slow due to the Chinese New Year holiday and an impact from the Coronavirus outbreak,we believe it is only temporary and we will continue to operate our business as steadily and safely as we can."

Fiscal Second Quarter 2020 Financial Review

The Company reported total revenues of approximately $2.0 million for the quarter ended December 31,2019,compared to approximately $10.5 million reported in the same period last year. The decrease was largely due to the fact that in certain freight logistics contracts that the Company entered into with customers starting from the first quarter of fiscal year 2020,only acted as an agent and did not control the services rendered to the customers,as Sino-Global was not the primary responsible party to fulfill the services. As such revenues on these contracts are accounted for on a net basis. The decrease was also due to the decrease in revenues from inland transportation management services as service contracts with customers have expired and there was no new business for this segment.

The Company's gross profit for the 2020 fiscal second quarter was approximately $1.3 million,compared to approximately $2.0 million in the same period last year. Gross profit margin during the quarter was approximately 62.6%,compared to approximately 18.6% in the same period last year. The increase was largely due to the Company's shifting of business focus towards its agency business for providing freight logistics services where the Company acted solely as an agent and did not control the services rendered to its customers.

The following tables present summary information by segment for the three months ended December 31,2019 and 2018,respectively:

For the Three Months Ended December 31,2019

Shipping

Agency and

Management Services

Inland

Transportation

Management

Services

Freight

Logistics

Services

Container

Trucking

Services

Total

Revenues

- Related party

$

-

$

-

$

-

$

-

$

-

- Third parties

$

500,000

$

-

$

1,503,500

*

$

17,624

$

2,021,124

Total revenues

$

500,500

$

17,124

Cost of revenues

$

66,584

$

-

$

673,646

*

$

15,415

$

755,645

Gross profit

$

433,416

$

-

$

829,854

$

2,209

$

1,265,479

Depreciation and amortization

$

79,144

$

-

$

-

$

3,389

$

82,533

Total capital expenditures

$

2,482

$

-

$

-

$

-

$

2,482

Gross margin%

86.7

%

-

%

55.2

%

12.5

%

62.6

%

*

For certain freight logistics contracts that the Company entered into with customers starting from the first quarter of fiscal year 2020,the Company (i) acted as an agent in arranging the relationship between the customer and the third-party service provider and (ii) did not control the services rendered to the customers,revenues related to these contracts are presented net of related costs. For the three months ended December 31,gross revenues and gross cost of revenues related to these contracts amounted to approximately $12.9 million and $12.0 million,respectively.

For the Three Months Ended December 31,2018

Shipping

Agency and

Management Services

Inland

Transportation

Management

Services

Freight

Logistics

Services

Container

Trucking

Services

Total

Revenues

- Related party

$

-

$

75,000

$

-

$

-

$

75,000

- Third parties

$

889,070

$

345,000

$

8,978,923

$

227,294

$

10,440,287

Total revenues

$

889,070

$

420,515,287

Cost of revenues

$

809,040

$

20,000

$

7,497,666

$

229,891

$

8,556,597

Gross profit

$

80,030

$

400,000

$

1,481,257

$

(2,597)

$

1,958,690

Depreciation and amortization

$

-

$

20,339

$

475

$

4,751

$

25,565

Total capital expenditures

$

-

$

-

$

-

$

8,534

$

8,534

Gross margin%

9.0

%

95.2

%

16.5

%

(1.1)

%

18.6

%

The Company had an operating loss of $332,995 for the three months ended December 31,compared to an operating loss of $1,178,661 for the same period in 2018.

For the fiscal quarter ended December 31,the Company reported net loss attributable to Sino-Global Shipping America,Ltd. of approximately $407,333,or a loss of approximately $0.02 per diluted share based on approximately 16.8 million weighted average shares outstanding,compared to net loss attributable to Sino-Global Shipping America,Ltd. of approximately $1.5 million,or loss of approximately $0.11 per diluted share based on approximately 13.8 million weighted average shares outstanding,for the same period last year.

Balance Sheet Information

The Company holds no long-term debt.

As of December 31,the Company's working capital was approximately $10.4 million and the Company had cash of approximately $0.1 million. The Company plans to fund continuing operations through identifying new prospective joint venture partners and strategic alliance opportunities for new revenue sources,and by reducing costs to improve profitability and replenish working capital. However,there is no assurance the Company will be successful in its plans.

The Company's allowance for doubtful accounts was approximately $6.9 million as of December 31,2019 compared with allowance of doubtful accounts of approximately $5.7 million as of June 30,2019. As the Company continues to maintain long-standing relationships with its customers,it will work with these parties to monitor their payments closely and it does not believe that there are any significant collection issues with respect to accounts receivables,net of allowance.

About Sino-Global Shipping America,Ltd.

Founded in the United States in 2001,Sino-Global Shipping America,Ltd. is a company engaged originally in shipping,chartering,logistics and related business services. Headquartered in New York,Sino-Global has offices in mainland China,Australia,Canada and Hong Kong. The Company's current service offerings consist of shipping agency and management,inland transportation management,freight logistics and container trucking services. Additional information about Sino-Global can be found on the Company's corporate website at www.sino-global.com. The Company routinely posts important information on its website.

Forward Looking Statements

No statement made in this press release should be interpreted as an offer to sell or a solicitation of an offer to purchase any security. Such an offer can only be made in accordance with the Securities Act of 1933,as amended,and applicable state securities laws. Any statements contained in this release that relate to future plans,events or performance are forward-looking statements that involve risks and uncertainties as identified in Sino-Global's filings with the U.S. Securities and Exchange Commission. Actual results,events or performance may differ materially. Readers are cautioned not to place undue reliance on these forward-looking statements,which speak only as of the date hereof. Sino-Global undertakes no obligation to publicly release the results of any revisions to these forward-looking statements that may be made to reflect the events or circumstances after the date hereof or to reflect the occurrence of unanticipated events unless required by applicable law or regulations.

Contact Information

The Equity Group Inc.

Adam Prior

Senior Vice-President

(212)-836-9606 / aprior@equityny.com

SINO-GLOBAL SHIPPING AMERICA,LTD. AND AFFILIATES

CONSOLIDATED STATEMENTS OF OPERATION AND COMPREHENSIVE LOSS

(UNAUDITED)

For the Three Months Ended

For the Six Months Ended

December 31,

December 31,

2019

2018

2019

2018

Net revenues - third parties

$

2,124

$

10,287

$

3,807,350

$

16,617,820

Net revenues - related party

-

75,000

-

397,000

Total revenues

2,124

10,287

3,350

17,014,820

Cost of revenues

(755,645)

(8,597)

(1,439,049)

(13,640,429)

Gross profit

1,479

1,690

2,368,301

3,374,391

Selling expenses

(126,125)

(258,229)

(256,154)

(366,598)

General and administrative expenses

(702,064)

(1,415,040)

(1,793,519)

(2,388,792)

Impairment loss of fixed assets and intangible asset

-

-

(327,632)

-

Provision for doubtful accounts

(278,676)

(416,706)

(1,167,754)

(1,287,787)

Stock-based compensation

(491,609)

(1,047,376)

(906,317)

(1,864,584)

Total operating expenses

(1,598,474)

(3,137,351)

(4,451,376)

(5,907,761)

Operating loss

(332,995)

(1,661)

(2,083,075)

(2,533,370)

Other (expenses) income,net

(15,613)

782

(14,157)

1,494

Net loss before provision for income taxes

(348,608)

(1,177,879)

(2,097,232)

(2,531,876)

Income tax expense

(14,747)

(244,979)

(14,747)

(178,513)

Net loss

(363,355)

(1,422,858)

(2,111,979)

(2,710,389)

Net income (loss) attributable to non-controlling interest

43,978

51,114

(77,293)

80,345

Net loss attributable to Sino-Global Shipping America,Ltd.

$

(407,333)

$

(1,473,972)

$

(2,034,686)

$

(2,790,734)

Comprehensive income (loss)

Net loss

$

(363,355)

$

(1,858)

$

(2,979)

$

(2,389)

Other comprehensive income (loss) - foreign currency

256,206

(106,762)

(247,461)

(568,924)

Comprehensive loss

(107,149)

(1,529,620)

(2,359,440)

(3,279,313)

Less: Comprehensive (loss) income attributable to non-controlling

interest

(49,831)

26,930

(28,558)

133,655

Comprehensive loss attributable to Sino-Global Shipping America,

Ltd.

$

(57,318)

$

(1,550)

$

(2,330,882)

$

(3,412,968)

Loss per share

Basic and diluted

$

(0.02)

$

(0.11)

$

(0.12)

$

(0.21)

Weighted average number of common shares used in computation

Basic and diluted

16,819,010

13,769,918

16,448,371

13,457,726

SINO-GLOBAL SHIPPING AMERICA,LTD. AND AFFILIATES

CONSOLIDATED BALANCE SHEETS

(UNAUDITED)

December31,

June 30,

2019

2019

Assets

Current assets

Cash

$

119,667

$

3,142,650

Notes receivable

-

383,792

Accounts receivable,net

4,551

7,045,846

Other receivables

10,316,228

4,335,715

Advances to suppliers - third parties

193,450

124,140

Prepaid expenses and other current assets

94,912

105,054

Due from related party,net

435,898

807,965

Total Current Assets

15,490,706

15,945,162

Property and equipment,net

666,280

989,910

Right-of-use assets

384,794

-

Intangible assets,net

58,056

89,722

Prepaid expenses

150,412

519,503

Other long-term assets - deposits

3,005,589

3,054,706

Total Assets

$

19,755,837

$

20,599,003

Liabilities and Equity

Current Liabilities

Advances from customers

$

74,912

$

68,590

Accounts payable

510,667

567,619

Lease liabilities - current

155,820

-

Taxes payable

3,157,711

3,184,895

Accrued expenses and other current liabilities

1,190,518

1,418,129

Total current liabilities

5,089,628

5,239,233

Lease liabilities - noncurrent

230,262

-

Total liabilities

5,319,890

5,233

Commitments and Contingencies

Equity

Preferred stock,2,000,000 shares authorized,no par value,none issued

-

-

Common stock,50,no par value; 17,289,537 and 16,534 shares issued

as of December 31,2019 and June 30,respectively; 17,537 and 15,879,037 shares

outstanding as of December 31,respectively

27,308,992

26,523,830

Additional paid-in capital

2,299,823

2,066,906

Treasury stock,at cost,0 and 175,497 shares as of December 31,respectively

-

(417,538)

Accumulated deficit

(9,003,386)

(6,968,700)

Accumulated other comprehensive loss

(967,302)

(671,106)

Total Sino-Global Shipping America Ltd. Stockholders' Equity

19,638,127

20,392

Non-controlling Interest

(5,202,180)

(5,173,622)

Total Equity

14,435,947

15,770

Total Liabilities and Equity

$

19,003

SINO-GLOBAL SHIPPING AMERICA,LTD. AND AFFILIATES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(UNAUDITED)

For the Six Months Ended

December 31,

2019

2018

Operating Activities

Net loss

$

(2,389)

Adjustments to reconcile net loss to net cash used in operating activities:

Stock-based compensation

906,317

1,584

Depreciation and amortization

237,011

51,280

Non-cash lease expense

78,405

-

Provision for doubtful accounts

1,754

1,787

Impairment loss of fixed assets and intangible asset

327,632

-

Deferred tax benefit

-

(120,500)

Changes in assets and liabilities

Notes receivable

386,233

-

Accounts receivable

1,629,174

(5,044,123)

Other receivables

(5,855,492)

79,773

Advances to suppliers - third parties

(66,691)

(220,166)

Advances to suppliers - related party

-

3,294,701

Prepaid expenses and other current assets

160,497

408,642

Other long-term assets - deposits

96,281

(2,489,067)

Due from related parties

413,408

1,091,355

Advances from customers

5,580

(295,619)

Accounts payable

(63,131)

(2,508,225)

Taxes payable

(76,110)

305,603

Lease liabilities

(77,118)

-

Accrued expenses and other current liabilities

(233,414)

286,613

Net cash used in operating activities

(3,075,643)

(4,717,751)

Investing Activities

Acquisition of property and equipment

(7,020)

(9,357)

Net cash used in investing activities

(7,357)

Financing Activities

Proceeds from issuance of common stock

500,500

500,000

Net cash provided by financing activities

500,000

Effect of exchange rate fluctuations on cash

(440,820)

(416,925)

Net decrease in cash

(3,022,983)

(4,644,033)

Cash at beginning of period

3,650

7,098,259

Cash at end of period

$

119,667

$

2,454,226

Supplemental information

Income taxes paid

$

38,498

$

16,536

Non-cash transactions of operating and investing activities

Transfer of prepayment to intangible asset

$

218,678

$

-

Initial recognition of right-of-use assets and lease liabilities

$

462,361

$

-

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