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FORM 6-K
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Report of Foreign Issuer
Pursuant to Rule 13a-16 or 15d-16 of
the Securities Exchange Act of 1934
For the month of July 10, 2000
DSG International Limited
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(Translation of registrant's name into English)
17/F Watson Centre, 16-22 Kung Yip Street,
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Kwai Chung, Hong Kong
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Tel No. 852-2427-6951
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(Address of principal executive offices)
[Indicate by check mark whether the registrant files or
will file annual reports under cover Form 20-F or Form 40-F.]
Form 20-F x Form 40-F
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[Indicate by check mark whether the registrant by furnishing the
information contained in this Form is also thereby furnishing the information
to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act
of 1934.]
Yes No x
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[If "yes" is marked, indicate below the file number assigned to the
registrant in connection with Rule 12g3-2(b), 82-________.]
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
DSG International Limited
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(Registrant)
Date: July 10, 2000
-------------- By /s/ Peter Chang
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Peter Chang
Vice President
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REVIEW OF OPERATIONS
FIRST QUARTER 2000
To our Shareholders:
We are pleased to announce our first quarter ended March 31, 2000 results.
First Quarter ended March 31, 2000 compared to First Quarter ended March 31,
1999
The Company's net sales for the first quarter of 2000 increased by 4.2% to $55.9
million compared with net sales of $53.6 million for the same quarter of 1999.
Net income and earnings per share for the first quarter of 2000 were $1.6
million and $0.24 respectively, and represented an improvement of 3% over the
first quarter of 1999.
The Company's sales in Asia Pacific region for the first quarter of 2000
recorded strong growth of 24% over the same period in 1999. This had resulted
from the volume growth in the Malaysian and PRC markets. The Company's sales in
North America for the first quarter of 2000 increased by 11% compared with the
corresponding quarter of 1999. Net sales in the first quarter of 1999 included
$2.9 million from an operation in Switzerland which sold at the end of that
quarter. The Company's sales growth after adjusting for this disposal was
10.3%.
Gross profit margin for the first quarter of 2000 improved by 1.1% to 33.3%
compared with 32.2% for the corresponding period in 1999, primarily due to the
improvement in sales volume and manufacturing efficiency, which also offset the
higher fluff wood pulp cost in most of the Company's operations. Selling,
general and administrative expense as a percentage of net sales for the first
quarter of 2000 was 28.2%, which was at the same level as that of the first
quarter of 1999.
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Brandon Wang, the Chairman of the Company, said: "I am delighted that the
Company's sales are growing in the new century. With the economic recovery in
the Asian market, we have captured the market growth by the strategically
located production facilities and sales offices in the region. Meanwhile, we
continue to expand our sales in the major provinces and cities in China. I am
confident that the Company's overall operating performance will be further
improved in the new millenium through a series of products and manufacturing
efficiency enhancement and market expansion."
DSG International Limited and its predecessors have been in the business of
manufacturing and distributing disposal diapers since 1973. With manufacturing
plants in Georgia and Wisconsin, the Company also maintains manufacturing
operations in Hong Kong, Australia, Great Britain, Switzerland, China, Thailand,
Indonesia and Malaysia. Additionally, the Company distributes its products
throughout Asia, Australia, North America and Europe. The Company produces
private label disposable diapers, adult incontinence products and training pants
at certain of its operations. Its best selling brands include "Fitti(R)", "Pet
Pet(R)", "Cosifits(R)", "Baby Love(R)", "Babyjoy(R)", "Cares(R)", "Cuddles(R)",
"Super Fan-nies(R)", "Dispo 123(TM)", "Handy(TM)", "Vlesi(R)", "Certainty(R)",
and "Merit(R)".
May 17, 2000
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STATEMENTS OF OPERATIONS AND BALANCE SHEET DATA
The Statements of Operations for the three-month period ended March 31, 2000 and
1999, and the Balance Sheet information as of March 31, 2000, are derived from
unaudited financial statements which, in the opinion of the management, include
all necessary adjustments, consisting only of normally recurring adjustments,
for a fair presentation of the results of operations for these time frames. The
results for the periods, however, are not necessarily indicative of the results
for the full year.
SUMMARY OF RESULTS
(In thousands, except per share amounts)
Three months ended
March 31
2000 1999
Net sales $ 55,868 $ 53,591
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Gross profit 18,635 17,273
Gain on sale of property, plant and equipment 23 509
Selling, general and administrative expense (15,753) (15,143)
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Operating income 2,905 2,639
Interest expense (396) (608)
Exchange loss (59) (70)
Other income 20 125
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Income before income taxes 2,470 2,086
Provision for income taxes (689) (511)
Minority interest (178) (19)
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Net income $ 1,603 $ 1,556
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Earnings per share $ 0.24 $ 0.23
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Weighted average number of shares
outstanding 6,675 6,675
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STATEMENTS OF COMPREHENSIVE INCOME
(Dollars in thousands)
Three months ended
March 31,
2000 1999
Net income $ 1,603 $ 1,556
Other comprehensive expense
Foreign currency translation adjustments (1,220) (761)
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Comprehensive income $ 383 $ 795
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BALANCE SHEET DATA
(Dollars in thousands, unaudited)
March 31, December 31,
2000 1999
Working capital $ 29,473 $ 36,000
Total assets 112,233 121,847
Long-term debt 11,081 11,894
Shareholders' equity 63,007 70,302
On March 31, 2000, the Company had cash and cash equivalents of $6.4 million.
