Document And Entity Information
Document And Entity Information | 12 Months Ended |
Jun. 30, 2017shares | |
Document Information [Line Items] | |
Document Type | 20-F |
Amendment Flag | false |
Document Period End Date | Jun. 30, 2017 |
Document Fiscal Year Focus | 2,017 |
Document Fiscal Period Focus | FY |
Entity Registrant Name | Hollysys Automation Technologies, Ltd. |
Entity Central Index Key | 1,357,450 |
Current Fiscal Year End Date | --06-30 |
Entity Well-known Seasoned Issuer | Yes |
Entity Voluntary Filers | No |
Entity Current Reporting Status | Yes |
Entity Filer Category | Large Accelerated Filer |
Trading Symbol | HOLI |
Entity Common Stock, Shares Outstanding | 60,342,099 |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Jun. 30, 2017 | Jun. 30, 2016 |
Current assets | ||
Cash and cash equivalents | $ 197,640 | $ 229,095 |
Time deposits with maturities over three months | 96,214 | 42,368 |
Restricted cash | 39,534 | 27,592 |
Accounts receivable, net of allowance for doubtful accounts of $42,471 and $48,089 as of June 30, 2016 and 2017, respectively | 246,552 | 237,179 |
Costs and estimated earnings in excess of billings, net of allowance for doubtful accounts of $6,383 and $8,660 as of June 30, 2016 and 2017, respectively | 162,096 | 189,928 |
Other receivables, net of allowance for doubtful accounts of $1,302 and $1,448 as of June 30, 2016 and 2017, respectively | 20,036 | 13,358 |
Advances to suppliers | 9,964 | 11,661 |
Amounts due from related parties | 34,142 | 28,012 |
Inventories | 45,660 | 36,401 |
Prepaid expenses | 619 | 569 |
Income tax recoverable | 5,169 | 4,488 |
Deferred tax assets | 7,730 | 6,659 |
Total current assets | 865,356 | 827,310 |
Non-current assets | ||
Restricted cash | 522 | 402 |
Prepaid expenses | 0 | 13 |
Property, plant and equipment, net | 80,529 | 79,938 |
Prepaid land leases | 10,206 | 10,773 |
Intangible assets, net | 1,928 | 856 |
Investments in equity investees | 47,242 | 18,714 |
Investments in cost investees | 4,024 | 4,108 |
Goodwill | 47,326 | 59,847 |
Deferred tax assets | 1,121 | 2,195 |
Total non-current assets | 192,898 | 176,846 |
Total assets | 1,058,254 | 1,004,156 |
Current liabilities (including amounts of the VIE without recourse to the primary beneficiary of $270 and $14,051 as of June 30, 2016 and 2017, respectively): | ||
Derivative financial liability | 487 | 398 |
Short-term bank loans | 8,121 | 3,051 |
Current portion of long-term loans | 420 | 6,833 |
Accounts payable | 122,714 | 106,833 |
Construction costs payable | 383 | 647 |
Deferred revenue | 107,407 | 82,004 |
Accrued payroll and related expenses | 13,600 | 13,193 |
Income tax payable | 3,371 | 4,917 |
Warranty liabilities | 5,386 | 6,782 |
Other tax payables | 10,488 | 18,069 |
Accrued liabilities | 23,950 | 44,041 |
Amounts due to related parties | 2,301 | 1,645 |
Deferred tax liabilities | 4,350 | 8,913 |
Total current liabilities | 302,978 | 297,326 |
Accrued liabilities | 2,220 | 0 |
Long-term loans | 20,581 | 20,508 |
Deferred tax liabilities | 6,689 | 59 |
Warranty liabilities | 2,246 | 3,578 |
Total non-current liabilities | 31,736 | 24,145 |
Total liabilities | 334,714 | 321,471 |
Commitments and contingencies | ||
Stockholders' equity: | ||
Ordinary shares, par value $0.001 per share, 100,000,000 shares authorized; 59,598,099 and 60,342,099 shares issued and outstanding as of June 30, 2016 and 2017, respectively | 60 | 60 |
Additional paid-in capital | 222,189 | 215,403 |
Statutory reserves | 41,130 | 36,533 |
Retained earnings | 482,999 | 430,627 |
Accumulated other comprehensive income | (22,859) | (8,467) |
Total Hollysys Automation Technologies Ltd. Stockholders' equity | 723,519 | 674,156 |
Non-controlling interest | 21 | 8,529 |
Total equity | 723,540 | 682,685 |
Total liabilities and equity | $ 1,058,254 | $ 1,004,156 |
CONSOLIDATED BALANCE SHEETS _Pa
CONSOLIDATED BALANCE SHEETS [Parenthetical] - USD ($) $ in Thousands | Jun. 30, 2017 | Jun. 30, 2016 |
Allowance for doubtful accounts, accounts receivable | $ 48,089 | $ 42,471 |
Allowance for doubtful accounts of costs and estimated earnings in excess of billings | 8,660 | 6,383 |
Allowance for doubtful accounts, other receivables | $ 1,448 | $ 1,302 |
Common stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Common stock, shares authorized (in shares) | 100,000,000 | 100,000,000 |
Common stock, shares issued (in shares) | 60,342,099 | 59,598,099 |
Common stock, shares outstanding (in shares) | 60,342,099 | 59,598,099 |
Liabilities, Current, Total | $ 302,978 | $ 297,326 |
Variable Interest Entity, Not Primary Beneficiary [Member] | ||
Liabilities, Current, Total | $ 14,051 | $ 270 |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Thousands | 12 Months Ended | ||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2015 | |
Net revenues | |||
Integrated contract revenue (including revenue from related parties of $22,544, $3,871 and $2,442 for the years ended June 30, 2015, 2016 and 2017, respectively) | $ 385,500 | $ 477,790 | $ 481,006 |
Product sales (including revenue from related parties of $2,014, $868 and $9,447 for the years ended June 30, 2015, 2016 and 2017, respectively) | 32,665 | 54,546 | 39,762 |
Revenue from services (including revenue from related parties of $19, nil and nil for the years ended June 30, 2015, 2016 and 2017, respectively) | 13,778 | 11,989 | 10,611 |
Total net revenues | 431,943 | 544,325 | 531,379 |
Costs of integrated contracts (including purchases from related parties of $419, $22 and $762 for the years ended June 30, 2015, 2016 and 2017, respectively) | 277,476 | 310,545 | 300,332 |
Costs of products sold (including purchases from related parties of nil, $370 and $24 for the years ended June 30, 2015, 2016 and 2017, respectively) | 9,971 | 24,023 | 12,547 |
Costs of services rendered | 4,025 | 4,031 | 4,098 |
Gross profit | 140,471 | 205,726 | 214,402 |
Operating expenses | |||
Selling (including expenses from related parties of $914, $517 and nil for the years ended June 30, 2015, 2016 and 2017, respectively) | 24,412 | 25,637 | 26,263 |
General and administrative | 44,297 | 45,832 | 50,786 |
Goodwill impairment charge | 11,211 | 0 | 1,855 |
Research and development | 30,109 | 36,564 | 35,779 |
VAT refunds and government subsidies | (29,828) | (22,890) | (30,388) |
Total operating expenses | 80,201 | 85,143 | 84,295 |
Income from operations | 60,270 | 120,583 | 130,107 |
Other income, net (including other income from related parties of $41, nil and $602 for the years ended June 30, 2015, 2016 and 2017, respectively) | 1,722 | 4,061 | 2,601 |
Foreign exchange loss | (135) | (299) | (6,765) |
Gains on deconsolidation of the Company’s interests in Beijing Hollycon Electronic Technology Co., Ltd (“Hollycon”) | 14,514 | 0 | 0 |
Gains on disposal of a subsidiary | 628 | 0 | 0 |
Gain on disposal of an equity investee | 0 | 0 | 80 |
Share of net (loss) income of equity investees | 3,607 | 7,834 | (2,910) |
Interest income | 3,687 | 5,858 | 3,686 |
Interest expenses | (938) | (1,404) | (1,821) |
Dividend income from a cost investee | 0 | 1,109 | 249 |
Income before income taxes | 83,355 | 137,742 | 125,227 |
Income tax expenses | 14,386 | 14,238 | 26,040 |
Net income | 68,969 | 123,504 | 99,187 |
Less: net income attributable to non-controlling interests | 25 | 5,033 | 2,660 |
Net income attributable to Hollysys Automation Technologies Ltd. | 68,944 | 118,471 | 96,527 |
Other comprehensive income, net of tax of nil | |||
Translation adjustments | (14,428) | (48,841) | (1,386) |
Comprehensive income | 54,541 | 74,663 | 97,801 |
Less: comprehensive income attributable to non-controlling interests | (11) | 2,244 | 2,701 |
Comprehensive income attributable to Hollysys Automation Technologies Ltd. | $ 54,552 | $ 72,419 | $ 95,100 |
Net income per ordinary share: | |||
Basic (in dollars per share) | $ 1.15 | $ 2 | $ 1.65 |
Diluted (in dollars per share) | $ 1.14 | $ 1.97 | $ 1.61 |
Shares used in income per share computation: | |||
Weighted average number of ordinary shares | 60,189,004 | 59,170,050 | 58,612,596 |
Weighted average number of diluted ordinary shares | 61,011,510 | 60,611,456 | 60,134,203 |
CONSOLIDATED STATEMENTS OF COM5
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME [Parenthetical] - USD ($) $ in Thousands | 12 Months Ended | ||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2015 | |
Integrated contract revenue from related parties | $ 2,442 | $ 3,871 | $ 22,544 |
Products sales revenue from related parties | 9,447 | 868 | 2,014 |
Costs of integrated contracts purchase from related parties | 762 | 22 | 419 |
Sales Of Goods and Services To Related Parties Amount | 0 | 517 | 914 |
Related Party Costs | 24 | 370 | 0 |
Sales Revenue For Services From Related Parties | 0 | 0 | 19 |
Costs and Expenses, Related Party | $ 602 | $ 0 | $ 41 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 12 Months Ended | ||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2015 | |
Cash flows from operating activities: | |||
Net income | $ 68,969 | $ 123,504 | $ 99,187 |
Adjustments to reconcile net income to net cash provided by operating activities: | |||
Depreciation of property, plant and equipment | 8,752 | 6,266 | 8,508 |
Amortization of prepaid land leases | 261 | 281 | 197 |
Amortization of intangible assets | 623 | 818 | 4,454 |
Allowance for doubtful accounts | 9,760 | 10,918 | 17,418 |
Loss on disposal of property, plant and equipment | 596 | 224 | 598 |
Impairment loss on property, plant and equipment | 361 | 0 | 0 |
Goodwill impairment charge | 11,211 | 0 | 1,855 |
Share of net loss (income) of equity investees | (3,607) | (7,834) | 2,910 |
Dividends received from a cost investee | 0 | 0 | (249) |
Gain on disposal of investment in an equity investee | 0 | 0 | (80) |
Gains on deconsolidation of the Company’s interests in HollyCon | (14,514) | 0 | 0 |
Gain on disposal of a subsidiary | (628) | 0 | 0 |
Share-based compensation expenses | 464 | 3,860 | 2,492 |
Deferred income tax (benefit) expenses | 2,133 | (462) | 4,846 |
Acquisition-related consideration fair value adjustments | 0 | (1,745) | (166) |
Accretion of convertible bond | 230 | 230 | 192 |
Fair value adjustments of a bifurcated derivative | 89 | 93 | 35 |
Changes in operating assets and liabilities: | |||
Accounts receivable | (23,441) | (16,413) | (7,675) |
Costs and estimated earnings in excess of billings | 21,945 | (36,971) | 10,527 |
Inventories | (10,701) | (4,607) | 560 |
Advances to suppliers | 881 | 2,497 | (3,690) |
Other receivables | (6,767) | (2,481) | (1,928) |
Deposits and other assets | (12,698) | (674) | (13,375) |
Due from related parties | (6,819) | 8,226 | (15,205) |
Accounts payable | 23,563 | 8,272 | (25,836) |
Deferred revenue | 28,168 | (47,637) | 7,556 |
Accruals and other payables | (21,013) | 5,015 | 6,897 |
Due to related parties | 801 | 351 | (2,301) |
Income tax payable | (1,779) | (4,558) | (6,153) |
Other tax payables | (7,027) | (436) | (7,622) |
Net cash provided by operating activities | 69,813 | 46,737 | 83,952 |
Cash flows from investing activities: | |||
Time deposits placed with banks | (154,810) | (107,118) | (33,416) |
Purchases of property, plant and equipment | (3,711) | (7,887) | (4,553) |
Proceeds from disposal of investment in an equity investee | 0 | 0 | 80 |
Maturity of time deposits | 89,262 | 112,013 | 11,551 |
Proceeds from disposal of property, plant and equipment | 64 | 74 | 794 |
Investment of an equity investee | (2,654) | 0 | 0 |
Net cash reduced upon deconsolidation of a subsidiary | (16,140) | 0 | 0 |
Acquisition of a subsidiary, net of cash acquired | (1,652) | 0 | (14,600) |
Dividends received from a cost investee | 88 | 0 | 249 |
Proceeds from sale of shares of a subsidiary | 0 | 464 | 0 |
Net cash used in investing activities | (89,553) | (2,454) | (39,895) |
Cash flows from financing activities: | |||
Proceeds from short-term bank loans | 10,061 | 4,138 | 25,074 |
Repayments of short-term bank loans | (4,932) | (17,020) | (12,631) |
Proceeds from long-term bank loans | 461 | 2,606 | 0 |
Repayments of long-term bank loans | (7,350) | (9,681) | (8,813) |
Proceeds from convertible bond | 0 | 0 | 20,000 |
Convertible bond issuance cost | 0 | 0 | (349) |
Proceeds from exercise of options | 6,322 | 5,441 | 1,280 |
Payment of dividends | (11,975) | 0 | (23,300) |
Proceeds from issuance of shares of a subsidiary | 0 | 7,736 | 0 |
Net cash (used in) provided by financing activities | (7,413) | (6,780) | 1,261 |
Effect of foreign exchange rate changes | (4,302) | (16,242) | 357 |
Net increase (decrease) in cash and cash equivalents | (31,455) | 21,261 | 45,675 |
Cash and cash equivalents, beginning of year | 229,095 | 207,834 | 162,159 |
Cash and cash equivalents, end of year | 197,640 | 229,095 | 207,834 |
Supplementary disclosures of cash flow information: | |||
Interest | 727 | 1,048 | 1,855 |
Income tax | 13,918 | 19,099 | 26,183 |
Supplementary disclosures of significant non-cash transactions: | |||
Acquisition of property, plant and equipment included in construction costs payable and accrued liabilities | 7,266 | 4,439 | 484 |
Issuance of ordinary shares as purchase consideration in connection with the acquisition of Bond Group | $ 0 | $ 13,336 | $ 15,231 |
CONSOLIDATED STATEMENTS OF STOC
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY - USD ($) $ in Thousands | Total | Ordinary shares [Member] | Additional Paid-in Capital [Member] | Statutory Reserves [Member] | Retained Earnings [Member] | Accumulated Other Comprehensive Income [Member] | Total Hollysys Automation Technologies Ltd. Stockholders' Equity [Member] | Non-controlling Interest [Member] | |
Balance at Jun. 30, 2014 | $ 492,058 | $ 58 | $ 173,765 | $ 23,288 | $ 252,351 | $ 39,013 | $ 488,475 | $ 3,583 | |
Balance (in shares) at Jun. 30, 2014 | 57,554,824 | ||||||||
Share-based compensation | 2,492 | $ 0 | 2,492 | 0 | 0 | 0 | 2,492 | 0 | |
Issuance of ordinary shares upon exercise of options | 1,280 | $ 0 | [1] | 1,280 | 0 | 0 | 0 | 1,280 | 0 |
Issuance of ordinary shares upon exercise of options (in shares) | 142,500 | ||||||||
Exercise of share-based compensation on restricted shares issued to directors | 0 | $ 0 | [1] | 0 | 0 | 0 | 0 | 0 | 0 |
Exercise of share-based compensation on restricted shares issued to directors (in shares) | 12,500 | ||||||||
Issuance of Incentive Shares and Premium Shares for Bond Group | 15,231 | $ 0 | [1] | 15,231 | 0 | 0 | 0 | 15,231 | 0 |
Issuance of Incentive Shares and Premium Shares for Bond Group (in shares) | 648,697 | ||||||||
Net income for the year | 99,187 | $ 0 | 0 | 0 | 96,527 | 0 | 96,527 | 2,660 | |
Appropriations to statutory reserves | 0 | 0 | 0 | 7,137 | (7,137) | 0 | 0 | 0 | |
Dividend paid | (23,300) | 0 | 0 | 0 | (23,300) | 0 | (23,300) | 0 | |
Other | (177) | 0 | 0 | (177) | 0 | 0 | (177) | ||
Translation adjustments | (1,386) | 0 | 0 | 0 | 0 | (1,428) | (1,428) | 42 | |
Balance at Jun. 30, 2015 | 585,385 | $ 58 | 192,768 | 30,248 | 318,441 | 37,585 | 579,100 | 6,285 | |
Balance (in shares) at Jun. 30, 2015 | 58,358,521 | ||||||||
Share-based compensation | 3,860 | $ 0 | 3,860 | 0 | 0 | 0 | 3,860 | 0 | |
Issuance of ordinary shares upon exercise of options | 5,441 | $ 1 | 5,440 | 0 | 0 | 0 | 5,441 | 0 | |
Issuance of ordinary shares upon exercise of options (in shares) | 612,000 | ||||||||
Issuance of Incentive Shares and Premium Shares for Bond Group | 13,336 | $ 1 | 13,335 | 0 | 0 | 0 | 13,336 | 0 | |
Issuance of Incentive Shares and Premium Shares for Bond Group (in shares) | 627,578 | ||||||||
Net income for the year | 123,504 | $ 0 | 0 | 0 | 118,471 | 0 | 118,471 | 5,033 | |
Appropriations to statutory reserves | 0 | 0 | 0 | 6,285 | (6,285) | 0 | 0 | 0 | |
Translation adjustments | (48,841) | 0 | 0 | 0 | 0 | (46,052) | (46,052) | (2,789) | |
Balance at Jun. 30, 2016 | 682,685 | $ 60 | 215,403 | 36,533 | 430,627 | (8,467) | 674,156 | 8,529 | |
Balance (in shares) at Jun. 30, 2016 | 59,598,099 | ||||||||
Share-based compensation | 464 | $ 0 | 464 | 0 | 0 | 0 | 464 | 0 | |
Issuance of ordinary shares upon exercise of options | 6,322 | $ 0 | [1] | 6,322 | 6,322 | 0 | |||
Issuance of ordinary shares upon exercise of options (in shares) | 744,000 | ||||||||
Net income for the year | 68,969 | $ 0 | 0 | 68,944 | 0 | 68,944 | 25 | ||
Appropriations to statutory reserves | 0 | 0 | 4,993 | (4,993) | 0 | 0 | |||
Dividend paid | (11,975) | 0 | 0 | 0 | (11,975) | 0 | (11,975) | 0 | |
Deconsolidation of a subsidiary | (8,497) | 0 | 0 | (396) | 396 | 0 | 0 | (8,497) | |
Translation adjustments | (14,428) | 0 | 0 | 0 | (14,392) | (14,392) | (36) | ||
Balance at Jun. 30, 2017 | $ 723,540 | $ 60 | $ 222,189 | $ 41,130 | $ 482,999 | $ (22,859) | $ 723,519 | $ 21 | |
Balance (in shares) at Jun. 30, 2017 | 60,342,099 | ||||||||
[1] | The share capital increase for the issuance of ordinary shares upon exercise of options, restricted share and Incentive and Premium Shares for Bond are less than $1. |
ORGANIZATION AND BUSINESS BACKG
ORGANIZATION AND BUSINESS BACKGROUND | 12 Months Ended |
Jun. 30, 2017 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization, Consolidation and Presentation of Financial Statements Disclosure [Text Block] | NOTE 1 - ORGANIZATION AND BUSINESS BACKGROUND Hollysys Automation Technologies Ltd. (“Hollysys” or the “Company”) was established under the laws of the British Virgin Islands (“BVI”) on February 6, 2006. As of June 30, 2017, the Company had subsidiaries incorporated in countries and jurisdictions including the People’s Republic of China (“PRC”), Singapore, Malaysia, Macau, Hong Kong, BVI and India. The Company makes a determination at the inception of each arrangement whether an entity in which the Company has made an investment or in which the Company has other variable interests is considered a variable interest entity (“VIE”). The Company consolidates a VIE when it is deemed to be the primary beneficiary. The primary beneficiary of a VIE is the party that meets both of the following criteria: (i) has the power to make decisions that most significantly affect the economic performance of the VIE; and (ii) has the obligation to absorb losses or the right to receive benefits that in either case could potentially be significant to the VIE. Periodically, the Company determines whether any changes occurred requiring a reassessment of whether it is the primary beneficiary of a VIE. If the Company is not deemed to be the primary beneficiary in a VIE, the investment or other variable interests in a VIE is accounted for in accordance with applicable GAAP. In November 2015, CECL was established in Doha, Qatar, by CCPL, a wholly-owned subsidiary of the Company incorporated under the laws of Singapore, and a Qatar citizen as a nominee shareholder, with 49% and 51% of equity interest in CECL, respectively. Through a series of contractual arrangements signed in November 2015 and September 2016, CCPL is entitled to appoint majority of directors of CECL who have the power to direct the activities that significantly impact CECL’s economic performance. In addition, CCPL is entitled to 95% of the variable returns or loss from CECL’s operations. In accordance with ASC 810, Consolidation June 30, 2016 2017 Current assets $ 105 $ 14,331 Non-current assets 69 239 Total assets 174 14,570 Current liabilities $ 270 $ 14,178 Total liabilities 270 14,178 Year ended June 30, 2016 2017 Revenue $ - $ 6,914 Cost of revenue - 5,753 Net (loss) profit (151) 494 Net cash provided by operating activities 71 8,721 Net cash used in investing activities (71) (216) Net cash provided by financing activities $ 55 $ - As of June 30, 2017, the current assets of the VIE included amounts due from subsidiaries of the Group amounting to $ 1,629 127 The Group is principally engaged in the manufacture, sale and provision of integrated automation systems and services, mechanical and electrical solution services and installation services in the PRC, Southeast Asia and the Middle East. |
SUMMARY OF SIGNIFICANT ACCOUNTI
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 12 Months Ended |
Jun. 30, 2017 | |
Accounting Policies [Abstract] | |
Significant Accounting Policies [Text Block] | SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES The consolidated financial statements are prepared in accordance with United States generally accepted accounting principles (“U.S. GAAP”). The consolidated financial statements include the financial statements of the Company, its subsidiaries and a VIE. All inter-company transactions and balances between the Company, its subsidiaries, and the VIE are eliminated upon consolidation. The Company included the results of operations of acquired businesses from the respective dates of acquisition. The preparation of financial statements in conformity with US GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Management evaluates estimates, including those related to the expected total costs of integrated contracts, expected gross margins of integrated solution contracts, allowance for doubtful accounts, fair values of share options, fair value of bifurcated derivative, fair value of retained non-controlling investment in the former subsidiary, warranties, valuation allowance of deferred tax assets and impairment of goodwill and other long-lived assets. Management bases the estimates on historical experience and on various other assumptions that are believed to be reasonable, the results of which form the basis for making judgments about the carrying values of assets and liabilities. Actual results could differ materially from those estimates. The Company’s functional currency is the United States dollars (“US dollars” or “$”); whereas the Company’s subsidiaries and VIE use the primary currency of the economic environment in which their operations are conducted as their functional currency. According to the criteria of Accounting Standards Codification (“ASC”) Topic 830 (“ASC 830”), the Company uses the US dollars as its reporting currency. The Company translates the assets and liabilities into US dollars using the rate of exchange prevailing at the balance sheet date, and the statements of comprehensive income are translated at average rates during the reporting period. Adjustments resulting from the translation of financial statements from the functional currency into US dollars are recorded in stockholders’ equity as part of accumulated other comprehensive income. Transactions dominated in currencies other than the functional currency are translated into functional currency at the exchange rates prevailing on the transaction dates, and the exchange gains or losses are reflected in the consolidated statements of comprehensive income for the reporting period. Transactions denominated in foreign currencies are measured into the functional currency at the exchange rates prevailing on the transaction dates. Foreign currency denominated financial assets and liabilities are re-measured at the exchange rates prevailing at the balance sheet date. Exchange gains and losses are included in earnings, except for those raised from intercompany transactions with investment nature, which are recorded in other comprehensive income. The Company accounts for its business combinations using the purchase method of accounting in accordance with ASC Topic 805, Business Combinations The determination and allocation of fair values to the identifiable assets acquired, liabilities assumed and non-controlling interests is based on various assumptions and valuation methodologies requiring considerable management judgment. The most significant variables in these valuations are discount rates, terminal values, as well as the assumptions and estimates used to determine the cash inflows and outflows. The Company determines discount rates to be used based on the risk inherent in the related activity’s current business model and industry comparisons. Terminal values are based on the expected life of assets and forecasted cash flows over that period. Acquisition-related costs are recognized as general and administrative expenses in the statements of comprehensive income as incurred. Cash and cash equivalents consist of cash on hand and bank deposits, which are unrestricted as to withdrawal and use. All highly liquid investments that are readily convertible to known amounts of cash with original stated maturities of three months or less are classified as cash equivalents. Time deposits with original maturities over three months consist of deposits placed with financial institutions with original maturity terms from four months to one year. As of June 30, 2017, $ 80,507 11,690 3,935 82 35,318 7,042 8 Restricted cash mainly consists of the cash deposited in banks pledged for performance guarantees, or bank loans. These cash balances are not available for use until these guarantees are expired or cancelled, or the loans are repaid. Integrated solutions contracts Revenues generated from designing, building, and delivering customized integrated industrial automation systems are recognized over the contractual terms based on the percentage of completion method. The contracts for designing, building, and delivering customized integrated industrial automation systems are legally enforceable and binding agreements between the Company and customers. The duration of contracts depends on the contract size and ranges from 6 5 Revenue generated from mechanical and electrical solution contracts for the construction or renovation of buildings, rail or infrastructure facilities are also recognized over the contractual terms based on the percentage of completion method. The contracts for mechanical and electrical solution are legally enforceable and binding agreements between the Company and customers. The duration of contracts depends on the contract size and the complexity of the construction work and ranges from 6 3 In accordance with ASC 605-35, Revenue Recognition - Construction-Type and Production-Type Contracts The Company reviews and updates the estimated total costs of integrated solutions contracts at least annually. The Company accounts for revisions to contract revenue and estimated total costs of integrated solution contracts, including the impact due to approved change orders, in the period in which the facts that cause the revision become known as changes in estimates. Unapproved change orders are considered claims. Claims are recognized only when it has been awarded by customers. Excluding the impact of change orders, if the estimated total costs of integrated solution contracts, which were revised during the years ended June 30, 2015, 2016 and 2017, had been used as a basis of recognition of integrated contract revenue since the contract commencement, net income for the years ended June 30, 2015, 2016 and 2017 would have been decreased by $ 26,232 30,270 12,062 0.45 0.51 0.20 0.44 0.50 0.20 The Company combines a group of contracts as one project if they are closely related and are, in substance, parts of a single project with an overall profit margin. The Company segments a contract into several projects, when they are of different business substance, for example, with different business negotiation, solutions, implementation plans and margins. Revenue in excess of billings on the contracts is recorded as costs and estimated earnings in excess of billings. Billings in excess of revenues recognized on the contracts are recorded as deferred revenue until the above revenue recognition criteria are met. Recognition of accounts receivable and costs and estimated earnings in excess of billings are discussed below. The Company generally recognizes 100 Product sales Revenue generated from sales of products is recognized when the following four revenue recognition criteria are met: (i) persuasive evidence of an arrangement exists, (ii) delivery has occurred, (iii) the selling price is fixed or determinable, and (iv) collectability is reasonably assured. Service rendered The Company has in recent years extended its service offerings as described below. The Company mainly provides two types of services: Revenue from one-off services: the Company provides different types of one-off services, including on-site maintenance service and training services which are generally completed on site within a few working days. Revenue is recognized when the Company has completed all the respective services described in the contracts, there is persuasive evidence of an arrangement, the fee is fixed or determinable and collection is reasonably assured. Revenue from services covering a period of time: the Company also separately sells extended warranties to their integrated solution customers for a fixed period. Such arrangements are negotiated separately from the corresponding integrated solution system and are usually entered into upon the expiration of the warranty period attached to the integrated solution contract. During the extended warranty period, the Company is responsible for addressing issues related to the system. Part replacement is not covered in such services. The Company recognizes revenue on a pro-rata basis over the contractual term. Performance of the integrated contracts will often extend over long periods and the Company’s right to receive payments depends on its performance in accordance with the contractual agreements. There are different billing practices in the PRC, overseas operating subsidiaries and the VIE (Concord and Bond Groups). For the Company’s PRC subsidiaries, billings are issued based on milestones specified in contracts negotiated with customers. In general, there are four milestones: 1) project commencement, 2) system manufacturing and delivery, 3) installation, trial-run and customer acceptance, and 4) expiration of the warranty period. The amounts to be billed at each milestone are specified in the contract. All contracts have the first milestone, but not all contracts require prepayments. The length of each interval between two continuous billings under an integrated contract varies depending on the duration of the contract (under certain contracts, the interval lasts more than a year) and the last billing to be issued for an integrated solution contract is scheduled at the end of a warranty period. For Concord and Bond Groups, billing claims rendered are subject to the further approval and certification of the customers or their designated consultants. Payments are made to Concord or Bond Groups based on the certified billings according to the payment terms mutually agreed between the customers and Concord or Bond Groups. Certain amounts are retained by the customer and payable to Concord and Bond Groups upon satisfaction of final quality inspection or at the end of the warranty period. The retained amounts which were recorded as accounts receivable were $ 10,848 12,838 The carrying value of the Company’s accounts receivable and costs and estimated earnings in excess of billings, net of the allowance for doubtful accounts, represents their estimated net realizable value. An allowance for doubtful accounts is recognized when it’s probable that the Company will not collect the amount and is written off in the period when deemed uncollectible. The Company periodically reviews the status of contracts and decides how much of an allowance for doubtful accounts should be made based on factors surrounding the credit risk of customers and historical experience. The Company does not require collateral from its customers and does not charge interest for late payments by its customers. Inventories Inventories are composed of raw materials, work in progress, purchased and manufactured finished goods and low value consumables. Inventories are stated at the lower of cost or market. The Company elected to use weighted average cost method as inventory costing method. The Company assesses the lower of cost or market for non-saleable, excess or obsolete inventories based on its periodic review of inventory quantities on hand and the latest forecasts of product demand and production requirements from its customers. The Company writes down inventories for non-saleable, excess or obsolete raw materials, work-in-process and finished goods by charging such write-downs to cost of integrated contracts and/or costs of products sold. Warranties Warranties represent a major term under an integrated contract, which will last, in general, for one to three years or otherwise specified in the terms of the contract. The Company accrues warranty liabilities under an integrated contract as a percentage of revenue recognized, which is derived from its historical experience, in order to recognize the warranty cost for an integrated contract throughout the contract period. Property, plant and equipment, other than construction in progress, are recorded at cost and are stated net of accumulated depreciation and impairment, if any. Buildings 30 -50 years Machinery 5 - 10 years Software 3 - 5 years Vehicles 5- 6 years Electronic and other equipment 3 - 10 years Construction in progress represents uncompleted construction work of certain facilities which, upon completion, management intends to hold for production purposes. In addition to costs under construction contracts, other costs directly related to the construction of such facilities, including duty and tariff, equipment installation and shipping costs, and borrowing costs are capitalized. Depreciation commences when the asset is placed in service. Maintenance and repairs are charged directly to expenses as incurred, whereas betterment and renewals are capitalized in their respective accounts. When an item is retired or otherwise disposed of, the cost and applicable accumulated depreciation are removed and the resulting gain or loss is recognized for the reporting period. Prepaid land lease payments, for the land use right of three parcels of land in the PRC, three parcels of leasehold land in Malaysia and one parcel of leasehold land in Singapore, are initially stated at cost and are subsequently amortized on a straight-line basis over the lease terms of 49 88 Intangible assets are carried at cost less accumulated amortization and any impairment. Intangible assets acquired in a business combination are recognized initially at fair value at the date of acquisition. Intangible assets, except for which are estimated to have an indefinite useful life, are amortized using a straight-line method. Intangible assets estimated to have an indefinite useful life are not amortized but tested for impairment annually or more frequently when indicators of impairment exist. Category Estimated useful life Customer relationship 57 - 60 months Order backlog 21 - 33 months Patents and copyrights 60 - 120 months Residual values are considered nil. Goodwill represents the excess of the purchase price over the estimated fair value of net tangible and identifiable intangible assets acquired. The Company assesses goodwill for impairment in accordance with ASC subtopic 350-20 (“ASC 350-20”), Intangibles Goodwill and Other, which requires that goodwill is not amortized but to be tested for impairment at the reporting unit level at least annually and more frequently upon the occurrence of certain events, as defined by ASC 350-20. The Company’s goodwill outstanding at June 30, 2017 was related to the acquisitions of two reporting units, Concord Group and Bond Group. The Company has the option to assess qualitative factors first to determine whether it is necessary to perform the two-step test in accordance with ASC 350-20. If the Company believes, as a result of the qualitative assessment, that it is more-likely-than-not that the fair value of the reporting unit is less than its carrying amount, the two-step quantitative impairment test described above is required. Otherwise, no further testing is required. In the qualitative assessment, the Company considers primary factors such as industry and market considerations, overall financial performance of the reporting unit, and other specific information related to the operations. In performing the two-step quantitative impairment test, the first step compares the carrying amount of the reporting unit to the fair value of the reporting unit based on either quoted market prices of the ordinary shares or estimated fair value using a combination of the income approach and the market approach. If the fair value of the reporting unit exceeds the carrying value of the reporting unit, goodwill is not impaired and the Company is not required to perform further testing. If the carrying value of the reporting unit exceeds the fair value of the reporting unit, then the Company must perform the second step of the impairment test in order to determine the implied fair value of the reporting unit’s goodwill. The fair value of the reporting unit is allocated to its assets and liabilities in a manner similar to a purchase price allocation in order to determine the implied fair value of the reporting unit goodwill. If the carrying amount of the goodwill is greater than its implied fair value, the excess is recognized as an impairment loss. The Company elected to assess goodwill for impairment using the two-step process for both Concord Group and Bond Group for the year ended June 30, 2017, with assistances from a third-party appraiser. Concord and Bond Groups’ management judgment is involved in determining these estimates and assumptions, and actual results may differ from those used in valuations. Changes in these estimates and assumptions could materially affect the determination of fair value for each reporting unit which could trigger future impairment. The judgment in estimating the fair value of reporting units includes forecasts of future cash flows, which are based on management’s best estimate of future revenue, gross profit, operating expenses growth rates, future capital expenditure and working capital level, as well as discount rate determined by Weighted Average Cost of Capital approach and the selection of comparable companies operating in similar businesses. The Company also reviewed marketplace and/or historical data to assess the reasonableness of assumptions such as discount rate and working capital level. The carrying amount of Concord Group exceeded its fair value as of June 30, 2017, and a goodwill impairment charge of $ 11,211 There are uncertainties surrounding the amount and timing of future expected cash flows as they may be impacted by negative events such as a slowdown in the mechanical and electrical engineering sector, deteriorating economic conditions in the geographical areas Concord Group operates in, political, economic and social uncertainties in the Middle East, increasing competitive pressures and fewer than expected mechanical and electrical solution contracts awarded to Concord Group. These events can negatively impact demand for Concord Group’s services and result in actual future cash flows being less than forecasted or delays in the timing of when those cash flows are expected to be realized. Further, the timing of when actual future cash flows are received could differ from the Company’s estimates, which are based on historical trends and does not factor in unexpected delays in project commencement or execution. The fair value of Bond Group exceeded its carrying amounts as of June 30, 2017, and therefore goodwill related to Bond Group was not impaired and the Company was not required to perform further step testing. The Company evaluates its long-lived assets or asset group including acquired intangibles with finite lives for impairment whenever events or changes in circumstances (such as a significant adverse change to market conditions that will impact the future use of the assets) indicate that the carrying amount of a group of long-lived assets may not be fully recoverable. When these events occur, the Company evaluates the impairment by comparing the carrying amount of the assets to future undiscounted cash flows expected to result from the use of the assets and their eventual disposition. If the sum of the expected undiscounted cash flows is less than the carrying amount of the assets, the Company recognizes an impairment loss based on the excess of the carrying amount of the asset group over its fair value, generally based upon discounted cash flows or quoted market prices. All shipping and handling fees charged to customers are included in net revenue. Shipping and handling costs incurred are included in cost of integrated contracts and/or costs of products sold as appropriate. The Company follows the liability method of accounting for income taxes. Under this method, deferred tax assets and liabilities are determined based on the differences between the financial reporting and tax bases of assets and liabilities using enacted tax rates that will be in effect in the period in which the differences are expected to reverse. The Company records a valuation allowance to offset deferred tax assets if based on the weight of available evidence, it is more-likely-than-not that some portion, or all, of the deferred tax assets will not be realized. The effect on deferred taxes of a change in tax rate is recognized in tax expense in the period that includes the enactment date of the change in tax rate. The Company adopted ASC 740, Income Taxes , Research and development costs consist primarily of salaries, bonuses and benefits for research and development personnel. Research and development costs also include travel expenses of research and development personnel as well as depreciation of hardware equipment and software tools and other materials used in research and development activities. Research and development costs are expensed as incurred. Software development costs are also expensed as incurred as the costs qualifying for capitalization have been insignificant. Pursuant to the laws and regulations of the PRC, the Company remits 17 3 7,593 6,085 10,238 2,191 2,886 12,885 Under the corporate law and relevant regulations in the PRC, all of the subsidiaries of the Company located in the PRC are required to appropriate a portion of its retained earnings to statutory reserve. All subsidiaries located in the PRC are required to appropriate 10 In accordance with ASC 280, Segment reporting Comprehensive income is defined as the changes in equity of the Company during a period from transactions and other events and circumstances excluding transactions resulting from investments by owners and distributions to owners. In accordance with ASC 220, Comprehensive Income The Company accounts for its equity investments under either the cost method or the equity method by considering the Company’s rights and ability to exercise significant influence over the investees. Under the cost method, investments are initially carried at cost. In the event that the fair value of the investment falls below the initial cost and the decline is considered as other-than-temporary, the Company recognizes an impairment charge, equal to the difference between the cost basis and the fair value of the investment. A variety of factors are considered when determining if a decline in fair value below carrying value is other than temporary, including, among others, the financial condition and prospects of the investee. The investments in entities over which the Company has the ability to exercise significant influence are accounted for using the equity method. Significant influence is generally considered to exist when the Company has an ownership interest in the voting stock of the investee between 20 50 Under the equity method, original investments are recorded at cost and adjusted by the Company’s share of undistributed earnings or losses of these entities, by the amortization of any basis difference between the amount of the Company’s investment and its share of the net assets of the investee, and by dividend distributions or subsequent investments. Unrealized inter-company profits and losses related to equity investees are eliminated. An impairment charge, being the difference between the carrying amount and the fair value of the equity investee, is recognized in the consolidated statements of comprehensive income when the decline in value is considered other than temporary. There was no impairment loss on investments in cost or equity investees for the years ended June 30, 2015, 2016 and 2017, respectively. Interest incurred on borrowings for the Company’s construction of facilities and assembly line projects during the active construction period are capitalized. The capitalization of interest ceases once a project is substantially complete. The amount to be capitalized is determined by applying the weighted-average interest rate of the Company’s outstanding borrowings to the average amount of accumulated capital expenditures for assets under construction during the year and is added to the cost of the underlying assets and amortized over their respective useful lives. Income per share is computed in accordance with ASC 260, Earnings Per Share The Company accounts for share-based compensation in accordance with ASC 718, Compensation-Stock Compensation For share-based awards that are subject to performance-based vesting conditions in addition to time-based vesting, the Company recognizes the estimated grant-date fair value of performance-based awards, net of estimated forfeitures, as share-based compensation expense over the vesting period based upon the Company’s determination of whether it is probable that the performance-based criteria will be achieved. At each reporting period, the Company reassesses the probability of achieving the performance-based criteria. Determining whether the performance-based criteria will be achieved involves judgment, and the estimate of share-based compensation expense may be revised periodically based on changes in the probability of achieving the performance-based criteria. Revisions are reflected in the period in which the estimate is changed. If the performance-based criteria are not met, no share-based compensation expense is recognized, and, to the extent share-based compensation expense was previously recognized, such share-based compensation expense is reversed. The Company has adopted ASC 820, Fair Value Measurements and Disclosures Level 1 - Quoted prices in active markets for identical assets or liabilities. Level 2 - Inputs other than Level 1 that are observable, either directly or indirectly, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. Level 3 - Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. Classification within the hierarchy is determined based on the lowest level of input that is significant to the fair value measurement. ASC 820 describes three main approaches to measuring the fair value of assets and liabilities: (1) market approach; (2) income approach and (3) cost approach. The market approach uses prices and other relevant information generated from market transactions involving identical or comparable assets or liabilities. The income approach uses valuation techniques to convert future amounts to a single present value amount. The measurement is based on the value indicated by current market expectations about those future amounts. The cost approach is based on the amount that would currently be required to replace an asset. Leases have been classified as either capital or operating leases. Leases that transfer substantially all the benefits and risks incidental to the ownership of assets are accounted for as if there was an acquisition of an asset and incurrence of an obligation at the inception of the lease. All other leases are accounted for as operating leases wherein rental payments are expensed as incurred. Minimum contractual rental from leases are recognized on a straight-line basis over the non-cancelable term of the lease. 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 commences when the customer assumes control 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. Contingent rental revenue is accrued when the contingency is removed. Concentration of credit risk Assets that potentially subject the Company to significant concentration of credit risk primarily consist of cash and cash equivalents, time deposits with original maturities over three months, restricted cash, accounts receivable, other receivables and amounts due from related parties. The maximum exposure of such assets to credit risk is their carrying amounts as of the balance sheet date. As of June 30, 2017, substantially all of the Company’s cash and cash equivalents and time deposits with original maturities exceeding three months were managed by financial institutions located in the PRC, Singapore, Malaysia and Dubai, which management believes are of high credit quality. Accounts receivable, other receivables and amounts due from related parties are typically unsecured and the risk with respect to accounts receivable is mitigated by credit evaluations the Company performs on its customers and its ongoing monitoring process of outstanding balances. The Company has no customer that individually comprised 10 Concentration of business and economic risk A majority of the Company’s net revenue and net income are derived in the PRC. The Company’s operations may be adversely affected by significant political, economic and social uncertainties in the PRC. Although the PRC government has been pursuing economic reform policies for more than 20 years, no assurance can be given that the PRC government will continue to pursue such policies or that such policies may not be significantly altered, especially in the event of a change in leadership, social or political disruption or unforeseen circumstances affecting the PRC’s political, economic and social conditions. There is also no guarantee that the PRC government’s pursuit of economic reforms will be consistent or effective. Concentration of currency convertibility risk A majority of the Company’s businesses are transacted in RMB, which is not freely convertible into foreign currencies. All foreign exchange transactions take place either through the People’s Bank of China or other banks authorized to buy and sell foreign currencies at the exchange rates quoted by the People’s Bank of China. Approval of foreign currency payments by the People’s Bank of China or other regulatory institutions requires submitting a payment application form together with suppliers’ invoices, shipping documents and signed contracts. Concentration of foreign currency exchange rate risk The Company’s exposure to foreign currency exchange rate risk primarily relates to monetary assets or liabilities held in foreign currencies. Since July 21, 2005, the RMB has been permitted to fluctuate within a narrow and managed band against a basket of certain foreign currencies. On June 19, 2010, the People’s Bank of China announced the end of the RMB’s de facto peg to USD, a policy which was instituted in late 2008 in the face of the global financial crisis, to further reform the RMB exchange rate regime and to enhance the RMB’s exchange rate flexibility. The exchange rate floating bands will remain the same as previously announced in the inter-bank foreign exchange market. The depreciation of the US dollars against RMB was approximately 0.64 8.68 2.07 For the years ended June 30, 2015, 2016 and 2017, the net foreign currency translation losses resulting from the translation of RMB, SGD and other functional currencies to the U.S. dollar reporting currency recorded in other comprehensive income was $ 1,386 48,841 14,428 In August 2015, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update 2015-14, which defers the effective date of ASU 2014-09 Revenue from Contracts with Customers (Topic 606) (" In November 2015, the FASB issued ASU No. 2015-17 (“ASU 2015-17”), Income Taxes (Topic 740): Balance Sheet Classification of Deferred Taxes In February 2016, the FASB issued ASU No. 2016-02 (“ASU |
INVENTORIES
INVENTORIES | 12 Months Ended |
Jun. 30, 2017 | |
Inventory Disclosure [Abstract] | |
Inventory Disclosure [Text Block] | INVENTORIES June 30, 2016 2017 Raw materials $ 12,975 $ 15,781 Work in progress 12,770 19,525 Finished goods 10,656 10,354 $ 36,401 $ 45,660 |
ACCOUNTS RECEIVABLE
ACCOUNTS RECEIVABLE | 12 Months Ended |
Jun. 30, 2017 | |
Receivables [Abstract] | |
Loans, Notes, Trade and Other Receivables Disclosure [Text Block] | NOTE 4 - ACCOUNTS RECEIVABLE June 30, 2016 2017 Accounts receivable $ 279,650 $ 294,641 Allowance for doubtful accounts (42,471) (48,089) $ 237,179 $ 246,552 June 30, 2015 2016 2017 Balance at the beginning of year $ 25,691 $ 34,259 $ 42,471 Additions 13,907 12,000 7,400 Deconsolidation of a subsidiary - - (160) Written off (5,499) (714) (784) Translation adjustment 160 (3,074) (838) Balance at the end of year $ 34,259 $ 42,471 $ 48,089 |
COSTS AND ESTIMATED EARNINGS IN
COSTS AND ESTIMATED EARNINGS IN EXCESS OF BILLINGS | 12 Months Ended |
Jun. 30, 2017 | |
Costs In Excess Of Billings and Billings In Excess Of Costs Incurred [Abstract] | |
Costs In Excess Of Billings and Billings In Excess Of Costs Incurred [Text Block] | NOTE 5 - COSTS AND ESTIMATED EARNINGS IN EXCESS OF BILLINGS June 30, 2016 2017 Contracts costs incurred plus estimated earnings $ 887,037 $ 810,327 Less: Progress billings (690,726) (639,571) Cost and estimated earnings in excess of billings 196,311 170,756 Less: Allowance for doubtful accounts (6,383) (8,660) $ 189,928 $ 162,096 June 30, 2015 2016 2017 Balance at the beginning of year $ 5,839 $ 8,850 $ 6,383 Additions 3,085 (1,823) 2,404 Written off (122) - - Translation adjustment 48 (644) (127) Balance at the end of the year $ 8,850 $ 6,383 $ 8,660 |
PROPERTY, PLANT AND EQUIPMENT
PROPERTY, PLANT AND EQUIPMENT | 12 Months Ended |
Jun. 30, 2017 | |
Property, Plant and Equipment [Abstract] | |
Property, Plant and Equipment Disclosure [Text Block] | NOTE 6 - PROPERTY, PLANT AND EQUIPMENT June 30, 2016 2017 Buildings $ 71,037 $ 70,029 Machinery 8,148 10,892 Software 7,377 10,004 Vehicles 3,886 4,378 Electronic and other equipment 23,704 29,321 Construction in progress 5,753 4,113 $ 119,905 $ 128,737 Less: Accumulated depreciation and impairment (39,967) (48,208) $ 79,938 $ 80,529 Buildings with a total carrying value of $ 1,014 991 Buildings with a total carrying value of $ 3,976 3,209 Buildings and vehicles with a total carrying value of $ 1,157 1,703 Construction in progress consists of capital expenditures and capitalized interest charges related to the construction of facilities and assembly line projects and the expenditures related to the Company’s information system constructions. The depreciation expenses for the years ended June 30, 2015, 2016 and 2017 were $ 8,508 6,266 8,752 Assets leased to others under operating leases June 30, 2016 2017 Buildings leased to others - at original cost $ 10,086 $ 13,925 Less: accumulated depreciation (3,725) (4,261) Buildings leased to others - net $ 6,361 $ 9,664 |
PREPAID LAND LEASES
PREPAID LAND LEASES | 12 Months Ended |
Jun. 30, 2017 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |
Prepaid Land Leases [Text Block] | NOTE 7 - PREPAID LAND LEASES June 30, 2016 2017 Prepaid land leases $ 12,641 $ 12,335 Less: Accumulated amortization (1,868) (2,129) $ 10,773 $ 10,206 The amortization for the years ended June 30, 2015, 2016 and 2017 were $ 197 281 261 Of the total prepaid land leases, $ 4,593 Year ending June 30, 2018 $ 263 2019 263 2020 263 2021 263 2022 263 $ 1,315 |
INTANGIBLE ASSETS, NET
INTANGIBLE ASSETS, NET | 12 Months Ended |
Jun. 30, 2017 | |
Intangible Assets, Net (Excluding Goodwill) [Abstract] | |
Intangible Assets Disclosure [Text Block] | NOTE 8 - INTANGIBLE ASSETS, NET June 30, 2016 2017 Gross Accumulated Net Gross Accumulated Net Customer relationships $ 3,151 (2,308) 843 $ 3,086 (2,811) 275 Order backlog 11,848 (11,835) 13 11,605 (11,605) - Patents and copyrights - - - 1,695 (42) 1,653 $ 14,999 (14,143) 856 $ 16,386 (14,458) 1,928 The customer relationships and order backlog were related to the acquisition of Concord and Bond Groups, which were acquired on July 1, 2011 and April 1, 2013, respectively. The amortization for the years ended June 30, 2015, 2016 and 2017 were $ 4,454 818 623 within one year Year ending June 30, 2018 $ 500 2019 225 2020 225 2021 225 2022 215 $ 1,390 |
GOODWILL
GOODWILL | 12 Months Ended |
Jun. 30, 2017 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill Disclosure [Text Block] | NOTE 9 - GOODWILL June 30, 2016 2017 Balance at beginning of year $ 59,918 $ 59,847 Goodwill impairment charge - (11,211) Translation adjustment (71) (1,310) Balance at the end of year $ 59,847 $ 47,326 Concord Group, as a component of the M&E operating segment, is considered to be a reporting unit for goodwill impairment purposes as Concord Group constitutes a business for which discrete financial information is available and segment management regularly reviews the operating results of Concord Group. The amount of goodwill allocated to Concord Group was $ 25,111 24,595 11,211 23,258 11,488 Estimating the fair value of Concord Group requires the Company to make assumptions and estimates regarding its future plans, market share, industry and economic conditions of the various geographical areas in which it operates which includes Singapore, Malaysia and the Middle East. In applying the discounted cash flow approach, key assumptions include the amount and timing of future expected cash flows, terminal value growth rates and appropriate discount rates. The Company estimates future expected cash flows for each geographical area in which it operates and calculates the net present value of those estimated cash flows using risk adjusted discount rates ranging from 12.7 16.9 2 2 1 1,187 1,383 1 562 498 There are uncertainties surrounding the amount and timing of future expected cash flows as they may be impacted by negative events such as a slowdown in the mechanical and electrical engineering sector, deteriorating economic conditions in the geographical areas Concord Group operates in, political, economic and social uncertainties in the Middle East, increasing competitive pressures and fewer than expected mechanical and electrical solution contracts awarded to Concord Group. These events can negatively impact demand for Concord Group’s services and result in actual future cash flows being less than forecasted or delays in the timing of when those cash flows are expected to be realized. Further, the timing of when actual future cash flows are received could differ from the Company’s estimates, which are based on historical trends and does not factor in unexpected delays in project commencement or execution. |
INVESTMENTS IN EQUITY AND COST
INVESTMENTS IN EQUITY AND COST INVESTEES | 12 Months Ended |
Jun. 30, 2017 | |
Investments, Debt and Equity Securities [Abstract] | |
Investment [Text Block] | NOTE 10 - INVESTMENTS IN EQUITY AND COST INVESTEES June 30, 2016 Interest Long-term Share of Advance Total Equity method China Techenergy Co., Ltd. 40.00 % $ 9,030 1,077 44 10,151 Beijing Hollysys Electric Motor Co., Ltd. 40.00 % 797 3,961 - 4,758 Beijing IPE Biotechnology Co., Ltd. 22.02 % 1,484 2,213 - 3,697 Southcon Development Sdn Bhd. 30.00 % 224 (116) - 108 Beijing Hollysys Machine Automation Co., Ltd. 30.00 % 452 (452) - - $ 11,987 6,683 44 18,714 Cost method Shenhua Hollysys Information Technology Co., Ltd. 20.00 % $ 2,387 - - 2,387 Heilongjiang Ruixing Technology Co., Ltd. 6.00 % 1,631 - - 1,631 Zhejiang Sanxin Technology Co., Ltd. 6.00 % 90 - - 90 Zhongjijing Investment Consulting Co., Ltd. 5.00 % - - - - $ 4,108 - - 4,108 June 30, 2017 Interest Long-term Share of Advance Total Equity method Beijing Hollycon Medicine & Technology. Co., Ltd. 30.00 % $ 22,737 1,773 - 24,510 China Techenergy Co., Ltd. 40.00 % 8,847 2,503 43 11,393 Beijing Hollysys Electric Motor Co., Ltd. 40.00 % 781 4,262 - 5,043 Beijing IPE Biotechnology Co., Ltd. 22.02 % 1,454 2,241 - 3,695 Shenzhen HollySys Intelligent Technologies Co., Ltd. 60.00 % 2,654 (159) - 2,495 Southcon Development Sdn Bhd. 30.00 % 210 (104) - 106 Beijing Hollysys Machine Automation Co., Ltd. 30.00 % 442 (442) - - $ 37,125 10,074 43 47,242 Cost method Shenhua Hollysys Information Technology Co., Ltd. 20.00 % $ 2,338 - - 2,338 Heilongjiang Ruixing Technology Co., Ltd. 6.00 % 1,598 - - 1,598 Zhejiang Sanxin Technology Co., Ltd. 6.00 % 88 - - 88 Zhongjijing Investment Consulting Co., Ltd. 5.00 % - - - - $ 4,024 - - 4,024 In July 2016, Beijing Hollycon Medicine & Technology. Co., Ltd. (“Hollycon”), previously one of the Company’s subsidiaries, issued new shares for an aggregate cash consideration of $ 30,943 0.6 464 51 30 22,737 14,514 Shenzhen HollySys Intelligent Technologies Co., Ltd. (“Shenzhen HollySys”) was set up in October 2016. The Company holds a 60 1) Only one out of the three board representatives is elected by the Company and the remaining two are elected by other two shareholders; 2) Based on the articles of association of Shenzhen HollySys, all major decisions in the normal business operation and appointment of key managements of Shenzhen HollySys is subject to approval by at least two-third vote of the Board of Directors. The Company holds a 20 1) Only one out of the five board representatives is elected by the Company and the remaining 80 2) Key management of Shenhua Information including the chief executive officer, chief financial officer, chief operating officer and head of accounting are all appointed by the other shareholder. 3) Based on the articles of association of Shenhua Information, there are no matters that require unanimous approval of all shareholders and there are no participating rights for non-controlling shareholders. The Company reduced the investment in Zhongjijing Investment Consulting Co., Ltd. (“Zhongjijing”) to nil since June 30, 2014. The Company expects that the recoverable amount of the investment in Zhongjijing to be nil. |
WARRANTY LIABILITIES
WARRANTY LIABILITIES | 12 Months Ended |
Jun. 30, 2017 | |
Product Warranties Disclosures [Abstract] | |
Product Warranty Disclosure [Text Block] | NOTE 11 - WARRANTY LIABILITIES June 30, 2016 2017 Beginning balance $ 10,387 $ 10,360 Deconsolidation of a subsidiary - (227) Expense accrued 3,876 1,547 Expense incurred (3,075) (3,836) Translation adjustment (828) (212) $ 10,360 $ 7,632 Less: current portion of warranty liabilities (6,782) (5,386) Long-term warranty liabilities $ 3,578 $ 2,246 |
SHORT-TERM BANK LOANS
SHORT-TERM BANK LOANS | 12 Months Ended |
Jun. 30, 2017 | |
Short-Term Debt [Abstract] | |
Short-term Debt [Text Block] | NOTE 12 - SHORT-TERM BANK LOANS On June 30, 2016, the Company’s short-term bank borrowings consisted of revolving bank loans of $ 3,051 0.8 5.12 1.5 2,743 1,014 On June 30, 2017, the Company’s short-term bank borrowings consisted of revolving bank loans of $ 8,121 3.09 4.85 3.53 16,410 991 For the years ended June 30, 2015, 2016, and 2017, interest expenses on short-term bank loans amounted to $ 286 211 178 As of June 30, 2016, the Company had available lines of credit from various banks in the PRC, Singapore and Malaysia amounting to $ 205,129 72,592 132,537 3,754 3,976 As of June 30, 2017, the Company had available lines of credit from various banks in the PRC, Singapore and Malaysia amounting to $ 257,670 78,910 178,760 4,954 3,209 |
LONG-TERM LOANS
LONG-TERM LOANS | 12 Months Ended |
Jun. 30, 2017 | |
Debt Disclosure [Abstract] | |
Long-term Debt [Text Block] | NOTE 13 - LONG-TERM LOANS June 30, 2016 2017 USD denominated loan (i) 4,770 - MYR denominated loan (ii) 830 782 SGD denominated loan (iii) 1,939 187 Convertible Bond (iv) 19,802 20,032 $ 27,341 $ 21,001 Less: current portion (6,833) (420) $ 20,508 $ 20,581 i. The USD denominated loan was repaid in March 2017. The borrowing was secured by restricted cash amounting to $ 4,515 ii. The MYR denominated loans are repayable in 3 to 75 installments with the last installment due in December 2041. For the year ended June 30, 2017, the effective interest rates ranged from 2.19 5.68 1,019 1,396 iii. The SGD denominated loans are repayable in 10 to 31 installments with the last installment due on March 15, 2020. For the year ended June 30, 2017, the effective interest rates ranged from 2.68 5.44 3,148 307 iv. Convertible Bond On May 30, 2014, the Company entered into a Convertible Bond agreement with International Finance Corporation ("IFC"), under which the Company borrowed $ 20,000 2.1 0.5 Conversion rate The initial conversion rate at the time of the agreement is 38 ordinary shares per $1, and the initial conversion price is $26.35 per share. the Company paid out a cash dividend of $0.40 per share in March 2015 and $0.2 per share in November 2016, the conversion rate and conversion price was adjusted to 39.22 ordinary shares per $1 and $25.50 per share, respectively. Conversion The Convertible Bond has both voluntary and mandatory conversion terms. IFC may at its option convert, in $ 1,000 According to the Convertible Bond agreement, 50% of the principal amount of the Convertible Bond then outstanding will be mandatorily converted into ordinary shares of the Company at the conversion rate and conversion price then in effect if at any time, with respect to the period of 30 consecutive trading days ending at such time, the volume weighted average prices for 20 trading days or more in such 30 consecutive trading day period is equal to or more than 150% of the conversion price in effect at such time. In addition, 100% of the principal amount of the Convertible Bond then outstanding will be mandatorily converted into ordinary shares at the conversion rate and conversion price then in effect if at any time, with respect to the period of 30 consecutive trading days ending at such time, the volume weighted average prices for 20 trading days or more in such 30 consecutive trading day period is equal to or more than 200% of the conversion price in effect at such time. Non-conversion compensation feature In the event that there remains any outstanding principal of the Convertible Bond not converted by IFC into ordinary shares at the maturity date, the Company shall pay to IFC an additional amount equal to 4% of such outstanding principle (“non-conversion compensation feature”). The non-conversion compensation feature is bifurcated as a derivative liability and measured at the fair value in each reporting period. Registration rights agreement The Company has filed a shelf-registration statement with the United States Securities and Exchange Commission with respect to the resale of any ordinary shares issued or issuable upon conversion of the Convertible Loan. The Company shall maintain the effectiveness of the registration statement for so long as any registrable securities remain issued and outstanding. In the event that the registration statement is not declared effective or ceases to remain continuously effective such that IFC is not able to utilize the prospectus to resell its ordinary shares, the Company shall pay a penalty equal to 0.5 5 In accounting for the issuance of the Convertible Bond, the Company bifurcated the non-conversion compensation feature from the Convertible Bond in accordance with ASC 815-15-30-2. The bifurcated feature is accounted for as a liability at its fair value in each reporting period. The Company did not bifurcate the conversion option, as it is considered indexed to the entity’s own stock and meets the equity classification guidance in ASC 815-40-25, it is eligible for a scope exception from ASC 815 and does not need to be bifurcated from the underlying debt host instrument. At the commitment date, there was no beneficial conversion as the conversion price was higher than the stock price. The fees and expenses associated with the issuance of the Convertible Bond are recorded as a discount to the debt liability in accordance with ASU 2015-03, which the Company has early adopted in fiscal year ended June 30, 2015. The Convertible Bond, which is the proceeds net of fees and expenses payable to the creditor and the fair value of the bifurcated derivative, will be accreted to the redemption value on the maturity date using the effective interest method over the estimated life of the debt instrument. The registration right liability is accounted for in accordance with ASC 450-20 which defines that a liability should be recorded in connection with the registration rights agreement when it becomes probable that a payment under the registration rights agreement would be required and the amount of payment can be reasonably estimated. As of June 30, 2017, the Company did not recognize any liability related to the registration right. The Company paid up-front fees related to the issuance of the Convertible Bond amounting to $ 349 For fiscal year 2016 and 2017, the accretion of the Convertible Bond was $ 230 230 Year ending June 30, 2018 $ 420 2019 215 2020 20,955 2021 90 2022 and onwards 121 $ 21,801 For the years ended June 30, 2015, 2016, and 2017, interest expenses of long-term loans incurred amounted to $ 1,535 1,193 760 |
FAIR VALUE MEASUREMENT
FAIR VALUE MEASUREMENT | 12 Months Ended |
Jun. 30, 2017 | |
Fair Value Disclosures [Abstract] | |
Fair Value Disclosures [Text Block] | NOTE 14 - FAIR VALUE MEASUREMENT Financial instruments include cash and cash equivalents, time deposits with maturities over three months, accounts receivable, other receivables, amounts due to or from related parties, accounts payable, short-term bank loans, long-term bank loans and bifurcated derivative. The carrying values of these financial instruments, other than long-term bank loans and a bifurcated derivative (which is a recurring fair value measurement), approximate their fair values due to their short-term maturities. The carrying value of the Company’s long-term bank loans other than the Convertible Bond approximates its fair value as the long-term bank loans are subject to floating interest rates. These assets and liabilities, excluding cash and cash equivalents (which fall into level 1 of the fair value hierarchy), fall into level 2 of the fair value hierarchy. The carrying value of the Convertible Bond is $ 19,802 20,032 13,929 15,359 June 30, 2016 Quoted prices Significant Significant (Level 1) (Level 2) (Level 3) Total Liabilities: Derivative financial liability (i) $ - $ - $ 398 $ 398 Total liabilities measured at fair value on a recurring basis $ - $ - $ 398 $ 398 June 30, 2017 Quoted prices Significant Significant (Level 1) (Level 2) (Level 3) Total Liabilities: Derivative financial liability (i) $ - $ - $ 487 $ 487 Total liabilities measured at fair value on a recurring basis $ - $ - $ 487 $ 487 (i) The derivative financial liability Fair value measurements as of June (Level 3) Non-conversion compensation feature Balance as at June 30, 2016 $ 398 Change in fair-value (included within other expenses, net) 89 Balance as of June 30, 2017 $ 487 June 30, 2017 Quoted prices in active markets for Significant other observable inputs Significant unobservable inputs (Level 1) (Level 2) (Level 3) Total Assets: Retained non-controlling interest in a former subsidiary (i) $ - $ - $ 22,737 $ 22,737 Goodwill (ii) - - 11,488 11,488 Total assets measured at fair value on a non-recurring basis $ - $ - $ 34,225 $ 34,225 (i) During the year ended June 30, 2017, the investment in Hollycon was measured based on significant unobservable inputs (Level 3), using a discounted cash flow approach assuming a certain terminal growth rate and discount rate (Note 10). (ii) As of June 30, 2017, the Company’s goodwill of $11,488 was related to the acquisition of Concord Group and $35,838 was related to the acquisition of Bond Group. The Company engaged an independent third-party appraiser to assist with the valuation of the goodwill related to the Concord and Bond Groups. The Company is ultimately responsible for the fair value of the goodwill recorded in the consolidated financial statements. For the purposes of step one of the goodwill impairment test, the Company has adopted the income approach, in particular the discounted cash flow approach, to evaluate the fair value of the reporting unit. In applying the discounted cash flow approach, key assumptions include the amount and timing of future expected cash flows, terminal value growth rates and appropriate discount rates. For the purpose of step two of the goodwill impairment test, the Company has allocated the fair value of the reporting unit derived in step one to the assets and liabilities of the reporting unit, as if the reporting unit had been acquired in a business combination and the fair value of the reporting unit was the price paid to acquire the reporting unit. The Company adopted the multi-period excess earnings model to evaluate the fair value of the intangible assets of the reporting unit, which was then used to compute the implied fair value of the goodwill via a residual approach. As a result, the Company recorded a goodwill impairment charge of $11,211 (Note 9). |
STOCKHOLDERS' EQUITY
STOCKHOLDERS' EQUITY | 12 Months Ended |
Jun. 30, 2017 | |
Stockholders' Equity Note [Abstract] | |
Stockholders' Equity Note Disclosure [Text Block] | NOTE 15 - STOCKHOLDERS’ EQUITY In August 2010, the Board of Directors adopted the 2010 Rights Plan. The 2010 Rights Plan provides for a dividend distribution of one preferred share purchase (the “Right”), for each outstanding ordinary share. Each Right entitles the shareholder to buy one share of the Class A Preferred Stock at an exercise price of $ 160 20 20 50 On May 30, 2013, October 29, 2014, and December 9, 2015, pursuant to the terms of the acquisition of Bond Group, the Company issued 1,407,907 648,697 627,578 On February 9, 2015, the Company declared a special cash dividend of $ 0.40 On September 26, 2016 0.20 October 26, 2016 November 11, 2016 |
SHARE-BASED COMPENSATION EXPENS
SHARE-BASED COMPENSATION EXPENSES | 12 Months Ended |
Jun. 30, 2017 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Disclosure of Compensation Related Costs, Share-based Payments [Text Block] | SHARE-BASED COMPENSATION EXPENSES On September 20, 2007, the Company adopted the 2006 Stock Plan (the “2006 Plan”) which allows the Company to offer a variety of incentive awards to employees, officers, directors and consultants. Options to purchase 3,000,000 On May 14, 2015, the Board of Directors approved the 2015 Equity Incentive Plan (the “2015 Equity Plan”). The 2015 Equity Plan provided for 5,000,000 Performance options Performance share options granted in 2012 (“2012 Performance Options”) The Company granted 1,476,000 721,500 The Company recorded share-based compensation expense relating to 2012 performance share options of $ 1,602 251 Performance options granted in 2015 (“2015 Performance Options”) On May 14, 2015, certain employees of the Company were granted share-based compensation awards totaling 1,740,000 22.25 On the 24, 36, 48 month anniversary of the grant date, 30 30 40 1,160,000 15 48 50 580,000 50 580,000 Moreover, for option grantees who are responsible for individual businesses, they have to meet the following additional criteria in each year, from fiscal years 2015 to 2017, to exercise the options in that particular year. The annual revenue growth rate compared to prior fiscal year must equal to or exceed 15%, 5%, 15% and 50% respectively for industrial automation (“IA”), rail transportation (“Rail”), mechanical and electrical solutions (“M&E”) and medical (“Medical”) revenue streams. EPS Threshold Number of vested Months after the grant date 24 months 36 months 48 months Annual growth rate over 15% but below 20% 1,160,000 348,000 348,000 464,000 CAGR equals or over 20% but below 25% Additional 290,000 - - 290,000 CAGR equals 25% or above Additional 290,000 - - 290,000 Total 348,000 348,000 1,044,000 The 2015 Performance Options will remain exercisable from the vesting date until the 60 month anniversary of the grant date. The EPS threshold and the revenue growth thresholds for Rail and Medical were met for fiscal years ended June 30, 2015 and 2016, however, the revenue growth thresholds of IA and M&E was not achieved. The annual growth rate of Non-GAAP diluted EPS for fiscal year 2017 failed to fall between 15 20 396,000 1,740,000 2015 Performance Number of Weighted Weighted average Aggregate Outstanding as at June 30, 2016 1,740,000 22.25 3.87 - Forfeited 1,344,000 22.05 Outstanding as at June 30, 2017 396,000 22.05 2.87 - Vested and expected to vest at June 30, 2017 396,000 22.05 2.87 - Exercisable at June 30, 2017 198,000 22.05 2.87 - The weighted averaged grant-date fair value of the 2015 performance options granted in fiscal year 2015 was $ 22.22 The Company recorded share-based compensation expense relating to the 2015 performance options in the amount of $ 471 3,190 (263) 588 0.87 For the 2015 performance options, the Company engaged an independent third-party appraiser to assist with the valuation of the option. The Company has adopted the binomial option pricing model to assess the fair value as of the valuation date. For options granted on Risk-free rate of return 1.51% Weighted average expected volatility 53.42% Expected life (in years) 5 years Expected ordinary dividend yield nil Restricted shares During the year ended June 30, 2014, the Company granted 52,500 During the year ended June 30, 2017, the Company granted 67,500 Number of restricted shares Weighted average grant-date fair value Un-vested at June 30, 2016 14,375 23.95 Granted 67,500 20.09 Vested 18,750 23.05 Un-vested at June 30, 2017 63,125 20.09 The aggregated grant-date fair value of restricted shares vested during the years ended June 30, 2015, 2016 and 2017 were $ 419 419 432 419 419 727 904 2.63 |
EMPLOYEE BENEFITS
EMPLOYEE BENEFITS | 12 Months Ended |
Jun. 30, 2017 | |
Compensation and Retirement Disclosure [Abstract] | |
Compensation and Employee Benefit Plans [Text Block] | NOTE 17 - EMPLOYEE BENEFITS The Company contributes to a state pension scheme run by the Chinese government in respect of its employees in China, a central provision fund run by the Singapore government in respect of its employees in Singapore, and an employment provident fund in respect of its employees in Malaysia. The expenses related to these plans were $ 17,018 18,235 17,568 |
INCOME TAX
INCOME TAX | 12 Months Ended |
Jun. 30, 2017 | |
Income Tax Disclosure [Abstract] | |
Income Tax Disclosure [Text Block] | INCOME TAX BVI Hollysys and its subsidiaries incorporated in the BVI are not subject to income tax under the relevant regulations. Singapore The Company’s wholly owned subsidiaries incorporated in Singapore are subject to Singapore corporate tax at a rate of 17 Malaysia The Company’s wholly owned subsidiaries incorporated in Malaysia are subject to Malaysia corporate income tax at a rate of 24 Dubai The branch of the Company’s wholly owned subsidiary is a tax exempt company incorporated in Dubai, and no tax provision has been made for each of the years ended June 30, 2015, 2016 and 2017. Hong Kong The Company’s wholly owned subsidiaries incorporated in Hong Kong are subject to Hong Kong profits tax at a rate of 16.5 Macau The Company’s wholly owned subsidiary incorporated in Macau is subject to the Macau corporate income tax at a rate of 12 600 India The Company’s wholly owned subsidiary incorporated in India is subject to India corporate tax at a rate of 30 Qatar CECL is subject to the Qatar Corporate income tax at a rate of 10 PRC The Company’s subsidiaries incorporated in the PRC are subject to PRC enterprise income tax (“EIT”) on their respective taxable incomes as adjusted in accordance with relevant PRC income tax laws. The PRC statutory EIT rate is 25 Beijing Hollysys Co., Ltd Beijing Hollysys was certified as a High and New Technology Enterprise (“HNTE”) which provides a preferential EIT rate of 15 Further, Beijing Hollysys was expected to be qualified for the Key Software Enterprise (“KSE”) status in 2017 and would be entitled to the preferential tax rate of 10 25 Hangzhou Hollysys Automation Co., Ltd Hangzhou Hollysys was certified as a HNTE which provides a preferential EIT rate of 15 Further, Hangzhou Hollysys was qualified for the KSE status in 2017 and was entitled to the preferential tax rate of 10 25 Year ended June 30, 2015 2016 2017 PRC $ 134,657 $ 142,900 $ 105,331 Non-PRC (9,430) (5,158) (22,976) $ 125,227 $ 137,742 $ 83,355 Year ended June 30, 2015 2016 2017 Current income tax expense (benefit) PRC 16,074 10,590 12,911 Non-PRC 5,120 4,110 (658) $ 21,194 $ 14,700 $ 12,253 Deferred income tax expense (benefit) PRC 5,834 (196) 2,616 Non-PRC (988) (266) (483) $ 4,846 (462) 2,133 $ 26,040 $ 14,238 $ 14,386 25 Year ended June 30, 2015 2016 2017 Income before income taxes $ 125,227 $ 137,742 $ 83,355 Expected income tax expense at statutory tax rate in the PRC 31,307 34,436 20,838 Effect of different tax rates in various jurisdictions 1,286 2,109 2,627 Effect of preferential tax treatment (12,453) (12,296) (10,650) Effect of non-taxable income (6,770) (4,985) - Effect of additional deductible research and development expenses (2,772) (4,716) (2,385) Effect of non-deductible expenses 8,402 5,569 4,608 Effect of change in tax rate (4,191) (6,613) (4,835) Change in valuation allowance 1,475 540 3,964 Tax rate differential on deferred tax items 3,139 (587) 2,056 Withholding tax on dividend paid by subsidiaries 6,028 1,252 (2,799) Others 589 (471) 962 Total $ 26,040 $ 14,238 $ 14,386 Had the above preferential tax treatment not been available, the tax charge would have been increased by $ 12,453 12,296 10,650 0.21 0.21 0.18 0.21 0.20 0.17 June 30, 2016 2017 Deferred tax assets, current Allowance for doubtful accounts $ 9,838 $ 9,172 Inventory provision 205 179 Provision for contract loss 917 694 Long-term assets 13 13 Deferred revenue 3,522 3,220 Deferred subsidies 1,020 1,654 Warranty liabilities 1,322 829 Recognition of intangible assets 57 (2) Accrued payroll 960 998 Net operating loss carry forward 6,361 9,801 Valuation allowance (6,307) (10,160) Total deferred tax assets, current $ 17,908 $ 16,398 Deferred tax liabilities, current Costs and estimated earnings in excess of billings $ (16,068) $ (10,071) Recognition of intangible assets (1,060) - PRC dividend withholding tax (3,010) (2,949) Others (24) 2 Total deferred tax liabilities, current $ (20,162) $ (13,018) Net deferred tax assets, current $ 6,659 $ 7,730 Net deferred tax liabilities, current $ (8,913) $ (4,350) Deferred tax assets, non-current Long-term assets $ 699 $ 112 Deferred subsidies 2,642 333 Net operating loss carryforward - 1,573 Warranty liabilities 874 332 Others (16) 192 Total deferred tax assets, non-current $ 4,199 $ 2,542 Deferred tax liabilities, non-current Share of net gains of equity investees $ (1,733) $ (2,520) Property, plant and equipment - (38) Intangible assets and other non-current assets (330) (5,552) Total deferred tax liabilities, non-current $ (2,063) $ (8,110) Net deferred tax assets-non-current $ 2,195 $ 1,121 Net deferred tax liabilities-non-current $ (59) $ (6,689) As of June 30, 2017 the Company had incurred net losses of approximately $ 9,748 48,342 1,377 9,748 The valuation allowance is considered on an individual entity basis. Under the EIT Law and the implementation rules, profits of the Company’s PRC subsidiaries earned on or after January 1, 2008 and distributed by the PRC subsidiaries to their respective foreign holding companies are subject to a withholding tax at 10 2,907,542 447,025 3,654,625 557,093 200,000 29,490 2,947 As of June 30, 2016 and June 30, 2017, the undistributed retained earnings generated from periods prior to January 1, 2008 were approximately $ 63,716 372,040 484,314 30,832 42,060 The Chinese tax law grants the tax authorities the rights to further inspect companies’ tax returns retroactively in a three-year period (up to five years under certain special conditions), which means theoretically the tax authorities can still review the PRC subsidiaries’ tax returns for the years ended December 31, 2012 through 2016. The tax law also states that companies will be liable to additional tax, interest charges and penalties if errors are found in their tax returns and such errors have led to an underpayment of tax. Determining income tax provisions involves judgment on the future tax treatment of certain transactions. The Company performed a self-assessment and concluded that there was no significant uncertain tax position requiring recognition in its financial statements. The tax treatment of such transactions is reconsidered periodically to take into account all changes in tax legislations. Where the final tax outcome of these transactions is different from the amounts that were initially recorded, such difference will impact the income tax and deferred tax provisions in the year in which such determination is made. There were no material interest or penalties incurred for and as of the years ended June 30, 2015, 2016 and 2017, respectively. |
INCOME PER SHARE
INCOME PER SHARE | 12 Months Ended |
Jun. 30, 2017 | |
Earnings Per Share [Abstract] | |
Earnings Per Share [Text Block] | INCOME PER SHARE Year ended June 30, 2015 2016 2017 Numerator: Net income attributable to the Company - basic $ 96,527 $ 118,471 $ 68,944 Net income attributable to the Company - diluted (i) $ 96,877 $ 119,121 $ 69,605 Denominator: Weighted average ordinary shares outstanding used in computing basic income per share 58,612,596 59,170,050 60,189,004 Effect of dilutive securities Convertible Bond 644,850 776,800 784,400 Share options 839,425 642,184 - Restricted shares 37,332 22,422 38,106 Weighted average ordinary shares outstanding used in computing diluted income per share 60,134,203 60,611,456 61,011,510 Income per share - basic $ 1.65 2.00 1.15 Income per share - diluted $ 1.61 1.97 1.14 (i) For the year ended June 30, 2016 and 2017, interest accretion related to the Convertible Bond of $ 650 661 Vested and unissued restricted shares of 58,726 75,066 72,263 |
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS | 12 Months Ended |
Jun. 30, 2017 | |
Related Party Transactions [Abstract] | |
Related Party Transactions Disclosure [Text Block] | RELATED PARTY TRANSACTIONS The related party relationships and related party transactions are listed as follows: Related party relationships Name of related parties Relationship with the Company Shenhua Hollysys Information Technology Co., Ltd. (“Shenhua Information”) 20% owned by Beijing Hollysys China Techenergy Co., Ltd. (“China Techenergy”) 40% owned by Beijing Hollysys Beijing Hollysys Electric Motor Co., Ltd. (“Electric Motor”) 40% owned by Beijing Hollysys Beijing Hollysys Machine Automation Co., Ltd. (“Hollysys Machine”) 30% owned by Hollysys (Beijing) Investment Co., Ltd. (“Hollysys Investment”) Heilongjiang Ruixing Technology Co., Ltd. (“Heilongjiang Ruixing”) 6% owned by Beijing Hollysys Beijing IPE Biotechnology Co., Ltd. (“Beijing IPE”) 22.02% owned by Beijing Hollysys Beijing Hollycon Medicine & Technology. Co., Ltd. (“Hollycon”) 30% owned by Beijing Hollysys Group Co., Ltd. (“Hollysys Group”) Shenzhen HollySys Intelligent Technologies Co., Ltd. (“Shenzhen HollySys”) 60% owned by Beijing Hollysys Intelligent Technologies Co., Ltd. (“Hollysys Intelligent”) Due from related parties June 30, 2016 2017 China Techenergy $ 22,579 $ 28,778 Shenhua Information 2,995 3,267 Heilongjiang Ruixing 1,071 1,049 Hollysys Machine 1,367 965 Hollycon - 79 Shenzhen HollySys - 2 Beijing IPE - 2 $ 28,012 $ 34,142 The Company’s management believes that the collection of amounts due from related parties is reasonably assured and accordingly and no provision had been made for these balances. June 30, 2016 2017 China Techenergy $ 1,170 $ 1,117 Hollysys Machine 112 817 Shenhua Information 358 353 Electric Motor 5 11 Beijing IPE - 2 Hollycon - 1 $ 1,645 $ 2,301 Purchases of goods and services from: Year ended June 30, 2015 2016 2017 Hollysys Machine $ 914 $ 555 $ 749 Electric Motor 50 354 29 Hollycon - - 8 Shenhua Information 368 - - China Techenergy 1 - - $ 1,333 $ 909 $ 786 Sales of goods and integrated solutions to: Year ended June 30, 2015 2016 2017 China Techenergy $ 21,936 $ 3,657 $ 10,842 Shenhua Information 2,128 847 765 Hollysys Machine 512 235 167 Hollycon - - 108 Beijing IPE - - 7 Electric Motor 1 - - $ 24,577 $ 4,739 $ 11,889 Operating lease income from: Year ended June 30, 2015 2016 2017 Hollycon - - 602 Hollysys Machine 41 40 - $ 41 $ 40 $ 602 Purchases of intangible assets: Year ended June 30, 2015 2016 2017 Hollysys Machine $ - $ - $ 1,648 The Company sells automation control systems to China Techenergy which is used for non-safety operations control in the nuclear power industry. China Techenergy incorporates the Company’s non-safety automation control systems with their proprietary safety automated control systems to provide an overall automation and control system for nuclear power stations in China. The Company is not a party to the integrated sales contracts executed between China Techenergy and its customers. The Company’s pro rata shares of the intercompany profits and losses are eliminated until realized through a sale to outside parties, as if China Techenergy were a consolidated subsidiary. The Company sells automation control systems to Shenhua Information which is used for operations control in the information automation industry. Shenhua Information incorporates the Company’s automation control systems with their proprietary automated remote control systems to provide an overall automation and control system to its customers. The Company is not a party to the integrated sales contracts executed between Shenhua Information and its customers. The Company’s pro rata shares of the intercompany profits and losses are eliminated until realized through a sale to an outside party as if Shenhua Information were a consolidated subsidiary. The Company engages Hollysys Machine to sell the Company’s products to end customers. The Company pays commission to Hollysys Machine in exchange for its services. The amount of the commission is determined based on the value of the products sold by Hollysys Machine during the year. In fiscal year 2017, one of the Company’s subsidiary Hollysys Intelligent reached an agreement with Hollysys Machine to purchase a series of fixed assets, software copyrights and patents because of their similar business category. The Company entered into an operating lease agreement with Hollycon to lease part of its one building located in Beijing. The lease term is for 1 year from the commencement date of July 1, 2016 to June 30, 2017. Amounts due from and due to the related parties relating to the above transactions are unsecured, non-interest bearing and repayable on demand. |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 12 Months Ended |
Jun. 30, 2017 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies Disclosure [Text Block] | NOTE 21 - COMMITMENTS AND CONTINGENCIES Operating lease commitments The Company leases premises under various operating leases. Rental expenses under operating leases included in the consolidated statements of comprehensive income were $ 1,492 1,811 2,718 Years ending June 30, Minimum lease payments 2018 $ 2,453 2019 1,060 2020 263 2021 103 2022 and onwards 63 Total minimum lease payments $ 3,942 The Company’s lease arrangements have no renewal or purchase options, rent escalation clauses, restriction or contingent rents and are all conducted with third parties. Capital commitments As of June 30, 2017, the Company had approximately $ 1,026 Purchase obligation As of June 30, 2017, the Company had $ 142,424 Performance guarantee and standby letters of credit The Company had stand-by letters of credit of $ 24,941 62,914 13,289 The Company accounts for performance guarantees and stand-by letters of credit in accordance with ASC topic 460 (“ASC 460”), Guarantees. Both the performance guarantees and the stand-by letters of credit are for the Company’s commitment of its own future performance, and the outcome of which is within its own control. As a result, performance guarantees and stand-by letters of credit are subject to ASC 460 disclosure requirements only. |
OPERATING LEASES AS LESSOR
OPERATING LEASES AS LESSOR | 12 Months Ended |
Jun. 30, 2017 | |
Leases [Abstract] | |
Operating Leases Of Lessor Disclosure [Text Block] | OPERATING LEASES AS LESSOR On April 3, 2013, Beijing Hollysys entered into an operating lease agreement to lease out one of its buildings located in Beijing. The lease term is for a period of 10 Year ending June 30, Minimum lease payments 2018 $ 1,477 2019 1,522 2020 1,567 2021 1,614 2022 1,663 Total minimum lease payments to be received in the next five years $ 7,843 The minimum lease payment receivable after five years is $ 2,003 |
SEGMENT REPORTING
SEGMENT REPORTING | 12 Months Ended |
Jun. 30, 2017 | |
Segment Reporting [Abstract] | |
Segment Reporting Disclosure [Text Block] | NOTE 23 - SEGMENT REPORTING The chief operating decision makers have been identified as the Chairman, Chief Executive Officer and Chief Financial Officer of the Company. The Company organizes its internal financial reporting structure based on its main product and service offerings. Based on the criteria established by ASC 280, Segment Reporting Year ended June 30, 2015 IA Rail M&E Miscellaneous Consolidated Revenues from external customers $ 213,252 193,274 110,030 14,823 531,379 Costs of revenue 119,520 97,503 93,452 6,502 316,977 Gross profit $ 93,732 95,771 16,578 8,321 214,402 Year ended June 30, 2016 IA Rail M&E Miscellaneous Consolidated Revenues from external customers $ 182,901 240,310 95,277 25,837 544,325 Costs of revenue 113,314 131,043 82,900 11,342 338,599 Gross profit $ 69,587 109,267 12,377 14,495 205,726 Year ended June 30, 2017 IA Rail M&E Miscellaneous Consolidated Revenues from external customers $ 172,667 155,732 103,544 - 431,943 Costs of revenue 106,583 86,128 98,761 - 291,472 Gross profit $ 66,084 69,604 4,783 - 140,471 The Company’s assets are shared among the segments thus no assets have been designated to specific segments. Year ended June 30, 2015 2016 2017 Revenues: PRC $ 410,644 $ 443,256 $ 326,713 Non-PRC 120,735 101,069 105,230 $ 531,379 $ 544,325 $ 431,943 T June 30, 2016 2017 Long-lived assets other than goodwill and acquired intangible assets PRC $ 100,454 $ 131,625 Non-PRC 13,079 12,029 $ 113,533 $ 143,654 |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 12 Months Ended |
Jun. 30, 2017 | |
Subsequent Events [Abstract] | |
Subsequent Events [Text Block] | SUBSEQUENT EVENTS On July 10, 2017, the Company completed the acquisition of 100 2,380 |
ENDORSEMENT OF NOTE RECEIVABLES
ENDORSEMENT OF NOTE RECEIVABLES | 12 Months Ended |
Jun. 30, 2017 | |
Endorsement Of Note Receivables [Abstract] | |
Endorsement Of Note Receivables [Text Block] | NOTE 25 - ENDORSEMENT OF NOTE RECEIVABLES The Company endorsed bank acceptance bills to its suppliers as a way of settling accounts payable. The total endorsed but not yet due bank acceptance bills amounted to $ 31,991 25,462 Transfer and Servicing |
CONDENSED FINANCIAL INFORMATION
CONDENSED FINANCIAL INFORMATION OF THE PARENT COMPANY | 12 Months Ended |
Jun. 30, 2017 | |
Condensed Financial Information of Parent Company Only Disclosure [Abstract] | |
Condensed Financial Information of Parent Company Only Disclosure [Text Block] | NOTE 26 - CONDENSED FINANCIAL INFORMATION OF THE PARENT COMPANY Under the PRC laws and regulations, the Company’s PRC subsidiaries’ ability to transfer net assets in the form of dividend payments, loans, or advances are restricted. The amount restricted was RMB 538,113 79,500 569,279 84,091 The following represents condensed unconsolidated financial information of the parent company only: June 30, 2016 2017 ASSETS Current assets: Cash and cash equivalents $ 8,571 $ 13,103 Amounts due from subsidiaries 72,303 59,920 Prepaid expenses 63 61 Total current assets 80,937 73,084 Investments in subsidiaries 669,326 726,837 Total assets $ 750,263 $ 799,921 LIABILITIES AND STOCKHOLDERS’ EQUITY Current liabilities: Accrued payroll and related expense $ 9 $ 14 Accrued liabilities 427 487 Amounts due to subsidiaries 55,869 55,869 Total current liabilities 56,305 56,370 Long-term loan 19,802 20,032 Total liabilities 76,107 76,402 Equity: Ordinary shares, par value $0.001 per share, 100,000,000 shares authorized; 59,598,099 and 60,342,099 shares issued and outstanding as of June 30, 2016 and 2017, respectively 60 60 Additional paid-in capital 215,403 222,189 Retained earnings 467,160 524,129 Accumulated other comprehensive loss (8,467) (22,859) Total equity 674,156 723,519 Total liabilities and equity $ 750,263 $ 799,921 Year Ended June 30, 2015 2016 2017 General and administrative expenses $ 3,169 $ 4,484 $ 1,062 Loss from operations (3,169) (4,484) (1,062) Other expense, net (35) (93) (89) Interest income 1 80 4 Interest expenses (463) (705) (1,074) Foreign exchange gains (losses) 238 (719) (740) Equity in profit of subsidiaries $ 99,955 $ 124,392 $ 71,905 Income before income taxes 96,527 118,471 68,944 Income tax expenses - - - Net income 96,527 118,471 68,944 Other comprehensive income, net of tax of nil Translation adjustment (1,427) (46,052) (14,392) Comprehensive income $ 95,100 $ 72,419 $ 54,552 Year ended June 30, 2015 2016 2017 Net cash used in operating activities $ (397) $ (1,697) $ (930) Net cash (used in) provided by investing activities (4,402) $ 11,390 $ (396) Net cash provided by (used in) financing activities $ 13,236 $ (9,559) $ 5,858 Net increase in cash and cash equivalents $ 8,437 $ 134 $ 4,532 Cash and cash equivalents, beginning of year $ - $ 8,437 $ 8,571 Cash and cash equivalents, end of year $ 8,437 $ 8,571 $ 13,103 Basis of presentation For the presentation of the parent company only condensed financial information, the Company records its investment in subsidiaries under the equity method of accounting as prescribed in ASC 323, InvestmentsEquity Method and Joint Ventures |
SUMMARY OF SIGNIFICANT ACCOUN34
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 12 Months Ended |
Jun. 30, 2017 | |
Accounting Policies [Abstract] | |
Principles Of Consolidation and Basis Of Presentation [Policy Text Block] | Basis of Presentation The consolidated financial statements are prepared in accordance with United States generally accepted accounting principles (“U.S. GAAP”). |
Consolidation, Policy [Policy Text Block] | Principles of Consolidation The consolidated financial statements include the financial statements of the Company, its subsidiaries and a VIE. All inter-company transactions and balances between the Company, its subsidiaries, and the VIE are eliminated upon consolidation. The Company included the results of operations of acquired businesses from the respective dates of acquisition. |
Use of Estimates, Policy [Policy Text Block] | The preparation of financial statements in conformity with US GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Management evaluates estimates, including those related to the expected total costs of integrated contracts, expected gross margins of integrated solution contracts, allowance for doubtful accounts, fair values of share options, fair value of bifurcated derivative, fair value of retained non-controlling investment in the former subsidiary, warranties, valuation allowance of deferred tax assets and impairment of goodwill and other long-lived assets. Management bases the estimates on historical experience and on various other assumptions that are believed to be reasonable, the results of which form the basis for making judgments about the carrying values of assets and liabilities. Actual results could differ materially from those estimates. |
Foreign Currency Transactions and Translations Policy [Policy Text Block] | Foreign currency translations and transactions The Company’s functional currency is the United States dollars (“US dollars” or “$”); whereas the Company’s subsidiaries and VIE use the primary currency of the economic environment in which their operations are conducted as their functional currency. According to the criteria of Accounting Standards Codification (“ASC”) Topic 830 (“ASC 830”), the Company uses the US dollars as its reporting currency. The Company translates the assets and liabilities into US dollars using the rate of exchange prevailing at the balance sheet date, and the statements of comprehensive income are translated at average rates during the reporting period. Adjustments resulting from the translation of financial statements from the functional currency into US dollars are recorded in stockholders’ equity as part of accumulated other comprehensive income. Transactions dominated in currencies other than the functional currency are translated into functional currency at the exchange rates prevailing on the transaction dates, and the exchange gains or losses are reflected in the consolidated statements of comprehensive income for the reporting period. Transactions denominated in foreign currencies are measured into the functional currency at the exchange rates prevailing on the transaction dates. Foreign currency denominated financial assets and liabilities are re-measured at the exchange rates prevailing at the balance sheet date. Exchange gains and losses are included in earnings, except for those raised from intercompany transactions with investment nature, which are recorded in other comprehensive income. |
Business Combinations Policy [Policy Text Block] | Business combinations The Company accounts for its business combinations using the purchase method of accounting in accordance with ASC Topic 805, Business Combinations The determination and allocation of fair values to the identifiable assets acquired, liabilities assumed and non-controlling interests is based on various assumptions and valuation methodologies requiring considerable management judgment. The most significant variables in these valuations are discount rates, terminal values, as well as the assumptions and estimates used to determine the cash inflows and outflows. The Company determines discount rates to be used based on the risk inherent in the related activity’s current business model and industry comparisons. Terminal values are based on the expected life of assets and forecasted cash flows over that period. Acquisition-related costs are recognized as general and administrative expenses in the statements of comprehensive income as incurred. |
Cash and Cash Equivalents, Policy [Policy Text Block] | Cash and cash equivalents Cash and cash equivalents consist of cash on hand and bank deposits, which are unrestricted as to withdrawal and use. All highly liquid investments that are readily convertible to known amounts of cash with original stated maturities of three months or less are classified as cash equivalents. |
Time Deposits With Original Maturities Over Three Months [Policy Text Block] | Time deposits with original maturities over three months Time deposits with original maturities over three months consist of deposits placed with financial institutions with original maturity terms from four months to one year. As of June 30, 2017, $ 80,507 11,690 3,935 82 35,318 7,042 8 |
Cash and Cash Equivalents, Restricted Cash and Cash Equivalents, Policy [Policy Text Block] | Restricted cash Restricted cash mainly consists of the cash deposited in banks pledged for performance guarantees, or bank loans. These cash balances are not available for use until these guarantees are expired or cancelled, or the loans are repaid. |
Revenue Recognition, Policy [Policy Text Block] | Revenue recognition Integrated solutions contracts Revenues generated from designing, building, and delivering customized integrated industrial automation systems are recognized over the contractual terms based on the percentage of completion method. The contracts for designing, building, and delivering customized integrated industrial automation systems are legally enforceable and binding agreements between the Company and customers. The duration of contracts depends on the contract size and ranges from 6 5 Revenue generated from mechanical and electrical solution contracts for the construction or renovation of buildings, rail or infrastructure facilities are also recognized over the contractual terms based on the percentage of completion method. The contracts for mechanical and electrical solution are legally enforceable and binding agreements between the Company and customers. The duration of contracts depends on the contract size and the complexity of the construction work and ranges from 6 3 In accordance with ASC 605-35, Revenue Recognition - Construction-Type and Production-Type Contracts The Company reviews and updates the estimated total costs of integrated solutions contracts at least annually. The Company accounts for revisions to contract revenue and estimated total costs of integrated solution contracts, including the impact due to approved change orders, in the period in which the facts that cause the revision become known as changes in estimates. Unapproved change orders are considered claims. Claims are recognized only when it has been awarded by customers. Excluding the impact of change orders, if the estimated total costs of integrated solution contracts, which were revised during the years ended June 30, 2015, 2016 and 2017, had been used as a basis of recognition of integrated contract revenue since the contract commencement, net income for the years ended June 30, 2015, 2016 and 2017 would have been decreased by $ 26,232 30,270 12,062 0.45 0.51 0.20 0.44 0.50 0.20 The Company combines a group of contracts as one project if they are closely related and are, in substance, parts of a single project with an overall profit margin. The Company segments a contract into several projects, when they are of different business substance, for example, with different business negotiation, solutions, implementation plans and margins. Revenue in excess of billings on the contracts is recorded as costs and estimated earnings in excess of billings. Billings in excess of revenues recognized on the contracts are recorded as deferred revenue until the above revenue recognition criteria are met. Recognition of accounts receivable and costs and estimated earnings in excess of billings are discussed below. The Company generally recognizes 100 Product sales Revenue generated from sales of products is recognized when the following four revenue recognition criteria are met: (i) persuasive evidence of an arrangement exists, (ii) delivery has occurred, (iii) the selling price is fixed or determinable, and (iv) collectability is reasonably assured. Service rendered The Company has in recent years extended its service offerings as described below. The Company mainly provides two types of services: Revenue from one-off services: the Company provides different types of one-off services, including on-site maintenance service and training services which are generally completed on site within a few working days. Revenue is recognized when the Company has completed all the respective services described in the contracts, there is persuasive evidence of an arrangement, the fee is fixed or determinable and collection is reasonably assured. Revenue from services covering a period of time: the Company also separately sells extended warranties to their integrated solution customers for a fixed period. Such arrangements are negotiated separately from the corresponding integrated solution system and are usually entered into upon the expiration of the warranty period attached to the integrated solution contract. During the extended warranty period, the Company is responsible for addressing issues related to the system. Part replacement is not covered in such services. The Company recognizes revenue on a pro-rata basis over the contractual term. |
Accounts Receivable and Cost and Estimated Earnings In Excess Of Billings [Policy Text Block] | Performance of the integrated contracts will often extend over long periods and the Company’s right to receive payments depends on its performance in accordance with the contractual agreements. There are different billing practices in the PRC, overseas operating subsidiaries and the VIE (Concord and Bond Groups). For the Company’s PRC subsidiaries, billings are issued based on milestones specified in contracts negotiated with customers. In general, there are four milestones: 1) project commencement, 2) system manufacturing and delivery, 3) installation, trial-run and customer acceptance, and 4) expiration of the warranty period. The amounts to be billed at each milestone are specified in the contract. All contracts have the first milestone, but not all contracts require prepayments. The length of each interval between two continuous billings under an integrated contract varies depending on the duration of the contract (under certain contracts, the interval lasts more than a year) and the last billing to be issued for an integrated solution contract is scheduled at the end of a warranty period. For Concord and Bond Groups, billing claims rendered are subject to the further approval and certification of the customers or their designated consultants. Payments are made to Concord or Bond Groups based on the certified billings according to the payment terms mutually agreed between the customers and Concord or Bond Groups. Certain amounts are retained by the customer and payable to Concord and Bond Groups upon satisfaction of final quality inspection or at the end of the warranty period. The retained amounts which were recorded as accounts receivable were $ 10,848 12,838 The carrying value of the Company’s accounts receivable and costs and estimated earnings in excess of billings, net of the allowance for doubtful accounts, represents their estimated net realizable value. An allowance for doubtful accounts is recognized when it’s probable that the Company will not collect the amount and is written off in the period when deemed uncollectible. The Company periodically reviews the status of contracts and decides how much of an allowance for doubtful accounts should be made based on factors surrounding the credit risk of customers and historical experience. The Company does not require collateral from its customers and does not charge interest for late payments by its customers. |
Inventory, Policy [Policy Text Block] | Inventories Inventories are composed of raw materials, work in progress, purchased and manufactured finished goods and low value consumables. Inventories are stated at the lower of cost or market. The Company elected to use weighted average cost method as inventory costing method. The Company assesses the lower of cost or market for non-saleable, excess or obsolete inventories based on its periodic review of inventory quantities on hand and the latest forecasts of product demand and production requirements from its customers. The Company writes down inventories for non-saleable, excess or obsolete raw materials, work-in-process and finished goods by charging such write-downs to cost of integrated contracts and/or costs of products sold. |
Standard Product Warranty, Policy [Policy Text Block] | Warranties Warranties represent a major term under an integrated contract, which will last, in general, for one to three years or otherwise specified in the terms of the contract. The Company accrues warranty liabilities under an integrated contract as a percentage of revenue recognized, which is derived from its historical experience, in order to recognize the warranty cost for an integrated contract throughout the contract period. |
Property, Plant and Equipment, Policy [Policy Text Block] | Property, plant and equipment, net Property, plant and equipment, other than construction in progress, are recorded at cost and are stated net of accumulated depreciation and impairment, if any. Buildings 30 -50 years Machinery 5 - 10 years Software 3 - 5 years Vehicles 5- 6 years Electronic and other equipment 3 - 10 years Construction in progress represents uncompleted construction work of certain facilities which, upon completion, management intends to hold for production purposes. In addition to costs under construction contracts, other costs directly related to the construction of such facilities, including duty and tariff, equipment installation and shipping costs, and borrowing costs are capitalized. Depreciation commences when the asset is placed in service. Maintenance and repairs are charged directly to expenses as incurred, whereas betterment and renewals are capitalized in their respective accounts. When an item is retired or otherwise disposed of, the cost and applicable accumulated depreciation are removed and the resulting gain or loss is recognized for the reporting period. |
Lease, Policy [Policy Text Block] | Prepaid land leases, net Prepaid land lease payments, for the land use right of three parcels of land in the PRC, three parcels of leasehold land in Malaysia and one parcel of leasehold land in Singapore, are initially stated at cost and are subsequently amortized on a straight-line basis over the lease terms of 49 88 |
Intangible Assets, Finite-Lived, Policy [Policy Text Block] | Intangible assets, net Intangible assets are carried at cost less accumulated amortization and any impairment. Intangible assets acquired in a business combination are recognized initially at fair value at the date of acquisition. Intangible assets, except for which are estimated to have an indefinite useful life, are amortized using a straight-line method. Intangible assets estimated to have an indefinite useful life are not amortized but tested for impairment annually or more frequently when indicators of impairment exist. Category Estimated useful life Customer relationship 57 - 60 months Order backlog 21 - 33 months Patents and copyrights 60 - 120 months Residual values are considered nil. |
Goodwill Impairment [Policy Text Block] | Goodwill represents the excess of the purchase price over the estimated fair value of net tangible and identifiable intangible assets acquired. The Company assesses goodwill for impairment in accordance with ASC subtopic 350-20 (“ASC 350-20”), Intangibles Goodwill and Other, which requires that goodwill is not amortized but to be tested for impairment at the reporting unit level at least annually and more frequently upon the occurrence of certain events, as defined by ASC 350-20. The Company’s goodwill outstanding at June 30, 2017 was related to the acquisitions of two reporting units, Concord Group and Bond Group. The Company has the option to assess qualitative factors first to determine whether it is necessary to perform the two-step test in accordance with ASC 350-20. If the Company believes, as a result of the qualitative assessment, that it is more-likely-than-not that the fair value of the reporting unit is less than its carrying amount, the two-step quantitative impairment test described above is required. Otherwise, no further testing is required. In the qualitative assessment, the Company considers primary factors such as industry and market considerations, overall financial performance of the reporting unit, and other specific information related to the operations. In performing the two-step quantitative impairment test, the first step compares the carrying amount of the reporting unit to the fair value of the reporting unit based on either quoted market prices of the ordinary shares or estimated fair value using a combination of the income approach and the market approach. If the fair value of the reporting unit exceeds the carrying value of the reporting unit, goodwill is not impaired and the Company is not required to perform further testing. If the carrying value of the reporting unit exceeds the fair value of the reporting unit, then the Company must perform the second step of the impairment test in order to determine the implied fair value of the reporting unit’s goodwill. The fair value of the reporting unit is allocated to its assets and liabilities in a manner similar to a purchase price allocation in order to determine the implied fair value of the reporting unit goodwill. If the carrying amount of the goodwill is greater than its implied fair value, the excess is recognized as an impairment loss. The Company elected to assess goodwill for impairment using the two-step process for both Concord Group and Bond Group for the year ended June 30, 2017, with assistances from a third-party appraiser. Concord and Bond Groups’ management judgment is involved in determining these estimates and assumptions, and actual results may differ from those used in valuations. Changes in these estimates and assumptions could materially affect the determination of fair value for each reporting unit which could trigger future impairment. The judgment in estimating the fair value of reporting units includes forecasts of future cash flows, which are based on management’s best estimate of future revenue, gross profit, operating expenses growth rates, future capital expenditure and working capital level, as well as discount rate determined by Weighted Average Cost of Capital approach and the selection of comparable companies operating in similar businesses. The Company also reviewed marketplace and/or historical data to assess the reasonableness of assumptions such as discount rate and working capital level. The carrying amount of Concord Group exceeded its fair value as of June 30, 2017, and a goodwill impairment charge of $ 11,211 There are uncertainties surrounding the amount and timing of future expected cash flows as they may be impacted by negative events such as a slowdown in the mechanical and electrical engineering sector, deteriorating economic conditions in the geographical areas Concord Group operates in, political, economic and social uncertainties in the Middle East, increasing competitive pressures and fewer than expected mechanical and electrical solution contracts awarded to Concord Group. These events can negatively impact demand for Concord Group’s services and result in actual future cash flows being less than forecasted or delays in the timing of when those cash flows are expected to be realized. Further, the timing of when actual future cash flows are received could differ from the Company’s estimates, which are based on historical trends and does not factor in unexpected delays in project commencement or execution. The fair value of Bond Group exceeded its carrying amounts as of June 30, 2017, and therefore goodwill related to Bond Group was not impaired and the Company was not required to perform further step testing. |
Impairment Of Long Lived Assets Other Than Goodwill [Policy Text Block] | Impairment of long-lived assets other than goodwill The Company evaluates its long-lived assets or asset group including acquired intangibles with finite lives for impairment whenever events or changes in circumstances (such as a significant adverse change to market conditions that will impact the future use of the assets) indicate that the carrying amount of a group of long-lived assets may not be fully recoverable. When these events occur, the Company evaluates the impairment by comparing the carrying amount of the assets to future undiscounted cash flows expected to result from the use of the assets and their eventual disposition. If the sum of the expected undiscounted cash flows is less than the carrying amount of the assets, the Company recognizes an impairment loss based on the excess of the carrying amount of the asset group over its fair value, generally based upon discounted cash flows or quoted market prices. |
Shipping and Handling Cost, Policy [Policy Text Block] | Shipping and handling costs All shipping and handling fees charged to customers are included in net revenue. Shipping and handling costs incurred are included in cost of integrated contracts and/or costs of products sold as appropriate. |
Income Tax, Policy [Policy Text Block] | Income taxes The Company follows the liability method of accounting for income taxes. Under this method, deferred tax assets and liabilities are determined based on the differences between the financial reporting and tax bases of assets and liabilities using enacted tax rates that will be in effect in the period in which the differences are expected to reverse. The Company records a valuation allowance to offset deferred tax assets if based on the weight of available evidence, it is more-likely-than-not that some portion, or all, of the deferred tax assets will not be realized. The effect on deferred taxes of a change in tax rate is recognized in tax expense in the period that includes the enactment date of the change in tax rate. The Company adopted ASC 740, Income Taxes , |
Research and Development Expense, Policy [Policy Text Block] | Research and development costs Research and development costs consist primarily of salaries, bonuses and benefits for research and development personnel. Research and development costs also include travel expenses of research and development personnel as well as depreciation of hardware equipment and software tools and other materials used in research and development activities. Research and development costs are expensed as incurred. Software development costs are also expensed as incurred as the costs qualifying for capitalization have been insignificant. |
Vat Refunds and Government Subsidies [Policy Text Block] | VAT refunds and government subsidies Pursuant to the laws and regulations of the PRC, the Company remits 17 3 7,593 6,085 10,238 2,191 2,886 12,885 |
Appropriations To Statutory Reserve [Policy Text Block] | Appropriations to statutory reserve Under the corporate law and relevant regulations in the PRC, all of the subsidiaries of the Company located in the PRC are required to appropriate a portion of its retained earnings to statutory reserve. All subsidiaries located in the PRC are required to appropriate 10 |
Segment Reporting, Policy [Policy Text Block] | Segment reporting In accordance with ASC 280, Segment reporting |
Comprehensive Income, Policy [Policy Text Block] | Comprehensive income Comprehensive income is defined as the changes in equity of the Company during a period from transactions and other events and circumstances excluding transactions resulting from investments by owners and distributions to owners. In accordance with ASC 220, Comprehensive Income |
Equity and Cost Method Investments, Policy [Policy Text Block] | Investments in cost and equity investees The Company accounts for its equity investments under either the cost method or the equity method by considering the Company’s rights and ability to exercise significant influence over the investees. Under the cost method, investments are initially carried at cost. In the event that the fair value of the investment falls below the initial cost and the decline is considered as other-than-temporary, the Company recognizes an impairment charge, equal to the difference between the cost basis and the fair value of the investment. A variety of factors are considered when determining if a decline in fair value below carrying value is other than temporary, including, among others, the financial condition and prospects of the investee. The investments in entities over which the Company has the ability to exercise significant influence are accounted for using the equity method. Significant influence is generally considered to exist when the Company has an ownership interest in the voting stock of the investee between 20 50 Under the equity method, original investments are recorded at cost and adjusted by the Company’s share of undistributed earnings or losses of these entities, by the amortization of any basis difference between the amount of the Company’s investment and its share of the net assets of the investee, and by dividend distributions or subsequent investments. Unrealized inter-company profits and losses related to equity investees are eliminated. An impairment charge, being the difference between the carrying amount and the fair value of the equity investee, is recognized in the consolidated statements of comprehensive income when the decline in value is considered other than temporary. There was no impairment loss on investments in cost or equity investees for the years ended June 30, 2015, 2016 and 2017, respectively. |
Interest Capitalization, Policy [Policy Text Block] | Capitalization of interest Interest incurred on borrowings for the Company’s construction of facilities and assembly line projects during the active construction period are capitalized. The capitalization of interest ceases once a project is substantially complete. The amount to be capitalized is determined by applying the weighted-average interest rate of the Company’s outstanding borrowings to the average amount of accumulated capital expenditures for assets under construction during the year and is added to the cost of the underlying assets and amortized over their respective useful lives. |
Earnings Per Share, Policy [Policy Text Block] | Income per share Income per share is computed in accordance with ASC 260, Earnings Per Share |
Share-based Compensation, Option and Incentive Plans Policy [Policy Text Block] | Share-based compensation The Company accounts for share-based compensation in accordance with ASC 718, Compensation-Stock Compensation For share-based awards that are subject to performance-based vesting conditions in addition to time-based vesting, the Company recognizes the estimated grant-date fair value of performance-based awards, net of estimated forfeitures, as share-based compensation expense over the vesting period based upon the Company’s determination of whether it is probable that the performance-based criteria will be achieved. At each reporting period, the Company reassesses the probability of achieving the performance-based criteria. Determining whether the performance-based criteria will be achieved involves judgment, and the estimate of share-based compensation expense may be revised periodically based on changes in the probability of achieving the performance-based criteria. Revisions are reflected in the period in which the estimate is changed. If the performance-based criteria are not met, no share-based compensation expense is recognized, and, to the extent share-based compensation expense was previously recognized, such share-based compensation expense is reversed. |
Fair Value Measurement, Policy [Policy Text Block] | Fair value measurements The Company has adopted ASC 820, Fair Value Measurements and Disclosures Level 1 - Quoted prices in active markets for identical assets or liabilities. Level 2 - Inputs other than Level 1 that are observable, either directly or indirectly, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. Level 3 - Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. Classification within the hierarchy is determined based on the lowest level of input that is significant to the fair value measurement. ASC 820 describes three main approaches to measuring the fair value of assets and liabilities: (1) market approach; (2) income approach and (3) cost approach. The market approach uses prices and other relevant information generated from market transactions involving identical or comparable assets or liabilities. The income approach uses valuation techniques to convert future amounts to a single present value amount. The measurement is based on the value indicated by current market expectations about those future amounts. The cost approach is based on the amount that would currently be required to replace an asset. |
Revenue Recognition Leases [Policy Text Block] | Leases Leases have been classified as either capital or operating leases. Leases that transfer substantially all the benefits and risks incidental to the ownership of assets are accounted for as if there was an acquisition of an asset and incurrence of an obligation at the inception of the lease. All other leases are accounted for as operating leases wherein rental payments are expensed as incurred. |
Lessor [Policy Text Block] | Accounting for lessor Minimum contractual rental from leases are recognized on a straight-line basis over the non-cancelable term of the lease. 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 commences when the customer assumes control 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. Contingent rental revenue is accrued when the contingency is removed. |
Concentration Of Risks [Policy Text Block] | Concentration of risks Concentration of credit risk Assets that potentially subject the Company to significant concentration of credit risk primarily consist of cash and cash equivalents, time deposits with original maturities over three months, restricted cash, accounts receivable, other receivables and amounts due from related parties. The maximum exposure of such assets to credit risk is their carrying amounts as of the balance sheet date. As of June 30, 2017, substantially all of the Company’s cash and cash equivalents and time deposits with original maturities exceeding three months were managed by financial institutions located in the PRC, Singapore, Malaysia and Dubai, which management believes are of high credit quality. Accounts receivable, other receivables and amounts due from related parties are typically unsecured and the risk with respect to accounts receivable is mitigated by credit evaluations the Company performs on its customers and its ongoing monitoring process of outstanding balances. The Company has no customer that individually comprised 10 Concentration of business and economic risk A majority of the Company’s net revenue and net income are derived in the PRC. The Company’s operations may be adversely affected by significant political, economic and social uncertainties in the PRC. Although the PRC government has been pursuing economic reform policies for more than 20 years, no assurance can be given that the PRC government will continue to pursue such policies or that such policies may not be significantly altered, especially in the event of a change in leadership, social or political disruption or unforeseen circumstances affecting the PRC’s political, economic and social conditions. There is also no guarantee that the PRC government’s pursuit of economic reforms will be consistent or effective. Concentration of currency convertibility risk A majority of the Company’s businesses are transacted in RMB, which is not freely convertible into foreign currencies. All foreign exchange transactions take place either through the People’s Bank of China or other banks authorized to buy and sell foreign currencies at the exchange rates quoted by the People’s Bank of China. Approval of foreign currency payments by the People’s Bank of China or other regulatory institutions requires submitting a payment application form together with suppliers’ invoices, shipping documents and signed contracts. Concentration of foreign currency exchange rate risk The Company’s exposure to foreign currency exchange rate risk primarily relates to monetary assets or liabilities held in foreign currencies. Since July 21, 2005, the RMB has been permitted to fluctuate within a narrow and managed band against a basket of certain foreign currencies. On June 19, 2010, the People’s Bank of China announced the end of the RMB’s de facto peg to USD, a policy which was instituted in late 2008 in the face of the global financial crisis, to further reform the RMB exchange rate regime and to enhance the RMB’s exchange rate flexibility. The exchange rate floating bands will remain the same as previously announced in the inter-bank foreign exchange market. The depreciation of the US dollars against RMB was approximately 0.64 8.68 2.07 For the years ended June 30, 2015, 2016 and 2017, the net foreign currency translation losses resulting from the translation of RMB, SGD and other functional currencies to the U.S. dollar reporting currency recorded in other comprehensive income was $ 1,386 48,841 14,428 |
New Accounting Pronouncements, Policy [Policy Text Block] | Recent accounting pronouncements In August 2015, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update 2015-14, which defers the effective date of ASU 2014-09 Revenue from Contracts with Customers (Topic 606) (" In November 2015, the FASB issued ASU No. 2015-17 (“ASU 2015-17”), Income Taxes (Topic 740): Balance Sheet Classification of Deferred Taxes In February 2016, the FASB issued ASU No. 2016-02 (“ASU 2016-02”), Leases On March 30, 2016, the FASB issued ASU 2016-09, Compensation - Stock Compensation: Improvements to Employee Share-Based Payment Accounting In August 2016, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments. In October 2016, the FASB issued ASU No. 2016-16, Income Taxes (Topic 740): Intra-Entity Transfers of Assets Other Than Inventory In January 2017, the FASB issued ASU No. 2017-01, Business Combinations (Topic 805): Clarifying Definition of a Business In January 2017, the FASB issued Accounting Standards Update No. 2017-04(“ASU 2017-04”), Intangibles Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment In May 2017, the FASB issued ASU No. 2017-09, Compensation Stock Compensation: Scope of Modification Accounting The guidance clarifies when changes to the terms or conditions of a share-based payment award must be accounted for as modifications. Entities will apply the modification accounting guidance if the value, vesting conditions or classification of the award changes. This guidance is effective for annual periods, including interim periods within those annual periods, beginning after December 15, 2017. Early adoption is permitted. |
ORGANIZATION AND BUSINESS BAC35
ORGANIZATION AND BUSINESS BACKGROUND (Tables) | 12 Months Ended |
Jun. 30, 2017 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Schedule of Variable Interest Entities [Table Text Block] | The carrying amounts and classifications of the assets and liabilities of the VIE are as follows: June 30, 2016 2017 Current assets $ 105 $ 14,331 Non-current assets 69 239 Total assets 174 14,570 Current liabilities $ 270 $ 14,178 Total liabilities 270 14,178 Year ended June 30, 2016 2017 Revenue $ - $ 6,914 Cost of revenue - 5,753 Net (loss) profit (151) 494 Net cash provided by operating activities 71 8,721 Net cash used in investing activities (71) (216) Net cash provided by financing activities $ 55 $ - |
SUMMARY OF SIGNIFICANT ACCOUN36
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) | 12 Months Ended |
Jun. 30, 2017 | |
Accounting Policies [Abstract] | |
Finite-lived Intangible Assets Amortization Expense [Table Text Block] | Depreciation expense is determined using the straight-line method over the estimated useful lives of the assets as follows: Buildings 30 -50 years Machinery 5 - 10 years Software 3 - 5 years Vehicles 5- 6 years Electronic and other equipment 3 - 10 years |
Schedule Of Acquired Finite Lived Intangible Assets By Major Class [Table Text Block] | The estimated useful lives for the intangible assets are as follows: Category Estimated useful life Customer relationship 57 - 60 months Order backlog 21 - 33 months Patents and copyrights 60 - 120 months |
INVENTORIES (Tables)
INVENTORIES (Tables) | 12 Months Ended |
Jun. 30, 2017 | |
Inventory Disclosure [Abstract] | |
Schedule of Inventory, Current [Table Text Block] | June 30, 2016 2017 Raw materials $ 12,975 $ 15,781 Work in progress 12,770 19,525 Finished goods 10,656 10,354 $ 36,401 $ 45,660 |
ACCOUNTS RECEIVABLE (Tables)
ACCOUNTS RECEIVABLE (Tables) | 12 Months Ended |
Jun. 30, 2017 | |
Receivables [Abstract] | |
Schedule of Accounts, Notes, Loans and Financing Receivable [Table Text Block] | June 30, 2016 2017 Accounts receivable $ 279,650 $ 294,641 Allowance for doubtful accounts (42,471) (48,089) $ 237,179 $ 246,552 |
Allowance for Credit Losses on Financing Receivables [Table Text Block] | The movements in allowance for doubtful accounts are as follows: June 30, 2015 2016 2017 Balance at the beginning of year $ 25,691 $ 34,259 $ 42,471 Additions 13,907 12,000 7,400 Deconsolidation of a subsidiary - - (160) Written off (5,499) (714) (784) Translation adjustment 160 (3,074) (838) Balance at the end of year $ 34,259 $ 42,471 $ 48,089 |
COSTS AND ESTIMATED EARNINGS 39
COSTS AND ESTIMATED EARNINGS IN EXCESS OF BILLINGS (Tables) | 12 Months Ended |
Jun. 30, 2017 | |
Costs In Excess Of Billings and Billings In Excess Of Costs Incurred [Abstract] | |
Costs In Excess Of Billings And Billings In Excess Of Costs [Table Text Block] | June 30, 2016 2017 Contracts costs incurred plus estimated earnings $ 887,037 $ 810,327 Less: Progress billings (690,726) (639,571) Cost and estimated earnings in excess of billings 196,311 170,756 Less: Allowance for doubtful accounts (6,383) (8,660) $ 189,928 $ 162,096 |
Allowance For Doubtful Accounts Of Costs And Estimated Earnings In Excess Of Billings [Table Text Block] | The movements in allowance for doubtful accounts are as follows: June 30, 2015 2016 2017 Balance at the beginning of year $ 5,839 $ 8,850 $ 6,383 Additions 3,085 (1,823) 2,404 Written off (122) - - Translation adjustment 48 (644) (127) Balance at the end of the year $ 8,850 $ 6,383 $ 8,660 |
PROPERTY, PLANT AND EQUIPMENT (
PROPERTY, PLANT AND EQUIPMENT (Tables) | 12 Months Ended |
Jun. 30, 2017 | |
Property, Plant and Equipment [Abstract] | |
Property, Plant and Equipment [Table Text Block] | A summary of property, plant and equipment is as follows: June 30, 2016 2017 Buildings $ 71,037 $ 70,029 Machinery 8,148 10,892 Software 7,377 10,004 Vehicles 3,886 4,378 Electronic and other equipment 23,704 29,321 Construction in progress 5,753 4,113 $ 119,905 $ 128,737 Less: Accumulated depreciation and impairment (39,967) (48,208) $ 79,938 $ 80,529 |
Schedule of Property Subject to or Available for Operating Lease [Table Text Block] | The Company has entered into operating lease contracts related to certain buildings owned with the carrying amount as shown below: June 30, 2016 2017 Buildings leased to others - at original cost $ 10,086 $ 13,925 Less: accumulated depreciation (3,725) (4,261) Buildings leased to others - net $ 6,361 $ 9,664 |
PREPAID LAND LEASES (Tables)
PREPAID LAND LEASES (Tables) | 12 Months Ended |
Jun. 30, 2017 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Table Text Block] | A summary of prepaid land leases is as follows: June 30, 2016 2017 Prepaid land leases $ 12,641 $ 12,335 Less: Accumulated amortization (1,868) (2,129) $ 10,773 $ 10,206 |
Schedule of Future Amortization Expenses of Prepaid Land Lease [Table Text Block] | The annual amortization of prepaid land leases for each of the five succeeding years is as follows: Year ending June 30, 2018 $ 263 2019 263 2020 263 2021 263 2022 263 $ 1,315 |
INTANGIBLE ASSETS, NET (Tables)
INTANGIBLE ASSETS, NET (Tables) | 12 Months Ended |
Jun. 30, 2017 | |
Intangible Assets, Net (Excluding Goodwill) [Abstract] | |
Schedule Of Finite Lived Intangible Assets Acquired As Part Of Business Combination [Table Text Block] | June 30, 2016 2017 Gross Accumulated Net Gross Accumulated Net Customer relationships $ 3,151 (2,308) 843 $ 3,086 (2,811) 275 Order backlog 11,848 (11,835) 13 11,605 (11,605) - Patents and copyrights - - - 1,695 (42) 1,653 $ 14,999 (14,143) 856 $ 16,386 (14,458) 1,928 |
Schedule of Expected Amortization Expense [Table Text Block] | The annual amortization expense relating to the existing intangible assets for the next year is as follow: Year ending June 30, 2018 $ 500 2019 225 2020 225 2021 225 2022 215 $ 1,390 |
GOODWILL (Tables)
GOODWILL (Tables) | 12 Months Ended |
Jun. 30, 2017 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Goodwill [Table Text Block] | The changes in the carrying amount of goodwill are as follows: June 30, 2016 2017 Balance at beginning of year $ 59,918 $ 59,847 Goodwill impairment charge - (11,211) Translation adjustment (71) (1,310) Balance at the end of year $ 59,847 $ 47,326 |
INVESTMENTS IN EQUITY AND COS44
INVESTMENTS IN EQUITY AND COST INVESTEES (Tables) | 12 Months Ended |
Jun. 30, 2017 | |
Equity and Cost Method Investments [Abstract] | |
Schedule Of Long Term Investments Accounted For Equity Method Or Cost Method [Table Text Block] | The following long-term investments were accounted for under either the equity method or the cost method as indicated: June 30, 2016 Interest Long-term Share of Advance Total Equity method China Techenergy Co., Ltd. 40.00 % $ 9,030 1,077 44 10,151 Beijing Hollysys Electric Motor Co., Ltd. 40.00 % 797 3,961 - 4,758 Beijing IPE Biotechnology Co., Ltd. 22.02 % 1,484 2,213 - 3,697 Southcon Development Sdn Bhd. 30.00 % 224 (116) - 108 Beijing Hollysys Machine Automation Co., Ltd. 30.00 % 452 (452) - - $ 11,987 6,683 44 18,714 Cost method Shenhua Hollysys Information Technology Co., Ltd. 20.00 % $ 2,387 - - 2,387 Heilongjiang Ruixing Technology Co., Ltd. 6.00 % 1,631 - - 1,631 Zhejiang Sanxin Technology Co., Ltd. 6.00 % 90 - - 90 Zhongjijing Investment Consulting Co., Ltd. 5.00 % - - - - $ 4,108 - - 4,108 June 30, 2017 Interest Long-term Share of Advance Total Equity method Beijing Hollycon Medicine & Technology. Co., Ltd. 30.00 % $ 22,737 1,773 - 24,510 China Techenergy Co., Ltd. 40.00 % 8,847 2,503 43 11,393 Beijing Hollysys Electric Motor Co., Ltd. 40.00 % 781 4,262 - 5,043 Beijing IPE Biotechnology Co., Ltd. 22.02 % 1,454 2,241 - 3,695 Shenzhen HollySys Intelligent Technologies Co., Ltd. 60.00 % 2,654 (159) - 2,495 Southcon Development Sdn Bhd. 30.00 % 210 (104) - 106 Beijing Hollysys Machine Automation Co., Ltd. 30.00 % 442 (442) - - $ 37,125 10,074 43 47,242 Cost method Shenhua Hollysys Information Technology Co., Ltd. 20.00 % $ 2,338 - - 2,338 Heilongjiang Ruixing Technology Co., Ltd. 6.00 % 1,598 - - 1,598 Zhejiang Sanxin Technology Co., Ltd. 6.00 % 88 - - 88 Zhongjijing Investment Consulting Co., Ltd. 5.00 % - - - - $ 4,024 - - 4,024 |
WARRANTY LIABILITIES (Tables)
WARRANTY LIABILITIES (Tables) | 12 Months Ended |
Jun. 30, 2017 | |
Other Liabilities Disclosure [Abstract] | |
Schedule of Product Warranty Liability [Table Text Block] | June 30, 2016 2017 Beginning balance $ 10,387 $ 10,360 Deconsolidation of a subsidiary - (227) Expense accrued 3,876 1,547 Expense incurred (3,075) (3,836) Translation adjustment (828) (212) $ 10,360 $ 7,632 Less: current portion of warranty liabilities (6,782) (5,386) Long-term warranty liabilities $ 3,578 $ 2,246 |
LONG-TERM LOANS (Tables)
LONG-TERM LOANS (Tables) | 12 Months Ended |
Jun. 30, 2017 | |
Debt Disclosure [Abstract] | |
Schedule Of Debt Instruments [Table Text Block] | June 30, 2016 2017 USD denominated loan (i) 4,770 - MYR denominated loan (ii) 830 782 SGD denominated loan (iii) 1,939 187 Convertible Bond (iv) 19,802 20,032 $ 27,341 $ 21,001 Less: current portion (6,833) (420) $ 20,508 $ 20,581 i. The USD denominated loan was repaid in March 2017. The borrowing was secured by restricted cash amounting to $ 4,515 ii. The MYR denominated loans are repayable in 3 to 75 installments with the last installment due in December 2041. For the year ended June 30, 2017, the effective interest rates ranged from 2.19 5.68 1,019 1,396 iii. The SGD denominated loans are repayable in 10 to 31 installments with the last installment due on March 15, 2020. For the year ended June 30, 2017, the effective interest rates ranged from 2.68 5.44 3,148 307 iv. Convertible Bond On May 30, 2014, the Company entered into a Convertible Bond agreement with International Finance Corporation ("IFC"), under which the Company borrowed $ 20,000 2.1 0.5 |
Schedule of Maturities of Long-term Debt [Table Text Block] | Scheduled principal payments for all outstanding long-term loans as of June 30, 2017 are as follows: Year ending June 30, 2018 $ 420 2019 215 2020 20,955 2021 90 2022 and onwards 121 $ 21,801 |
FAIR VALUE MEASUREMENT (Tables)
FAIR VALUE MEASUREMENT (Tables) | 12 Months Ended |
Jun. 30, 2017 | |
Fair Value Disclosures [Abstract] | |
Fair Value, Liabilities Measured on Recurring Basis [Table Text Block] | Assets and liabilities measured at fair value on a recurring basis as of June 30, 2016, and 2017 are stated below: June 30, 2016 Quoted prices Significant Significant (Level 1) (Level 2) (Level 3) Total Liabilities: Derivative financial liability (i) $ - $ - $ 398 $ 398 Total liabilities measured at fair value on a recurring basis $ - $ - $ 398 $ 398 June 30, 2017 Quoted prices Significant Significant (Level 1) (Level 2) (Level 3) Total Liabilities: Derivative financial liability (i) $ - $ - $ 487 $ 487 Total liabilities measured at fair value on a recurring basis $ - $ - $ 487 $ 487 (i) The derivative financial liability Fair value measurements as of June (Level 3) Non-conversion compensation feature Balance as at June 30, 2016 $ 398 Change in fair-value (included within other expenses, net) 89 Balance as of June 30, 2017 $ 487 |
Fair Value Measurements, Recurring and Nonrecurring [Table Text Block] | June 30, 2017 Quoted prices in active markets for Significant other observable inputs Significant unobservable inputs (Level 1) (Level 2) (Level 3) Total Assets: Retained non-controlling interest in a former subsidiary (i) $ - $ - $ 22,737 $ 22,737 Goodwill (ii) - - 11,488 11,488 Total assets measured at fair value on a non-recurring basis $ - $ - $ 34,225 $ 34,225 (i) During the year ended June 30, 2017, the investment in Hollycon was measured based on significant unobservable inputs (Level 3), using a discounted cash flow approach assuming a certain terminal growth rate and discount rate (Note 10). (ii) As of June 30, 2017, the Company’s goodwill of $11,488 was related to the acquisition of Concord Group and $35,838 was related to the acquisition of Bond Group. The Company engaged an independent third-party appraiser to assist with the valuation of the goodwill related to the Concord and Bond Groups. The Company is ultimately responsible for the fair value of the goodwill recorded in the consolidated financial statements. For the purposes of step one of the goodwill impairment test, the Company has adopted the income approach, in particular the discounted cash flow approach, to evaluate the fair value of the reporting unit. In applying the discounted cash flow approach, key assumptions include the amount and timing of future expected cash flows, terminal value growth rates and appropriate discount rates. For the purpose of step two of the goodwill impairment test, the Company has allocated the fair value of the reporting unit derived in step one to the assets and liabilities of the reporting unit, as if the reporting unit had been acquired in a business combination and the fair value of the reporting unit was the price paid to acquire the reporting unit. The Company adopted the multi-period excess earnings model to evaluate the fair value of the intangible assets of the reporting unit, which was then used to compute the implied fair value of the goodwill via a residual approach. As a result, the Company recorded a goodwill impairment charge of $11,211 (Note 9). |
SHARE-BASED COMPENSATION EXPE48
SHARE-BASED COMPENSATION EXPENSES (Tables) | 12 Months Ended |
Jun. 30, 2017 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Schedule of Nonvested Restricted Stock Units Activity [Table Text Block] | A summary of the restricted share activity for the year ended June 30, 2017 is as follows: Number of restricted shares Weighted average grant-date fair value Un-vested at June 30, 2016 14,375 23.95 Granted 67,500 20.09 Vested 18,750 23.05 Un-vested at June 30, 2017 63,125 20.09 |
Performance Options 2015 [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Schedule of Share-based Compensation, Stock Options, Activity [Table Text Block] | A summary of the 2015 performance option activity for the year ended June 30, 2017 is as shown below: 2015 Performance Number of Weighted Weighted average Aggregate Outstanding as at June 30, 2016 1,740,000 22.25 3.87 - Forfeited 1,344,000 22.05 Outstanding as at June 30, 2017 396,000 22.05 2.87 - Vested and expected to vest at June 30, 2017 396,000 22.05 2.87 - Exercisable at June 30, 2017 198,000 22.05 2.87 - |
Schedule of Share-based Payment Award, Stock Options, Valuation Assumptions [Table Text Block] | For options granted on Risk-free rate of return 1.51% Weighted average expected volatility 53.42% Expected life (in years) 5 years Expected ordinary dividend yield nil |
Vesting Schedule For Performance Shares [Table Text Block] | The vesting schedule for such performance share options is as below: EPS Threshold Number of vested Months after the grant date 24 months 36 months 48 months Annual growth rate over 15% but below 20% 1,160,000 348,000 348,000 464,000 CAGR equals or over 20% but below 25% Additional 290,000 - - 290,000 CAGR equals 25% or above Additional 290,000 - - 290,000 Total 348,000 348,000 1,044,000 |
INCOME TAX (Tables)
INCOME TAX (Tables) | 12 Months Ended |
Jun. 30, 2017 | |
Income Tax Disclosure [Abstract] | |
Schedule of Income before Income Tax, Domestic and Foreign [Table Text Block] | The Company’s income before income taxes consists of: Year ended June 30, 2015 2016 2017 PRC $ 134,657 $ 142,900 $ 105,331 Non-PRC (9,430) (5,158) (22,976) $ 125,227 $ 137,742 $ 83,355 |
Schedule of Components of Income Tax Expense (Benefit) [Table Text Block] | Income tax expense, most of which is incurred in the PRC, consists of: Year ended June 30, 2015 2016 2017 Current income tax expense (benefit) PRC 16,074 10,590 12,911 Non-PRC 5,120 4,110 (658) $ 21,194 $ 14,700 $ 12,253 Deferred income tax expense (benefit) PRC 5,834 (196) 2,616 Non-PRC (988) (266) (483) $ 4,846 (462) 2,133 $ 26,040 $ 14,238 $ 14,386 |
Schedule of Effective Income Tax Rate Reconciliation [Table Text Block] | Reconciliation of the income tax expenses as computed by applying the PRC statutory tax rate of 25 Year ended June 30, 2015 2016 2017 Income before income taxes $ 125,227 $ 137,742 $ 83,355 Expected income tax expense at statutory tax rate in the PRC 31,307 34,436 20,838 Effect of different tax rates in various jurisdictions 1,286 2,109 2,627 Effect of preferential tax treatment (12,453) (12,296) (10,650) Effect of non-taxable income (6,770) (4,985) - Effect of additional deductible research and development expenses (2,772) (4,716) (2,385) Effect of non-deductible expenses 8,402 5,569 4,608 Effect of change in tax rate (4,191) (6,613) (4,835) Change in valuation allowance 1,475 540 3,964 Tax rate differential on deferred tax items 3,139 (587) 2,056 Withholding tax on dividend paid by subsidiaries 6,028 1,252 (2,799) Others 589 (471) 962 Total $ 26,040 $ 14,238 $ 14,386 |
Schedule of Deferred Tax Assets and Liabilities [Table Text Block] | June 30, 2016 2017 Deferred tax assets, current Allowance for doubtful accounts $ 9,838 $ 9,172 Inventory provision 205 179 Provision for contract loss 917 694 Long-term assets 13 13 Deferred revenue 3,522 3,220 Deferred subsidies 1,020 1,654 Warranty liabilities 1,322 829 Recognition of intangible assets 57 (2) Accrued payroll 960 998 Net operating loss carry forward 6,361 9,801 Valuation allowance (6,307) (10,160) Total deferred tax assets, current $ 17,908 $ 16,398 Deferred tax liabilities, current Costs and estimated earnings in excess of billings $ (16,068) $ (10,071) Recognition of intangible assets (1,060) - PRC dividend withholding tax (3,010) (2,949) Others (24) 2 Total deferred tax liabilities, current $ (20,162) $ (13,018) Net deferred tax assets, current $ 6,659 $ 7,730 Net deferred tax liabilities, current $ (8,913) $ (4,350) Deferred tax assets, non-current Long-term assets $ 699 $ 112 Deferred subsidies 2,642 333 Net operating loss carryforward - 1,573 Warranty liabilities 874 332 Others (16) 192 Total deferred tax assets, non-current $ 4,199 $ 2,542 Deferred tax liabilities, non-current Share of net gains of equity investees $ (1,733) $ (2,520) Property, plant and equipment - (38) Intangible assets and other non-current assets (330) (5,552) Total deferred tax liabilities, non-current $ (2,063) $ (8,110) Net deferred tax assets-non-current $ 2,195 $ 1,121 Net deferred tax liabilities-non-current $ (59) $ (6,689) |
INCOME PER SHARE (Tables)
INCOME PER SHARE (Tables) | 12 Months Ended |
Jun. 30, 2017 | |
Earnings Per Share [Abstract] | |
Schedule of Earnings Per Share, Basic and Diluted [Table Text Block] | The following table sets forth the computation of basic and diluted net income per share attributable to Hollysys for the years indicated: Year ended June 30, 2015 2016 2017 Numerator: Net income attributable to the Company - basic $ 96,527 $ 118,471 $ 68,944 Net income attributable to the Company - diluted (i) $ 96,877 $ 119,121 $ 69,605 Denominator: Weighted average ordinary shares outstanding used in computing basic income per share 58,612,596 59,170,050 60,189,004 Effect of dilutive securities Convertible Bond 644,850 776,800 784,400 Share options 839,425 642,184 - Restricted shares 37,332 22,422 38,106 Weighted average ordinary shares outstanding used in computing diluted income per share 60,134,203 60,611,456 61,011,510 Income per share - basic $ 1.65 2.00 1.15 Income per share - diluted $ 1.61 1.97 1.14 (i) For the year ended June 30, 2016 and 2017, interest accretion related to the Convertible Bond of $ 650 661 |
RELATED PARTY TRANSACTIONS (Tab
RELATED PARTY TRANSACTIONS (Tables) | 12 Months Ended |
Jun. 30, 2017 | |
Related Party Transactions [Abstract] | |
Schedule Of Amount Due From Related Parties [Table Text Block] | Due from related parties June 30, 2016 2017 China Techenergy $ 22,579 $ 28,778 Shenhua Information 2,995 3,267 Heilongjiang Ruixing 1,071 1,049 Hollysys Machine 1,367 965 Hollycon - 79 Shenzhen HollySys - 2 Beijing IPE - 2 $ 28,012 $ 34,142 |
Schedule Of Amount Due To Related Parties [Table Text Block] | Due to related parties June 30, 2016 2017 China Techenergy $ 1,170 $ 1,117 Hollysys Machine 112 817 Shenhua Information 358 353 Electric Motor 5 11 Beijing IPE - 2 Hollycon - 1 $ 1,645 $ 2,301 |
Schedule of Related Party Transactions [Table Text Block] | Transactions with related parties Purchases of goods and services from: Year ended June 30, 2015 2016 2017 Hollysys Machine $ 914 $ 555 $ 749 Electric Motor 50 354 29 Hollycon - - 8 Shenhua Information 368 - - China Techenergy 1 - - $ 1,333 $ 909 $ 786 Sales of goods and integrated solutions to: Year ended June 30, 2015 2016 2017 China Techenergy $ 21,936 $ 3,657 $ 10,842 Shenhua Information 2,128 847 765 Hollysys Machine 512 235 167 Hollycon - - 108 Beijing IPE - - 7 Electric Motor 1 - - $ 24,577 $ 4,739 $ 11,889 Operating lease income from: Year ended June 30, 2015 2016 2017 Hollycon - - 602 Hollysys Machine 41 40 - $ 41 $ 40 $ 602 Purchases of intangible assets: Year ended June 30, 2015 2016 2017 Hollysys Machine $ - $ - $ 1,648 |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Tables) | 12 Months Ended |
Jun. 30, 2017 | |
Commitments and Contingencies Disclosure [Abstract] | |
Schedule of Future Minimum Lease Payments under Non Cancelable Operating Leases [Table Text Block] | Future minimum lease payments under non-cancelable operating leases with initial terms of one year or more consist of the following: Years ending June 30, Minimum lease payments 2018 $ 2,453 2019 1,060 2020 263 2021 103 2022 and onwards 63 Total minimum lease payments $ 3,942 |
OPERATING LEASES AS LESSOR (Tab
OPERATING LEASES AS LESSOR (Tables) | 12 Months Ended |
Jun. 30, 2017 | |
Leases [Abstract] | |
Minimum Lease Payment to Be Received For Operating Leases [Table Text Block] | The minimum rental income in the next five years is shown as below: Year ending June 30, Minimum lease payments 2018 $ 1,477 2019 1,522 2020 1,567 2021 1,614 2022 1,663 Total minimum lease payments to be received in the next five years $ 7,843 |
SEGMENT REPORTING (Tables)
SEGMENT REPORTING (Tables) | 12 Months Ended |
Jun. 30, 2017 | |
Segment Reporting [Abstract] | |
Reconciliation of Revenue from Segments to Consolidated [Table Text Block] | Summarized information by segments for the years ended June 30, 2015, 2016, and 2017 is as follows: Year ended June 30, 2015 IA Rail M&E Miscellaneous Consolidated Revenues from external customers $ 213,252 193,274 110,030 14,823 531,379 Costs of revenue 119,520 97,503 93,452 6,502 316,977 Gross profit $ 93,732 95,771 16,578 8,321 214,402 Year ended June 30, 2016 IA Rail M&E Miscellaneous Consolidated Revenues from external customers $ 182,901 240,310 95,277 25,837 544,325 Costs of revenue 113,314 131,043 82,900 11,342 338,599 Gross profit $ 69,587 109,267 12,377 14,495 205,726 Year ended June 30, 2017 IA Rail M&E Miscellaneous Consolidated Revenues from external customers $ 172,667 155,732 103,544 - 431,943 Costs of revenue 106,583 86,128 98,761 - 291,472 Gross profit $ 66,084 69,604 4,783 - 140,471 |
Schedule of Revenue from External Customers Attributed to Foreign Countries by Geographic Area [Table Text Block] | The majority of the Company’s revenues and long-lived assets other than goodwill and intangible assets are derived from and located in the PRC. The following table sets forth the revenues by geographical area: Year ended June 30, 2015 2016 2017 Revenues: PRC $ 410,644 $ 443,256 $ 326,713 Non-PRC 120,735 101,069 105,230 $ 531,379 $ 544,325 $ 431,943 |
Schedule of Disclosure on Geographic Areas, Long-Lived Assets in Individual Foreign Countries by Country [Table Text Block] | he following table sets forth the long-lived assets other than goodwill and intangible assets by geographical area: June 30, 2016 2017 Long-lived assets other than goodwill and acquired intangible assets PRC $ 100,454 $ 131,625 Non-PRC 13,079 12,029 $ 113,533 $ 143,654 |
CONDENSED FINANCIAL INFORMATI55
CONDENSED FINANCIAL INFORMATION OF THE PARENT COMPANY (Tables) | 12 Months Ended |
Jun. 30, 2017 | |
Condensed Financial Information of Parent Company Only Disclosure [Abstract] | |
Condensed Balance Sheet [Table Text Block] | CONDENSED BALANCE SHEETS June 30, 2016 2017 ASSETS Current assets: Cash and cash equivalents $ 8,571 $ 13,103 Amounts due from subsidiaries 72,303 59,920 Prepaid expenses 63 61 Total current assets 80,937 73,084 Investments in subsidiaries 669,326 726,837 Total assets $ 750,263 $ 799,921 LIABILITIES AND STOCKHOLDERS’ EQUITY Current liabilities: Accrued payroll and related expense $ 9 $ 14 Accrued liabilities 427 487 Amounts due to subsidiaries 55,869 55,869 Total current liabilities 56,305 56,370 Long-term loan 19,802 20,032 Total liabilities 76,107 76,402 Equity: Ordinary shares, par value $0.001 per share, 100,000,000 shares authorized; 59,598,099 and 60,342,099 shares issued and outstanding as of June 30, 2016 and 2017, respectively 60 60 Additional paid-in capital 215,403 222,189 Retained earnings 467,160 524,129 Accumulated other comprehensive loss (8,467) (22,859) Total equity 674,156 723,519 Total liabilities and equity $ 750,263 $ 799,921 |
Condensed Income Statement [Table Text Block] | CONDENSED STATEMENTS OF COMPREHENSIVE INCOME Year Ended June 30, 2015 2016 2017 General and administrative expenses $ 3,169 $ 4,484 $ 1,062 Loss from operations (3,169) (4,484) (1,062) Other expense, net (35) (93) (89) Interest income 1 80 4 Interest expenses (463) (705) (1,074) Foreign exchange gains (losses) 238 (719) (740) Equity in profit of subsidiaries $ 99,955 $ 124,392 $ 71,905 Income before income taxes 96,527 118,471 68,944 Income tax expenses - - - Net income 96,527 118,471 68,944 Other comprehensive income, net of tax of nil Translation adjustment (1,427) (46,052) (14,392) Comprehensive income $ 95,100 $ 72,419 $ 54,552 |
Condensed Cash Flow Statement [Table Text Block] | CONDENSED STATEMENTS OF CASH FLOWS Year ended June 30, 2015 2016 2017 Net cash used in operating activities $ (397) $ (1,697) $ (930) Net cash (used in) provided by investing activities (4,402) $ 11,390 $ (396) Net cash provided by (used in) financing activities $ 13,236 $ (9,559) $ 5,858 Net increase in cash and cash equivalents $ 8,437 $ 134 $ 4,532 Cash and cash equivalents, beginning of year $ - $ 8,437 $ 8,571 Cash and cash equivalents, end of year $ 8,437 $ 8,571 $ 13,103 |
ORGANIZATION AND BUSINESS BAC56
ORGANIZATION AND BUSINESS BACKGROUND (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2015 | |
Equity Method Investment Summarized Financial Information [Line Items] | |||
Current assets | $ 14,331 | $ 105 | |
Non-current assets | 239 | 69 | |
Total assets | 14,570 | 174 | |
Current liabilities | 14,178 | 270 | |
Total liabilities | 14,178 | 270 | |
Cost of revenue | 291,472 | 338,599 | $ 316,977 |
Net cash provided by operating activities | 69,813 | 46,737 | 83,952 |
Net cash used in investing activities | (89,553) | (2,454) | (39,895) |
Net cash provided by financing activities | (7,413) | (6,780) | $ 1,261 |
Variable Interest Entity (VIE) or Potential VIE, Information Unavailability [Member] | |||
Equity Method Investment Summarized Financial Information [Line Items] | |||
Revenue | 6,914 | 0 | |
Net (loss) profit | 494 | (151) | |
Cost of revenue | 5,753 | 0 | |
Net cash provided by operating activities | 8,721 | 71 | |
Net cash used in investing activities | (216) | (71) | |
Net cash provided by financing activities | $ 0 | $ 55 |
ORGANIZATION AND BUSINESS BAC57
ORGANIZATION AND BUSINESS BACKGROUND (Details Textual) - Subsidiaries [Member] - USD ($) $ in Thousands | Jun. 30, 2017 | Jun. 30, 2016 |
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | ||
Due to Affiliate, Current | $ 127 | $ 0 |
Due from Affiliate, Current | $ 1,629 | $ 0 |
SUMMARY OF SIGNIFICANT ACCOUN58
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details 1) | 12 Months Ended |
Jun. 30, 2017 | |
Buildings [Member] | Minimum [Member] | |
Property, Plant and Equipment [Line Items] | |
Property, Plant and Equipment, Useful Life | 30 years |
Buildings [Member] | Maximum [Member] | |
Property, Plant and Equipment [Line Items] | |
Property, Plant and Equipment, Useful Life | 50 years |
Machinery [Member] | Minimum [Member] | |
Property, Plant and Equipment [Line Items] | |
Property, Plant and Equipment, Useful Life | 5 years |
Machinery [Member] | Maximum [Member] | |
Property, Plant and Equipment [Line Items] | |
Property, Plant and Equipment, Useful Life | 10 years |
Computer Software, Intangible Asset [Member] | Minimum [Member] | |
Property, Plant and Equipment [Line Items] | |
Property, Plant and Equipment, Useful Life | 3 years |
Computer Software, Intangible Asset [Member] | Maximum [Member] | |
Property, Plant and Equipment [Line Items] | |
Property, Plant and Equipment, Useful Life | 5 years |
Vehicles [Member] | Minimum [Member] | |
Property, Plant and Equipment [Line Items] | |
Property, Plant and Equipment, Useful Life | 5 years |
Vehicles [Member] | Maximum [Member] | |
Property, Plant and Equipment [Line Items] | |
Property, Plant and Equipment, Useful Life | 6 years |
Electronic and Other Equipment [Member] | Minimum [Member] | |
Property, Plant and Equipment [Line Items] | |
Property, Plant and Equipment, Useful Life | 3 years |
Electronic and Other Equipment [Member] | Maximum [Member] | |
Property, Plant and Equipment [Line Items] | |
Property, Plant and Equipment, Useful Life | 10 years |
SUMMARY OF SIGNIFICANT ACCOUN59
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details 2) | 12 Months Ended |
Jun. 30, 2017 | |
Customer Relationships [Member] | Maximum [Member] | |
Finite-Lived Intangible Assets [Line Items] | |
Finite-Lived Intangible Asset, Useful Life | 60 months |
Customer Relationships [Member] | Minimum [Member] | |
Finite-Lived Intangible Assets [Line Items] | |
Finite-Lived Intangible Asset, Useful Life | 57 months |
Order or Production Backlog [Member] | Maximum [Member] | |
Finite-Lived Intangible Assets [Line Items] | |
Finite-Lived Intangible Asset, Useful Life | 33 months |
Order or Production Backlog [Member] | Minimum [Member] | |
Finite-Lived Intangible Assets [Line Items] | |
Finite-Lived Intangible Asset, Useful Life | 21 months |
Patents And Copyrights [Member] | Maximum [Member] | |
Finite-Lived Intangible Assets [Line Items] | |
Finite-Lived Intangible Asset, Useful Life | 120 months |
Patents And Copyrights [Member] | Minimum [Member] | |
Finite-Lived Intangible Assets [Line Items] | |
Finite-Lived Intangible Asset, Useful Life | 60 months |
SUMMARY OF SIGNIFICANT ACCOUN60
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details Textual) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | ||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2015 | |
Accounting Policies [Line Items] | |||
Percentage Of Recognized Contractual Revenue | 100.00% | ||
Goodwill, Impairment Loss | $ 11,211 | $ 0 | $ 1,855 |
Effective Value Added Tax Rate | 17.00% | ||
Percentage Of Value Added Tax Refunded | 3.00% | ||
Percentage Of After Tax Income Transferred To Statutory Reserved | 10.00% | ||
Impairment loss on long-term investment | $ 0 | 0 | 0 |
Retained Amount of Accounts Receivable | 12,838 | 10,848 | |
Government Grants Received | 10,238 | 6,085 | 7,593 |
Revenue from Grants | $ 12,885 | 2,886 | 2,191 |
Integrated Solutions Contracts Range Minimum | 6 months | ||
Integrated Solutions Contracts Range Maximum | 5 years | ||
Translation adjustments | $ (14,428) | $ (48,841) | $ (1,386) |
Decreased Net Income Per Share Basic | $ 0.20 | $ 0.51 | $ 0.45 |
Decreased Net Income Per Share diluted | $ 0.20 | $ 0.50 | $ 0.44 |
Decreased Net Income | $ 12,062 | $ 30,270 | $ 26,232 |
Percentage Of Currency Depreciation Or Appreciation | 2.07% | 8.68% | 0.64% |
Subsidiaries [Member] | |||
Accounting Policies [Line Items] | |||
Due to Affiliate, Current | $ 127 | $ 0 | |
Due from Affiliate, Current | 1,629 | 0 | |
Malaysia [Member] | |||
Accounting Policies [Line Items] | |||
Deposits Assets | 3,935 | 8 | |
SINGAPORE | |||
Accounting Policies [Line Items] | |||
Deposits Assets | 11,690 | 7,042 | |
INDIA | |||
Accounting Policies [Line Items] | |||
Deposits Assets | $ 82 | $ 0 | |
Accounts Receivable [Member] | |||
Accounting Policies [Line Items] | |||
Concentration Risk, Percentage | 10.00% | 10.00% | |
PRC [Member] | |||
Accounting Policies [Line Items] | |||
Deposits Assets | $ 80,507 | $ 35,318 | |
Minimum [Member] | |||
Accounting Policies [Line Items] | |||
Business Acquisition, Percentage of Voting Interests Acquired | 20.00% | ||
Contract Period | 6 months | ||
Minimum [Member] | Use Rights [Member] | |||
Accounting Policies [Line Items] | |||
Finite-Lived Intangible Asset, Useful Life | 49 years | ||
Maximum [Member] | |||
Accounting Policies [Line Items] | |||
Business Acquisition, Percentage of Voting Interests Acquired | 50.00% | ||
Contract Period | 3 years | ||
Maximum [Member] | Use Rights [Member] | |||
Accounting Policies [Line Items] | |||
Finite-Lived Intangible Asset, Useful Life | 88 years |
INVENTORIES (Details)
INVENTORIES (Details) - USD ($) $ in Thousands | Jun. 30, 2017 | Jun. 30, 2016 |
Inventory [Line Items] | ||
Raw materials | $ 15,781 | $ 12,975 |
Work in progress | 19,525 | 12,770 |
Finished goods | 10,354 | 10,656 |
Inventories | $ 45,660 | $ 36,401 |
ACCOUNTS RECEIVABLE (Details)
ACCOUNTS RECEIVABLE (Details) - USD ($) $ in Thousands | Jun. 30, 2017 | Jun. 30, 2016 |
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Accounts receivable | $ 294,641 | $ 279,650 |
Allowance for doubtful accounts | (48,089) | (42,471) |
Accounts receivable, net | $ 246,552 | $ 237,179 |
ACCOUNTS RECEIVABLE (Details 1)
ACCOUNTS RECEIVABLE (Details 1) - USD ($) $ in Thousands | 12 Months Ended | ||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2015 | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Balance at the beginning of year | $ 42,471 | $ 34,259 | $ 25,691 |
Additions | 7,400 | 12,000 | 13,907 |
Deconsolidation of a subsidiary | (160) | 0 | 0 |
Written off | (784) | (714) | (5,499) |
Translation adjustment | (838) | (3,074) | 160 |
Balance at the end of year | $ 48,089 | $ 42,471 | $ 34,259 |
COSTS AND ESTIMATED EARNINGS 64
COSTS AND ESTIMATED EARNINGS IN EXCESS OF BILLINGS (Details) - USD ($) $ in Thousands | Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2014 |
Costs In Excess Of Billings And Billings In Excess Of Costs Incurred [Line Items] | ||||
Contracts costs incurred plus estimated earnings | $ 810,327 | $ 887,037 | ||
Less: Progress billings | (639,571) | (690,726) | ||
Cost and estimated earnings in excess of billings | 170,756 | 196,311 | ||
Less: Allowance for doubtful accounts | (8,660) | (6,383) | $ (8,850) | $ (5,839) |
Cost and estimated earnings in excess of billings, Total | $ 162,096 | $ 189,928 |
COSTS AND ESTIMATED EARNINGS 65
COSTS AND ESTIMATED EARNINGS IN EXCESS OF BILLINGS (Details 1) - USD ($) $ in Thousands | 12 Months Ended | ||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2015 | |
Costs In Excess Of Billings And Billings In Excess Of Costs Incurred [Line Items] | |||
Balance at the beginning of year | $ 6,383 | $ 8,850 | $ 5,839 |
Additions | 2,404 | (1,823) | 3,085 |
Written off | 0 | 0 | (122) |
Translation adjustment | (127) | (644) | 48 |
Balance at the end of the year | $ 8,660 | $ 6,383 | $ 8,850 |
PROPERTY, PLANT AND EQUIPMENT66
PROPERTY, PLANT AND EQUIPMENT (Details) - USD ($) $ in Thousands | Jun. 30, 2017 | Jun. 30, 2016 |
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Gross | $ 128,737 | $ 119,905 |
Less: Accumulated depreciation and impairment | (48,208) | (39,967) |
Property, plant and equipment, net | 80,529 | 79,938 |
Buildings [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Gross | 70,029 | 71,037 |
Machinery [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Gross | 10,892 | 8,148 |
Software [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Gross | 10,004 | 7,377 |
Vehicles [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Gross | 4,378 | 3,886 |
Electronic and other equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Gross | 29,321 | 23,704 |
Construction in Progress [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Gross | $ 4,113 | $ 5,753 |
PROPERTY, PLANT AND EQUIPMENT67
PROPERTY, PLANT AND EQUIPMENT (Details 1) - Assets Leased to Others [Member] - Building [Member] - USD ($) $ in Thousands | Jun. 30, 2017 | Jun. 30, 2016 |
Property Subject to or Available for Operating Lease [Line Items] | ||
Buildings leased to others - at original cost | $ 13,925 | $ 10,086 |
Less: accumulated depreciation | (4,261) | (3,725) |
Buildings leased to others - net | $ 9,664 | $ 6,361 |
PROPERTY, PLANT AND EQUIPMENT68
PROPERTY, PLANT AND EQUIPMENT (Details Textual) - USD ($) $ in Thousands | 12 Months Ended | ||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2015 | |
Property, Plant and Equipment [Line Items] | |||
Depreciation, Depletion and Amortization | $ 8,752 | $ 6,266 | $ 8,508 |
Property Plant And Equipment Pledged For Short Term Loans | 991 | 1,014 | |
Property Plant And Equipment Pledged For Long Term Loans | 1,703 | 1,157 | |
Property Plant And Equipment Pledged For Line Of Credit | $ 3,209 | $ 3,976 |
PREPAID LAND LEASES (Details)
PREPAID LAND LEASES (Details) - USD ($) $ in Thousands | Jun. 30, 2017 | Jun. 30, 2016 |
Prepaid Land and Leases [Line Items] | ||
Prepaid land leases | $ 12,335 | $ 12,641 |
Less: Accumulated amortization | (2,129) | (1,868) |
Deferred Costs, Leasing, Net | $ 10,206 | $ 10,773 |
PREPAID LAND LEASES (Details 1)
PREPAID LAND LEASES (Details 1) $ in Thousands | Jun. 30, 2017USD ($) |
Prepaid Land and Leases [Line Items] | |
2,018 | $ 263 |
2,019 | 263 |
2,020 | 263 |
2,021 | 263 |
2,022 | 263 |
Prepaid Land Lease Amortization Expense Net Total | $ 1,315 |
PREPAID LAND LEASES (Details Te
PREPAID LAND LEASES (Details Textual) - USD ($) $ in Thousands | 12 Months Ended | ||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2015 | |
Prepaid Land and Leases [Line Items] | |||
Amortization of Deferred Leasing Fees | $ 261 | $ 281 | $ 197 |
Prepaid Land Leases Total | $ 0 | $ 4,593 |
INTANGIBLE ASSETS, NET (Details
INTANGIBLE ASSETS, NET (Details) - USD ($) $ in Thousands | Jun. 30, 2017 | Jun. 30, 2016 |
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Gross carrying value | $ 16,386 | $ 14,999 |
Accumulated amortization | (14,458) | (14,143) |
Net carrying value | 1,928 | 856 |
Customer Relationships [Member] | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Gross carrying value | 3,086 | 3,151 |
Accumulated amortization | (2,811) | (2,308) |
Net carrying value | 275 | 843 |
Order Backlog [Member] | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Gross carrying value | 11,605 | 11,848 |
Accumulated amortization | (11,605) | (11,835) |
Net carrying value | 0 | 13 |
Intellectual Property [Member] | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Gross carrying value | 1,695 | 0 |
Accumulated amortization | (42) | 0 |
Net carrying value | $ 1,653 | $ 0 |
INTANGIBLE ASSETS, NET (Detai73
INTANGIBLE ASSETS, NET (Details 1) $ in Thousands | Jun. 30, 2017USD ($) |
Schedule of Finite Lived Intangible Assets Future Amortization Expense [Line Items] | |
2,018 | $ 500 |
2,019 | 225 |
2,020 | 225 |
2,021 | 225 |
2,022 | 215 |
Intangible assets, Total | $ 1,390 |
INTANGIBLE ASSETS, NET (Detai74
INTANGIBLE ASSETS, NET (Details Textual) - USD ($) $ in Thousands | 12 Months Ended | ||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2015 | |
Intangible Assets Net Excluding Goodwill [Line Items] | |||
Accumulated amortization | $ 623 | $ 818 | $ 4,454 |
Customer Relationships, Weighted Average Useful Life | within one year |
GOODWILL (Details)
GOODWILL (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2015 | |
Goodwill [Line Items] | |||
Balance at beginning of year | $ 59,847 | $ 59,918 | |
Goodwill impairment charge | (11,211) | 0 | $ (1,855) |
Translation adjustments | (1,310) | (71) | |
Balance at the end of year | $ 47,326 | $ 59,847 | $ 59,918 |
GOODWILL (Details Textual)
GOODWILL (Details Textual) - USD ($) $ in Thousands | 12 Months Ended | ||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2015 | |
Goodwill [Line Items] | |||
Goodwill | $ 47,326 | $ 59,847 | $ 59,918 |
Goodwill, Impairment Loss | 11,211 | 0 | $ 1,855 |
Concord Corporation Pte Ltd [Member] | |||
Goodwill [Line Items] | |||
Goodwill | 24,595 | 25,111 | |
Concord [Member] | |||
Goodwill [Line Items] | |||
Goodwill | 11,488 | $ 23,258 | |
Goodwill, Impairment Loss | $ 11,211 | ||
Fair Value Inputs, Terminal Value Growth Rate | 2.00% | 2.00% | |
Maximum [Member] | Concord [Member] | |||
Goodwill [Line Items] | |||
Fair Value Inputs, Discount Rate | 16.90% | ||
Minimum [Member] | Concord [Member] | |||
Goodwill [Line Items] | |||
Fair Value Inputs, Discount Rate | 12.70% | ||
Discount Rate [Member] | Concord [Member] | |||
Goodwill [Line Items] | |||
Percentage Of Goodwill Increase | 1.00% | ||
Percentage Of Goodwill Decrease | 1.00% | ||
Discount Rate [Member] | Maximum [Member] | Concord [Member] | |||
Goodwill [Line Items] | |||
Goodwill, Period Increase (Decrease) | $ 1,187 | ||
Discount Rate [Member] | Minimum [Member] | Concord [Member] | |||
Goodwill [Line Items] | |||
Goodwill, Period Increase (Decrease) | $ 1,383 | ||
Terminal Value Growth Rate [Member] | Concord [Member] | |||
Goodwill [Line Items] | |||
Percentage Of Goodwill Increase | 1.00% | ||
Percentage Of Goodwill Decrease | 1.00% | ||
Terminal Value Growth Rate [Member] | Maximum [Member] | Concord [Member] | |||
Goodwill [Line Items] | |||
Goodwill, Period Increase (Decrease) | $ 562 | ||
Terminal Value Growth Rate [Member] | Minimum [Member] | Concord [Member] | |||
Goodwill [Line Items] | |||
Goodwill, Period Increase (Decrease) | $ 498 |
INVESTMENTS IN EQUITY AND COS77
INVESTMENTS IN EQUITY AND COST INVESTEES (Details) - USD ($) $ in Thousands | 12 Months Ended | ||||
Jun. 30, 2017 | Jun. 30, 2016 | Oct. 31, 2016 | Jul. 31, 2016 | Jun. 30, 2014 | |
Schedule Of Equity And Cost Method Investments [Line Items] | |||||
Long-term investment, at cost, less impairment | $ 37,125 | $ 11,987 | |||
Share of undistributed profits | 10,074 | 6,683 | |||
Advance to investee company | 43 | 44 | |||
Total | 47,242 | 18,714 | |||
Long-term investment, at cost, less impairment | 4,024 | 4,108 | |||
Share of undistributed profits | 0 | 0 | |||
Advance to investee company | 0 | 0 | |||
Total | $ 4,024 | $ 4,108 | |||
Shenhua Hollysys Information Technology Co Ltd [Member] | |||||
Schedule Of Equity And Cost Method Investments [Line Items] | |||||
Interest held (in percentage) | 20.00% | ||||
Beijing Hollycon Medicine Technology Co Ltd [Member] | |||||
Schedule Of Equity And Cost Method Investments [Line Items] | |||||
Long-term investment, at cost, less impairment | $ 22,737 | ||||
Shenzhen HollySys Intelligent Technologies Co., Ltd. [Member] | |||||
Schedule Of Equity And Cost Method Investments [Line Items] | |||||
Interest held (in percentage) | 60.00% | ||||
Equity Method Investments [Member] | China Techenergy Co Ltd [Member] | |||||
Schedule Of Equity And Cost Method Investments [Line Items] | |||||
Interest held (in percentage) | 40.00% | 40.00% | |||
Long-term investment, at cost, less impairment | $ 8,847 | $ 9,030 | |||
Share of undistributed profits | 2,503 | 1,077 | |||
Advance to investee company | 43 | 44 | |||
Total | $ 11,393 | $ 10,151 | |||
Equity Method Investments [Member] | Beijing Hollysys Electric Motor Co Ltd [Member] | |||||
Schedule Of Equity And Cost Method Investments [Line Items] | |||||
Interest held (in percentage) | 40.00% | 40.00% | |||
Long-term investment, at cost, less impairment | $ 781 | $ 797 | |||
Share of undistributed profits | 4,262 | 3,961 | |||
Advance to investee company | 0 | 0 | |||
Total | $ 5,043 | $ 4,758 | |||
Equity Method Investments [Member] | Beijing IPE Biotechnology Co Ltd [Member] | |||||
Schedule Of Equity And Cost Method Investments [Line Items] | |||||
Interest held (in percentage) | 22.02% | 22.02% | |||
Long-term investment, at cost, less impairment | $ 1,454 | $ 1,484 | |||
Share of undistributed profits | 2,241 | 2,213 | |||
Advance to investee company | 0 | 0 | |||
Total | $ 3,695 | $ 3,697 | |||
Equity Method Investments [Member] | Beijing Hollysys Machine Automation Co Ltd [Member] | |||||
Schedule Of Equity And Cost Method Investments [Line Items] | |||||
Interest held (in percentage) | 30.00% | 30.00% | |||
Long-term investment, at cost, less impairment | $ 442 | $ 452 | |||
Share of undistributed profits | (442) | (452) | |||
Advance to investee company | 0 | 0 | |||
Total | $ 0 | $ 0 | |||
Equity Method Investments [Member] | Southcon Development Sdn Bhd [Member] | |||||
Schedule Of Equity And Cost Method Investments [Line Items] | |||||
Interest held (in percentage) | 30.00% | 30.00% | |||
Long-term investment, at cost, less impairment | $ 210 | $ 224 | |||
Share of undistributed profits | (104) | (116) | |||
Advance to investee company | 0 | 0 | |||
Total | $ 106 | $ 108 | |||
Equity Method Investments [Member] | Beijing Hollycon Medicine Technology Co Ltd [Member] | |||||
Schedule Of Equity And Cost Method Investments [Line Items] | |||||
Interest held (in percentage) | 30.00% | ||||
Long-term investment, at cost, less impairment | $ 22,737 | ||||
Share of undistributed profits | 1,773 | ||||
Advance to investee company | 0 | ||||
Total | $ 24,510 | ||||
Equity Method Investments [Member] | Shenzhen HollySys Intelligent Technologies Co., Ltd. [Member] | |||||
Schedule Of Equity And Cost Method Investments [Line Items] | |||||
Interest held (in percentage) | 60.00% | ||||
Long-term investment, at cost, less impairment | $ 2,654 | ||||
Share of undistributed profits | (159) | ||||
Advance to investee company | 0 | ||||
Total | $ 2,495 | ||||
Cost-method Investments [Member] | Shenhua Hollysys Information Technology Co Ltd [Member] | |||||
Schedule Of Equity And Cost Method Investments [Line Items] | |||||
Interest held (in percentage) | 20.00% | 20.00% | |||
Long-term investment, at cost, less impairment | $ 2,338 | $ 2,387 | |||
Share of undistributed profits | 0 | 0 | |||
Advance to investee company | 0 | 0 | |||
Total | $ 2,338 | $ 2,387 | |||
Cost-method Investments [Member] | Heilongjiang Ruixing Technology Co Ltd [Member] | |||||
Schedule Of Equity And Cost Method Investments [Line Items] | |||||
Interest held (in percentage) | 6.00% | 6.00% | |||
Long-term investment, at cost, less impairment | $ 1,598 | $ 1,631 | |||
Share of undistributed profits | 0 | 0 | |||
Advance to investee company | 0 | 0 | |||
Total | $ 1,598 | $ 1,631 | |||
Cost-method Investments [Member] | Zhongjijing Investment Consulting Co Ltd [Member] | |||||
Schedule Of Equity And Cost Method Investments [Line Items] | |||||
Interest held (in percentage) | 5.00% | 5.00% | |||
Long-term investment, at cost, less impairment | $ 0 | $ 0 | |||
Share of undistributed profits | 0 | 0 | |||
Advance to investee company | 0 | 0 | |||
Total | $ 0 | $ 0 | |||
Cost-method Investments [Member] | Zhejiang Sanxin Technology Co Ltd [Member] | |||||
Schedule Of Equity And Cost Method Investments [Line Items] | |||||
Interest held (in percentage) | 6.00% | 6.00% | |||
Long-term investment, at cost, less impairment | $ 88 | $ 90 | |||
Share of undistributed profits | 0 | 0 | |||
Advance to investee company | 0 | 0 | |||
Total | $ 88 | $ 90 |
INVESTMENTS IN EQUITY AND COS78
INVESTMENTS IN EQUITY AND COST INVESTEES (Details Textual) - USD ($) $ in Thousands | 1 Months Ended | 12 Months Ended | ||||
Jul. 31, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2014 | Oct. 31, 2016 | |
Schedule of Equity Method Investments [Line Items] | ||||||
Equity method investment remaining percentage | 80.00% | |||||
Equity Method Investment Less Impairment ,At Cost | $ 37,125 | $ 11,987 | ||||
Proceeds from Divestiture of Interest in Consolidated Subsidiaries | 0 | 464 | $ 0 | |||
Deconsolidation, Gain (Loss), Amount | $ 14,514 | $ 0 | $ 0 | |||
Shenhua Hollysys Information Technology Co Ltd [Member] | ||||||
Schedule of Equity Method Investments [Line Items] | ||||||
Cost Method Investment Ownership Percentage | 20.00% | |||||
Beijing Hollycon Medicine Technology Co Ltd [Member] | ||||||
Schedule of Equity Method Investments [Line Items] | ||||||
Equity Method Investment Less Impairment ,At Cost | $ 22,737 | |||||
Sale of Stock, Consideration Received on Transaction | $ 30,943 | |||||
Equity Method Investment, Percentage Sold | 0.60% | |||||
Proceeds from Divestiture of Interest in Consolidated Subsidiaries | $ 464 | |||||
Sale of Stock, Percentage of Ownership before Transaction | 51.00% | |||||
Sale of Stock, Percentage of Ownership after Transaction | 30.00% | |||||
Deconsolidation, Gain (Loss), Amount | $ 14,514 | |||||
Shenzhen HollySys Intelligent Technologies Co., Ltd. [Member] | ||||||
Schedule of Equity Method Investments [Line Items] | ||||||
Equity Method Investment, Ownership Percentage | 60.00% |
WARRANTY LIABILITIES (Details)
WARRANTY LIABILITIES (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Jun. 30, 2017 | Jun. 30, 2016 | |
Class of Warrant or Right [Line Items] | ||
Beginning balance | $ 10,360 | $ 10,387 |
Deconsolidation of a subsidiary | (227) | 0 |
Expense accrued | 1,547 | 3,876 |
Expense incurred | (3,836) | (3,075) |
Translation adjustment | (212) | (828) |
Closing balance | 7,632 | 10,360 |
Less: current portion of warranty liabilities | (5,386) | (6,782) |
Long-term warranty liabilities | $ 2,246 | $ 3,578 |
SHORT-TERM BANK LOANS (Details
SHORT-TERM BANK LOANS (Details Textual) - USD ($) $ in Thousands | 12 Months Ended | ||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2015 | |
Short-term Debt [Line Items] | |||
Short-term bank loans | $ 8,121 | $ 3,051 | |
Property Plant And Equipment Pledged For Short Term Loans | 991 | 1,014 | |
Deferred Costs Leasing Total | 0 | 4,593 | |
Interest Expense | 178 | 211 | $ 286 |
Long-term Line of Credit | 257,670 | 205,129 | |
Line Of Credit Facility Amount Utilized | 78,910 | 72,592 | |
Line Of Credit Facility Amount Available For Use | 178,760 | 132,537 | |
Line Of Credit Facility Secured By Restricted Cash | 4,954 | 3,754 | |
Line Of Credit Facility Secured By Restricted Buildings | 3,209 | 3,976 | |
Building [Member] | |||
Short-term Debt [Line Items] | |||
Deferred Costs Leasing Total | 991 | 1,014 | |
Restricted Stock [Member] | |||
Short-term Debt [Line Items] | |||
Property Plant And Equipment Pledged For Short Term Loans | $ 16,410 | $ 2,743 | |
Minimum [Member] | |||
Short-term Debt [Line Items] | |||
Debt Instrument, Interest Rate, Effective Percentage | 3.09% | 0.80% | |
Maximum [Member] | |||
Short-term Debt [Line Items] | |||
Debt Instrument, Interest Rate, Effective Percentage | 4.85% | 5.12% | |
Weighted Average [Member] | |||
Short-term Debt [Line Items] | |||
Debt Instrument, Interest Rate, Effective Percentage | 3.53% | 1.50% |
LONG-TERM LOANS (Details)
LONG-TERM LOANS (Details) - USD ($) $ in Thousands | Jun. 30, 2017 | Jun. 30, 2016 | |
Debt Instrument [Line Items] | |||
Loans Payable to Bank | $ 21,001 | $ 27,341 | |
Less: current portion | (420) | (6,833) | |
Long-term bank loans | 20,581 | 20,508 | |
USD-denominated loan [Member] | |||
Debt Instrument [Line Items] | |||
Loans Payable to Bank | [1] | 0 | 4,770 |
MYR-denominated loan [Member] | |||
Debt Instrument [Line Items] | |||
Loans Payable to Bank | [2] | 782 | 830 |
SGD-denominated loan [Member] | |||
Debt Instrument [Line Items] | |||
Loans Payable to Bank | [3] | 187 | 1,939 |
Convertible Bond [Member] | |||
Debt Instrument [Line Items] | |||
Loans Payable to Bank | [4] | $ 20,032 | $ 19,802 |
[1] | The USD denominated loan was repaid in March 2017. The borrowing was secured by restricted cash amounting to $4,515 which was released in March 2017 upon the repayment. | ||
[2] | The MYR denominated loans are repayable in 3 to 75 installments with the last installment due in December 2041. For the year ended June 30, 2017, the effective interest rates ranged from 2.19% to 5.68% per annum. The borrowings are secured by the mortgages of buildings, vehicles, and prepaid land leases in Malaysia, with an aggregate carrying value of $1,019 and $1,396 as of June 30, 2016 and 2017, respectively. | ||
[3] | The SGD denominated loans are repayable in 10 to 31 installments with the last installment due on March 15, 2020. For the year ended June 30, 2017, the effective interest rates ranged from 2.68% to 5.44% per annum. The borrowing is secured by vehicles and restricted cash with a total carrying value of $3,148 and $307 as of June 30, 2016 and 2017, respectively. | ||
[4] | On May 30, 2014, the Company entered into a Convertible Bond agreement with International Finance Corporation ("IFC"), under which the Company borrowed $20,000 from IFC (the “Convertible Bond”) with an interest rate of 2.1% per annum and commitment fee of 0.5% per annum paid in arrears semi-annually. The Convertible Bond has a five year term and was drawn down on August 30, 2014 and is repayable in full on August 29, 2019. The loan may not be prepaid before it is due. |
LONG-TERM LOANS (Details 1)
LONG-TERM LOANS (Details 1) $ in Thousands | Jun. 30, 2017USD ($) |
Debt Instrument [Line Items] | |
2,018 | $ 420 |
2,019 | 215 |
2,020 | 20,955 |
2,021 | 90 |
2022 and onwards | 121 |
Loans Payable to Bank | $ 21,801 |
LONG-TERM LOANS (Details Textua
LONG-TERM LOANS (Details Textual) - USD ($) $ in Thousands | 1 Months Ended | 12 Months Ended | |||
May 30, 2014 | Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2015 | Mar. 31, 2017 | |
Debt Instrument [Line Items] | |||||
Prepaid Land Leases Total | $ 0 | $ 4,593 | |||
Interest Payable | 760 | 1,193 | $ 1,535 | ||
Proceeds from Convertible Debt | $ 0 | 0 | $ 20,000 | ||
Penalty Percentage | 0.50% | ||||
Maximum [Member] | |||||
Debt Instrument [Line Items] | |||||
Penalty Percentage | 5.00% | ||||
USD-denominated loan [Member] | |||||
Debt Instrument [Line Items] | |||||
Debt Instrument, Collateral Amount | $ 4,515 | ||||
SGD-denominated loan [Member] | |||||
Debt Instrument [Line Items] | |||||
Prepaid Land Leases Total | $ 307 | 3,148 | |||
SGD-denominated loan [Member] | Maximum [Member] | |||||
Debt Instrument [Line Items] | |||||
Debt Instrument, Interest Rate During Period | 5.44% | ||||
SGD-denominated loan [Member] | Minimum [Member] | |||||
Debt Instrument [Line Items] | |||||
Debt Instrument, Interest Rate During Period | 2.68% | ||||
MYR-denominated loan [Member] | |||||
Debt Instrument [Line Items] | |||||
Prepaid Land Leases Total | $ 1,396 | 1,019 | |||
MYR-denominated loan [Member] | Maximum [Member] | |||||
Debt Instrument [Line Items] | |||||
Debt Instrument, Interest Rate During Period | 5.68% | ||||
MYR-denominated loan [Member] | Minimum [Member] | |||||
Debt Instrument [Line Items] | |||||
Debt Instrument, Interest Rate During Period | 2.19% | ||||
IFC Convertible Bond [Member] | International Finance Corporation [Member] | |||||
Debt Instrument [Line Items] | |||||
Proceeds from Convertible Debt | $ 20,000 | ||||
Debt Instrument, Interest Rate, Stated Percentage | 2.10% | ||||
Line of Credit Facility, Commitment Fee Percentage | 0.50% | ||||
Debt Instrument, Convertible, Beneficial Conversion Feature | $ 1,000 | ||||
Debt Instrument, Fee Amount | $ 349 | ||||
Debt Instrument, Unamortized Discount | $ 230 | $ 230 | |||
Debt Instrument, Convertible, Terms of Conversion Feature | According to the Convertible Bond agreement, 50% of the principal amount of the Convertible Bond then outstanding will be mandatorily converted into ordinary shares of the Company at the conversion rate and conversion price then in effect if at any time, with respect to the period of 30 consecutive trading days ending at such time, the volume weighted average prices for 20 trading days or more in such 30 consecutive trading day period is equal to or more than 150% of the conversion price in effect at such time. In addition, 100% of the principal amount of the Convertible Bond then outstanding will be mandatorily converted into ordinary shares at the conversion rate and conversion price then in effect if at any time, with respect to the period of 30 consecutive trading days ending at such time, the volume weighted average prices for 20 trading days or more in such 30 consecutive trading day period is equal to or more than 200% of the conversion price in effect at such time. | ||||
IFC Conversion Rate [Member] | |||||
Debt Instrument [Line Items] | |||||
Debt Instrument, Convertible, Terms of Conversion Feature | The initial conversion rate at the time of the agreement is 38 ordinary shares per $1, and the initial conversion price is $26.35 per share. | the Company paid out a cash dividend of $0.40 per share in March 2015 and $0.2 per share in November 2016, the conversion rate and conversion price was adjusted to 39.22 ordinary shares per $1 and $25.50 per share, respectively. |
FAIR VALUE MEASUREMENT (Details
FAIR VALUE MEASUREMENT (Details) - USD ($) $ in Thousands | Jun. 30, 2017 | Jun. 30, 2016 | |
Liabilities: | |||
Total liabilities measured at fair value on a recurring basis | $ 487 | $ 398 | |
Fair Value, Measurements, Recurring [Member] | |||
Liabilities: | |||
Derivative financial liability | [1] | 487 | 398 |
Total liabilities measured at fair value on a recurring basis | 487 | 398 | |
Fair Value, Inputs, Level 1 [Member] | Fair Value, Measurements, Recurring [Member] | |||
Liabilities: | |||
Derivative financial liability | [1] | 0 | 0 |
Total liabilities measured at fair value on a recurring basis | 0 | 0 | |
Fair Value, Inputs, Level 2 [Member] | Fair Value, Measurements, Recurring [Member] | |||
Liabilities: | |||
Derivative financial liability | [1] | 0 | 0 |
Total liabilities measured at fair value on a recurring basis | 0 | 0 | |
Fair Value, Inputs, Level 3 [Member] | Fair Value, Measurements, Recurring [Member] | |||
Liabilities: | |||
Derivative financial liability | [1] | 487 | 398 |
Total liabilities measured at fair value on a recurring basis | $ 487 | $ 398 | |
[1] | The derivative financial liability represents the fair value of the non-conversion compensation feature (note 13). The Company engaged an independent third-party appraiser to assist with the valuation of the feature. The Company is ultimately responsible for the fair value of the non-conversion compensation feature recorded in the consolidated financial statements. The Company adopted the binomial model to assess the fair value of such feature as of year-end. The non-conversion compensation feature is equal to the difference between the fair value of the whole Convertible Bond with the non-conversion compensation feature and the whole Convertible Bond without the non-conversion feature. The significant unobservable inputs used in the fair value measurement of the non-conversion compensation feature includes the risk-free rate of return, expected volatility, expected life of the Convertible Bond and expected ordinary dividend yield. The changes in fair value of the non-conversion compensation feature during fiscal year 2016 and 2017 are shown in the following table. |
FAIR VALUE MEASUREMENT (Detai85
FAIR VALUE MEASUREMENT (Details 1) $ in Thousands | 12 Months Ended |
Jun. 30, 2017USD ($) | |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |
Balance | $ 398 |
Change in fair-value (included within other expenses, net) | 89 |
Balance | $ 487 |
FAIR VALUE MEASUREMENT (Detai86
FAIR VALUE MEASUREMENT (Details 2) - Fair Value, Measurements, Nonrecurring [Member] $ in Thousands | Jun. 30, 2017USD ($) | |
Assets: | ||
Retained non-controlling interest in a former subsidiary | $ 22,737 | [1] |
Goodwill | 11,488 | [2] |
Total assets measured at fair value on a non-recurring basis | 34,225 | |
Fair Value, Inputs, Level 1 [Member] | ||
Assets: | ||
Retained non-controlling interest in a former subsidiary | 0 | [1] |
Goodwill | 0 | [2] |
Total assets measured at fair value on a non-recurring basis | 0 | |
Fair Value, Inputs, Level 2 [Member] | ||
Assets: | ||
Retained non-controlling interest in a former subsidiary | 0 | [1] |
Goodwill | 0 | [2] |
Total assets measured at fair value on a non-recurring basis | 0 | |
Fair Value, Inputs, Level 3 [Member] | ||
Assets: | ||
Retained non-controlling interest in a former subsidiary | 22,737 | [1] |
Goodwill | 11,488 | [2] |
Total assets measured at fair value on a non-recurring basis | $ 34,225 | |
[1] | During the year ended June 30, 2017, the investment in Hollycon was measured based on significant unobservable inputs (Level 3), using a discounted cash flow approach assuming a certain terminal growth rate and discount rate (Note 10). | |
[2] | As of June 30, 2017, the Company’s goodwill of $11,488 was related to the acquisition of Concord Group and $35,838 was related to the acquisition of Bond Group. The Company engaged an independent third-party appraiser to assist with the valuation of the goodwill related to the Concord and Bond Groups. The Company is ultimately responsible for the fair value of the goodwill recorded in the consolidated financial statements. For the purposes of step one of the goodwill impairment test, the Company has adopted the income approach, in particular the discounted cash flow approach, to evaluate the fair value of the reporting unit. In applying the discounted cash flow approach, key assumptions include the amount and timing of future expected cash flows, terminal value growth rates and appropriate discount rates. For the purpose of step two of the goodwill impairment test, the Company has allocated the fair value of the reporting unit derived in step one to the assets and liabilities of the reporting unit, as if the reporting unit had been acquired in a business combination and the fair value of the reporting unit was the price paid to acquire the reporting unit. The Company adopted the multi-period excess earnings model to evaluate the fair value of the intangible assets of the reporting unit, which was then used to compute the implied fair value of the goodwill via a residual approach. As a result, the Company recorded a goodwill impairment charge of $11,211 (Note 9). |
FAIR VALUE MEASUREMENT (Detai87
FAIR VALUE MEASUREMENT (Details Textual) - Bond [Member] - USD ($) $ in Thousands | Jun. 30, 2017 | Jun. 30, 2016 |
Fair Value Inputs, Liabilities, Quantitative Information [Line Items] | ||
Convertible Debt | $ 20,032 | $ 19,802 |
Convertible Debt, Fair Value Disclosures | $ 15,359 | $ 13,929 |
STOCKHOLDERS' EQUITY (Details T
STOCKHOLDERS' EQUITY (Details Textual) - $ / shares | Dec. 09, 2015 | Feb. 09, 2015 | Sep. 26, 2016 | Oct. 29, 2014 | May 30, 2013 | Jun. 30, 2017 | Jun. 30, 2016 | Aug. 31, 2010 |
Stockholders Equity Note [Line Items] | ||||||||
Common Stock, Dividends, Per Share, Declared | $ 0.40 | |||||||
Dividends Payable, Amount Per Share | $ 0.20 | |||||||
Dividends Payable, Date Declared | Sep. 26, 2016 | |||||||
Dividends Payable, Date of Record | Oct. 26, 2016 | |||||||
Dividends Payable, Date to be Paid | Nov. 11, 2016 | |||||||
Preferred Class [Member] | ||||||||
Stockholders Equity Note [Line Items] | ||||||||
Business Acquisition, Share Price (in dollars per share) | $ 160 | |||||||
2010 Rights Plan [Member] | ||||||||
Stockholders Equity Note [Line Items] | ||||||||
Business Acquisition, Percentage of Voting Interests Acquired | 20.00% | |||||||
Percentage Of Tender Offer For Ordinary Shares | 20.00% | |||||||
Percentage Of Ordinary Shares Acquiring Discount | 50.00% | |||||||
Bond [Member] | ||||||||
Stockholders Equity Note [Line Items] | ||||||||
Business Acquisition, Equity Interest Issued Or Issuable, Number Of Shares | 627,578 | 648,697 | 1,407,907 |
SHARE-BASED COMPENSATION EXPE89
SHARE-BASED COMPENSATION EXPENSES (Details) | 12 Months Ended |
Jun. 30, 2017shares | |
Performance Options 2015 [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Share Based Compensation Arrangement By Share Based Payment Award Options Vested And Expected To Vest Outstanding Number | 396,000 |
Grant Date After Two Years [Member] | Performance Options 2015 [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Share Based Compensation Arrangement By Share Based Payment Award Options Vested And Expected To Vest Outstanding Number | 348,000 |
Grant Date After Three Years [Member] | Performance Options 2015 [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Share Based Compensation Arrangement By Share Based Payment Award Options Vested And Expected To Vest Outstanding Number | 348,000 |
Grant Date After Four Years [Member] | Performance Options 2015 [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Share Based Compensation Arrangement By Share Based Payment Award Options Vested And Expected To Vest Outstanding Number | 1,044,000 |
Performance Shares Eps Threshold Limit Over Fifteen Percentage But Below Twenty Percentage [Member] | Performance Options 2015 [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Share Based Compensation Arrangement By Share Based Payment Award Options Vested And Expected To Vest Outstanding Number | 1,160,000 |
Performance Shares Eps Threshold Limit Over Fifteen Percentage But Below Twenty Percentage [Member] | Grant Date After Two Years [Member] | Performance Options 2015 [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Performance share options vested | 348,000 |
Performance Shares Eps Threshold Limit Over Fifteen Percentage But Below Twenty Percentage [Member] | Grant Date After Three Years [Member] | Performance Options 2015 [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Performance share options vested | 348,000 |
Performance Shares Eps Threshold Limit Over Fifteen Percentage But Below Twenty Percentage [Member] | Grant Date After Four Years [Member] | Performance Options 2015 [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Performance share options vested | 464,000 |
Performance Shares Eps Threshold Limit Equal Or Over Twenty Percentage But Below Twenty Five Percentage [Member] | Performance Options 2012 [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Share Based Compensation Arrangement By Share Based Payment Award Options Vested And Expected To Vest Outstanding Number | 236,000 |
Performance Shares Eps Threshold Limit Equal Or Over Twenty Percentage But Below Twenty Five Percentage [Member] | Performance Options 2015 [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Share Based Compensation Arrangement By Share Based Payment Award Options Vested And Expected To Vest Outstanding Number | 290,000 |
Performance Shares Eps Threshold Limit Equal Or Over Twenty Percentage But Below Twenty Five Percentage [Member] | Grant Date After Two Years [Member] | Performance Options 2015 [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Performance share options vested | 0 |
Performance Shares Eps Threshold Limit Equal Or Over Twenty Percentage But Below Twenty Five Percentage [Member] | Grant Date After Three Years [Member] | Performance Options 2015 [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Performance share options vested | 0 |
Performance Shares Eps Threshold Limit Equal Or Over Twenty Percentage But Below Twenty Five Percentage [Member] | Grant Date After Four Years [Member] | Performance Options 2015 [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Performance share options vested | 290,000 |
Performance Shares Eps Threshold Limit Twenty Five Percentage Or Above [Member] | Performance Options 2012 [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Share Based Compensation Arrangement By Share Based Payment Award Options Vested And Expected To Vest Outstanding Number | 236,000 |
Performance Shares Eps Threshold Limit Twenty Five Percentage Or Above [Member] | Performance Options 2015 [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Share Based Compensation Arrangement By Share Based Payment Award Options Vested And Expected To Vest Outstanding Number | 290,000 |
Performance Shares Eps Threshold Limit Twenty Five Percentage Or Above [Member] | Grant Date After Two Years [Member] | Performance Options 2015 [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Performance share options vested | 0 |
Performance Shares Eps Threshold Limit Twenty Five Percentage Or Above [Member] | Grant Date After Three Years [Member] | Performance Options 2015 [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Performance share options vested | 0 |
Performance Shares Eps Threshold Limit Twenty Five Percentage Or Above [Member] | Grant Date After Four Years [Member] | Performance Options 2015 [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Performance share options vested | 290,000 |
SHARE-BASED COMPENSATION EXPE90
SHARE-BASED COMPENSATION EXPENSES (Details 1) - Performance Options 2015 [Member] - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | |
Jun. 30, 2017 | Jun. 30, 2016 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Number of shares, Outstanding at June 30, 2016 | 1,740,000 | |
Number of shares, Forfeited | 1,344,000 | |
Number of shares, Outstanding at June 30, 2017 | 396,000 | 1,740,000 |
Number of shares, Vested and expected to vest at June 30, 2017 | 396,000 | |
Number of shares, Exercisable at June 30, 2017 | 198,000 | |
Weighted average exercise price, Outstanding at June 30, 2016 (in dollars per share) | $ 22.25 | |
Weighted average exercise price, Forfeited (in dollars per share) | 22.05 | |
Weighted average exercise price, Outstanding at June 30, 2017 (in dollars per share) | 22.05 | $ 22.25 |
Weighted average exercise price, Vested and expected to vest at June 30, 2017 (in dollars per share) | 22.05 | |
Weighted average exercise price, Exercisable at June 30, 2017 (in dollars per share) | $ 22.05 | |
Weighted average remaining contractual life (years), Outstanding | 2 years 10 months 13 days | 3 years 10 months 13 days |
Weighted average remaining contractual life (years), Vested and expected to vest | 2 years 10 months 13 days | |
Weighted average remaining contractual life (years), Exercisable | 2 years 10 months 13 days | |
Aggregate intrinsic value, Outstanding at June 30, 2016 (in dollars) | $ 0 | |
Aggregate intrinsic value, Outstanding at June 30, 2017 (in dollars) | 0 | $ 0 |
Aggregate intrinsic value, Vested and expected to vest at June 30, 2017 (in dollars) | 0 | |
Aggregate intrinsic value, Exercisable at June 30, 2017 (in dollars) | $ 0 |
SHARE-BASED COMPENSATION EXPE91
SHARE-BASED COMPENSATION EXPENSES (Details 2) - Performance Options 2015 [Member] | 1 Months Ended |
May 14, 2015 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Risk-free rate of return | 1.51% |
Weighted average expected volatility | 53.42% |
Expected life (in years) | 5 years |
Expected ordinary dividend yield | 0.00% |
SHARE-BASED COMPENSATION EXPE92
SHARE-BASED COMPENSATION EXPENSES (Details 3) - Restricted Stock [Member] - $ / shares | 12 Months Ended | |
Jun. 30, 2017 | Jun. 30, 2014 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Number of restricted shares, Un-vested | 14,375 | |
Number of restricted shares, Granted | 67,500 | 52,500 |
Number of restricted shares, Vested | 18,750 | |
Number of restricted shares, Un-vested | 63,125 | |
Weighted average grant-date fair value, Un-vested (in dollars per share) | $ 20.09 | |
Weighted average grant-date fair value, Granted (in dollars per share) | 20.09 | |
Weighted average grant-date fair value, Vested (in dollars per share) | 23.05 | |
Weighted average grant-date fair value, Un-vested (in dollars per share) | $ 23.95 |
SHARE-BASED COMPENSATION EXPE93
SHARE-BASED COMPENSATION EXPENSES (Details Textual) - USD ($) | 1 Months Ended | 12 Months Ended | ||||||
May 14, 2015 | Feb. 20, 2012 | Jun. 30, 2017 | Jun. 30, 2016 | Dec. 31, 2015 | Jun. 30, 2015 | Jun. 30, 2014 | Sep. 20, 2007 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Weighted average exercise price, Granted (in dollars per share) | $ 22.25 | |||||||
Share-Based Compensation | $ 464,000 | $ 3,860,000 | $ 2,492,000 | |||||
Share-Based Compensation Arrangement By Share-Based Payment Award, Options, Grants In Period, Gross (is shares) | 1,740,000 | |||||||
Bond [Member] | Installment One [Member] | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Fair Values Of Incentive Shares Issuable To Shareholders | 10,941,000 | |||||||
Bond [Member] | Installment Two [Member] | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Fair Values Of Incentive Shares Issuable To Shareholders | 10,896,000 | |||||||
Service and Performance Conditions 1 [Member] | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Allocated Share-based Compensation Expense | 0 | 0 | ||||||
Service and Performance Conditions 2 [Member] | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Allocated Share-based Compensation Expense | $ 0 | |||||||
Service and Performance Conditions 2 [Member] | EPS Threshold One [Member] | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Average Growth Rate Of Non GAAP Diluted Earnings Per Share Threshold Minimum | 15.00% | |||||||
Average Growth Rate Of Non GAAP Diluted Earnings Per Share Threshold Maximum | 20.00% | |||||||
Service and Performance Conditions 2 [Member] | Options Vest Three [Member] | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Share-Based Compensation Arrangement By Share-Based Payment Award, Fair Value Assumptions, Expected Term | 48 months | |||||||
Restricted Stock [Member] | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Employee Service Share-based Compensation, Nonvested Awards, Total Compensation Cost Not yet Recognized, Stock Options | $ 904,000 | |||||||
Employee Service Share-based Compensation, Nonvested Awards, Total Compensation Cost Not yet Recognized, Period for Recognition | 2 years 7 months 17 days | |||||||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Vested in Period, Fair Value | $ 432,000 | 419,000 | 419,000 | |||||
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period | 3 years | |||||||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Grants in Period | 67,500 | 52,500 | ||||||
Restricted Stock [Member] | General and Administrative Expense [Member] | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Share-Based Compensation | $ 727,000 | 419,000 | 419,000 | |||||
Performance Shares [Member] | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Employee Service Share-based Compensation, Nonvested Awards, Total Compensation Cost Not yet Recognized, Stock Options | 588,000 | |||||||
Share-Based Compensation | $ (263,000) | 3,190,000 | $ 471,000 | |||||
Share-Based Compensation Arrangement By Share-Based Payment Award, Options, Grants In Period, Gross (is shares) | 1,476,000 | |||||||
Stock issued during period shares stock options exercised (in shares) | 721,500 | |||||||
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period | 10 months 13 days | |||||||
Equity Plan 2015 [Member] | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Number of Shares Authorized (in shares) | 5,000,000 | |||||||
Performance Options 2015 [Member] | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Share-Based Compensation Arrangement By Share-Based Payment Award, Options, Vested and Expected To Vest, Outstanding, Number | 396,000 | 1,740,000 | ||||||
Two Thousand Fifteen Performance Options [Member] | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Aggregate intrinsic value, Forfeited or expired | $ 0 | 0 | $ 0 | |||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Vested in Period, Fair Value | 0 | 0 | ||||||
Share-Based Compensation Arrangement By Share-Based Payment Award, Fair Value Assumptions, Expected Term | 5 years | |||||||
Share-Based Compensation Arrangement By Share-Based Payment Award, Options, Vested and Expected To Vest, Outstanding, Number | 396,000 | |||||||
Two Thousand Fifteen Performance Options [Member] | Vesting Period One [Member] | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Vested, Number of Shares (in shares) | 1,160,000 | |||||||
Two Thousand Fifteen Performance Options [Member] | Vesting Period Two [Member] | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Vested, Number of Shares (in shares) | 580,000 | |||||||
Two Thousand Fifteen Performance Options [Member] | Vesting Period Three [Member] | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Vested, Number of Shares (in shares) | 580,000 | |||||||
2012 Performance Share Options [Member] | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Aggregate intrinsic value, Forfeited or expired | 2,383,000 | |||||||
Share-Based Compensation | $ 0 | |||||||
Allocated Share-based Compensation Expense | 0 | $ 251,000 | $ 1,602,000 | |||||
Share Based Compensation Arrangement by Share Based Payment Award Options Vested in Period Total Fair Value | $ 0 | |||||||
Stock Plan 2006 [Member] | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Number of Shares Authorized (in shares) | 3,000,000 | |||||||
Package A [Member] | Performance Options 2015 [Member] | Fiscal Year 2015 [Member] | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Share Based Compensation Arrangement By Share Based Payment Award Options Vested Grant Date Fair Value Percentage | 30.00% | |||||||
Package A [Member] | Performance Options 2015 [Member] | Fiscal Year 2016 [Member] | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Share Based Compensation Arrangement By Share Based Payment Award Options Vested Grant Date Fair Value Percentage | 30.00% | |||||||
Package A [Member] | Performance Options 2015 [Member] | Fiscal Year 2017 [Member] | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Share Based Compensation Arrangement By Share Based Payment Award Options Vested Grant Date Fair Value Percentage | 40.00% | |||||||
Package B [Member] | Performance Options 2015 [Member] | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Average Growth Rate Of Non GAAP Diluted Earnings Per Share Threshold Minimum | 15.00% | |||||||
Package B [Member] | Performance Options 2015 [Member] | Vesting Period One [Member] | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Share Based Compensation Arrangement By Share Based Payment Award Options Vested Grant Date Fair Value Percentage | 50.00% | |||||||
Package B [Member] | Performance Options 2015 [Member] | Vesting Period Two [Member] | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Share Based Compensation Arrangement By Share Based Payment Award Options Vested Grant Date Fair Value Percentage | 50.00% | |||||||
Performance Option 2015 [Member] | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Weighted Average Grant Date Fair Value (in dollars per share) | $ 22.22 |
EMPLOYEE BENEFITS (Details Text
EMPLOYEE BENEFITS (Details Textual) - USD ($) $ in Thousands | 12 Months Ended | ||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2015 | |
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Contribution Plan, Cost Recognized | $ 17,568 | $ 18,235 | $ 17,018 |
INCOME TAX (Details)
INCOME TAX (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2015 | |
Schedule Of Income Tax Disclosure [Line Items] | |||
PRC | $ 105,331 | $ 142,900 | $ 134,657 |
Non-PRC | (22,976) | (5,158) | (9,430) |
Income (Loss) from Continuing Operations before Income Taxes, Extraordinary Items, Noncontrolling Interest, Total | $ 83,355 | $ 137,742 | $ 125,227 |
INCOME TAX (Details 1)
INCOME TAX (Details 1) - USD ($) $ in Thousands | 12 Months Ended | ||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2015 | |
Income Tax Expense Incurred In PRC [Line Items] | |||
Current income tax expense (benefit) | $ 12,253 | $ 14,700 | $ 21,194 |
Deferred income tax expense (benefit) | 2,133 | (462) | 4,846 |
Effective income tax expense | 14,386 | 14,238 | 26,040 |
PRC [Member] | |||
Income Tax Expense Incurred In PRC [Line Items] | |||
Current income tax expense (benefit) | 12,911 | 10,590 | 16,074 |
Deferred income tax expense (benefit) | 2,616 | (196) | 5,834 |
Non Prc [Member] | |||
Income Tax Expense Incurred In PRC [Line Items] | |||
Current income tax expense (benefit) | (658) | 4,110 | 5,120 |
Deferred income tax expense (benefit) | $ (483) | $ (266) | $ (988) |
INCOME TAX (Details 2)
INCOME TAX (Details 2) - USD ($) $ in Thousands | 12 Months Ended | ||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2015 | |
Income Tax Statutory Tax Rate PRC [Line Items] | |||
Income before income taxes | $ 83,355 | $ 137,742 | $ 125,227 |
Effect of preferential tax treatment | (10,650) | (12,296) | (12,453) |
Withholding tax on dividend paid by subsidiaries | 2,947 | ||
Total | 14,386 | 14,238 | 26,040 |
People Republic Of China Subsidiaries [Member] | |||
Income Tax Statutory Tax Rate PRC [Line Items] | |||
Income before income taxes | 83,355 | 137,742 | 125,227 |
Expected income tax expense at statutory tax rate in the PRC | 20,838 | 34,436 | 31,307 |
Effect of different tax rates in various jurisdictions | 2,627 | 2,109 | 1,286 |
Effect of preferential tax treatment | (10,650) | (12,296) | (12,453) |
Effect of non-taxable income | 0 | (4,985) | (6,770) |
Effect of additional deductible research and development expenses | (2,385) | (4,716) | (2,772) |
Effect of non-deductible expenses | 4,608 | 5,569 | 8,402 |
Effect of change in tax rate | (4,835) | (6,613) | (4,191) |
Change in valuation allowance | 3,964 | 540 | 1,475 |
Tax rate differential on deferred tax items | 2,056 | (587) | 3,139 |
Withholding tax on dividend paid by subsidiaries | (2,799) | 1,252 | 6,028 |
Others | 962 | (471) | 589 |
Total | $ 14,386 | $ 14,238 | $ 26,040 |
INCOME TAX (Details 3)
INCOME TAX (Details 3) - USD ($) $ in Thousands | Jun. 30, 2017 | Jun. 30, 2016 |
Deferred tax assets, current | ||
Allowance for doubtful accounts | $ 9,172 | $ 9,838 |
Inventory provision | 179 | 205 |
Provision for contract loss | 694 | 917 |
Long-term assets | 13 | 13 |
Deferred revenue | 3,220 | 3,522 |
Deferred subsidies | 1,654 | 1,020 |
Warranty liabilities | 829 | 1,322 |
Recognition of intangible assets | (2) | 57 |
Accrued payroll | 998 | 960 |
Net operating loss carry forward | 9,801 | 6,361 |
Valuation allowance | (10,160) | (6,307) |
Total deferred tax assets, current | 16,398 | 17,908 |
Deferred tax liabilities, current | ||
Costs and estimated earnings in excess of billings | (10,071) | (16,068) |
Recognition of intangible assets | 0 | (1,060) |
PRC dividend withholding tax | (2,949) | (3,010) |
Others | 2 | (24) |
Total deferred tax liabilities, current | (13,018) | (20,162) |
Net deferred tax assets, current | 7,730 | 6,659 |
Deferred tax liabilities | 4,350 | 8,913 |
Deferred tax assets, non-current | ||
Long-term assets | 112 | 699 |
Deferred subsidies | 333 | 2,642 |
Net operating loss carryforward | 1,573 | 0 |
Warranty liabilities | 332 | 874 |
Others | 192 | (16) |
Total deferred tax assets, non-current | 2,542 | 4,199 |
Deferred tax liabilities, non-current | ||
Share of net gains of equity investees | (2,520) | (1,733) |
Property, plant and equipment | (38) | 0 |
Intangible assets and other non-current assets | (5,552) | (330) |
Total deferred tax liabilities, non-current | (8,110) | (2,063) |
Net deferred tax assets-non-current | 1,121 | 2,195 |
Net deferred tax liabilities-non-current | $ (6,689) | $ (59) |
INCOME TAX (Details Textual)
INCOME TAX (Details Textual) $ / shares in Units, ¥ in Thousands, MOP in Thousands, $ in Thousands | 1 Months Ended | 12 Months Ended | |||||||||
Nov. 24, 2015 | Jun. 30, 2017USD ($)$ / shares | Jun. 30, 2017MOP | Jun. 30, 2017CNY (¥) | Dec. 31, 2016 | Jun. 30, 2016USD ($)$ / shares | Jun. 30, 2015USD ($)$ / shares | Dec. 31, 2011 | Dec. 31, 2008 | Jun. 30, 2017CNY (¥) | Jun. 30, 2016CNY (¥) | |
Income Tax Disclosure [Line Items] | |||||||||||
Income Tax Reconciliation Deductions Qualified Production Activities (in dollars) | $ 10,650 | $ 12,296 | $ 12,453 | ||||||||
Undistributed Earnings of Foreign Subsidiaries (in dollars) | 557,093 | 447,025 | ¥ 3,654,625 | ¥ 2,907,542 | |||||||
Operating Loss Carry Forwards Expiration | 9,748 | ||||||||||
Withholding tax rate profits of subsidiaries earned | 10.00% | ||||||||||
Withholding Tax On Capital Gain | 2,947 | ||||||||||
Distributed Earnings | 29,490 | ¥ 200,000 | |||||||||
Profits arising from subsidiary with an Maximum exemption | MOP | MOP 600 | ||||||||||
Undistributed, Retained Earnings Of Foreign Subsidiaries With No Withholding Tax | $ 63,716 | $ 63,716 | |||||||||
Net Income Per Share Basic [Member] | |||||||||||
Income Tax Disclosure [Line Items] | |||||||||||
Impact Of Tax Holidays and Concessions On Earnings Per Share (in dollars per share) | $ / shares | $ 0.18 | $ 0.21 | $ 0.21 | ||||||||
Net Income Per Share Diluted [Member] | |||||||||||
Income Tax Disclosure [Line Items] | |||||||||||
Impact Of Tax Holidays and Concessions On Earnings Per Share (in dollars per share) | $ / shares | $ 0.17 | $ 0.20 | $ 0.21 | ||||||||
Singapore [Member] | |||||||||||
Income Tax Disclosure [Line Items] | |||||||||||
Effective Income Tax Rate Reconciliation, at Federal Statutory Income Tax Rate, Percent | 17.00% | 17.00% | 17.00% | ||||||||
Operating Loss Carryforwards (in dollars) | $ 48,342 | ||||||||||
Malaysia [Member] | |||||||||||
Income Tax Disclosure [Line Items] | |||||||||||
Effective Income Tax Rate Reconciliation, at Federal Statutory Income Tax Rate, Percent | 24.00% | 24.00% | 24.00% | ||||||||
Hong kong [Member] | |||||||||||
Income Tax Disclosure [Line Items] | |||||||||||
Effective Income Tax Rate Reconciliation, at Federal Statutory Income Tax Rate, Percent | 16.50% | 16.50% | 16.50% | ||||||||
Operating Loss Carryforwards (in dollars) | $ 1,377 | ||||||||||
Macau [Member] | Minimum [Member] | |||||||||||
Income Tax Disclosure [Line Items] | |||||||||||
Effective Income Tax Rate Reconciliation, at Federal Statutory Income Tax Rate, Percent | 12.00% | 12.00% | 12.00% | ||||||||
India [Member] | |||||||||||
Income Tax Disclosure [Line Items] | |||||||||||
Effective Income Tax Rate Reconciliation, at Federal Statutory Income Tax Rate, Percent | 30.00% | 30.00% | 30.00% | ||||||||
QATAR | |||||||||||
Income Tax Disclosure [Line Items] | |||||||||||
Effective Income Tax Rate Reconciliation, at Federal Statutory Income Tax Rate, Percent | 10.00% | ||||||||||
PRC [Member] | |||||||||||
Income Tax Disclosure [Line Items] | |||||||||||
Operating Loss Carryforwards (in dollars) | $ 9,748 | ||||||||||
People Republic Of China Subsidiaries [Member] | |||||||||||
Income Tax Disclosure [Line Items] | |||||||||||
Income Tax Reconciliation Deductions Qualified Production Activities (in dollars) | $ 10,650 | $ 12,296 | $ 12,453 | ||||||||
Effective Income Tax Rate Reconciliation, at Federal Statutory Income Tax Rate, Percent | 25.00% | 25.00% | 25.00% | 25.00% | |||||||
Withholding Tax On Capital Gain | $ (2,799) | 1,252 | $ 6,028 | ||||||||
Deferred Tax Liability Not Recognized, Amount of Unrecognized Deferred Tax Liability, Undistributed Earnings of Foreign Subsidiaries | 42,060 | 30,832 | |||||||||
Undistributed Earnings Of Foreign Subsidiaries With No Withholding Tax | $ 484,314 | $ 372,040 | |||||||||
Hangzhou Hollysys Automation Company Ltd [Member] | |||||||||||
Income Tax Disclosure [Line Items] | |||||||||||
Effective Income Tax Rate Reconciliation, Foreign Income Tax Rate Differential | 15.00% | ||||||||||
Effective Income Tax Rate Reconciliation, at Federal Statutory Income Tax Rate, Percent | 25.00% | 25.00% | 25.00% | 10.00% | |||||||
Beijing Hollysys Company Ltd [Member] | |||||||||||
Income Tax Disclosure [Line Items] | |||||||||||
Effective Income Tax Rate Reconciliation, at Federal Statutory Income Tax Rate, Percent | 25.00% | 25.00% | 25.00% | 10.00% | 15.00% |
INCOME PER SHARE (Details)
INCOME PER SHARE (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | |||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2015 | ||
Numerator: | ||||
Net income attributable to the Company - basic (in dollars) | $ 68,944 | $ 118,471 | $ 96,527 | |
Net income attributable to the Company - diluted (in dollars) | [1] | $ 69,605 | $ 119,121 | $ 96,877 |
Denominator: | ||||
Weighted average ordinary shares outstanding used in computing basic income per share | 60,189,004 | 59,170,050 | 58,612,596 | |
Effect of dilutive securities | ||||
Convertible Bond | 784,400 | 776,800 | 644,850 | |
Share options | 0 | 642,184 | 839,425 | |
Restricted shares | 38,106 | 22,422 | 37,332 | |
Weighted average ordinary shares outstanding used in computing diluted income per share | 61,011,510 | 60,611,456 | 60,134,203 | |
Income per share - basic (in dollars per share) | $ 1.15 | $ 2 | $ 1.65 | |
Income per share - diluted (in dollars per share) | $ 1.14 | $ 1.97 | $ 1.61 | |
[1] | For the year ended June 30, 2016 and 2017, interest accretion related to the Convertible Bond of $650 and $661, respectively, is added back to derive net income attributable to the Company for computing diluted income per share. |
INCOME PER SHARE (Details Textu
INCOME PER SHARE (Details Textual) - USD ($) $ in Thousands | 12 Months Ended | ||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2015 | |
Earnings Per Share [Line Items] | |||
Interest on Convertible Debt, Net of Tax | $ 661 | $ 650 | |
Vested and Unissued Restricted Shares [Member] | |||
Earnings Per Share [Line Items] | |||
Weighted Average Number Diluted Shares Outstanding Vested And Unissued Restricted Shares | 72,263 | 75,066 | 58,726 |
RELATED PARTY TRANSACTIONS (Det
RELATED PARTY TRANSACTIONS (Details) - USD ($) $ in Thousands | Jun. 30, 2017 | Jun. 30, 2016 |
Related Party Transaction [Line Items] | ||
Due from Related Parties | $ 34,142 | $ 28,012 |
China Techenergy [Member] | ||
Related Party Transaction [Line Items] | ||
Due from Related Parties | 28,778 | 22,579 |
Shenhua Information [Member] | ||
Related Party Transaction [Line Items] | ||
Due from Related Parties | 3,267 | 2,995 |
Hollysys Machine [Member] | ||
Related Party Transaction [Line Items] | ||
Due from Related Parties | 965 | 1,367 |
Heilongjiang Ruixing [Member] | ||
Related Party Transaction [Line Items] | ||
Due from Related Parties | 1,049 | 1,071 |
Beijing IPE [Member] | ||
Related Party Transaction [Line Items] | ||
Due from Related Parties | 2 | 0 |
Hollycon [Member] | ||
Related Party Transaction [Line Items] | ||
Due from Related Parties | 79 | 0 |
Shenzhen HollySys [Member] | ||
Related Party Transaction [Line Items] | ||
Due from Related Parties | $ 2 | $ 0 |
RELATED PARTY TRANSACTIONS (103
RELATED PARTY TRANSACTIONS (Details 1) - USD ($) $ in Thousands | Jun. 30, 2017 | Jun. 30, 2016 |
Related Party Transaction [Line Items] | ||
Due to Related Parties | $ 2,301 | $ 1,645 |
China Techenergy [Member] | ||
Related Party Transaction [Line Items] | ||
Due to Related Parties | 1,117 | 1,170 |
Shenhua Information [Member] | ||
Related Party Transaction [Line Items] | ||
Due to Related Parties | 353 | 358 |
Electric Motor [Member] | ||
Related Party Transaction [Line Items] | ||
Due to Related Parties | 11 | 5 |
Hollysys Machine [Member] | ||
Related Party Transaction [Line Items] | ||
Due to Related Parties | 817 | 112 |
Beijing IPE [Member] | ||
Related Party Transaction [Line Items] | ||
Due to Related Parties | 2 | 0 |
Hollycon [Member] | ||
Related Party Transaction [Line Items] | ||
Due to Related Parties | $ 1 | $ 0 |
RELATED PARTY TRANSACTIONS (104
RELATED PARTY TRANSACTIONS (Details 2) - USD ($) $ in Thousands | 12 Months Ended | ||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2015 | |
Related Party Transaction [Line Items] | |||
Related Party Transaction Purchases From Related Party | $ 762 | $ 22 | $ 419 |
Goods And Services [Member] | |||
Related Party Transaction [Line Items] | |||
Related Party Transaction Purchases From Related Party | 786 | 909 | 1,333 |
Hollysys Machine [Member] | Goods And Services [Member] | |||
Related Party Transaction [Line Items] | |||
Related Party Transaction Purchases From Related Party | 749 | 555 | 914 |
Shenhua Information [Member] | Goods And Services [Member] | |||
Related Party Transaction [Line Items] | |||
Related Party Transaction Purchases From Related Party | 0 | 0 | 368 |
Electric Motor [Member] | Goods And Services [Member] | |||
Related Party Transaction [Line Items] | |||
Related Party Transaction Purchases From Related Party | 29 | 354 | 50 |
China Techenergy [Member] | Goods And Services [Member] | |||
Related Party Transaction [Line Items] | |||
Related Party Transaction Purchases From Related Party | 0 | 0 | 1 |
Hollycon [Member] | Goods And Services [Member] | |||
Related Party Transaction [Line Items] | |||
Related Party Transaction Purchases From Related Party | $ 8 | $ 0 | $ 0 |
RELATED PARTY TRANSACTIONS (105
RELATED PARTY TRANSACTIONS (Details 3) - USD ($) $ in Thousands | 12 Months Ended | ||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2015 | |
Related Party Transaction [Line Items] | |||
Sales Of Goods and Services To Related Parties Amount | $ 0 | $ 517 | $ 914 |
Goods And Services [Member] | |||
Related Party Transaction [Line Items] | |||
Sales Of Goods and Services To Related Parties Amount | 11,889 | 4,739 | 24,577 |
China Techenergy [Member] | Goods And Services [Member] | |||
Related Party Transaction [Line Items] | |||
Sales Of Goods and Services To Related Parties Amount | 10,842 | 3,657 | 21,936 |
Shenhua Information [Member] | Goods And Services [Member] | |||
Related Party Transaction [Line Items] | |||
Sales Of Goods and Services To Related Parties Amount | 765 | 847 | 2,128 |
Hollysys Machine [Member] | Goods And Services [Member] | |||
Related Party Transaction [Line Items] | |||
Sales Of Goods and Services To Related Parties Amount | 167 | 235 | 512 |
Electric Motor [Member] | Goods And Services [Member] | |||
Related Party Transaction [Line Items] | |||
Sales Of Goods and Services To Related Parties Amount | 0 | 0 | 1 |
Hollycon [Member] | Goods And Services [Member] | |||
Related Party Transaction [Line Items] | |||
Sales Of Goods and Services To Related Parties Amount | 108 | 0 | 0 |
Beijing IPE [Member] | Goods And Services [Member] | |||
Related Party Transaction [Line Items] | |||
Sales Of Goods and Services To Related Parties Amount | $ 7 | $ 0 | $ 0 |
RELATED PARTY TRANSACTIONS (106
RELATED PARTY TRANSACTIONS (Details 4) - USD ($) $ in Thousands | 12 Months Ended | ||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2015 | |
Related Party Transaction [Line Items] | |||
Sales Of Goods and Services To Related Parties Amount | $ 0 | $ 517 | $ 914 |
Goods And Services [Member] | |||
Related Party Transaction [Line Items] | |||
Sales Of Goods and Services To Related Parties Amount | 602 | 40 | 41 |
Hollysys Machine [Member] | Goods And Services [Member] | |||
Related Party Transaction [Line Items] | |||
Sales Of Goods and Services To Related Parties Amount | 0 | 40 | 41 |
Hollycon [Member] | Goods And Services [Member] | |||
Related Party Transaction [Line Items] | |||
Sales Of Goods and Services To Related Parties Amount | $ 602 | $ 0 | $ 0 |
RELATED PARTY TRANSACTIONS (107
RELATED PARTY TRANSACTIONS (Details 5) - USD ($) $ in Thousands | 12 Months Ended | ||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2015 | |
Related Party Transaction [Line Items] | |||
Related Party Transaction, Purchases from Related Party | $ 762 | $ 22 | $ 419 |
Hollysys Machine[Member] | |||
Related Party Transaction [Line Items] | |||
Related Party Transaction, Purchases from Related Party | $ 1,648 | $ 0 | $ 0 |
RELATED PARTY TRANSACTIONS (108
RELATED PARTY TRANSACTIONS (Details Textual) | 12 Months Ended |
Jun. 30, 2017 | |
Related Party Transaction [Line Items] | |
Lessor Leasing Arrangements, Operating Leases, Term of Contract | 10 years |
Hollycon [Member] | |
Related Party Transaction [Line Items] | |
Lessor Leasing Arrangements, Operating Leases, Term of Contract | 1 year |
COMMITMENTS AND CONTINGENCIE109
COMMITMENTS AND CONTINGENCIES (Details) $ in Thousands | Jun. 30, 2017USD ($) |
Operating Leases Future Minimum Payments Due [Line Items] | |
2,018 | $ 2,453 |
2,019 | 1,060 |
2,020 | 263 |
2,021 | 103 |
2022 and onwards | 63 |
Total minimum lease payments | $ 3,942 |
COMMITMENTS AND CONTINGENCIE110
COMMITMENTS AND CONTINGENCIES (Details Textual) - USD ($) $ in Thousands | 12 Months Ended | ||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2015 | |
Commitments And Contingencies Disclosure [Line Items] | |||
Operating Leases, Rent Expense | $ 2,718 | $ 1,811 | $ 1,492 |
Commitments and contingencies | |||
Outstanding Guarantees | 62,914 | ||
Line of Credit Facility, Amount Outstanding | 257,670 | $ 205,129 | |
Purchase Obligation, Due in Next Twelve Months | 142,424 | ||
Capital Commitments [Member] | |||
Commitments And Contingencies Disclosure [Line Items] | |||
Commitments and contingencies | 1,026 | ||
Standby Letters of Credit [Member] | |||
Commitments And Contingencies Disclosure [Line Items] | |||
Line of Credit Facility, Amount Outstanding | 24,941 | ||
Performance Guarantee [Member] | |||
Commitments And Contingencies Disclosure [Line Items] | |||
Restricted Cash and Cash Equivalents | $ 13,289 |
OPERATING LEASES AS LESSOR (Det
OPERATING LEASES AS LESSOR (Details) - Beijing Hollysys [Member] $ in Thousands | Jun. 30, 2017USD ($) |
Operating Leases Future Minimum Payments Receivable [Line Items] | |
2,018 | $ 1,477 |
2,019 | 1,522 |
2,020 | 1,567 |
2,021 | 1,614 |
2,022 | 1,663 |
Total minimum lease payments to be received in the next five years | $ 7,843 |
OPERATING LEASES AS LESSOR (112
OPERATING LEASES AS LESSOR (Details Textual) $ in Thousands | 12 Months Ended |
Jun. 30, 2017USD ($) | |
Leases Operating [Line Items] | |
Lessor Leasing Arrangements, Operating Leases, Term of Contract | 10 years |
Operating Leases, Future Minimum Payments Receivable | $ 2,003 |
Hollycon [Member] | |
Leases Operating [Line Items] | |
Lessor Leasing Arrangements, Operating Leases, Term of Contract | 1 year |
SEGMENT REPORTING (Details)
SEGMENT REPORTING (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2015 | |
Segment Reporting Information [Line Items] | |||
Revenues from external customers | $ 431,943 | $ 544,325 | $ 531,379 |
Costs of revenue | 291,472 | 338,599 | 316,977 |
Gross profit | 140,471 | 205,726 | 214,402 |
IA [Member] | |||
Segment Reporting Information [Line Items] | |||
Revenues from external customers | 172,667 | 182,901 | 213,252 |
Costs of revenue | 106,583 | 113,314 | 119,520 |
Gross profit | 66,084 | 69,587 | 93,732 |
Rail [Member] | |||
Segment Reporting Information [Line Items] | |||
Revenues from external customers | 155,732 | 240,310 | 193,274 |
Costs of revenue | 86,128 | 131,043 | 97,503 |
Gross profit | 69,604 | 109,267 | 95,771 |
M&E [Member] | |||
Segment Reporting Information [Line Items] | |||
Revenues from external customers | 103,544 | 95,277 | 110,030 |
Costs of revenue | 98,761 | 82,900 | 93,452 |
Gross profit | 4,783 | 12,377 | 16,578 |
Miscellaneous [Member] | |||
Segment Reporting Information [Line Items] | |||
Revenues from external customers | 0 | 25,837 | 14,823 |
Costs of revenue | 0 | 11,342 | 6,502 |
Gross profit | $ 0 | $ 14,495 | $ 8,321 |
SEGMENT REPORTING (Details 1)
SEGMENT REPORTING (Details 1) - USD ($) $ in Thousands | 12 Months Ended | ||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2015 | |
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Revenues | $ 431,943 | $ 544,325 | $ 531,379 |
PRC [Member] | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Revenues | 326,713 | 443,256 | 410,644 |
Non-PRC [Member] | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Revenues | $ 105,230 | $ 101,069 | $ 120,735 |
SEGMENT REPORTING (Details 2)
SEGMENT REPORTING (Details 2) - USD ($) $ in Thousands | Jun. 30, 2017 | Jun. 30, 2016 |
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Long-lived assets other than goodwill and acquired intangible assets | $ 143,654 | $ 113,533 |
PRC [Member] | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Long-lived assets other than goodwill and acquired intangible assets | 131,625 | 100,454 |
Non-PRC [Member] | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Long-lived assets other than goodwill and acquired intangible assets | $ 12,029 | $ 13,079 |
SUBSEQUENT EVENTS (Details Text
SUBSEQUENT EVENTS (Details Textual) - Subsequent Event [Member] $ in Thousands | Jul. 10, 2017USD ($) |
Subsequent Event [Line Items] | |
Business Combination, Consideration Transferred | $ 2,380 |
Beijing Shuanghe Technology Company Limited [Member] | |
Subsequent Event [Line Items] | |
Business Acquisition, Percentage of Voting Interests Acquired | 100.00% |
ENDORSEMENT OF NOTE RECEIVAB117
ENDORSEMENT OF NOTE RECEIVABLES (Details Textual) - USD ($) $ in Thousands | Jun. 30, 2017 | Jun. 30, 2016 |
ENDORSEMENT OF NOTE RECEIVABLES [Line Items] | ||
Endorsed Bank Acceptance Bill | $ 25,462 | $ 31,991 |
CONDENSED FINANCIAL INFORMAT118
CONDENSED FINANCIAL INFORMATION OF THE PARENT COMPANY (Details) - USD ($) $ in Thousands | Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2014 |
ASSETS | ||||
Cash and cash equivalents | $ 197,640 | $ 229,095 | $ 207,834 | $ 162,159 |
Prepaid expenses | 619 | 569 | ||
Total current assets | 865,356 | 827,310 | ||
Total assets | 1,058,254 | 1,004,156 | ||
LIABILITIES AND STOCKHOLDERS' EQUITY | ||||
Accrued payroll and related expense | 13,600 | 13,193 | ||
Accrued liabilities | 23,950 | 44,041 | ||
Total current liabilities | 302,978 | 297,326 | ||
Long-term loan | 20,581 | 20,508 | ||
Total liabilities | 334,714 | 321,471 | ||
Equity: | ||||
Ordinary shares, par value $0.001 per share, 100,000,000 shares authorized; 59,598,099 and 60,342,099 shares issued and outstanding as of June 30, 2016 and 2017, respectively | 60 | 60 | ||
Additional paid-in capital | 222,189 | 215,403 | ||
Accumulated other comprehensive loss | (22,859) | (8,467) | ||
Total equity | 723,540 | 682,685 | 585,385 | 492,058 |
Total liabilities and equity | 1,058,254 | 1,004,156 | ||
Parent Company [Member] | ||||
ASSETS | ||||
Cash and cash equivalents | 13,103 | 8,571 | $ 8,437 | $ 0 |
Amounts due from subsidiaries | 59,920 | 72,303 | ||
Prepaid expenses | 61 | 63 | ||
Total current assets | 73,084 | 80,937 | ||
Investments in subsidiaries | 726,837 | 669,326 | ||
Total assets | 799,921 | 750,263 | ||
LIABILITIES AND STOCKHOLDERS' EQUITY | ||||
Accrued payroll and related expense | 14 | 9 | ||
Accrued liabilities | 487 | 427 | ||
Amounts due to subsidiaries | 55,869 | 55,869 | ||
Total current liabilities | 56,370 | 56,305 | ||
Long-term loan | 20,032 | 19,802 | ||
Total liabilities | 76,402 | 76,107 | ||
Equity: | ||||
Ordinary shares, par value $0.001 per share, 100,000,000 shares authorized; 59,598,099 and 60,342,099 shares issued and outstanding as of June 30, 2016 and 2017, respectively | 60 | 60 | ||
Additional paid-in capital | 222,189 | 215,403 | ||
Retained earnings | 524,129 | 467,160 | ||
Accumulated other comprehensive loss | (22,859) | (8,467) | ||
Total equity | 723,519 | 674,156 | ||
Total liabilities and equity | $ 799,921 | $ 750,263 |
CONDENSED FINANCIAL INFORMAT119
CONDENSED FINANCIAL INFORMATION OF THE PARENT COMPANY (Details 1) - USD ($) $ in Thousands | 12 Months Ended | ||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2015 | |
Condensed Income Statements, Captions [Line Items] | |||
General and administrative expenses | $ 44,297 | $ 45,832 | $ 50,786 |
Loss from operations | 60,270 | 120,583 | 130,107 |
Interest income | 3,687 | 5,858 | 3,686 |
Interest expenses | (938) | (1,404) | (1,821) |
Income before income taxes | 83,355 | 137,742 | 125,227 |
Income tax expenses | 14,386 | 14,238 | 26,040 |
Net income | 68,944 | 118,471 | 96,527 |
Other comprehensive income, net of tax of nil | |||
Translation adjustment | (14,428) | (48,841) | (1,386) |
Comprehensive income | 54,541 | 74,663 | 97,801 |
Parent Company [Member] | |||
Condensed Income Statements, Captions [Line Items] | |||
General and administrative expenses | 1,062 | 4,484 | 3,169 |
Loss from operations | (1,062) | (4,484) | (3,169) |
Other expense, net | (89) | (93) | (35) |
Interest income | 4 | 80 | 1 |
Interest expenses | (1,074) | (705) | (463) |
Foreign exchange gains (losses) | (740) | (719) | 238 |
Equity in profit of subsidiaries | 71,905 | 124,392 | 99,955 |
Income before income taxes | 68,944 | 118,471 | 96,527 |
Income tax expenses | 0 | 0 | 0 |
Net income | 68,944 | 118,471 | 96,527 |
Other comprehensive income, net of tax of nil | |||
Translation adjustment | (14,392) | (46,052) | (1,427) |
Comprehensive income | $ 54,552 | $ 72,419 | $ 95,100 |
CONDENSED FINANCIAL INFORMAT120
CONDENSED FINANCIAL INFORMATION OF THE PARENT COMPANY (Details 2) - USD ($) $ in Thousands | 12 Months Ended | ||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2015 | |
Net increase in cash and cash equivalents | $ (31,455) | $ 21,261 | $ 45,675 |
Cash and cash equivalents, beginning of year | 229,095 | 207,834 | 162,159 |
Cash and cash equivalents, end of year | 197,640 | 229,095 | 207,834 |
Parent Company [Member] | |||
Net cash used in operating activities | (930) | (1,697) | (397) |
Net cash (used in) provided by investing activities | (396) | 11,390 | (4,402) |
Net cash provided by (used in) financing activities | 5,858 | (9,559) | 13,236 |
Net increase in cash and cash equivalents | 4,532 | 134 | 8,437 |
Cash and cash equivalents, beginning of year | 8,571 | 8,437 | 0 |
Cash and cash equivalents, end of year | $ 13,103 | $ 8,571 | $ 8,437 |
CONDENSED FINANCIAL INFORMAT121
CONDENSED FINANCIAL INFORMATION OF THE PARENT COMPANY (Details Textual) $ / shares in Units, ¥ in Thousands, $ in Thousands | Jun. 30, 2017USD ($)$ / sharesshares | Jun. 30, 2017CNY (¥)shares | Jun. 30, 2016USD ($)$ / sharesshares | Jun. 30, 2016CNY (¥)shares |
Condensed Financial Information of Parent Company [Line Items] | ||||
Common stock, par value (in dollars per share) | $ / shares | $ 0.001 | $ 0.001 | ||
Common stock, shares authorized (in shares) | 100,000,000 | 100,000,000 | 100,000,000 | 100,000,000 |
Common stock, shares issued (in shares) | 60,342,099 | 60,342,099 | 59,598,099 | 59,598,099 |
Common stock, shares outstanding (in shares) | 60,342,099 | 60,342,099 | 59,598,099 | 59,598,099 |
Parent Company [Member] | ||||
Condensed Financial Information of Parent Company [Line Items] | ||||
Common stock, par value (in dollars per share) | $ / shares | $ 0.001 | $ 0.001 | ||
Common stock, shares authorized (in shares) | 100,000,000 | 100,000,000 | 100,000,000 | 100,000,000 |
Common stock, shares issued (in shares) | 60,342,099 | 60,342,099 | 59,598,099 | 59,598,099 |
Common stock, shares outstanding (in shares) | 60,342,099 | 60,342,099 | 59,598,099 | 59,598,099 |
Amount Restricted To Transfer From Subsidiary To Parent | $ 84,091 | ¥ 569,279 | $ 79,500 | ¥ 538,113 |