SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 6-K

REPORT OF FOREIGN ISSUER
PURSUANT TO RULE 13a-16 OR 15d-16 OF
THE SECURITIES EXCHANGE ACT OF 1934

November 3, 2008

HIGHWAY HOLDINGS LIMITED
(Translation of Registrant's Name Into English)

Suite 810, Level 8
Landmark North
39 Lung Sum Avenue
Sheung Shui
New Territories, Hong Kong
(Address of Principal Executive Offices)

(Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F.)

Form 20-F x Form 40-F o

(Indicate by check mark whether the registrant by furnishing the information contained in this Form is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.)

Yes o  No x

(If "Yes" is marked, indicate below the file number assigned to the registrant in connection with Rule 12g3-2(b): 82-_______________.)

Attached to this Report on Form 6-K is the press release issued by the registrant on November 3, 2008.

 
 
 

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

     
  HIGHWAY HOLDINGS LIMITED
 
 		  
 		  
 
Date: November 3, 2008 By:   /s/ ROLAND W. KOHL
 
Roland W. Kohl
  Chief Executive Officer


 
 
 
NEWS RELEASE
CONTACT:
Gary S. Maier
 
Maier & Company, Inc.
 
(310) 442-9852
   

HIGHWAY HOLDINGS REPORTS FISCAL 2009 SECOND QUARTER RESULTS
 
-- Profit Climbs 20.5 Percent For Quarter; Sales Up Eight Percent --

HONG KONG — November 3, 2008 — Highway Holdings Limited (Nasdaq:HIHO) today reported results for its second fiscal quarter ended September 30, 2008, reflecting increased profitability, sales and improved efficiency in its manufacturing process.
Net income for the 2009 fiscal second quarter climbed 20.5 percent to $100,000, or $0.03 per diluted share, from $83,000, or $0.02 per diluted share, a year earlier. Net sales for same period climbed 8.1 percent to $9.5 million from $8.8 million a year ago.
Net income for the first six months of fiscal 2009 increased 16.9 percent to $387,000, or $0.10 per diluted share, from $331,000, or $0.09 per diluted share, a year earlier. Net sales for the same period increased 6.4 percent to $18.9 million from $17.7 million a year ago, supported particularly from sales contributions from European customers. Metal, mechanical and electronic OEM sales for the six months represented approximately $18.2 million, or 96.3 percent of the company’s total net sales -- highlighting the company’s continuing transition away from its non-core businesses to more profitable original equipment manufacturing operations.
“Results for the fiscal 2009 second quarter highlight continued success in controlling costs and leveraging the company’s broad range of manufacturing capabilities -- utilizing metal, plastic and electric components and integration production to attract leading OEM customers,” said Roland Kohl, president and chief executive officer.
Gross profit for the quarter increased 10.1 percent to $1.82 million from $1.65 million last year -- reflecting the benefits of OEM sales initiatives and enhancements to its manufacturing process. During the prior fiscal year, the company invested approximately $1.5 million in new equipment and machinery. Gross profit as a percentage of sales was 19.1 percent compared with 18.8 percent in the same period a year ago. Kohl noted that gross profit benefited from price increases and the benefits of higher manufacturing efficiencies.
 
 
 
 
Highway Holdings Ltd.
2-2-2
 
He further noted that the company’s recently acquired Golden Bright plastic molding operation is still experiencing some operating inefficiencies, which impacted the company’s profitability for the quarter. Management is focused on improving these operations through enhancements such as additional utilization of automated equipment in its production process in order to further reduce manufacturing costs, as well as greater integration of Goldenbright’s administrative functions into its main operation. In addition, the company is focused on increasing utilization of machine capacity through higher volume component sales from its existing customer base.
Selling, general and administrative expenses decreased by $151,000 for the 2009 fiscal second quarter and $76,000 for the six-month period. The decrease in selling, general and administrative expenses was the result of increased sales turnover, as well as ongoing streamlining of its administrative operations. As a result of increased sales, improved operating margins and decreased selling, general and administrative expenses, the company’s operating income increased by 111 percent to $704,000 in the first six months of the current fiscal year from $333,000 in the same period a year ago. The increase in operating income was, however, offset by a $205,000 currency exchange loss during the six months ended September 30, 2008. During the same six-month period last year, the company realized a currency exchange gain of $82,000. The currency losses resulted from the recent decrease in the value of the euro compared to the U.S. dollar and to the increased value of the Chinese renminbi. As the company’s sales to Europe increases, its exposure to future currency rate fluctuations will increase. The company does not engage in currency hedging transactions. The company does, however, adjust its currency exchange rate with most of its customers on a three-month basis.
Kohl noted the company’s balance sheet remains strong. The total shareholders’ equity at September 30, 2008 was $10.81 million compared with $10.39 million at 2008 fiscal year end. The company’s current ratio was 1.86:1 at September 30, 2008.
 
About Highway Holdings
 
Highway Holdings produces a wide variety of high-quality products for blue chip original equipment manufacturers -- from simple parts and components to sub-assemblies. It also manufactures finished products, such as LED lights, radio chimes and other electronic products. Highway Holdings is headquartered in Hong Kong and operates four manufacturing facilities in the People's Republic of China.
 
Except for the historical information contained herein, the matters discussed in this press release are forward-looking statements which involve risks and uncertainties, including but not limited to economic, competitive, governmental, political and technological factors affecting the company's revenues, operations, markets, products and prices, and other factors discussed in the company’s various filings with the Securities and Exchange Commission, including without limitation, the company’s annual reports on Form 20-F.
 
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HIGHWAY HOLDINGS LIMITED AND SUBSIDIARIES
Consolidated Statement of Income
(Dollars in thousands, except per share data)
(Unaudited)

   
Three Months Ended
  
Six Months Ended
  
   
September 30,
  
September 30,
  
                   
   
2008
  
2007
  
2008
  
2007
  
                   
Net sales
  
$
9,507
  
$
8,796
  
$
18,854
  
$
17,728
  
Cost of sales
    
7,690
    
7,145
    
15,092
    
14,261
  
Gross profit
    
1,817
    
1,651
    
3,762
    
3,467
  
Selling, general and administrative expenses
    
1,445
    
1,596
    
3,058
    
3,134
  
Operating income
   
372
    
55
    
704
    
333
  
                           
Non-operating items
                          
Interest expenses
    
(48
)
  
(63
)
  
(88
)
  
(122
)
Exchange gain (loss), net
    
(197
)
  
74
   
(205
)
  
82
  
Interest income
    
9
   
17
   
20
    
50
  
Other income
    
4
   
0
   
19
    
7
  
Total non-operating income (expenses)
    
(232
)
  
28
    
(254
)
  
17
  
                           
Net income before income tax and minority interests
    
140
    
83
    
450
    
350
  
Income taxes
    
38
    
0
    
77
    
19
  
Income before minority interests
    
102
    
83
    
373
    
331
  
Minority Interests
    
(2
)
  
0
    
14
    
0
  
Net income
 
$
100
  
$
83
  
$
387
  
$
331
  
                           
Earnings per share - basic
  
$
0.03
  
$
0.02
  
$
0.10
  
$
0.09
  
Weighted average number of shares - basic
    
3,734
    
3,785
    
3,734
    
3,785
  
                           
Earnings per share - diluted
  
$
0.03
  
$
0.02
  
$
0.10
  
$
0.09
  
Weighted average number of shares - diluted
    
3,734
    
3,817
    
3,734
    
3,817
  


 
 
 

HIGHWAY HOLDINGS LIMITED AND SUBSIDIARIES
 
Consolidated Balance Sheet
(In thousands, except per share data)
   
Sep 30
  
March 31
  
   
2008
  
2008
  
Current assets:
          
Cash and cash equivalents
  
$
4,292
 
$
3,889
  
Restricted cash
    
1,671
    
1,671
  
Accounts receivable, net of doubtful accounts
    
4,920
    
4,766
 
Inventories
    
6,408
    
5,775
 
Prepaid expenses and other current assets
    
826
    
689
  
Total current assets
    
18,117
    
16,790
 
           
Property, plant and equipment, (net)
    
3,142
   
3,646
 
Investment in affiliates
   
2
   
2
 
Intangible assets, (net)
    
43
   
52
 
Total assets
    
21,304
    
20,490
 
               
Current liabilities:
              
Accounts payable
  
$
2,882
  
$
3,757
  
Short-term borrowing
    
3,877
   
2,214
 
Current portion of long-term debt
    
270
   
311
 
Accrued mould charges
    
92
   
260
 
Accrual payroll and employee benefits
    
864
   
988
 
Other liabilities and accrued expenses
    
1,776
   
1,704
 
Total current liabilities
    
9,761
   
9,234
 
Long-term debt - net of current portion 
    
408
   
522
 
Deferred income taxes
    
189
   
189
 
Total liabilities
    
10,358
    
9,945
  
               
Minority Interest
    
137
    
151
  
               
Shareholders' equity:
              
Common shares, $0.01 par value, authorized 20,000,000 shares
              
3,819,900 shares as of March 31, 2008 and 3,720,520 shares
              
as of September 30, 2008, respectively, issued and outstanding
    
38
   
38
 
Additional paid-in capital
    
11,049
    
11,562
  
Retained earnings (Accumulated Deficit)
    
(232
)
  
(614
)
Accumulated other comprehensive loss
    
7
    
(26
)
Treasury shares, at cost - 166,334 shares as of March 31, 2008; 37,800 shares as of September 30, 2008
   
(53
)
  
(566
)
Total shareholders' equity
    
10,809
    
10,394
 
               
Total liabilities and shareholders' equity
    
21,304
   
20,490