omniture

China Solar & Clean Energy Solutions, Inc. Announces Record Third Quarter Revenue



-- Third Quarter Revenue Increased 92% to $12.6 million

-- YTD Revenues increased 57% to $25 million, and Net Income increased 35%

to $1.4 million with $.20 in EPS

-- Company anticipates launching its new flat plate collector production

and water tank assembly lines in first quarter 2008

-- Company recently appoints new CFO and Director

LOS ANGELES and BEIJING, Nov. 14 /Xinhua-PRNewswire-FirstCall/ -- China Solar & Clean Energy Solutions, Inc. (f/k/a Deli Solar (USA), Inc.) (OTC Bulletin Board: CSOL) (“we,” “us”, the “Company” or “CSOL”), a premier manufacturer and distributor of solar water heaters, renewable energy solutions, and space heating devices in the People’s Republic of China (the "PRC"), today announced its results for the third quarter ended September 30, 2007.

Three Month Results

Sales for the third quarter of 2007 increased 92% to $12.6 million compared to $6.6 million for the same quarter of 2006. On July 1, 2007, we acquired 51% of Tianjin Huaneng Energy Equipment Company, a company incorporated in China (“Tianjin Huaneng”), which manufactures energy saving boilers and environmental protection equipment for industrial customers for a purchase price of $1,689,741. Tianjin Huaneng’s business contributed $3.8 million in revenue for the third quarter of 2007 compared to none for the same period in 2006. $2.2 million, or 37% of the revenue growth during the quarter, was organic and emanated from increased marketing efforts coupled with an expansion of the company’s network of distributors.

Gross profit for the three months ended September 30, 2007 was $2.6 million, an increase of approximately 86% from the third quarter of 2006. Gross margin was 20.2% compared to 20.9% for the third quarter 2006. The slight reduction was primarily due to price competition in solar water heater market in China.

Operating expenses for the three months ended September 30, 2007 increased 115.3% to $1.8 million compared to the same period in 2006, a result of increased input in advertising and promotional expenses for the purpose of gaining market share, in addition to after sales service, as well as selling expenses directly related to Tianjin Huaneng’s increased sales volume.

Operating income for the third quarter of 2007 totaled $0.8 million, a 41% increase, compared to $0.6 million for the same period in 2006. Principally a result of the increased operating expenses and income taxes, net income for the third quarter of 2007 decreased 9.2% to $0.5 million from $0.6 million in net income for the same period in 2006, earnings per share decreased to $.06 for the third quarter of 2007 from $.07 per share for the same period in 2006. Calculations were based upon 8.31 million and 8.03 million weighted average number of shares outstanding respectively. Taxes paid during the quarter were $0.2 million compared to none in the year ago period, equating to an effective tax rate of approximately 25.3 percent compared to none in the 2006 third quarter.

“We are pleased with our strong growth during the quarter. The acquisition of Tianjin Huaneng Energy Equipment Company, along with continued organic growth within our core solar water heater business enabled us to achieve a 92% increase in revenues,” commented Mr. Deli Du, President and Chief Executive Officer. “While margins were slightly impacted by competition and pricing pressure, a factor which we believe will continue, we anticipate that Tianjin Huaneng’s proprietary energy saving boilers and environmental protection equipment will improve our overall operating profitability on a go forward basis. In addition, we are very close to completing the installation of our new flat plate collector production and water tank assembly lines, which we expect to be fully operational during the first quarter of 2008. We believe this will improve our production efficiencies and capacity, and the quality of our products while enhancing both margins and profitability on a go forward basis,” continued Mr. Du.

Nine Month Results

Sales increased approximately 57% to $25 million for nine months ended September 30, 2007 as compared to $16 million for the same period last year. Operating expenses for the nine months ended September 30, 2007 were $3.4 million as compared to $2.4 million for the same period in 2006, an increase of 42.7% which includes expenses from Tianjin Huaneng since the acquisition on July 1, 2007. Operating income for the nine months ended September 30, 2007 was $1.8 million, an increase of 73.7% as compared to $1.1 million for the nine months ended September 30, 2006.

Net income was $1.4 million for the nine months ended September 30, 2007, an increase of $0.4 million, or approximately 35.4% compared to same period last year. This equated to earnings of $.20 per share, compared to $.13 per share for the first nine months of 2006 based on 7.04 million and 8.03 million weighted average number of shares respectively.

Balance Sheet and Cash Flow Discussion

From a balance sheet perspective, the Company had $3.3 million in cash and equivalents on September 30, 2007 while stockholders’ equity increased to $16.6 million, representing a book value of approximately $2.00 per diluted share. Net cash flow from operations was $324,013 for the nine months ended September 30, 2007.

Inventory increased to $5.2 million and accounts receivable increased to $7.2 million due to the consolidation with Tianjin Huaneng. Different from CSOL’s core business, Tianjin Huaneng collects receivables during the project life, where 30 percent of the total cost is pre-paid by customers, 30 percent is paid once installation is commenced, 30 percent is paid when installation is completed and 10 percent is held back for one year to guarantee work.

“Inventory levels were directly related to longer-term projects. Tianjin Huaneng is currently fulfilling for its customers and we expect a significant portion to convert to revenue during the fourth quarter with further improvements made for inventory management on a go forward basis. The increase in accounts receivable were also related to Tianjin Huaneng which extends credit terms to customers. In addition, we continue to evaluate new acquisition targets which will complement our product portfolio as an integrated clean technology energy solution provider and open up new market opportunities in China.”

“We would like to welcome Mr. Gary Lam who recently joined CSOL as our new CFO. He brings extensive corporate finance experience and expertise in developing strategic business plans. In addition, we would like to welcome Mr. Randolph to the board of directors as his experience in a variety of Asian companies will complement the Board’s composition while further assisting with all corporate governance issues. We believe these gentlemen will benefit us as we continue to grow organically and through strategic acquisitions, while further evolving as a public company,” Mr. Du concluded.

About China Solar & Clean Energy Solutions, Inc.

China Solar & Clean Energy Solutions, Inc. operates through its wholly owned subsidiaries Bazhou Deli Solar Heating Energy Co. Ltd., Beijing Deli Solar Technology Development Co., Ltd. and its 51% ownership in Tianjin Huaneng, all of which are located in the PRC. The Company manufactures and distributes hot water and space heating devices to customers in the PRC, in addition to waste heat recovery systems. For more information, please visit http://www.delisolar.com .

Safe Harbor Statement:

Certain statements in this news release may contain forward-looking information about China Solar & Clean Energy Solutions, Inc. and its subsidiaries’ business and products within the meaning of Rule 175 under the Securities Act of 1933 and Rule 3b-6 under the Securities Exchange Act of 1934, and are subject to the safe harbor created by those rules. The actual results may differ materially depending on a number of risk factors including, but not limited to, the general economic and business conditions in the PRC, market and customer acceptance and demand for products, ability to market products, fluctuations in foreign currency markets, the use of estimates in the preparation of financial statements, the impact of competitive products and pricing, the ability to develop and launch new products on a timely basis, the regulatory environment, fluctuations in operating results, and various other factors beyond its control. All forward-looking statements are expressly qualified in their entirety by this Cautionary Statement and the risks factors detailed in the Company’s reports filed with the Securities and Exchange Commission. China Solar & Clean Energy Solutions, Inc. undertakes no duty to revise or update any forward-looking statements to reflect events or circumstances after the date of this release.

-- FINANCIAL TABLES FOLLOW --

Balance Sheets (unaudited)

Assets September 30, December 31,

2007 2006

Current assets

Cash and cash equivalents $3,311,421 $3,212,065

Trade accounts receivable 7,220,091 986,809

Allowances for doubtful accounts (811,950) (116,363)

Net trade accounts receivable 6,408,141 870,446

Advance to suppliers 1,348,254 1,007,709

Prepaid expenses 29,129 58,203

Inventories 5,238,184 315,765

Total current assets 16,335,129 5,464,188

Property, plant and equipment

Buildings 4,457,449 3,528,180

Machinery and equipment 1,348,627 71,131

Vehicles 364,891 76,176

Computer equipment 31,483 12,625

Office equipment 177,209 65,749

Construction in progress 3,336,862 2,580,031

Total plant and equipment 9,716,521 6,333,892

Accumulated depreciation (1,723,631) (407,424)

Net property, plant and equipment 7,992,890 5,926,468

Other receivables 1,583,569 321,999

Prepaid land lease 1,560,428 1,003,530

Total other assets 3,143,997 1,325,529

Goodwill 1,773,550 --

Total assets $29,245,566 $12,716,185

Liabilities and stockholders’ September 30, December 31,

equity 2007 2006

Current liabilities

Trade accounts payable $1,623,020 $147,901

Related party payable 500 22,528

Other payables 1,389,768 35,934

Accrued expenses 736,043 22,080

Deposits 3,493,478 262,269

Taxes payable 1,975,859

Deferred revenue 678,486

Short-term notes payable 1,154,703 --

Total current liabilities 11,051,857 490,712

Long term loans 778,474 --

Minority Interests 785,018 --

Stockholders’ equity

Convertible preferred stock: par

value $0.001; 25,000,000 shares

authorized, 2,674,194 shares

issued and authorized 2,674 --

Common stock: par value $0.001;

66,666,667 shares authorized,

6,205,290 shares issued and

outstanding 6,205 6,205

Additional paid in capital 8,283,900 5,705,574

Retained earnings 7,400,960 5,979,785

Accumulated other comprehensive

income 936,478 533,909

Total stockholders’ equity 16,630,217 12,225,473

Total Liabilities and

stockholders’ equity $29,245,566 $12,716,185

Consolidated Statements of Operations and Comprehensive Income

(unaudited)

Three Three Nine Nine

months months months months

ended ended ended ended

September September September September

30, 2007 30, 2006 30, 2007 30, 2006

Sales revenues $12,629,636 $6,565,606 $25,043,660 $15,982,081

Cost of goods sold 10,078,609 5,190,840 19,817,653 12,549,545

Gross profit 2,551,027 1,374,766 5,226,007 3,432,536

Operating expenses

Advertising 458,652 382,287 1,118,745 881,190

Selling expense 583,166 145,073 864,698 330,400

Salaries and

benefits 111,656 88,113 260,649 194,319

Depreciation 82,731 29,943 153,697 89,208

Other general and

administrative 532,137 175,914 987,093 877,544

Total operating

expenses 1,768,342 821,330 3,384,882 2,372,661

Net operating

income 782,685 553,436 1,841,125 1,059,875

Other income

(expense)

Interest income

(expense) (31,845) (3,898) (30,207) (10,108)

Total other income

(expense) (31,845) (3,898) (30,207) (10,108)

Net income before

minority interest

and taxes 750,840 549,538 1,810,918 1,049,767

Taxes 189,770 -- 327,747 --

Net income after

taxes $561,070 $549,538 $1,483,171 $1,049,767

Minority Interests 61,996 -- 61,996 --

Net income $499,074 $549,538 $1,421,175 $1,049,767

Foreign Currency

Translation

Adjustment 154,609 194,660 402,569 286,200

Comprehensive

Income $653,683 $744,198 $1,823,743 $1,335,967

Basic earnings per

share $0.08 $0.09 $0.23 $0.17

Denominator for

basic EPS 6,205,290 6,205,290 6,205,290 6,205,290

Fully diluted

earnings per share $0.06 $0.07 $0.20 $0.13

Denominator for

diluted EPS 8,310,856 8,031,009 7,039,341 8,031,009

For more information, please contact:

Gary Lam

China Solar & Clean Energy Solutions, Inc.

Tel: +86-10-6385-0516

Email: garylam8899@yahoo.com.cn

Matthew Hayden

HC International, Inc.

Tel: +1-858-704-5065

Email: matt@haydenir.com

Source: China Solar & Clean Energy Solutions, Inc.
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