China Metal Resources Utilization Limited Announces 2018 Interim Results

Revenue significanty increased 129.5% to approximately RMB9,658.4 million

HONG KONG, Aug. 28, 2018 /PRNewswire/ --

Interim Results Highlights

• Revenue significantly increased 129.5% to approximately RMB9,658.4 million
• Adjusted EBITDA increased 20.7% to approximately RMB127.8 million
• Entered into a subscription agreement to issue new shares to a state-owned enterprise for raising approximately HK$364.7 million
• Completed the acquisitions of two target companies in 100% equal interest which have production facilities in Sichuan and Hubei respectively

China Metal Resources Utilization Limited ("CMRU" or 'the Company"） (Stock Code: 1636.HK), announced its 2018 interim results for the six months ended 30 June 2018 (the "Period"). During the Period, the Company recorded total revenue of approximately RMB9,658.4 million (1H2017: RMB4,208.9 million), representing significantly increased 129.5%. During the Period, adjusted EBITDA was RMB127.8 million (1H2017: RMB105.9 million), increased by 20.7% compared to the corresponding period last year. Earnings per share was RMB2 cents.

Business Review

The significant increase in revenue was principally due to increase in the demand for copper products across the country. Such increase in revenue was contributed not only by the increase in the Company's trading volume of electrolytic copper but also by the increase in production volume of its recycled copper products. During the Period, the revenue from copper products amounted to RMB9,527.1 million (1H2017: RMB4,177.9 million), representing an increase of 128.0%, reflecting mainly an increase of 102.6 % to 213.8 thousand metric tons for the Period (1H2017: 105.5 thousand metric tons) in the sales volume of all copper products, and an increase of 12.4% to RMB44.5 thousand per ton for the Period (1H2017: RMB40 thousand per ton) in average selling price.

During the Period, the revenue from sales of power transmission and distribution cables amounted to RMB16.7 million (1H2017: RMB4.2 million), representing an increase of 298.6%. The revenue from sales of communication cables amounted to RMB23.2 million for the Period (1H2017: RMB14.8 million), representing an increase of 57.1%. During the Period, profit was RMB60.2 million (1H2017: RMB85.5 million). The decrease was mainly due to the enlarged sales volume from trading of metal, the gross profit of which was lower than that from sales of manufactured products.

In order to increase the financial strength to be well prepared for the future, the Company has entered into a subscription agreement to issue 75,980,000 new shares to a state-owned enterprise for raising approximately HK$364.7 million in the Period. It is expected to be completed in the fourth quarter of 2018. Also, the Company has also completed the acquisitions of two target companies which have production facilities in Sichuan and Hubei respectively, in order to grasp the favorable opportunities to expand the Company's scale.

Mr. Yu Jianqiu, Chairman of the Company, concluded, "We are delighted to see the robust growth of the Company's revenue. We will be cautious looking to increase our financial strength so that we will be able to cope with headwinds as well as take full advantage of future opportunities. At the same time, we shall also continue to seek suitable acquisition opportunities to help grow our business. We are dedicated to take full advantage of further improvements in the market environment to increase profitability for our shareholders."

About China Metal Resources Utilization Limited

China Metal Resources Utilization Limited is a leading manufacturer in scrap copper industry. The Company has a fully integrated value chain with a production and service business model, with business consisting of scrap metal recycling, standard processing and metal deep processing products. By making use of the internet, the Company also provides a comprehensive platform combined with recycle metal information, warehouse logistics and financial services, providing services including recycled metal production, sale and related services. China Metal Resources is mainly involved in the sale of deep processed metal products and scrap metal value chain integrated services, in which deep processing metal includes the processing of recycled scrap copper, scrap aluminium, turning them into different copper and aluminium products such as copper rod, copper bar, copper wire as well as cable, wire and network cable; while scrap metal value chain integrated services include standard metal recovery processing, warehouse logistics, transaction settlement and financial services.