ZHENGZHOU, China, November 15, 2011 /PRNewswire-Asia/ -- ANNEC GREEN REFRACTORIES CORPORATION (OTCBB: ANNC), one of leading refractory enterprises in China, today announced financial results for the third quarter of 2011:
Third Quarter 2011 Highlights
Mr. Fuchao Li, Chairman, commented, "We are very pleased to report a 39.2% increase in revenues for the third quarter of 2011 compared to the same period of 2010. Our strategy is to increase our presence in overseas markets while consolidating market share based on established distribution channels in China in 2011."
Mr. Li continued to comment: "In efforts to increase our revenues, we continue to explore opportunities and continue negotiations with prospective M&A targets. Meanwhile we will take measures to decrease our selling expenses so as to increase our net income."
About Annec Green Refractories Corporation
We indirectly control through subsidiaries, Zhengzhou Annec Industrial Co., Ltd. ("Annec"), a PRC wholly-Foreign Owned Enterprise, which is engaged in the business of design, manufacturing and selling of medium and high level refractory materials for top combustion type, internal combustion type, and external combustion type hot blast stoves, and through our variable interest entity ("VIE"), Annec (Beijing) Engineering Technology Co., Ltd. ("Beijing Annec"), a PRC limited company, we provide turnkey service for large hot blast stove projects, integrating the structural design, equipment purchase, construction, refractory production/sale and after-sale service of hot blast stoves.
Forward-Looking Statements
This release contains certain "forward-looking statements" relating to the business of the Company. These forward looking statements are often identified by the use of forward-looking terminology such as "believes," "expects" or similar expressions. Further the forward looking statements involve known and unknown risks and uncertainties that may cause actual results to be materially different from those described herein as anticipated, believed, estimated or expected. Investors should not place undue reliance on these forward-looking statements, which speak only as of the date of this press release. The Company's actual results could differ materially from those anticipated in these forward-looking statements as a result of a variety of factors, including those discussed in the Company's periodic reports that are filed with the Securities and Exchange Commission and available on its website (www.sec.gov). The Company does not assume a duty to update these forward-looking statements.
ANNEC GREEN REFRACTORIES CORPORATION | ||||
CONDENSED CONSOLIDATED BALANCE SHEETS | ||||
(Unaudited) | ||||
September 30, | December 31, | |||
2011 | 2010 (1) | |||
ASSETS | ||||
Current assets: | ||||
Cash | $ 511,381 | $ 1,504,971 | ||
Restricted cash | 3,124,121 | 4,425,167 | ||
Bank notes receivable | 4,999,723 | 1,056,569 | ||
Accounts receivable (net of allowance of $811,190 and $572,793 at | ||||
September 30, 2011 and December 31, 2010, respectively) | 28,966,047 | 16,130,117 | ||
Retentions receivable | 9,661,325 | 4,553,071 | ||
Prepaid expenses and deposits | 16,272,640 | 5,604,102 | ||
Other receivables | 5,061,474 | 5,420,233 | ||
Inventories | 38,649,235 | 25,703,214 | ||
Total current assets | 107,245,946 | 64,397,444 | ||
Long-term retentions receivable | 4,480,732 | 5,425,110 | ||
Deposits for capital expenditure | 3,201,283 | 3,235,272 | ||
Plant and equipment, net | 12,746,717 | 12,093,625 | ||
Land use rights, net | 2,217,205 | 2,193,823 | ||
Long-term investment | 156,206 | 151,722 | ||
|
| |||
Total assets | $130,048,089 | $ 87,496,996 | ||
LIABILITIES AND STOCKHOLDERS' EQUITY | ||||
Current liabilities: | ||||
Short-term loans | $ 12,005,998 | $ 8,475,193 | ||
Bank notes payable | 3,124,121 | 5,310,272 | ||
Accounts payable and accrued expenses | 23,850,099 | 11,271,228 | ||
Advances from customers | 43,951,086 | 23,105,778 | ||
Salaries payable | 557,859 | 436,635 | ||
Taxes payable | 1,191,687 | 2,535,965 | ||
Related party payable | 2,356,968 | 917,008 | ||
Loans payable to employees | 2,600,786 | 2,154,409 | ||
Loans payable to other individuals | 2,967,915 | 1,972,387 | ||
Other payable | 2,180,426 | 1,918,056 | ||
Total current liabilities | 94,786,945 | 58,096,931 | ||
Deferred income | 2,839,655 | 2,884,600 | ||
Long-term loans | 995,033 | 1,189,501 | ||
|
| |||
Total liabilities | 98,621,633 | 62,171,032 | ||
Commitments and contingencies (Note 13) | ||||
Stockholders' equity: | ||||
Series A preferred stock, $0.0001 par value; 20,000,000 shares authorized; zero shares | ||||
issued and outstanding | - | - | ||
Common stock, $0.0001 par value; 100,000,000 shares authorized; 19,995,701 issued | ||||
and outstanding | 2,000 | 2,000 | ||
Additional paid-in capital | 4,046,992 | 4,046,992 | ||
Retained earnings | 26,000,245 | 20,700,451 | ||
Accumulated other comprehensive income | 1,377,219 | 576,521 | ||
|
| |||
Total stockholders' equity | 31,426,456 | 25,325,964 | ||
Total liabilities and stockholders' equity | $130,048,089 | $ 87,496,996 | ||
(1) Derived from the consolidated audited financial statements included in our annual report filed on Form 8-K(a) | ||||
with the SEC for the year ended December 31, 2010. | ||||
- | - | |||
Balance sheet conversion rate | 6.4018 | 6.4231 | ||
ANNEC GREEN REFRACTORIES CORPORATION | ||||||||
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS | ||||||||
(Unaudited) | ||||||||
Three Months Ended | Nine Months Ended | |||||||
September 30, | September 30, | |||||||
2011 | 2010 | 2011 | 2010 | |||||
Revenues | $ 21,284,455 | $ 15,358,263 | $ 58,613,778 | 39,169,826 | ||||
Cost of revenues | 11,415,483 | 8,377,592 | 34,780,715 | 23,936,038 | ||||
Gross profit | 9,868,972 | 6,980,671 | 23,833,063 | 15,233,788 | ||||
Operating expenses: | ||||||||
Selling | 4,288,462 | 1,308,240 | 10,926,396 | 4,231,333 | ||||
General and administrative | 1,289,033 | 1,274,678 | 3,970,995 | 4,102,463 | ||||
Total operating expenses | 5,577,495 | 2,582,918 | 14,897,391 | 8,333,796 | ||||
Income from operations | 4,291,477 | 4,397,753 | 8,935,672 | 6,899,992 | ||||
Other income (expense): | ||||||||
Interest income | 72,579 | 8,621 | 257,223 | 60,113 | ||||
Interest expense | (638,521) | (296,713) | (2,331,305) | (916,179) | ||||
Other income (expense), net | 80,679 | (5,969) | 322,442 | (384,099) | ||||
Total other income (expense), net | (485,263) | (294,061) | (1,751,640) | (1,240,165) | ||||
Income before provision for | ||||||||
income taxes | 3,806,214 | 4,103,692 | 7,184,032 | 5,659,827 | ||||
Provision for income taxes | 598,081 | 646,719 | 1,185,972 | 912,336 | ||||
Net income | $ 3,208,133 | $ 3,456,973 | $ 5,998,060 | 4,747,491 | ||||
Net income per share-basic and dilutive | $ 0.16 | $ 0.17 | $ 0.30 | 0.24 | ||||
Shares used in computing net income | ||||||||
per share-basic and dilutive | 19,995,701 | 19,995,701 | 19,995,701 | 19,995,701 | ||||
ANNEC GREEN REFRACTORIES CORPORATION | ||||
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS | ||||
(Unaudited) | ||||
Nine Months Ended | ||||
September 30, | ||||
2011 | 2010 | |||
Cash flows from operating activities: | ||||
Net income | $ 5,998,060 | $ 4,747,491 | ||
Adjustments to reconcile net income to net cash provided by | ||||
operating activities: | ||||
Depreciation and amortization | 1,048,251 | 845,982 | ||
Provision (recovery) for bad debt | 217,922 | - | ||
Loss (gain) on sale of plant and equipment | 31,848 | 463,371 | ||
Change in assets and liabilities: | ||||
Accounts receivable, retentions receivable, and long-term | ||||
retentions receivable | (16,186,208) | (2,016,266) | ||
Prepaid expenses and deposits | (10,334,699) | (4,716,670) | ||
Other receivables | 510,638 | 2,242,525 | ||
Inventories | (11,991,206) | (4,862,952) | ||
Accounts payable and accrued expenses | 12,092,207 | (3,292,671) | ||
Advances from customers | 19,839,514 | 4,731,836 | ||
Salary payable | 106,585 | 216,214 | ||
Taxes payable | (1,396,496) | 355,593 | ||
Deferred income | (128,112) | 1,869,826 | ||
Other payable | 202,389 | 30,243 | ||
Net cash (used in) provided by operating activities | 10,693 | 614,522 | ||
Cash flows from investing activities: | ||||
Net proceeds from bank notes receivable | (3,849,275) | (225,217) | ||
Restricted cash for issuance of bank notes payable | 1,408,896 | 2,787,395 | ||
Deposits for capital expenditure | 127,530 | - | ||
Purchase of plant and equipment | (1,454,403) | (1,567,937) | ||
Purchase of land use rights | - | (2,176,301) | ||
Proceeds from sale of plant and equipment | 79,926 | 126,753 | ||
Net cash used in investing activities | (3,687,326) | (1,055,307) | ||
Cash flows from financing activities: | ||||
Payments of dividends | (705,276) | (208,291) | ||
Proceeds from loans to related parties, employees, and other | ||||
individuals, net of payments | 2,689,031 | 461,472 | ||
Proceeds from issuance of short-term borrowings, net of payments | 922,226 | 1,026,935 | ||
Proceeds from issuance of long-term borrowings, net of payments | (225,945) | - | ||
Net cash provided by (used in) financing activities | 2,680,036 | 1,280,116 | ||
Net (decrease) increase in cash | (996,597) | 839,331 | ||
Effect of exchange rate changes | 3,007 | 33,727 | ||
Cash at beginning of period | 1,504,971 | 1,227,457 | ||
Cash at end of period | $ 511,381 | $ 2,100,515 | ||
Supplementary disclosure of cash flow information | ||||
Noncash investing activities: | ||||
Reduction of accounts payable through disposal of plant and equipment | $ 42,576 | $ 14,671 | ||
Cash paid during the period: | ||||
Interest | 1,959,534 | 874,681 | ||
Income taxes | 662,718 | 317,668 | ||
Check Should Be Zero | 511,381 | - | 1,504,971 | |
- | 595,544 | |||
For more information, please contact:
Yolanda Li
Tel: +86-371-6999-9012
Mobile: +86-152-1012-1018
Email: annecyolanda@annec.com.cn
