GONGYI, China, Jan. 7 /Xinhua-PRNewswire/ -- China Gengsheng Minerals, Inc. (OTC Bulletin Board: CHGS) ("Gengsheng" or the "Company"), a leading manufacturer in China of heat-resistant and energy-saving industrial materials, today announced that it has signed new supply contracts with Aoyu Iron and Steel Co., Ltd. ("Aoyu") and Xinjiang Bayi Iron and Steel Co. ("Xinjiang Bayi"), two prominent Chinese steel manufacturers.
Aoyu is the 38th largest steel manufacturer in China by capacity and one of the top steel makers in Hebei Province. According to the Hebei Metallurgical Industry Association, Hebei Province has been the No. 1 producer of steel among China's top seven steel-producing provinces for three years in a row. Aoyu specializes in the production of diversified steel-and-iron products. Aoyu's parent company, Aowei Group, is also known for its specialty in metallurgical technology as well as for its diverse range of operations from manufacturing steel and iron to international trade.
Xinjiang Bayi is a majority-owned subsidiary of the Baosteel Group, China's largest steel manufacturer by output and one of the most profitable steel enterprises in the world, with an annual production capacity of over 20 million metric tons. Xinjiang Bayi is the largest iron-and-steel company in China's Xinjiang Autonomous Region. It produced 2.84 million metric tons of crude steel last year and held over 75% of the market share in Xinjiang. The Baosteel Group plans to make use of Xinjiang Bayi's geographical location in China to further exploit the potential steel consumption in Asia.
"We are pleased to add Aoyu and Xinjiang Bayi as new customers," said Mr. Shunqing Zhang, Chairman, CEO and President of Gengsheng. "Aoyu and Xinjiang Bayi are both on the forefront of the campaign for cost-cutting and energy- saving in the Chinese steel industry. We believe that our refractory products are uniquely positioned to fulfill the growing needs of steel factories to produce more durable products with higher energy efficiency."
The Company has agreed to supply one million metric tons of comprehensive refractories (predominantly monolithic refractories) for steel ladle linings to Aoyu and to provide Xinjiang Bayi with six million metric tons of refractory castables for troughs and runners in blast furnaces for the term of their respective contracts. The Aoyu agreement will expire on December 25, 2008 and the Xinjiang Bayi agreement will expire on November 12, 2008. Based on the Company's projected output for the term of the contracts, the Company estimates the contracts to be worth $1.3 million and $400,000 in revenues, respectively.
About China Gengsheng Minerals, Inc.
China Gengsheng Minerals, Inc. ("Gengsheng") develops, manufactures and markets a broad range of mineral-based, heat-resistant products, including monolithic refractories, refractory bricks, industrial ceramics and fracture proppants. Using customized solutions, Gengsheng's products are widely used in the iron-and-steel industry, such as steel-making furnaces, industrial kilns and other high-temperature vessels to guarantee and improve the productivity of those expensive pieces of equipment while reducing their consumption of energy such as oil, gas and electricity. Founded in 1986 and based in China's Henan province, Gengsheng currently sells to over 160 customers in the iron, steel, glass, cement, aluminum and chemical businesses located in China and in 11 other countries, with exports accounting for about 10% of the revenue as of September 30, 2007. Gengsheng conducts business through Gengsheng International Corporation, a British Virgin Islands company and its Chinese subsidiaries, which are Henan Gengsheng Refractories Co., Ltd., Zhengzhou Duesail Fracture Proppant Co., Ltd. and Henan Gengsheng High Temperature Materials Co., Ltd.
For more information about the Company, please visit http://www.gengsheng.com.
Safe Harbor Statement
This press release may contain certain "forward-looking statements" relating to the business of China Gengsheng Minerals, Inc., and its subsidiary companies. All statements, other than statements of historical fact included herein are "forward-looking statements" including statements regarding the effect of the Aoyu and Xinjiang Bayi contracts on the Company's ability to market its products and services; the Company's ability to meet its projected output for the term of the contracts with Aoyu and Xinjiang Bayi; the general ability of the Company to achieve its commercial objectives; the business strategy, plans and objectives of the Company and its subsidiaries; and any other statements of non-historical information. These forward-looking statements are often identified by the use of forward-looking terminology such as "believes," "expects" or similar expressions, involve known and unknown risks and uncertainties. Although the Company believes that the expectations reflected in these forward-looking statements are reasonable, they do involve assumptions, risks and uncertainties, and these expectations may prove to be incorrect. 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 at http://www.sec.gov. All forward-looking statements attributable to the Company or persons acting on its behalf are expressly qualified in their entirety by these factors. Other than as required under the securities laws, the Company does not assume a duty to update these forward-looking statements.
For more information, please contact:
In China:
Mr. Fulong Zheng
Investor Relations
China Gengsheng Minerals, Inc.
Tel: +86-371-6405-9846
Email: zflde@163.com
In the U.S.:
Valentine Ding
Investor Relations
The Global Consulting Group
Tel: +1-646-284-9412
Email: vding@hfgcg.com
