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China Precision Steel Announces Fourth Quarter and Fiscal 20

时间:2019-01-11 作者:AG集&#

SHANGHAI, Sept. 29 /PRNewswire-Asia/ -- China Precision Steel (Nasdaq: CPSL), a niche precision steel processing Company principally engaged in producing and selling high precision, cold-rolled steel products, announced today its financial results for the fourth quarter and 2009 fiscal year ended June 30, 2009.

Fourth Quarter 2009 Highlights

-- Revenue was $25.7 million

-- Gross profit was $2.3 million with 9.0% gross margin

-- Net income was $2.2 million

-- Fully diluted earnings per share of $0.05

Full Year 2009 Highlights

-- Revenue was $76.3 million

-- Gross profit was $7.7 million with 10.1% gross margin

-- Net loss of $0.4 million resulting from a $3.8 million provision for

bad debt

-- Fully diluted loss per share of $0.01

-- Exports generated 27.6% of total sales

"We are extremely pleased with the rebound in our business during the fourth quarter of fiscal year 2009 as the Chinese steel industry recovers from its lowest level since the global economic crisis began," commented Dr. Wo Hing Li, China Precision Steel's Chairman and CEO. "While our business has not recovered to the levels achieved during fiscal year 2008 and there are still uncertainties within the steel industry, we have experienced a significant improvement in demand for our precision steel products over our 2009 fiscal third quarter and our inventory destocking continues to run its course. Our high carbon business is also benefiting from the implementation of a series of stimulus policies for automobiles by the Chinese government which has bolstered demand for automobiles and construction vehicles and subsequently precision steel clutch discs. Moreover, we have successfully acquired 123 new customers for the entire fiscal year."

Revenue for the fourth quarter of fiscal 2009 was $25.7 million, down 9.9% from $28.6 million in the fourth quarter of fiscal 2008. Revenue for the 2009 fourth quarter benefited from a $3.2 million subcontracting order, which represented 14.8% of total sales for the quarter. High carbon and low carbon products accounted for 30.4% and 51.8% of sales, respectively, compared to 30.4% and 61.3%, respectively, from the same period of the prior year.

Gross profit in the fourth quarter was $2.3 million, down 57.9% from gross profit of $5.5 million in the fourth quarter of fiscal 2008. Gross margin was 9.0%, compared to 19.2% in the same period a year ago. The decline in gross margin was mainly attributable to the higher cost of raw materials incurred in connection with the inventory build up during the first half of calendar year 2008 when demand and steel prices were both high. Subsequently, selling prices declined dramatically amid the worldwide industry downturn resulting in a tightening of gross margin.

Selling expenses for the fourth quarter of fiscal 2009 were $46,961, or 0.2% of revenue, compared to $123,134, or 0.4% of revenue, in the fourth fiscal quarter of 2008. Administrative expenses were $656,632, or 2.6% of revenue, compared to $726,720, or 2.5% of revenue in the same period a year ago. Depreciation and amortization expenses for the quarter were $103,648, or 0.4% of revenue, up from $17,668 or 0.1% of revenue in the same period a year ago.

Operating income for the fourth quarter was $1.5 million, compared to operating income of $4.6 million in the same period a year ago.

Net profit for the fourth quarter of fiscal 2009 was $2.2 million, compared to net income of $5.6 million in the same period of the prior year. Fully diluted earnings per share were $0.05, compared to fully diluted earnings per share of $0.12 in the fourth quarter of fiscal 2008.

Fiscal Year 2009 Results

Revenues for the fiscal year 2009 were $76.3 million, down 13.1% from revenues of $87.7 million in fiscal year 2008. Exports contributed to 27.6% of total revenue, compared to 18.2% in fiscal year 2008. Gross profit was $7.7 million, down 65.6% from gross profit of $22.5 million in fiscal year 2008. Gross margin was 10.1%, compared to 25.6% a year ago. Operating loss was $0.2 million, compared to operating income of $18.4 million in fiscal year 2008. Net loss was $0.4 million, compared to net income of $18.6 million a year ago. Fully diluted loss per share was $0.01, compared to fully diluted earnings per share of $0.43 for fiscal year 2008.

Financial Condition

As of June 30, 2009, China Precision Steel had $13.6 million in cash and cash equivalents, no long term debt, total liabilities of $42.8 million and working capital of $41.2 million. Stockholders' equity was $120.6 million, compared to $120.3 million as of June 30, 2008. The Company generated $15.1 million in cash flow from operating activities during the full year of fiscal 2009.

Business Outlook

China Precision Steel has completed the construction of its third cold rolling mill and has begun testing and commissioning of the mill. The new mill is a tandem mill with best in class gauge control and shape performance capable of producing high quality cold rolled steel for exposed and unexposed products and will be used primarily in the production of high carbon cold-rolled steel products. The Company expects the new mill to begin production in the third fiscal quarter of 2010 and reach its full design capacity of 100,000 tons within four years. As of June 30, 2009, China Precision Steel expects to incur an additional $2.5 million in capital expenditures in relation to the new mill and annealing furnaces.

"We remain optimistic about our future growth as we have built a strong foundation with our state-of-the-art patented technology process and our experienced management team which has served us well in these difficult times," Dr. Li commented. "Currently, we have a backorder of $9.3 million of which 50% is for our high carbon precision steel products which we believe is an indicator of a steady improvement in both demand and margins as overall economic conditions gradually improve. Furthermore, we remain committed to executing our long-term growth strategy and expanding our market penetration as demand for precision steel rebounds in China and the global market."

About China Precision Steel

China Precision Steel is a niche precision steel processing company principally engaged in the production and sale of high precision cold-rolled steel products and provides value added services such as heat treatment and cutting medium and high carbon hot-rolled steel strips. China Precision Steel's high precision, ultra-thin, high strength (7.5 mm to 0.05 mm)

cold-rolled steel products are mainly used in the production of automotive components, food packaging materials, saw blades, steel roofing and textile needles. The Company sells to manufacturers in the People's Republic of China as well as overseas markets such as Nigeria, Ethiopia, Thailand and Indonesia. China Precision Steel was incorporated in 2002 and is headquartered in Sheung Wan, Hong Kong. Additional information can be found at the Company's website http://chinaprecisionsteelinc.com .

Conference Call

China Precision Steel will host a conference call on Tuesday, September 29, 2009 at 9:00 am ET to discuss fiscal 2009 fourth quarter and year end results. To participate in the live conference call, please dial 888-419-5570 fifteen minutes prior to the scheduled conference call time. International callers should dial 617-896-9871. When prompted by the operator, provide Conference Passcode 529 178 60.

If you are unable to participate in the call at this time, a replay will be available for 14 days starting on Tuesday, September 29, 2009 at 11:00 a.m. Eastern Time. To access the replay, dial 888-286-8010 and enter the passcode 47792275. International callers should dial 617-801-6888 and enter the same passcode.

This conference call will be broadcast live over the Internet and can be accessed by all interested parties by clicking on http://www.chinaprecisionsteelinc.com . Please access the link at least fifteen minutes prior to the start of the call to register, download, and install any necessary audio software. For those unable to participate during the live broadcast, a 90-day replay will be available shortly after the call by accessing the same link.

Forward-Looking Statements

Safe Harbor Statement Under the Private Securities Litigation Reform Act of 1995: Certain statements in this press release and oral statements made by China Precision Steel on its conference call in relation to this release, constitute forward-looking statements for purposes of the safe harbor provisions under The Private Securities Litigation Reform Act of 1995. These statements include, without limitation, statements regarding, the impact of the Company's newly constructed facility on the Company's business and operations, and the Company's ability to expand manufacturing capacity in 2009 and 2010 as a result of the new facility; the significance of the Company's backorder on the future business and operations of the Company and the Company's ability to optimize growth as overall economic conditions improve; and predictions and guidance relating to the Company's future financial performance. We have based these forward-looking statements largely on our current expectations and projections about future events and financial trends that we believe may affect our financial condition, results of operations, business strategy and financial needs but they involve risks and uncertainties that could cause actual results to differ materially from those in the forward-looking statements, business conditions in China, weather and natural disasters, changing interpretations of generally accepted accounting principles; outcomes of government reviews; inquiries and investigations and related litigation; continued compliance with government regulations; legislation or regulatory environments, requirements or changes adversely affecting the businesses in which China Precision Steel is engaged; cyclicality of steel consumption including overcapacity and decline in steel prices, limited availability of raw material and energy may constrain operating levels and reduce profit margins, environmental compliance and remediation could result in increased cost of capital as well as other relevant risks not included herein. The information set forth herein should be read in light of such risks. You are urged to consider these factors carefully in evaluating the forward-looking statements herein and are cautioned not to place undue reliance on such forward-looking statements, which are qualified in their entirety by this cautionary statement. The forward-looking statements made herein speak only as of the date of this press release and the Company undertakes no duty to update any forward-looking statement to conform the statement to actual results or changes in the Company's expectations.

-- Financial Tables Follow --

China Precision Steel, Inc. and Subsidiaries

Consolidated Balance Sheets

Audited

June 30, June 30,

2009 2008

Assets

Current assets

Cash and equivalents $13,649,587 $18,568,842

Accounts receivable

Trade, net of allowances of

$830,127 and $1,033,479

at June 30, 2009 and 2008,

respectively 25,140,834 33,783,074

Bills receivable 6,131,143 4,309,703

Other 881,153 571,746

Inventories 16,275,070 17,815,087

Prepaid expenses 75,917 58,105

Advances to suppliers, net of

allowance of $1,631,557 and

$2,522,837 at June 30, 2009

and 2008, respectively 21,878,047 33,027,365

Total current assets 84,031,751 108,133,922

Property, plant and equipment

Property, plant and equipment, net 46,812,484 39,199,305

Deposits for plant and machinery 8,348,496 --

Construction-in-progress 22,245,173 16,476,454

77,406,153 55,675,759

Intangible assets, net 1,871,211 1,625,690

Goodwill 99,999 99,999

Total assets $163,409,114 $165,535,370

Liabilities and Stockholders' Equity

Current liabilities

Short-term loans $22,489,031 $17,465,799

Accounts payable and accrued liabilities 7,144,242 12,047,981

Advances from customers 1,742,944 6,996,996

Other taxes payables 6,650,668 3,976,239

Current income taxes payable 4,778,767 4,742,387

Total current liabilities 42,805,652 45,229,402

Stockholders' equity:

Preferred stock: $0.001 per value,

8,000,000 shares authorized, no shares

outstanding at June 30, 2009 and 2008

Common stock: $0.001 par value,

62,000,000 shares authorized, 46,562,955

and 46,472,955 issued and outstanding

June 30, 2009 and 2008, respectively 46,563 46,473

Additional paid-in capital 75,642,383 75,372,488

Accumulated other comprehensive income 9,731,505 9,295,658

Retained earnings 35,183,011 35,591,349

Total stockholders' equity 120,603,462 120,305,968

Total liabilities and stockholders' equity $163,409,114 $165,535,370

China Precision Steel, Inc. and Subsidiaries

Consolidated Statements of Operations

For the Three Months Ended For the Years Ended

June 30, June 30,

(Unaudited) (Audited)

2009 2008 2009 2008

Revenues

Sales revenues $25,734,034 28,550,266 $76,281,621 $87,739,326

Cost of goods

sold 23,423,791 23,068,828 68,549,426 65,241,825

Gross profit 2,310,243 5,481,438 7,732,195 22,497,501

Operating expenses

Selling expenses 46,961 123,134 1,679,283 608,060

Administrative

expenses 656,632 726,720 2,238,088 2,758,536

Allowance for

bad and

doubtful debts 1,344 25,025 3,831,478 686,955

Depreciation and

amortization

expense 103,648 17,668 196,793 64,253

Total operating

expenses 808,585 892,547 7,945,642 4,117,804

Income/(loss) from

operations 1,501,658 4,588,891 (213,447) 18,379,697

Other income/(expense)

Other revenues 1,061,001 1,061,473 1,397,258 2,006,777

Interest and

finance costs (323,360) (56,176) (1,228,665) (1,231,040)

Total other

Income (expense) 737,641 1,005,297 168,593 775,737

Net (loss)/income

before income tax 2,239,299 5,594,188 (44,854) 19,155,434

Provision for/(benefit

from) income tax

Current 29,937 (23,866) 363,484 1,636,351

Deferred -- -- -- (1,064,028)

Total income tax

expense 29,937 (23,866) 363,484 572,323

Net income/(loss) 2,209,362 5,618,054 (408,338) 18,583,111

Basic earnings/(loss)

per share $0.05 $0.12 ($0.01) $0.43

Basic weighted average

shares outstanding 46,561,229 43,044,420 46,561,229 43,044,420

Diluted earnings/

(loss)per share $0.05 $0.12 ($0.01) $0.43

Diluted weighted

average shares

outstanding 46,561,229 43,256,434 46,561,229 43,256,434

China Precision Steel, Inc. and Subsidiaries

Consolidated Statements of Cash Flows

For the Years Ended June 30, 2009 and 2008

Audited

2009 2008

Cash flows from operating activities

Net (loss)/income ($408,338) $18,583,111

Adjustments to reconcile net income to

net cash provided by operating

activities

Depreciation and amortization 3,565,422 2,214,643

Allowance for bad and doubtful debts 3,831,478 686,955

Reversal of provision for doubtful

accounts (1,105,866) --

Net changes in assets and liabilities:

Accounts receivable, net 3,016,777 (30,186,787)

Inventories 1,601,568 (511,151)

Deposits -- 82,758

Prepayments (17,861) (58,105)

Advances to suppliers 12,163,423 (19,898,096)

Accounts payable and accrued expenses (4,944,049) 6,704,028

Advances from customers (5,278,228) 5,103,242

Other taxes payable 2,660,691 3,077,622

Current income taxes 19,995 2,659,288

Deferred income taxes -- (1,064,028)

Net cash provided by/(used in) operating

activities 15,105,012 (12,606,520)

Cash flows from investing activities

Deposit for plant and machinery (8,348,496) --

Purchase of land use rights (340,066) --

Purchase of property, plant and

equipment including

construction in progress (16,642,038)(14,705,302)

Net cash used in investing activities (25,330,600)(14,705,302)

Cash flows from financing activities

Exercise of common stock warrants 269,985 1,730,001

Proceeds from sale of common stock -- 44,375,282

Advances from/(to) directors, net -- (189,315)

Short-term loan proceeds 5,050,727 16,702,976

Repayments of short-term loan (87,839)(24,421,766)

Net cash provided by financing activities 5,232,873 38,197,178

Effect of exchange rate 73,460 2,178,624

Net (decrease)/increase in cash (4,919,255) 13,063,980

Cash and cash equivalents, beginning of year 18,568,842 5,504,862

Cash and cash equivalents, end of year 13,649,587 18,568,842

Supplemental disclosure of cash flow information:

Cash paid during the year for:

Interest 1,228,665 1,231,040

Taxes 343,508 --

For more information, please contact:

China Precision Steel

Dan Carlson,

Email: DanielCarlson@comcast.net

Elite IR

Leslie J. Richardson, Partner

Tel: +852-3183-0283

Email: Leslie.richardson@elite-ir.com

本文源自: AG环亚官网

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