China Power Equipment, Inc. Reports Record Revenue and Net Income
Posted on: Tuesday, 18 August 2009, 08:30 CDT
NEW YORK, Aug. 18 /PRNewswire-Asia-FirstCall/ -- China Power Equipment,
Inc. ("China Power") (OTC Bulletin Board: CPQQ) today reported its operating
results for the second quarter of 2009.
Net revenues for the six months were $8,590,671, an 88% increase over the
first six months of 2008. Net income for the period nearly doubled to
$1,634,383, or $0.11 per share, as compared to $822,141, or $0.06 per share
for the first six months of 2008. These improvements were largely due to the
Company's strong performance in the second quarter. Revenue for the period
was $5,888,375, more than double the $2,236,584 earned in the second quarter
of 2008. Net income for the second quarter of 2009 was $1.3 million, or $0.09
per share, as compared to $310,746, or $0.02 per share, for the same period in
2008.
The increases to net income as a percent of sales reflect a decrease in
the selling, general and administrative expenses, which were 4% of revenues in
the second quarter of 2009 as compared to 8% of revenues for the same period
in 2008.
Yong Xing Song, Chairman of the Board of the Company, stated, "We are
quite pleased with the Company's performance during the second quarter. The
improved results reflect the investment we have made in our product line and
sales effort. We expect these trends will continue as China's economy
continues to expand, and with it, the demand for efficient, clean transfer of
energy. We look forward to building on the strong foundation we have built
with many of the regional utilities and government agencies as they continue
to increase and improve China's power grid."
China Power Equipment, Inc.
Consolidated Balance Sheets
June 30, December 31,
2009 2008
(Unaudited)
Assets
Current Assets
Cash $1,525,418 $1,071,038
Accounts receivable, net 2,422,684 2,013,305
Advance to suppliers 475,200 771,407
Inventory, net 1,098,316 461,634
Prepaid expenses and other receivables 320,256 257,700
Total Current Assets 5,841,874 4,575,084
Related party receivables 23,781 97,248
Property, plant and equipment, net 3,693,776 3,116,422
Intangible assets, net 423,388 220,742
Long-term investment 244,245 236,384
Deposit on contract rights 1,314,867 1,313,064
Prepaid capital lease 114,106 116,694
Total Assets $11,656,037 $9,675,638
Liabilities and Stockholders' Equity
Current Liabilities
Accounts payable $943,584 $710,480
Accrued liabilities and other payables 499,359 409,040
Advance from customers 33,242 142,156
Lease payable - current portion 1,947 1,944
Note payable 58,439 58,358
Value-added tax payable 72,609 64,686
Income taxes payable 348,550 235,262
Related party payable 1,169 1,167
Total Current Liabilities 1,958,899 1,623,093
Long-term Liabilities
Lease payable - non current portion 117,489 117,327
Total Long-term Liabilities 117,489 117,327
Stockholders' Equity
Preferred stock: par value $0.001 per
share, 10,000,000 shares authorized;
None issued and outstanding at March
31, 2009 and December 31, 2008 -- --
Common stock: par value $0.001 per
share, 100,000,000 shares authorized;
14,908,313 shares issued and
outstanding at June 30, 2009 and
December 31, 2008 14,908 14,908
Additional paid in capital 7,176,041 7,176,041
Statutory surplus reserve fund 202,665 202,665
Retained earnings/(Accumulated deficit) 1,171,412 -462,971
Accumulated other comprehensive income 1,014,623 1,004,575
Total stockholders' equity 9,579,649 7,935,218
Total Liabilities and Stockholders'
Equity $11,656,037 $9,675,638
China Power Equipment, Inc.
Consolidated Statements of Operations
(Unaudited)
Three Months Ended, Six Months Ended,
June 30, June 30,
2009 2008 2009 2008
Revenue, net $5,888,375 $2,236,584 $8,590,671 $4,566,249
Cost of goods sold -4,510,872 -1,727,023 -6,663,451 -3,312,075
Gross profit 1,377,503 509,561 1,927,220 1,254,174
Selling, general and
administrative expenses 224,650 176,589 425,217 335,793
Net income (loss) from
operations 1,152,853 332,972 1,502,003 918,381
Other income (expenses)
Gain on investment 21,409 40,045 51,373 62,253
Other income 350,881 -- 350,881 13,936
Interest income 1,441 235 5,815 2,467
Interest expense -- -56,214 -117 -79,516
Foreign exchange loss -- -- -- -2,712
Total other income 373,731 -15,934 407,952 -3,572
Net income before income
taxes 1,526,584 317,038 1,909,955 914,809
Income taxes 220,222 6,292 275,572 92,668
Net income after income
taxes $1,306,362 $310,746 $1,634,383 $822,141
Earnings per share - basic $0.09 $0.03 $0.11 $0.08
Earnings per share - diluted $0.09 $0.02 $0.11 $0.06
Weighted average common
shares outstanding:
Basic 14,908,313 10,886,413 14,908,313 10,879,246
Diluted 14,908,313 14,908,313 14,908,313 14,901,146
ABOUT CHINA POWER EQUIPMENT, INC.
China Power Equipment, Inc., through its wholly-owned subsidiary, Xi'an
Amorphous Zhongxi Co., Ltd., has developed a proprietary, patented technology
to produce a new generation of energy saving transformers and transformer
cores. The Company currently manufactures 55 different models of transformers
in four product series which are sold throughout China. The Company was formed
in 2006 as a U.S. corporation, and in November 2006, formed a Chinese
subsidiary which was granted a license as a privately held, Wholly-Owned
Foreign Enterprise, or "WOFE", by the Chinese government.
Safe Harbor
Certain statements in this release concerning our future growth prospects
are forward-looking statements, which involve a number of risks and
uncertainties that could cause actual results to differ materially from those
in such forward-looking statements. The risks and uncertainties relating to
these statements include, but are not limited to, risks and uncertainties
regarding the success of our investments, risks and uncertainties regarding
fluctuations in earnings, our ability to sustain our previous levels of
profitability including on account of our ability to manage growth, intense
competition, wage increases in China, our ability to attract and retain highly
skilled professionals, time and cost overruns on fixed-price, fixed-time frame
contracts, client concentration, our ability to successfully complete and
integrate potential acquisitions, withdrawal of governmental fiscal incentives,
political instability and regional conflicts and legal restrictions on raising
capital or acquiring companies outside China. Additional risks that could
affect our future operating results are more fully described in our United
States Securities and Exchange Commission filings, including our Prospectus
dated November 7, 2008, and 10-K filed on March 31, 2009 and our other recent
filings. These filings are available at www.sec.gov. We may, from time to time,
make additional written and oral forward-looking statements, including
statements contained in our filings with the Securities and Exchange
Commission and our reports to shareholders. We do not undertake to update any
forward-looking statements that may be made from time to time by or on our
behalf.
For More Information on China Power Equipment, Inc., visit the website at:
http://www.chinapower-equipment.com
For more information, please contact:
Tel: +1-866-374-1957 (US)
Email: xa-fj@xa-fj.com
SOURCE China Power Equipment, Inc.
Source: PR Newswire
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