Attached files
| file | filename |
|---|---|
| 8-K - China Advanced Construction Materials Group, Inc | v197855_8k.htm |
For
Immediate Release
China
ACM Reports Record Q4 and FY-2010 Results
-- FY-10
Non-GAAP Adjusted Net Income to
common shareholders up 36% or $0.95 Diluted
EPS–-
-- Q4-10
Non-GAAP Adjusted Diluted EPS to
common shareholders of $0.30 –-
--
Teleconference begins Wednesday at 8 a.m. EDT --
BEIJING, China – September 28, 2010 -
China Advanced Construction Materials Group, Inc. (NASDAQ GM: CADC)
(“China ACM,”), a leading provider of ready-mix concrete and related technical
services in China, today announced its audited financial results for the 2010
fiscal fourth quarter and year ended June 30, 2010. The Company will
host a conference call to discuss the results Wednesday, at 8:00 a.m. Eastern,
5:00 a.m. Pacific; details are provided below.
Fiscal Year 2010 Financial
Highlights
|
Ø
|
Revenue increased 134% year over
year to $93.0 million
|
|
Ø
|
Blended gross margin at 20.8%
|
|
Ø
|
Non-GAAP EBITDA rose 28.6% YOY to $22.2
million
|
|
Ø
|
Non-GAAP adjusted net income
available to common shareholders increased 36% YOY to $15.7
million
|
|
Ø
|
Non-GAAP adjusted fully
diluted
EPS to common
shareholders of $0.95, up $0.13 from a year
ago
|
|
Ø
|
Net income available to common
shareholders rose 11% YOY to $12.1
million
|
|
Ø
|
June 30, 2010 Order Backlog at
record $60 million; Pipeline at $33.1
million
|
|
Ø
|
$24.3 million in working capital at
June 30, 2010
|
Fourth Quarter FY 2010 Financial
Highlights
|
Ø
|
Revenue increased 114% year over year to $30.9 million
|
|
Ø
|
Gross margin at 21.5%
|
|
Ø
|
Non-GAAP adjusted net income
available to common shareholders at $5.4
million
|
|
Ø
|
Non-GAAP adjusted fully diluted
EPS to common
shareholders at
$0.30
|
|
Ø
|
Net income available to common
shareholders rose 32% YOY to $7.1
million
|
Year-ago comparisons reflect a fourth
quarter and fiscal year 2009 that benefitted from the supply/demand
imbalance created by
Beijing Olympics era
construction projects which
drove anomalous, higher market prices for concrete.
Management
Commentary
Mr. Xianfu Han, Chairman and Chief
Executive Officer of China ACM, commented, "Fiscal Year 2010 was an important year
of growth and profitability for China ACM as we achieved record revenue
and net income.
“We are successfully growing the company
by anticipating market
trends and customer requirements, building the chemical and
engineering services side
of the business and staying focused on strong bottom line results. We have also continued to build the
company from a financial and operational perspective.
1
“Key developments of fiscal 2010 include
appointing a new, cross-border CFO to lead the company into its next phase of growth. In the second half of the year
we raised $10.6 million in an equity offering which -- combined with
available cash flow -- will fully fund our growth plans. In addition, we reinforced our independent
board of
directors with a strategic
mix of accomplished, Chinese and American senior corporate
executives.
“The
outlook for our markets has never been better. The outlook for high speed rail
(HSR) in our Manufacturing Services is strong both near and long term, and our
Concrete Sales business mix is diversified and rapidly
growing. China’s near and long term growth outlook remains
strong and infrastructure spending on HSR, real estate, schools, government
buildings, utilities and other infrastructures projects in China ACM’s sweet
spot remains robust.”
Jeremy Goodwin, president and chief financial officer of
China ACM commented, “China
ACM posted record results due to strong growth across our business lines, but led by
our highest
margin, highest growth
segments Manufacturing Services and Technical
Services. We generated $22.2 million in 2010 EBITDA which provides the means
to internally fund the purchase or lease of a large number of portable plants
and fleet vehicles as we continue to ramp up the business, particularly in the
Manufacturing Services segment which is highly scalable.
“Over 80
percent of China ACM revenue comes from government funded or state owned
enterprise (SOE) sources, which are well funded over the long term. None of our
business is dependent, directly or indirectly, on any China export market. In
addition to HSR, our businesses today spans subways, highways, sewage lines,
airports, utilities, school, public and government buildings, residential,
commercial and industrial real estate construction and much more for
a well diversified mix.
“Earlier this month,” Mr. Goodwin added,
“we announced a record
$10.7 million HSR contract
package, which confirms that we can win and manage large-scale projects. We will be bidding more large, long-term projects in 2011. We also recently announced over $12
million in our Concrete Sales business segment, which is spread across approximately 70
different customers and 92 contracts. With this fiscal year report, we begin
reporting our full order backlog and new business pipeline for
both of our key segments,
all of which stand at record levels.”
China ACM reported full fiscal year 2010 non-GAAP adjusted net income available to
common shareholders
increased 36%, year over
year, to $15.7
million on $93.0 million in revenue. The
non-GAAP adjusted net income available to common shareholders is before non-cash change in fair value of warrants, option
and equity-based compensation as well as non-cash accretion discount (but
after cash dividends paid) on the Company’s 9% redeemable convertible preferred
stock issue which matured on June
11, 2010.
FY 2010 Manufacturing Services revenue increased by
122 percent to a record $15.7 million year over year with a
47.2 percent gross margin. Technical Services revenue increased
by 154 percent to $4.9 million with a
93.4 percent gross margin. Concrete Sales
revenue at our fixed plants
in Beijing increased by
151 percent to $70.6 million with a gross
margin of 8.4 percent or about double the
industry
average.
2
The Company’s fiscal year blended gross margin was
20.8 percent, declining from 38.3 percent a year ago as FY 2009 reflected the
completion of Beijing Olympics era construction projects contracted under
an anomalous supply/demand imbalance that
produced far higher concrete prices than normal, the last of which, the Beijing
South Railway Station, was completed in the fourth quarter of fiscal
2009.
Since that Olympics era, the concrete
industry has experienced
significant attrition and ongoing consolidation as the many of the smaller or
less experienced businesses that participated in Beijing Olympics era business
are marginalized – creating new opportunity for well
positioned
companies such as China
ACM. The
Company’s Concrete Sales gross margin increased every quarter, sequentially,
in FY 2010.
China ACM fourth quarter fiscal year 2010 reported non-GAAP adjusted net income available to
common shareholders
of $5.4 million on $30.9 million in
revenue. The
non-GAAP adjusted net income available to common shareholders is before non-cash change in fair value of warrants, option
and equity-based compensation as well as non-cash accretion discount (but
after cash dividends paid) on the Company’s 9% redeemable convertible preferred
stock issue which matured on June
11, 2010.
Fourth quarter fiscal year 2010
Manufacturing Services revenue increased by
193 percent to a record $5.1 million, year over year, with a
45.7 percent gross margin.
Technical Services revenue
increased by 303 percent to $1.8 million, year over year, with a
94.5 percent gross margin. Concrete Sales
revenue at our fixed plants
in Beijing
increased by 103 percent to $23.8 million, year over year, with a gross
margin of 10.35 percent or about double the industry
average.
In the fourth quarter, the Manufacturing Services segment increased to 16.6 percent and 35.2% percent of total company revenue and
gross profit, respectively.
This compares with 12.1
percent and 16.9 percent in the year-ago quarter.
Additionally, Technical Services increased to 5.9 percent and 25.9 percent of total company revenue, and gross profit, respectively. This compares with 3.1 percent and 9.1 percent a year ago.
The Company’s fourth quarter gross margin was 21.5 percent, which declined from 32.2 percent a year ago, as the
year-earlier quarter
reflected the completion
of the Beijing Olympics era construction
projects, and an extraordinary windfall
Bad Debt Recovery income credit of $800,000, for the full year’s accounts
receivable, which was recorded in SG&A.
Chairman and CEO Mr. Xianfu Han
concluded, “Increasingly,
we are migrating our business toward a specialty, chemical engineering services
model that offers healthy
gross margins, reflects our core skill set and engineering corporate culture as well as our R&D, intellectual
property and patented eco-friendly premium ready mix concrete (“RMC”).
3
"China ACM is well positioned for the
future. We nearly doubled our number of portable plants from nine to 16
to meet existing contracts and anticipated demand, and plan to add more portable
stations in 2011 and 2012 due to attractive margins and a high return on
investment. We finished the year
with a diversified
record backlog and new
business pipeline, an
excellent competitive position founded on deep marketplace relationships,
enormous addressable markets and high standards of corporate
governance.”
Backlog
China ACM reported that, on June 30, its
fiscal year-end backlog, or
bids in house, was $60 million, 82% of which is contracted with
Government State Owned Enterprise contractors and 12% contracted with private
sector developers. This is
comprised of $32 million in contracted unfilled orders
for its Concrete Sales segment, and $28 million in contracted unfilled order
for its Manufacturing Services segment. Based on its historical experience, the
Company’s estimated time to convert these
contracted orders into recognized revenues averages between six and twelve months for Concrete Services, and
12 to 30 months for Manufacturing Services
depending on the scope of the project.
The Company’s new business pipeline, or bids
outstanding, which is a measure of the value of bids it has submitted for either
Concrete Sales and
Manufacturing Services business, was $18.33 million and $14.75 million, respectively, or
$33.1 million total.
Both the backlog and new business
pipeline are at Company record levels.
Market
Opportunity
Urbanization and modernization are the
two primary drivers of China ACM’s robust long-term growth opportunity.
Recent developments support
the outlook for accelerated
growth across the full range of China ACM’s infrastructure markets.
For
example, it was recently reported that at the 2010 China International Rail
Transit and Urban Development Forum, the government said it wants to add 4,613
kilometers of high speed railways, at a cost of $1 billion, to the 10,000 km
lines already under construction. China is also planning a new 10,000 km
railway.
The HSR
sector is estimated to require at least $15 billion in RMC
contracts.
Separately,
Bloomberg reported China will spend more than $146 billion to triple the size of
its subway system over the next five years, to more than 3,000 kilometers by
2015.
And
according to a report published by the Freedonia Group in May 2010, construction
expenditures in China are expected to rise 9.1 percent per annum in real terms
and reach $1.7 trillion by 2014.
4
Use
of Non-GAAP Financial Measures
|
Year
Ended June 30,
|
||||||||||||
|
2010
|
2009
|
Increase
(Decrease)
|
||||||||||
|
Net
Income -GAAP
|
$
|
13,006,395
|
$
|
12,068,489
|
$
|
937,906
|
||||||
|
Subtract:
|
||||||||||||
|
Dividends
and accretion on redeemable convertible preferred stock
|
$
|
(955,557
|
)
|
$
|
(1,229,473
|
)
|
$
|
(273,916
|
)
|
|||
|
Net
Income available to Common shareholders -GAAP
|
$
|
12,050,838
|
$
|
10,839,016
|
$
|
1,211,822
|
||||||
|
Add
Back:
|
||||||||||||
|
Change
in fair value of warrants
|
$
|
2,488,959
|
$
|
-
|
$
|
2,488,959
|
||||||
|
Add
Back:
|
||||||||||||
|
Change
in Option and Equity Based Compensation
|
$
|
595,888
|
$
|
107,477
|
$
|
488,411
|
||||||
|
Add
Back:
|
||||||||||||
|
Accretion
of Discount on Redeemable Preferred Stock
|
$
|
567,580
|
$
|
600,968
|
$
|
(33,388
|
)
|
|||||
|
Adjusted
Net Income available to Common shareholders -non-GAAP
|
$
|
15,703,265
|
$
|
11,547,461
|
$
|
4,155,804
|
||||||
|
Basic
earnings per share - GAAP
|
$
|
0.90
|
$
|
1.03
|
$
|
(0.13
|
||||||
|
Add
back:
|
||||||||||||
|
Change
in fair value of warrant
|
$
|
0.18
|
$
|
-
|
$
|
0.18
|
||||||
|
Add
back:
|
||||||||||||
|
Change
in Option and Equity-Based Compensation
|
$
|
0.04
|
$
|
0.01
|
$
|
0.03
|
||||||
|
Add
back:
|
||||||||||||
|
Accretion
of Discount on Redeemable Preferred Stock
|
$
|
0.04
|
$
|
0.06
|
$
|
(0.02
|
||||||
|
Adjusted
basic earnings per share -Non-GAAP
|
$
|
1.16
|
$
|
1.10
|
$
|
0.06
|
||||||
|
Diluted
earnings per share-GAAP
|
$
|
0.79
|
$
|
0.86
|
$
|
(0.07
|
||||||
|
Add
back:
|
||||||||||||
|
Change
in fair value of warrant
|
$
|
0.15
|
(a) |
$
|
-
|
$
|
0.15
|
|||||
|
Add
back:
|
||||||||||||
|
Change
in Option and Equity-Based Compensation
|
$
|
0.04
|
(b) |
$
|
0.01
|
$
|
0.03
|
|||||
|
Adjusted
diluted earnings per share -Non-GAAP
|
$
|
0.98
|
$
|
0.87
|
$
|
0.11
|
||||||
|
Subtract:
|
||||||||||||
|
Cash
Dividends Paid on Redeemable Preferred Stock
|
$
|
0.03
|
(c) |
$
|
0.05
|
$
|
(0.02
|
|||||
|
Adjusted
diluted earnings per share available to common - Non-GAAP
|
$
|
.95
|
$
|
0.82
|
$
|
0.13
|
||||||
|
Weighted
average number of shares
|
||||||||||||
|
Basic
|
13,456,134
|
10,526,719
|
||||||||||
|
Diluted
|
16,521,296
|
14,032,479
|
||||||||||
5
FY 2010 Results
Summary
Revenue.
We generated Fiscal Year 2010 revenue of $93,040,847 compared to $39,714,802
during the same period of 2009, an increase of $53,326,045 or 134%. We increased
our production volumes in and outside of Beijing this fiscal year compared to
our last fiscal year.
As a
result, our concrete sales revenue was $70,579,631 for the year ended June 30,
2010, an increase of $42,461,139 or 151%, despite a decrease in unit sale price,
compared to the year ended June 30, 2009. The increase in revenues attributable
to concrete sales was principally due to addition of two new fixed
plants.
During
the year ended June 30, 2010, we continued to supply concrete products to
thirteen railway projects throughout China through our portable plants,
specifically the projects located in Shaanxi Province, Jiangsu Province, Hebei
Province, Guangxi Province, Zhejiang Province, Guangdong Province, Liaoning
Province, and Beijing. These thirteen projects contributed $15,654,659 to our
total revenue for the year ended June 30, 2010, an increase of $8,600,931 or
122%, compared to the year ended June 30, 2009. The increase in
revenues attributable to our manufacturing services was principally due to
addition of seven new portable plants to service a growing business pipeline.
For these railway projects, the general contractors generally supplied their own
raw materials while we provided manufacturing and transportation
services.
In
addition, revenue generated through our technical consulting services was
$4,889,460 during the year ended June 30, 2010, an increase of $2,965,371 or
154% compared to the same fiscal quarter in 2009. During the year ended June 30,
2010, we also rented our mixer trucks to mixture stations which generated mixer
rental revenues of $1,208,618, a decrease of $1,409,875 or 54%, as we
experienced greater overall fleet capacity utilization as the business expands
and we also generated marketing cooperation revenue of $422,356.
Gross
Profit. Gross profit was $19,336,146 for the fiscal year ended June 30,
2010, as compared to $15,196,760 for the year ended June 30, 2009. Our gross
profit for sale of concrete was $5,955,497, or 8.4% of revenue, for the year
ended June 30, 2010, compared to $7,461,180, or 27% of revenue, for the same
period last year, a decrease of $1,505,683. The lower gross margin for concrete
sales for the year ended June 30, 2010, compared with the same period in
2009, reflects exceptionally high demand, and much higher industry prices, for
capacity constrained premium concrete blends within unusually tight and
convergent project timelines for many large Beijing Olympic era projects
completed in the first half of calendar 2009 with the last installment of
Olympic-era projects, namely the Beijing South Railway Station which was
completed by the 4th fiscal
quarter of 2009.
6
Selling, General
and Administrative Expenses. Selling, general and administrative expenses
consist of sales commissions, advertising and marketing costs, office rent and
expenses, costs associated with staff and support personnel who manage our
business activities, and professional and legal fees paid to third parties. We
incurred selling, general and administrative expenses of $5,439,579 for the year
ended June 30, 2010, an increase of $3,721,785, or 216%, as compared to
$1,717,794 for the year ended June 30, 2009. The increase was principally due to
an increase in employment, salary and benefit and lease expenses resulting from
higher production and a larger base of operations during the year and
professional and consulting expenses from being a public company and resulting
from our overall production expansion during the year.
Net Income
available to Common shareholders. Excluding the effect from
non-cash charges related to changes in fair market of warrants, accretion of
discount on redeemable preferred stock and stock and option-based compensation,
our net income available to Common shareholders would be $15,703,265 for the
year ended June 30, 2010, an increase of $4,155,804 or 36%,as compared to net
income after cash dividends paid of $11,547,461 for the same period in
2009. See the section “Use of Non-GAAP Financial Measures” above for
a discussion regarding the presentation of net income excluding non-cash gain
(loss).
Balance
Sheet Overview
China ACM had working capital of $24.3
million at the June 30, 2010 fiscal year. Shareholders' equity was $61.2 million compared with $30.0 million on
June 30, 2009. The total number of shares outstanding as of September 24 is
17,572,104.
Conference Call
The
company will host a corresponding conference call with a live webcast and a full
Q&A session on Wednesday, September 29 at 8:00 a.m. Eastern time/5:00 a.m.
Pacific time, to discuss these results and answer questions.
Individuals interested in participating in the conference call
may do so by dialing 877-477-1461 from the United States, or
973-409-9694 from
outside the United States
and referencing conference ID #14145706. Those interested in listening to the conference call live
via the Internet may do so by visiting the Investor Relations section of the
Company's Web site at www.china-acm.com. Please visit the website at
least 15 minutes early to register for the web cast and download any necessary
audio software.
A telephone replay will be available
through October 13, 2010,
by dialing 800-642-1687 from the United States, or 706-645-9291 from outside the
United States, and entering conference ID 14145706. A webcast replay will be available for
90 days.
7
About
China ACM
China ACM
is a leading producer of advanced, certified eco-friendly ready-mix concrete
(RMC) and related technical services for large scale, high-speed rail (HSR) and
other complex infrastructure projects. Leveraging its proprietary
technology and value-add engineering services model, the Company has won work on
numerous high profile projects including the 30,000 km China HSR expansion, the
Olympic Stadium Birds’ Nest, Beijing South Railway Station, Beijing
International Airport, National Centre for Performing Arts, CCTV Headquarters,
Beijing Yintai Building and U.S. and French embassies.
Founded
in 2002, Beijing-based China ACM provides its materials and services through its
network of five ready-mix concrete plants covering the Beijing metropolitan
area. Of those five plants, it owns one and leases four. It also has technical
services and preferred procurement agreements with five other
independently-owned plants across China. Additionally, the Company
presently owns 16 portable plants deployed in 10 provinces across China.
Currently, its total RMC production designed capacity is in excess of 11 million
cubic meters annually. Additional information about the Company is available at
www.china-acm.com.
Contact
Financial
Profiles
Tricia
Ross
(916)
939-7285
tross@finprofiles.com
Financial
Profiles
Moira
Conlon
Tel:
(310) 478-2700 x11
mconlon@finprofiles.com
Use of Non-GAAP Financial
Measures
The Company makes reference to non-GAAP
financial measures. Management believes that investors may find it useful to
review our financial results that exclude the non-cash expenses of change in
fair value of warrants and management owned options as a result of the adoption
of a Financial Accounting Standards Board's ("FASB") ASC 815 (EITF 07-05)
accounting standard effective from January 1, 2010.
Management believes that these non-GAAP
financial measures are useful to investors in that they provide supplemental
information to possibly better understand the underlying business trends and
operating performance of the Company. The Company uses these non-GAAP financial
measures to evaluate operating performance. However, non-GAAP financial measures
should not be considered as an alternative to net income or any other
performance measures derived in accordance with GAAP.
8
Forward Looking
Statements
This press release contains statements
that are forward-looking in nature, including statements regarding the Company's
competitive position and product and service offerings. These statements are
based on current expectations on the date of this press release and involve a
number of risks and uncertainties, which may cause actual results to differ
significantly from such estimates. The risks include, but are not limited to,
the degree of market adoption of the Company's product and service offerings;
market competition; dependence on strategic partners; and the Company's ability
to manage its business effectively in a rapidly evolving market. Certain of
these and other risks are set forth in more detail in "Item 1A. Risk Factors" in
China ACM’s Annual Report on Form 10-K for the fiscal year ended June 30, 2010. China ACM does not assume any obligation to update
or revise any such forward-looking statements, whether as the result of new
developments or otherwise.
- Tables to Follow –
9
CONSOLIDATED
BALANCE SHEETS
AS OF
JUNE 30, 2010 AND 2009
|
2010
|
2009
|
|||||||
|
ASSETS
|
||||||||
|
CURRENT
ASSETS:
|
||||||||
|
Cash
|
$ | 3,300,820 | $ | 3,634,805 | ||||
|
Restricted
cash
|
57,580 | 453,192 | ||||||
|
Marketable
securities
|
- | 71,880 | ||||||
|
Notes
receivable
|
- | 10,799 | ||||||
|
Accounts
receivable, net of allowance for doubtful accounts of $456,085 and
$120,986, respectively
|
36,072,691 | 11,815,402 | ||||||
|
Inventories
|
2,164,769 | 1,216,014 | ||||||
|
Other
receivables
|
1,416,653 | 3,845,186 | ||||||
|
Prepayments
|
2,821,687 | 4,255,326 | ||||||
|
Total
current assets
|
45,834,200 | 25,302,604 | ||||||
|
PLANT
AND EQUIPMENT, net
|
26,488,354 | 22,089,717 | ||||||
|
OTHER
ASSETS:
|
||||||||
|
Accounts
receivable (non-current), net of allowance for doubtful accounts of $4,607
and $328,563 respectively
|
364,371 | 4,132,706 | ||||||
|
Deferred
tax assets
|
127,741 | - | ||||||
|
Advances
on equipment purchases
|
8,382,383 | - | ||||||
|
Long
term prepayments
|
4,414,391 | 4,794,746 | ||||||
|
Total
other assets
|
13,288,886 | 8,927,452 | ||||||
|
Total
assets
|
$ | 85,611,440 | $ | 56,319,773 | ||||
|
LIABILITIES
AND SHAREHOLDERS' EQUITY
|
||||||||
|
CURRENT
LIABILITIES:
|
||||||||
|
Short
term loans
|
$ | - | $ | 4,512,200 | ||||
|
Accounts
payable
|
16,473,080 | 10,722,741 | ||||||
|
Customer
deposits
|
711,219 | - | ||||||
|
Other
payables
|
329,136 | 352,880 | ||||||
|
Other
payables - shareholders
|
772,644 | 806,946 | ||||||
|
Accrued
liabilities
|
1,652,751 | 593,057 | ||||||
|
Taxes
payable
|
1,569,914 | 3,048,179 | ||||||
|
Total
current liabilities
|
21,508,744 | 20,036,003 | ||||||
|
OTHER
LIABILITIES
|
||||||||
|
Warrants
liabilities
|
2,920,520 | - | ||||||
|
Total
liabilities
|
24,429,264 | 20,036,003 | ||||||
|
COMMITMENTS
AND CONTINGENCIES (Note 19)
|
||||||||
|
REDEEMABLE
CONVERTIBLE PREFERRED STOCK ($0.001 par value, no share outstanding as of
June 30, 2010 and 851,125 shares issued and outstanding as of June 30,
2009), net of discount for the amount of $0 and $567,581 as of June 30,
2010 and 2009, respectively
|
- | 6,241,419 | ||||||
|
SHAREHOLDERS'
EQUITY:
|
||||||||
|
Preferred
stock $0.001 par value, 1,000,000 shares authorized, no
share
|
||||||||
|
outstanding
as of June 30, 2010 and 851,125 issued and outstanding
|
||||||||
|
as
of June 30, 2009, and classified outside shareholders' equity (see
above),
|
||||||||
|
liquidation
preference of $8.00 per share and accrued dividends as of
|
||||||||
|
June
30, 2010 and 2009
|
- | - | ||||||
|
Common
stock, $0.001 par value, 74,000,000 shares authorized, 17,467,104 and
10,595,500 shares issued and outstanding as of June 30, 2010 and 2009,
respectively
|
17,467 | 10,596 | ||||||
|
Paid-in-capital
|
33,720,762 | 12,987,417 | ||||||
|
Contribution
receivable
|
- | (1,210,000 | ) | |||||
|
Retained
earnings
|
19,912,444 | 12,783,892 | ||||||
|
Statutory
reserves
|
4,511,520 | 2,765,179 | ||||||
|
Accumulated
other comprehensive income
|
3,019,983 | 2,705,267 | ||||||
|
Total
shareholders' equity
|
61,182,176 | 30,042,351 | ||||||
|
Total
liabilities, redeemable preferred stock and shareholders'
equity
|
$ | 85,611,440 | $ | 56,319,773 | ||||
10
CONSOLIDATED
STATEMENTS OF INCOME AND OTHER COMPREHENSIVE INCOME
FOR THE
YEARS ENDED JUNE 30, 2010 AND 2009
|
2010
|
2009
|
|||||||
|
REVENUE
|
||||||||
|
Sales
of concrete
|
$ | 70,579,631 | $ | 28,118,492 | ||||
|
Manufacturing
services
|
15,654,659 | 7,053,728 | ||||||
|
Technical
services
|
4,889,460 | 1,924,089 | ||||||
|
Mixer
rental
|
1,208,618 | 2,618,493 | ||||||
|
Others
|
708,479 | - | ||||||
|
Total
revenue
|
93,040,847 | 39,714,802 | ||||||
|
COST
OF REVENUE
|
||||||||
|
Concrete
|
64,624,134 | 20,657,312 | ||||||
|
Manufacturing
services
|
8,261,407 | 2,768,255 | ||||||
|
Technical
services
|
320,835 | 147,418 | ||||||
|
Mixer
rental
|
151,456 | 945,057 | ||||||
|
Others
|
346,869 | - | ||||||
|
Total
cost of revenue
|
73,704,701 | 24,518,042 | ||||||
|
GROSS
PROFIT
|
19,336,146 | 15,196,760 | ||||||
|
SELLING,
GENERAL AND ADMINISTRATIVE EXPENSES
|
5,439,579 | 1,717,794 | ||||||
|
INCOME
FROM OPERATIONS
|
13,896,567 | 13,478,966 | ||||||
|
OTHER
(EXPENSE) INCOME, NET
|
||||||||
|
Other
subsidy income
|
4,881,152 | 2,109,290 | ||||||
|
Realized
gain from sales of marketable securities
|
27,079 | - | ||||||
|
Non-operating
(expense) income, net
|
(120,060 | ) | (602,020 | ) | ||||
|
Change
in fair value of warrant liability
|
(2,488,959 | ) | - | |||||
|
Interest
income
|
9,001 | - | ||||||
|
Interest
expense
|
(23,834 | ) | (802,650 | ) | ||||
|
TOTAL
OTHER INCOME, NET
|
2,284,379 | 704,620 | ||||||
|
INCOME
BEFORE PROVISION FOR INCOME TAXES
|
16,180,946 | 14,183,586 | ||||||
|
PROVISION
FOR INCOME TAXES
|
3,174,551 | 2,115,097 | ||||||
|
NET
INCOME
|
13,006,395 | 12,068,489 | ||||||
|
DIVIDENDS
AND ACCRETION ON REDEEMABLE CONVERTIBLE PREFERRED STOCK
|
(955,557 | ) | (1,229,473 | ) | ||||
|
NET
INCOME AVAILABLE TO COMMON SHAREHOLDERS
|
12,050,838 | 10,839,016 | ||||||
|
RECONCILIATION
OF COMPREHENSIVE INCOME:
|
||||||||
|
Net
Income
|
13,006,395 | 12,068,489 | ||||||
|
Unrealized
loss from marketable securities
|
- | 20,605 | ||||||
|
Foreign
currency translation adjustment
|
335,321 | 86,196 | ||||||
|
COMPREHENSIVE
INCOME
|
$ | 13,341,716 | $ | 12,175,290 | ||||
|
EARNINGS
PER COMMON SHARE ALLOCATED TO COMMON SHAREHOLDERS
|
||||||||
|
Weighted
average number of shares:
|
||||||||
|
Basic
|
13,456,134 | 10,526,719 | ||||||
|
Diluted
|
16,521,296 | 14,032,479 | ||||||
|
Earnings
per share:
|
||||||||
|
Basic
|
$ | 0.90 | $ | 1.03 | ||||
|
Diluted
|
$ | 0.79 | $ | 0.86 | ||||
11
CHINA ADVANCED CONSTRUCTION MATERIALS GROUP,
INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME AND
OTHER COMPREHENSIVE (LOSS) INCOME
FOR THE QUARTER ENDED JUNE 30,
2010
|
3 months
|
||||
|
June 30,
2010
|
||||
|
REVENUE
|
||||
|
Sales of
concrete
|
$ | 23,820,255 | ||
|
Manufacturing
services
|
5,125,647 | |||
|
Technical
services
|
1,822,298 | |||
|
Mixer
rental
|
50,242 | |||
|
Others
|
126,191 | |||
|
Total
revenue
|
30,944,633 | |||
|
COST OF
REVENUE
|
||||
|
Concrete
|
21,354,431 | |||
|
Manufacturing
services
|
2,783,306 | |||
|
Technical
services
|
100,716 | |||
|
Mixer
rental
|
15,475 | |||
|
Others
|
38,713 | |||
|
Total cost of
revenue
|
24,292,641 | |||
|
GROSS
PROFIT
|
6,651,992 | |||
|
SELLING, GENERAL AND
ADMINISTRATIVE EXPENSES
|
1,848,409 | |||
|
INCOME FROM
OPERATIONS
|
4,803,583 | |||
|
OTHER (EXPENSE) INCOME,
NET
|
||||
|
Other subsidy
income
|
1,735,974 | |||
|
Realized gain
from sales of marketable securities
|
71 | |||
|
Non-operating
(expense) income, net
|
(29,173 | ) | ||
|
Change in fair
value of warrant liability
|
1,900,988 | |||
|
Interest
income
|
2,995 | |||
|
Interest
expense
|
(69 | ) | ||
|
TOTAL OTHER INCOME,
NET
|
3,610,786 | |||
|
INCOME BEFORE PROVISION FOR INCOME
TAXES
|
8,414,369 | |||
|
PROVISION FOR INCOME
TAXES
|
1,221,918 | |||
|
NET INCOME
|
7,192,451 | |||
|
DIVIDENDS AND ACCRETION ON
REDEEMABLE CONVERTIBLE PREFERRED STOCK
|
(86,323 | ) | ||
|
NET INCOME AVAILABLE TO COMMON
SHAREHOLDERS
|
7,106,128 | |||
12
CHINA ADVANCED CONSTRUCTION MATERIALS GROUP,
INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME AND
OTHER COMPREHENSIVE (LOSS) INCOME
FOR THE QUARTER ENDED JUNE 30,
2009
|
3 Months
|
||||
|
June 30,
2009
|
||||
|
REVENUE
|
||||
|
Sales of
concrete
|
$ | 11,736,443 | ||
|
Manufacturing
services
|
1,752,574 | |||
|
Technical
services
|
452,506 | |||
|
Mixer
rental
|
531,806 | |||
|
Total
revenue
|
14,473,329 | |||
|
COST OF
SALES
|
||||
|
Concrete
|
8,510,245 | |||
|
Manufacturing
services
|
964,899 | |||
|
Technical
services
|
27,676 | |||
|
Mixer
rental
|
303,852 | |||
|
Total cost of
revenue
|
9,806,672 | |||
|
GROSS
PROFIT
|
4,666,657 | |||
|
SELLING, GENERAL AND
ADMINISTRATIVE EXPENSES
|
(361,463 | ) | ||
|
INCOME FROM
OPERATIONS
|
5,028,120 | |||
|
OTHER INCOME (EXPENSE),
NET
|
||||
|
Other subsidy
income
|
808,298 | |||
|
Non-operating
expense, net
|
(400,489 | ) | ||
|
Interest expense,
net
|
(166,883 | ) | ||
|
TOTAL OTHER INCOME,
NET
|
240,926 | |||
|
INCOME BEFORE PROVISION FOR INCOME
TAXES
|
5,269,046 | |||
|
PROVISION FOR INCOME
TAXES
|
(401,610 | ) | ||
|
NET INCOME
|
5,670,656 | |||
|
DIVIDENDS
AND ACCRETION ON REDEEMABLE CONVERTIBLE PREFERRED
STO
|
305,898 | |||
|
NET INCOME AVAILABLE TO COMMON
SHAREHOLDERS
|
5,364,758 | |||
|
RECONCILIATION OF COMPREHENSIVE
INCOME:
|
||||
|
Net
Income
|
5,670,656 | |||
|
Unrealized gain
(loss) from marketable securities
|
23,921 | |||
|
Foreign currency
translation adjustment
|
(12,643 | ) | ||
|
COMPREHENSIVE
INCOME
|
$ | 5,681,934 | ||
13
CHINA
ADVANCED CONSTRUCTION MATERIALS GROUP, INC. AND SUBSIDIARIES
CONSOLIDATED
STATEMENTS OF CASH FLOWS
FOR THE
YEARS ENDED JUNE 30, 2010 AND 2009
|
2010
|
2009
|
|||||||
|
CASH
FLOWS FROM OPERATING ACTIVITIES:
|
||||||||
|
Net
income
|
$ | 13,006,395 | 12,068,489 | |||||
|
Adjustments
to reconcile net income to cash provided by (used in) operating
activities:
|
||||||||
|
Depreciation
|
2,924,616 | 2,184,462 | ||||||
|
Stock-based
compensation expense
|
595,888 | 107,477 | ||||||
|
Bad
debt expense
|
8,651 | (189,052 | ) | |||||
|
Change
in fair value of warrants
|
2,488,959 | - | ||||||
|
Realized
gain on sale of marketable securities
|
(27,079 | ) | - | |||||
|
Changes
in operating assets and liabilities
|
||||||||
|
Note
receivable
|
10,811 | - | ||||||
|
Accounts
receivable
|
(28,605,681 | ) | (13,681,007 | ) | ||||
|
Inventories
|
(938,086 | ) | (977,200 | ) | ||||
|
Other
receivables
|
2,439,020 | (3,347,936 | ) | |||||
|
Prepayments
|
1,450,571 | 419,258 | ||||||
|
Deferred
tax assets
|
(127,194 | ) | - | |||||
|
Long
term prepayments
|
370,275 | 179,463 | ||||||
|
Accounts
payable
|
5,633,766 | 4,403,314 | ||||||
|
Customer
deposits
|
708,177 | (166,114 | ) | |||||
|
Other
payables
|
148,264 | 97,849 | ||||||
|
Accrued
liabilities
|
1,208,647 | 291,597 | ||||||
|
Taxes
payable
|
(1,488,516 | ) | 1,970,528 | |||||
|
Net
cash (used in) provided by operating activities
|
(192,516 | ) | 3,361,128 | |||||
|
CASH
FLOWS FROM INVESTING ACTIVITIES:
|
||||||||
|
Proceeds
from sale of marketable securities
|
78,413 | - | ||||||
|
Advanced
for equipment purchase
|
(4,495,436 | ) | - | |||||
|
Purchase
of property, plant and equipment
|
(2,682,293 | ) | (1,771,915 | ) | ||||
|
Net
cash used in investing activities
|
(7,099,316 | ) | (1,771,915 | ) | ||||
|
CASH
FLOWS FROM FINANCING ACTIVITIES:
|
||||||||
|
Proceeds
from short term loan
|
190,670 | 8,247,950 | ||||||
|
Payments
of short term loan
|
(4,699,119 | ) | (8,024,538 | ) | ||||
|
Payment
to shareholder for rent
|
(207,906 | ) | (73,889 | ) | ||||
|
Restricted
cash
|
395,612 | 459,900 | ||||||
|
Payment
to redeem preferred stock
|
(75,000 | ) | - | |||||
|
Proceeds
from issuance of options
|
187,500 | - | ||||||
|
Proceeds
from issuance of warrants
|
571,351 | - | ||||||
|
Proceeds
from issuance of common stock, net of offering costs
|
11,117,094 | - | ||||||
|
Preferred
dividends paid
|
(543,631 | ) | (472,851 | ) | ||||
|
Net
cash provided by financing activities
|
6,936,571 | 136,572 | ||||||
|
EFFECTS
OF EXCHANGE RATE CHANGE IN CASH
|
21,276 | (1,475 | ) | |||||
|
NET
(DECREASE) INCREASE IN CASH
|
(333,985 | ) | 1,724,310 | |||||
|
CASH,
beginning of year
|
3,634,805 | 1,910,495 | ||||||
|
CASH,
end of year
|
$ | 3,300,820 | 3,634,805 | |||||
|
SUPPLEMENTAL
DISCLOSURE OF NON-CASH TRANSACTIONS
|
||||||||
|
Advances
on equipment purchase offset by Accounts Payable
|
$ | (628,946 | ) | $ | - | |||
|
Advances
on equipment purchase paid by transferring of Accounts
Receivable
|
$ | (4,113,869 | ) | $ | - | |||
|
Fixed
assets additions paid by transferring of Accounts
Receivable
|
$ | (4,168,188 | ) | $ | (5,703,245 | ) | ||
|
Accretion
of discount on redeemable preferred stock
|
$ | 567,580 | $ | 600,968 | ||||
###
14