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China Fire Reports Record Second Quarter 2007 Results

发布时间:2018-10-17 10:33 作者:AG88 来源:admin 点击: 字号:

BEIJING, Aug. 14 /Xinhua-PRNewswire-FirstCall/ -- China Fire & Security Group, Inc. (Nasdaq: CFSG), a leading industrial fire protection products and solutions provider in China announced its financial results for the quarter ended June 30, 2007. The Company will host a conference call to discuss these results after the market closes.

Q2 Highlights

-- Revenues increase 37.9 % compared to Q2 last year to a record $11.5

million

-- Company reports proforma net income of $3.9 million and EPS of $0.14

-- In June, Company signs total solutions contract with Anshan Iron &

Steel for $7.6 million

-- Approved to list on Nasdaq Capital Market

Revenue increased for the second consecutive quarter to a record $11.5 million, up 37.9 percent from $8.4 million for the second quarter 2006. This increase was a result of further penetration of the Company’s customer base across various industries and improved sales execution. Total solutions accounted for 85.6 percent of revenue with product sales representing 13.3 percent and maintenance services comprising the balance of revenue. Gross profit for the quarter increased 31.9 percent to $6.3 million from $4.8 million for the comparable period last year with gross margins slightly lower than the same quarter a year ago at 54.6 percent in 2007. Gross margins decreased from last year as the Company utilized a higher percentage of third party products, which tend to carry lower margins.

"We are pleased to report another consecutive quarter of record revenues despite a challenging second quarter 2006 comparison as we continue to see strong demand from new and existing clients," commented Mr. Brian Lin, Chief Executive Officer of China Fire & Security Group, Inc. "During the second quarter we made further progress in product development and market expansion while positioning the Company for future growth. The successful win of total solution contract from Anshan Iron and Steel Group demonstrates China Fire’s capacity to further penetrate the sector, as the China Fire Protection Bureau is increasingly becoming more stringent on compliance."

Operating expenses increased 128.8 percent to $2.8 million during the second quarter as the Company increased sales and marketing initiatives to further establish the Company’s products in the market while also incurring higher public company expenses compared to the same quarter last year. Income from operations was $3.5 million, which was relatively unchanged from the second quarter last year. GAAP net income increased 16.8 percent to $4.2 million for the second quarter of 2007 with earnings per weighted average diluted share increasing to $0.16. Excluding a non-cash gain of $0.4 million related to Change in fair value of derivative instruments during the quarter, pro forma net income increased to $3.9 million with earnings per weighted average diluted share of $0.14.

"During the second quarter we significantly ramped up our sales and marketing efforts as we targeted new customers, introduced new products and sought industry verticals to penetrate," Mr. Lin continued. "We continue to believe that our core industrial market represents at least a $1 billion opportunity and we are confident given our industry leading product suite, value added proposition for manufacturers and increasing government regulations that we will capture a significant portion of the business in the future."

Six Month Financial Results

Revenue for the first six months of 2007 was $21.0 million, up 40.1 percent from $15.0 million in revenue for the first six months of 2006. Gross profit for the period increased 36.4 percent to $11.3 million. Income from operations increased 19.6 percent to $6.8 million as the Company benefited from increased revenue, which was offset by higher operating expenses. GAAP net income increased 43.9 percent to $8.4 million with earnings per weighted average diluted share increasing to $0.31. Excluding non-cash charges related to Change in fair value of derivative instruments and expenses, proforma net income increased 23.2 percent to $7.2 million or $0.26 per weighted average diluted share.

The Company continues to maintain a strong financial position. As of June 30, 2007, China Fire had $8.5 million in cash and cash equivalents, working capital of $28.9 million and no long-term debt. For the second quarter 2007, day sales outstanding or DSOs, were 127, down from DSOs of 145 in the first quarter 2007. Shareholders’ equity stood at $35.8 million, up from $25.0 million at the end of 2006.

"We have been working diligently on improving our operational efficiencies and expect both further revenue growth and margin improvement to contribute to a record 2007. Given our strong results thus far through 2007, we are confident that we are going to deliver full year results above our stated "make good" comprehensive income target of $13.0 million and $0.46 in earnings per share associated with our October 2006 private placement. We expect this momentum to continue in 2008 as we look to maintain our number one industry position and report another record year," concluded Mr. Lin.

Teleconference Information

The conference call will take place at 4:15 p.m. EDT on Tuesday, August 14, 2007. Interested participants should call 1-866-328-4270 when calling within the United States or 1-480-629-9563 when calling internationally. There will be a playback available until 11:59 p.m. eastern time August 21, 2007. To listen to the playback, please call 1-800-406-7325 when calling within the United States or 1-303-590-3030 when calling internationally. Please use pass code 3769237 for the replay.

This call is being webcast by ViaVid Broadcasting and can be accessed by clicking on this link http://viavid.net/dce.aspx?sid=0000435A or at ViaVid’s website at http://www.viavid.net . The webcast can be accessed through September 14, 2007.

About China Fire & Security Group, Inc.

China Fire & Security Group, Inc., through its wholly owned subsidiaries, Sureland Industrial Fire Safety Limited ("Sureland") and Sureland Industrial Fire Equipment (Beijing) Limited ("Sureland Equipment"), is engaged primarily in the design, development, manufacture and sale in China of a variety of fire safety products for the industrial fire safety market and the design and installation of industrial fire safety systems in which it uses its own fire safety products. It also provides maintenance services for customers of its industrial fire safety systems.

Headquartered in Beijing with over 30 sales and project offices throughout China, Sureland markets its industrial fire safety products and systems primarily to major companies in the iron and steel, power and petrochemical industries in China. It is developing and expanding its business in other industrial sectors including transportation, wine and tobacco, vessels, nuclear energy, and public space markets.

Cautionary Statement Regarding Forward Looking Information

This presentation may contain forward-looking information about China Fire & Security Group, Inc. and its wholly owned subsidiary Sureland which are intended to be covered by the safe harbor for forward-looking statements provided by the Private Securities Litigation Reform Act of 1995. Forward- looking statements are statements that are not historical facts. These statements can be identified by the use of forward-looking terminology such as "believe," "expect," "may," "will," "should," "project," "plan," "seek," "intend," or "anticipate" or the negative thereof or comparable terminology, and include discussions of strategy, and statements about industry trends and China Fire & Security Groups’ future performance, operations and products. This and other "Risk Factors" contained in China Fire & Security Groups’ public filings with the SEC.

CHINA FIRE & SECURITY GROUP, INC. AND SUBSIDIARIES

(FORMERLY KNOWN AS UNIPRO FINANCIAL SERVICES, INC.)

CONSOLIDATED STATEMENTS OF INCOME AND OTHER COMPREHENSIVE INCOME

FOR THE THREE MONTHS AND SIX MONTHS ENDED JUNE 30, 2007 AND 2006

(Unaudited)

Three months Six months

ended June 30, ended June 30,

2007 2006 2007 2006

REVENUES

System contracting

projects $9,887,878 $4,100,476 $17,164,386 $8,322,758

Products 1,538,049 4,138,369 3,639,805 6,507,601

Maintenance Services 121,258 132,888 242,456 195,724

Total revenues 11,547,185 8,371,733 21,046,647 15,026,083

COST OF REVENUES

System contracting

projects 4,379,902 2,092,985 8,024,570 4,748,617

Products 811,081 1,474,627 1,639,783 1,940,888

Maintenance Services 46,689 19,014 56,874 35,495

Total cost of

revenues 5,237,672 3,586,626 9,721,227 6,725,000

GROSS PROFIT 6,309,513 4,785,107 11,325,420 8,301,083

OPERATING EXPENSE

Selling and marketing 1,210,100 267,180 1,761,509 849,080

General and

administrative 1,174,309 590,685 2,185,353 1,092,414

Depreciation and

amortization 133,056 132,889 259,539 269,778

Research and

development 267,626 226,548 317,921 403,520

Total operating

expense 2,785,091 1,217,302 4,524,322 2,614,792

INCOME FROM OPERATIONS 3,524,422 3,567,805 6,801,098 5,686,291

OTHER INCOME

(EXPENSE)

Other income 323,702 128,091 327,998 225,484

Other expense (2,146) -- (6,417) --

Interest income 24,915 4,372 44,170 6,080

Interest expense -- (43,019) -- (43,019)

Change in fair value

of derivative

instruments 371,628 1,205,791

Total other income

(expense) 718,099 89,444 1,571,542 188,545

INCOME BEFORE PROVISION

FOR INCOME TAXES

AND MINORITY

INTEREST 4,242,521 3,657,249 8,372,640 5,874,836

PROVISION FOR INCOME

TAXES -- 43,144 -- 56,800

NET INCOME BEFORE

MINORITY INTEREST 4,242,521 3,614,105 8,372,640 5,818,036

MINORITY INTEREST -- (18,890) -- --

NET INCOME 4,242,521 3,632,995 8,372,640 5,818,036

OTHER COMPREHENSIVE

INCOME

Foreign currency

Translation

adjustment 514,775 32,993 810,334 120,677

COMPREHENSIVE

INCOME $4,757,296 $3,665,988 $9,182,974 $5,938,713

WEIGHTED AVERAGE

NUMBER OF SHARES –

BASIC 26,461,678 24,000,000 26,461,678 24,000,000

WEIGHTED AVERAGE

NUMBER OF SHARES –

DILUTED 27,164,207 24,000,000 27,085,807 24,000,000

EARNING PER SHARE –

BASIC $0.16 $0.15 $0.32 $0.24

EARNING PER SHARE

- DILUTED $0.16 $0.15 $0.31 $0.24

CHINA FIRE & SECURITY GROUP, INC. AND SUBSIDIARIES

(FORMERLY KNOWN AS UNIPRO FINANCIAL SERVICES, INC.)

CONSOLIDATED BALANCE SHEETS

AS OF JUNE 30, 2007 AND DECEMBER 31, 2006

A S S E T S

June 30, December 31,

2007 2006

Unaudited

CURRENT ASSETS:

Cash $8,487,318 $9,426,091

Restricted cash 894,494 1,622,833

Accounts receivable, net of

allowance for doubtful

accounts of $1,496,398 and

$1,252,947 as of June 30,

2007 and December 31,

2006, respectively 14,377,790 12,878,665

Accounts receivable -

related party -- 333,056

Notes receivable 1,550,911 903,425

Other receivables 1,993,014 785,111

Other receivables - related

party -- 90,008

Inventories 4,741,890 4,190,830

Costs and estimated

earnings in excess of

billings 12,258,012 9,020,122

Employee advances 2,186,930 1,648,560

Prepayments and deferred

expenses 2,557,245 2,396,571

Total current

assets 49,047,604 43,295,272

PLANT AND EQUIPMENT, net 3,929,627 3,529,808

OTHER ASSETS:

Accounts receivable -

retentions 667,103 383,375

Deferred expenses - non

current -- 40,830

Advances on building

purchases 896,865 --

Investment in joint venture 149,910 501,288

Land use rights, net of

accumulated amortization 565,797 558,255

Technology rights, net of

accumulated amortization 598,599 --

Total other assets 2,878,274 1,483,748

Total

assets $55,855,505 $48,308,828

L I A B I L I T I E S A N D S H A R E H O L D E R S' E Q U I T Y

CURRENT LIABILITIES:

Accounts payable $5,553,119 $5,796,979

Accounts payable - related

party -- 320,754

Customer deposits 8,335,538 2,713,451

Billings in excess of costs

and estimated earnings 2,331,174 8,867,624

Other payables 826,569 388,434

Other payables - related

party -- 50,523

Accrued liabilities 2,898,232 1,891,628

Taxes payable 162,204 619,949

Total current

liabilities 20,106,836 20,649,342

DERIVATIVE INSTRUMENT LIABILITIES -- 2,680,811

COMMITMENTS AND CONTINGENCIES -- --

SHAREHOLDERS' EQUITY:

Common stock, $0.001 par

value, 65,000,000 shares

authorized,

26,461,678 shares

issued and

outstanding 26,462 26,462

Additional paid-in-capital 14,980,191 13,393,171

Statutory reserves 3,123,127 3,728,127

Retained earnings 15,743,033 6,765,393

Accumulated other

comprehensive income 1,875,856 1,065,522

Total

shareholders'

equity 35,748,669 24,978,675

Total

Liabilities and

shareholders'

equity $55,855,505 $48,308,828

For more information, please contact:

China Fire & Security Group, Inc.

Brian Lin

CEO

Tel: +86-10-8589-7509

Email: ir@chinafiresecurity.com

本文源自: 环亚娱乐

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