China Industrial Waste Management Announces 2008 First Quarter Results

DALIAN, China, May 15 /Xinhua-PRNewswire-FirstCall/ -- ChinaIndustrial Waste Management, Inc. (OTC Bulletin Board: CIWT) todayannounced financial results for its first quarter ended March 31,2008.
Highlights for the First Quarter 2008
Revenues
The Company's operating revenues for the three months ended March31, 2008 were $3,130,280, an increase of $1,447,308 or 86% comparedwith $1,682,972 for the three months ended March 31, 2007.
The increase in revenues from service fees primarily results from abroadened customer base during this period compared with the sameperiod last year. Increased revenues from operations also resultfrom an increase in sales of cupric sulfate, which experienced a$320,510 or 83% increase during these three months in 2008 incomparison with the corresponding three months of 2007, as bothunit prices and volume of cupric sulfate increased.
Cost of Revenues
The Company's cost of revenues for the three months ended March 31,2008 was $928,093 compared with $509,768 for the three months endedMarch 31, 2007.
The cost of revenues increased by $418,325 or 82% for the threemonths ended March 31, 2008 compared to the three months endedMarch 31, 2007 as the rapid expansion of our business caused acorresponding increase in costs.
The cost of reclaimed products (which includes cost of cupricsulfate and cost of other recycled commodities) for the threemonths ended March 31, 2008 increased by $275,909,compared with thesame period in 2007. Such increase is attributable to the sharpincrease in sales.
Operating Expenses
Total operating expenses for the three months ended March 31, 2008increased by $160,526 to $581,927 from $421,401 for the threemonths ended March 31, 2007, an increase of 38%. The increase inoperating expenses is principally attributable to relativelysignificant increased General and administrative expenses as theCompany incurred expenses in connection with its expansionactivities. General and administrative expenses for the threemonths ended March 31, 2008 increased by 63% over the correspondingperiod in 2007.
Foreign Currency Translation
Foreign currency translation adjustments for the three months endedMarch 31, 2008 increased to $589,954 from $58,768 for the threemonths ended March 31, 2007. This fluctuation is attributable tothe revaluation of the Chinese currency against the U.S. dollar.
Net Income
Net income for the three months ended March 31, 2008 increased by$695,705 or 102% to $1,375,617 from $679,912 for the three monthsended March 31, 2007. This increase is primarily attributable tothe increase in revenues for the Company in the first quarter of2008.
Liquidity and Capital Resources
We have financed our operations and met capital expenditurerequirements primarily through cash provided by operatingactivities, trade credit and bank loans.
Accounts receivable increased by $997,998 or 168% from 594,322 asof December 31 2007 to $1,592,320. This is attributable to anincrease in the number of customers during the 2008 three-monthperiod. Short-term loan as of the three months ended March 31 2008was $2,563,299 whereas the amount as of December 31 2007 was$1,369,000 as the Company made additional bank borrowings toaccelerate our business expansion.
As of March 31, 2008, the Company had cash and cash equivalents of$4,225,461, compared to $3,260,307 at December 31, 2007. As ofMarch 31, 2008, the Company had working capital of $2,965,479,compared to $2,345,626 as of December 31, 2007.
Net cash provided by operating activities totalled $821,953 for thethree months ended March 31, 2008, compared to cash provided byoperations of $583,339 for the three months ended March 31, 2007;an increase of $238,614 or 41% over the same period in the previousyear. The principal reason for the increase in 2008 was cashin-flow generated from sales experienced a 7% increase in the firstquarter compared with the same period in 2007. Therefore cash spenton material procurement, payroll and tax payment increased.
Net cash used in investing activities for the three months endedMarch 31, 2008 decreased by $1,561,003 or 58% compared to the sameperiod in 2007. This decrease is attributable to a decline inspending on fixed assets and other investing activities.
Net cash provided by financing activities for the three monthsended March 31, 2008 increased by $1,114,642 compared to the sameperiod in 2007 as we received an additional bank loan in the firstquarter of 2008.
Mr. Dong, Jinqing, CEO of CIWT, commented, "It is a good beginningfor the Company with $3.13 million revenue and $1.38 million netincome for first quarter 2008. Viewed from what we have achieved inthe first quarter, we still hold an optimistic anticipation for2008.
We expect that demand for waste management services will continueto increase during 2008 as the macro economy of China andinvestment in environmental protection grow. The Companyanticipates that it will maintain steady growth as new facilitiesunder construction are scheduled to be put into production.
We are confident that we will be able to maintain our sustainablegrowth in China and that our stockholders will be rewarded fortheir confidence in us."
Outlook for second quarter 2008
For the second quarter of 2008, in which new projects are stillunder constructions, the Company anticipates revenues of $3.8million, net income of $1.6 million, and diluted earnings per shareof approximately $0.12, based on a total of 13.27 million sharesoutstanding.
Conventions
For the convenience of the reader, amounts expressed in this reportas United States dollars have been translated from Renminbi Yuan,the official currency of the People's Republic of China, at therate of USD$1.00 = RMB7.3046 quoted by The People's Bank of China("POBC") as of December 31, 2007; and at the rate of USD$1.00 =RMB7.0222 quoted by OANDA as of March 31, 2008. OANDA is a Delawarecorporation providing internet foreign exchange rate athttp://www.oanda.com . The Renminbi is not freely convertible intoforeign currencies and currency translations at such exchange ratesdoes not imply convertibility of Renminbi into U.S. Dollars orother currencies.
About China Industrial Waste Management, Inc.:
China Industrial Waste Management, Inc., through its 90%-ownedsubsidiary Dalian Dongtai Industrial Waste Treatment Co., Ltd., isengaged in the collection, treatment, disposal and recycling ofindustrial wastes principally in Dalian, China and surroundingareas in Liaoning Province. The Company provides waste disposalsolutions to its more than 400 customers from facilities located inthe Economic and Technology Development Zone, Dalian, PRC. DalianDongtai treats, disposes of and/or recycles a variety of industrialwastes through incineration, burial and/or water treatment, andrecycles, processes and/or resells waste products for use as rawmaterials in the production of chemical and metallurgy products. Inaddition, Dalian Dongtai provides environmental protectionservices, technology consultation, pollution treatment services,and waste management design processing services.
Forward-Looking Statements:
This release includes "forward-looking statements." You canidentify these statements by the fact that they do not relatestrictly to historical or current facts. These statements containsuch words as "may," "project," "might," "expect," "believe,""anticipate," "intend," "could," "would," "estimate," or thenegative or other variations thereof or comparable terminology.These forward-looking statements are based on current expectationsand projections about future events. Investors are cautioned thatforward-looking statements are not guarantees of future performanceor results and involve risks and uncertainties that cannot bepredicted or quantified and, consequently, our actual performancemay differ materially from those expressed or implied by suchforward-looking statements. Such risks and uncertainties include,but are not limited to, the following factors, as well as otherfactors described from time to time in our reports filed with theSecurities and Exchange Commission: the timing and magnitude oftechnological advances; the prospects for future acquisitions; theeffects of political, economic and social uncertainties regardingthe governmental, economic and political circumstances in thePeople's Republic of China, the possibility that a current customercould be acquired or otherwise be affected by a future event thatwould diminish their waste management requirements; the competitionin the waste management industry and the impact of such competitionon pricing, revenues and margins; uncertainties surrounding budgetreductions or changes in funding priorities of existing governmentprograms and the cost of attracting and retaining highly skilledpersonnel; our projected sales, profitability, and cash flows; ourgrowth strategies; anticipated trends in our industries; our futurefinancing plans; and our anticipated needs for working capital.
Forward-looking statements speak only as of the date on which theyare made, and, except to the extent required by federal securitieslaws, we undertake no obligation to update any forward-lookingstatement to reflect events or circumstances after the date onwhich the statement is made or to reflect the occurrence ofunanticipated events.
For further information, contact:
Copyright 2008 PR Newswire
Back to News Home