China Industrial Steel Inc (OTC:CDNN)

WEB NEWS

Friday, November 15, 2013

Comments & Business Outlook

Third Quarter 2013 Results

  • Total revenue from sales were $188,594,415, an increase of $19,044,199, or 11% compared to $169,550,216 in the comparable period of 2012.
  • Earnings Per Share were $0.04 for the third quarter 2013, versus a loss of $0.05 for the third quarter 2012.

Liu Shenghong, Chief Executive Officer and Chairman of the Company commented on the Company's performance, "China Industrial Steel's continued growth stems from increasing market demand. Our ability to generate improved revenue and net income despite the lingering pressure on the average unit sales price of our steel products, reflects the strength of our sales and marketing team as well as the efficiency of our production and distribution channels. I am confident that these efforts will continue to positively impact our financial performance going forward, most notably as pricing returns to prior levels."


Friday, August 16, 2013

Comments & Business Outlook

Second Quarter 2013 Financial Results

  • Revenues increased 24% to $181 million in the three months ended June 30, 2013 from $146 million for the same period in 2012.
  • Steel products tonnage sales up 45% for the quarter ended June 30, 2013, to 368,311 metric tons as compared to 253,490 metric tons in the same period of 2012.
  • Net Income decreased 42%, to $1.07 million for the three months ended June 30, 2013, as compared to $1.85 million for the prior year.
  • Earnings Per Share - Basic and Diluted was $0.01 vs. last years $0.03

 Liu Shenghong, Chief Executive Officer and Chairman of the Company commented on the Company's performance, "The Company's continued revenue growth is a reflection of a solid growth plan and strong customer relationships. Our renovated manufacturing facility not only provides us with the additional capacity to satisfy customer demand, higher production levels also strengthen our ability to negotiate preferable raw material prices. These actions have helped us remain profitable despite the market pressure on selling prices, and we anticipate they will have a positive impact on our financial performance once pricing returns to normal levels."


Thursday, May 16, 2013

Comments & Business Outlook

First Quarter 2013 Financial Results

  • Revenue of $188,363,697 for the three months ended March 31, 2013 an increase of $11,335,049, or 6% compared to $177,028,648 in the same period of 2012.
  • Earnings Per Share - Basic and Diluted was $0.02 vs. last years $0.06.

Commenting on the results, Liu Shenghong, Chief Executive Officer and Chairman of the Company stated, "I am pleased to report China Industrial Steel's financial results for the first quarter of 2013. Company revenues were up as a result of the rebound in China's demand for steel, and we remain profitable despite the industry wide decline in selling prices resulting from inventory stockpiles over the past year."

Chairman Liu went on to say, "Demand for our steel plate and wire increased during the quarter reflecting China's continued economic growth and the government's investment in infrastructure projects, such as roads, railways and bridges. We anticipate market prices will return to prior levels as steel manufacturers work through their backlog to supply these large scale projects and the forecast growth in other steel dependent industries, including the automotive and construction sectors."


Monday, August 20, 2012

Comments & Business Outlook

Second Quarter 2012 Results

  • Sales for the three months ended June 30, 2012 were $145,572,369, a decrease of $71,226,932, or 33%, compared to $216,799,301 in the comparable period in 2011.
  • Net income totaled $1,848,517 in the three months ended June 30, 2012, a decrease of $8,855,692, or 83%, compared to the net income of $10,704,209 in the comparable period of 2011.
  • Earnings per share in the three months ended June 30, 2012, were $0.03 vs. $0.15 in prior year.

Liu Shenghong, Chief Executive Officer and Chairman of the Company commented on the Company's performance, "This has been a challenging year for China's steel industry, and our Company was not an exception. According to the Association of Chinese Steel Industry, 34% of steel manufacturers are experiencing losses, and while our results are off from last year, I am pleased to report that China Industrial Steel has remained profitable throughout this downturn."

Mr. Liu went on to say "Although economic recovery has been slower than expected worldwide, we expect that China's growth will be a significant driver in the turnaround, and we are working to ensure that China Industrial Steel will fully participate in that growth. In addition to shifting our existing production capabilities to the highest margin product mix, we are evaluating financing alternatives to increase our capacity for specialized steel products, the first of which will be a Galvalume production facility. Galvalume is a coated steel product, which is primarily used in the automotive and home appliance industries."


Monday, June 4, 2012

Comments & Business Outlook
 
   
Three Months Ended March 31,
 
   
2012
   
2011
 
Revenues
           
Sales to customers
  $ 172,444,448     $ 187,524,816  
Sales to related parties
    4,584,200       -  
    Total Revenues
    177,028,648       187,524,816  
                 
Cost of Revenue
               
Cost of Revenue - non-related parties
    49,889,474       22,137,284  
Cost of Revenue - related parties
    118,315,091       154,960,989  
  Total Cost of Revenue
    168,204,565       177,098,273  
                 
Gross Profit
    8,824,083       10,426,543  
                 
Selling and General and Administrative Expenses
               
Selling and General and Administrative Expenses - non-related parties
    1,065,079       447,247  
Selling and General and Administrative Expenses - related parties
    177,083       186,650  
Total Selling and General and Administrative Expenses
    1,242,162       633,897  
                 
Income From Operations
    7,581,921       9,792,646  
                 
Other Income (Expenses)
               
Interest income
    52,489       215  
Interest expense - bank borrowings
    (944,908 )     (449,750 )
Interest expense - related parties
    (963,068 )     (1,065,316 )
    Total Other Income (Expenses)
    (1,855,487 )     (1,514,851 )
                 
Income from operation before income tax
    5,726,434       8,277,795  
Provision for income tax
    1,020,390       1,145,021  
Net Income
    4,706,044       7,132,774  
                 
Earnings Per Share - Basic
  $ 0.06     $ 0.10  
Weighted Average Shares Outstanding - Basic
    73,542,058       72,767,929  
Earnings Per Share - Diluted
  $ 0.06     $ 0.10  
Weighted Average Shares Outstanding - Diluted
    73,542,058       72,767,929  

Liquidity Requirements
The Company plans to add a new production line to produce a coated steel product, known as Galvalume, which is primarily used in the automotive and home appliance industries. To implement this expansion strategy, it is estimated that we will require at least $80 million. The management believes that our available cash will not be sufficient to fund our expansion requirements and therefore, we will have to finance the expansion through the sale of our equity securities or borrow from bank loans when available.

Sunday, June 3, 2012

Reverse Merger Activity

On September 29, 2011 Share holders registered stock to take company public. (Company was originally a private shell that became a non-public operating entity via a reverse merger, prior to registering its stock). In January 2011 the company completed a private placement where it sold an aggregate of 2,579,022 units at $1.50 per unit with each unit consisting of: (i) one share of our common stock, and (ii) a three-year warrant to purchase one share of our common stock at an exercise price of $4.50 per share.

Company Snapshot:

Produces and sells steel plate, bar and billet in ChinaIndustry Snapshot

Use Of proceeds: No money raised from this offering

Underwriter: Self

Completed offering price: $4.50

Post IPO Share Calculation:

  • 73,542,058: Pre IPO outstanding shares
  • 2,579,022: Registered shares of Common Stock by current shareholders (will not add to shares outstanding).
  • 2,579,022: Shares from warrants associated with private placement

GeoTeam® best effort calculation of total post IPO shares assuming full conversions:  76,121,080

Financial Snapshot: December Year End 

   
2011
   
2010
   
2009
 
Revenues
                 
Sales to customers
  $ 796,011,478     $ 546,489,212     $ 526,388,941  
Sales to related parties
    27,095,564       27,177,472       30,366,019  
    Total Revenues
    823,107,042       573,666,684       556,754,960  
                         
Cost of Revenue
                       
Cost of Revenue - non-related parties
    92,311,499       76,627,193       413,006,181  
Cost of Revenue - related parties
    669,334,535       459,227,304       81,612,000  
  Total Cost of Revenue
    761,646,034       535,854,497       494,618,181  
                         
Gross Profit
    61,461,008       37,812,187       62,136,779  
                         
Selling and General and Administrative Expenses
                       
Selling and General and Administrative Expenses - non-related parties
    1,695,836       1,963,226       586,610  
Selling and General and Administrative Expenses - related parties
    804,541       569,035       289,970  
Total Selling and General and Administrative Expenses
    2,500,377       2,532,261       876,580  
                         
Income From Operations
    58,960,631       35,279,926       61,260,199  
                         
Other Income (Expenses)
                       
Interest income
    67,303       19,058       14,000  
Interest expense - bank borrowings
    (1,505,340 )     (353,815 )     (169,128 )
Interest expense - related parties
    (4,405,934 )     (4,719,552 )     (2,944,094 )
Gain on disposal of fixed assets
    117,255       -       -  
    Total Other Income (Expenses)
    (5,726,716 )     (5,054,309 )     (3,099,222 )
                         
Income from operation before income tax
    53,233,915       30,225,617       58,160,977  
Provision for income tax
    7,432,439       4,455,177       -  
Net Income
  $ 45,801,476     $ 25,770,440     $ 58,160,977  
                         
Other Comprehensive Income:
                       
Foreign currency translation gain
    7,753,060       4,122,803       675,123  
Comprehensive Income
  $ 53,554,536     $ 29,893,243     $ 58,836,100  
                         
Net Income Per Share - Basic
  $ 0.62     $ 0.39     $ 0.94  
Weighted Average Shares Outstanding - Basic
    73,351,698       66,308,038       61,576,992  
Net Income Per Share - Diluted
  $ 0.62     $ 0.39     $ 0.94  
Weighted Average Shares Outstanding - Diluted
    73,351,698       66,308,038       61,576,992