Sutor Technology Group Limited (NASDAQ:TOR)

Item 3.01 Notice of Delisting or Failure to Satisfy a Continued Listing Rule or Standard; Transfer of Listing.

On December 9, 2015, Sutor Technology Group Limited (the “Company”) received a notice from the Listing Qualifications Department of The NASDAQ Stock Market indicating that, for the last 30 consecutive business days, the bid price for the Company’s common stock had closed below the minimum $1.00 per share required for continued inclusion on The NASDAQ Capital Market under the NASDAQ Listing Rule 5550(a)(2). The notification letter states that the Company will be afforded 180 calendar days, or until June 6, 2016, to regain compliance with the minimum bid price requirement. In order to regain compliance, shares of the Company’s common stock must maintain a minimum closing bid price of at least $1.00 per share for a minimum of ten consecutive business days. The Company intends to actively monitor the bid price for its common stock between now and June 6, 2016, and will consider all available options to resolve the deficiency and regain compliance with the NASDAQ minimum bid price requirement.

Item 3.01 Notice of Delisting or Failure to Satisfy a Continued Listing Rule or Standard; Transfer of Listing.

On November 24, 2015, Sutor Technology Group Limited (the “Company”) received notice (the “Notice”) from the Listing Qualifications Department of The NASDAQ Stock Market indicating that the Company does not comply with Nasdaq Listing Rule 5250(c)(1) because the Company has not yet filed its Form 10-Q for the period ended September 30, 2015 (the “Form 10-Q”), and because, as previously announced, the Company has not filed its Form 10-K for the fiscal year ended June 30, 2015 (the “Form 10-K”).

Pursuant to the Notice, the Company has until December 14, 2015 to submit a plan to regain compliance with respect to these delinquent reports. If Nasdaq accepts the Company’s plan to regain compliance, it may grant an exception of up to 180 calendar days from the due date of the Company’s Form 10-K, or March 28, 2016.

The Company issued a press release on December 1, 2015, disclosing receipt of the notice letter. A copy of the press release is attached hereto as Exhibit 99.1 and is incorporated herein by reference.

Item 3.01  Notice of Delisting or Failure to Satisfy a Continued Listing Rule or Standard; Transfer of Listing.

On October 14, 2015, Sutor Technology Group Limited (the “Company”) received notice from the Listing Qualifications Department of The NASDAQ Stock Market indicating that, due to the Company’s failure to timely file its annual report on Form 10-K for the fiscal year ended June 30, 2015 (the “Annual Report”), it no longer complies with the NASDAQ Listing Rule 5250(c)(1). The notification letter states that the Company has 60 calendar days, or until December 14, 2015, to submit a plan to regain compliance and if NASDAQ accepts the plan, it may grant the Company up to 180 calendar days from the filing due date of the Annual Report, or until April 11, 2016, to regain compliance. If NASDAQ does not accept the Company’s plan, then the Company will have the opportunity to appeal that decision to a NASDAQ Hearings Panel.

Item 8.01 Other Events.

On August 8, 2014, the Listing Qualifications Department of the Nasdaq Stock Market, LLC (“NASDAQ”) notified Sutor Technology Group Limited (the “Company”) that it did not comply with NASDAQ Listing Rule 5550(a)(2) (the “Rule”) because its common stock failed to maintain a minimum bid price of $1.00 over the previous 30 consecutive business. On July 13, 2015, the Company received a letter, dated the same date, from the NASDAQ indicating that by maintaining the closing bid price of its common stock at $1.00 per share or greater for the last 10 consecutive business days, from June 26, 2015 to July 10, 2015, the Company has regained compliance with the Rule and the matter is now closed.

Item 5.03. Amendments to Articles of Incorporation or Bylaws; Change in Fiscal Year.

Sutor Technology Group Limited (the “Company”) has filed a Certificate of Change pursuant to Section 78.209 of the Nevada Revised Statutes (the “Certificate of Change”) with the Secretary of State of the State of Nevada to effect a one-for-five (1-for-5) reverse stock split (the “Reverse Split”) of the authorized and issued and outstanding shares of the common stock, par value $0.001 per share, of the Company (the “Common Stock”). Pursuant to the Certificate of Change, the Reverse Split became effective at 5:00 a.m. Pacific Daylight Time on June 26, 2015 (the “Effective Time”).

The Reverse Split was duly approved by the Board of Directors of the Company without shareholder approval, in accordance with the authority conferred by Section 78.207 of the Nevada Revised Statutes. At the Effective Time, the Company’s Articles of Incorporation was also amended and the authorized number of shares of the Company’s Common Stock was accordingly decreased from five hundred million (500,000,000) shares to one hundred million (100,000,000) shares.

Pursuant to the Certificate of Change, holders of the Company’s Common Stock will be deemed to hold one (1) post-split share of the Company’s Common Stock for every five (5) shares of the Company’s issued and outstanding Common Stock held immediately prior to the Effective Time. No fractional shares of the Company’s Common Stock will be issued in connection with the Reverse Split. Stockholders who are entitled to a fractional post-split share will receive in lieu thereof one (1) whole post-split share. Following the Reverse Split, each stockholder’s percentage ownership and proportional voting power in the Company will remain unchanged, with the exception of minor changes and adjustments resultling from rounding up of fractional shares.

CHANGSHU, China, June 26, 2015 /PRNewswire/ -- Sutor Technology Group Limited (the "Company" or "Sutor") (Nasdaq: SUTR), one of the leading China-based manufacturers and service providers for fine finished steel products used by a variety of downstream applications, today announced that it has filed a Certificate of Change pursuant to Section 78.209 of the Nevada Revised Statutes with the Nevada Secretary of State to effect a one-for-five (1-for-5) reverse stock split of the authorized and issued and outstanding shares of common stock, par value $0.001 per share, of the Company ("Common Stock"). The reverse stock split will be effective at the market opening on June 26, 2015, at which time the Company's Common Stock will begin trading on the NASDAQ Capital Market on a split-adjusted basis. At the same time, the Company's Common Stock will trade under the new symbol "TOR" and under a new CUSIP number 869362202.

The Company is implementing the reverse stock split to regain compliance with NASDAQ continued listing standards. Following the reverse stock split the Company will have approximately 8.5 million shares of Common Stock issued and outstanding, and each stockholder's percentage ownership and proportional voting power in the Company will remain unchanged. In addition, the number of total authorized shares of Common Stock will be reduced to 100 million shares. The Company values maintaining a presence in the American capital markets. Based on the long-term interests of shareholders and in conjunction with Company's business transformation and upgrading and its goal of enhanced brand recognition, the Company is implementing the reverse stock split and changing trading symbol.

CHANGSHU, China, June 15, 2015 /PRNewswire/ -- Sutor Technology Group Limited (the "Company" or "Sutor") (Nasdaq: SUTR), one of the leading China-based manufacturers and service providers for fine finished steel products used by a variety of downstream applications, today announces that Ningbo Zhehua Heavy Steel Pipe Manufacturing Co., Ltd. ("Ningbo Zhehua"), a subsidiary of Sutor, has successfully completed the trial production of its two precision cold rolling processing production lines, which have the processing capacity of 100,000 and 200,000 metric tons respectively.

Lifang Chen, Chairwoman and CEO of Sutor commented, "With the Company's transformation and upgrading, we will provide customers with diversified and customized products and services. According to customers' feedback on our products and services, most of our steel pipe customers need processing services of cold rolled products such as shearing and cutting services. Therefore, to meet customers' requirements and to expand the current pipe manufacturing business, Ningbo Zhehua introduced two precision cold rolling processing production lines."

"We view the successful trial production of two processing production lines as validation of Sutor's focus and professionalism in the fine finished steel industry. We believe these two processing lines will supplement our current steel pipe business, which can greatly improve customer satisfaction and increase customer loyalty in the future," Ms. Chen concluded.

CHANGSHU, China, June 5, 2015 /PRNewswire/ -- Sutor Technology Group Limited (the "Company" or "Sutor") (Nasdaq: SUTR), one of the leading China-based manufacturers and service providers for fine finished steel products used by a variety of downstream applications, today announced that it has successfully reserved a new ticker symbol of "TOR" for the Company's common stock traded on the NASDAQ Capital Market. The Company's common stock will continue to be traded under the symbol of "SUTR" until the new symbol is officially adopted.

Lifang Chen, Chairwoman and CEO of Sutor commented, "The Company transformed from a traditional steel manufacturer to a fine finished steel supply chain service provider. To help foster a stronger and more recognizable brand for the Company, we reserved a new symbol of 'TOR'. We will decide at an appropriate time to start trading our common stock under the new symbol and update the market promptly.

CHANGSHU, China, May 27, 2015 /PRNewswire/ -- Sutor Technology Group Limited (the "Company" or "Sutor") (Nasdaq: SUTR), one of the leading China-based manufacturers and service providers for fine finished steel products used by a variety of downstream applications, announced that it launched a mobile application for its fine finished steel products recently. This application enables users to order, track orders and delivery, and read the latest Company news and industry news, all online. This integrated online platform signals a new era of products development and innovation for Sutor.

Lifang Chen, Chairwoman and CEO of Sutor commented, "As a high-tech enterprise, Sutor continues to pursue the development of new industrial techniques and services. Following the trend of fast increasing use of internet applications, Sutor's IT team developed the mobile application in-house. Customers can track order status real time and at any place where wi-fi is available. Since the launch of this application nearly one week ago, the volume of online orders for our fine finished steel products reached 6,000 metric tons on one of the days in that period."

"The launching of fine finished steel mobile application is a breakthrough in our efforts to provide our customers with integrated service. With the goal of becoming the best fine finished steel supply chain service provider, we will offer all customers with more convenient, more efficient and more comprehensive services continuously. "Ms. Chen concluded.

Third Quarter of Fiscal Year 2015 Results

• Revenue. For the three months ended March 31, 2015, revenue was $21.1 million, compared to $96.4 million for the same period last year, a decrease of $75.3 million, or 78.1 %.
• Diluted Earnings/(Loss) per Share was loss of ($0.06) vs. last years earnings of $0.03.

Ms. Lifang Chen, CEO and President of Sutor, commented, "Since the Company changed its traditional production model, Sutor Technology Co., Ltd, one of our subsidiaries ( "Sutor Technology PRC") has become a brand operation and service center. We are pleased to see that Sutor Technology PRC generated 47.6% of Company's total revenue in this fiscal quarter, and its revenue increased by 773.7% compared with the same period of fiscal year 2014. Through our efforts in brand promotion and development of online-to-offline (O2O) E-commerce, Sutor Technology PRC's online orders increased gradually. With active expansion and development in emerging markets, our revenues from related parties in this quarter declined 100.0% compared with the same period of last year.

Ms. Chen continued, "To better build Sutor into a customized fine steel processing service provider, the other three subsidiaries Changshu Huaye Steel Strip Co., Ltd. ("Changshu Huaye"), Jiangsu Cold-Rolled Technology Co., Ltd. ("Jiangsu Cold-Rolled") and Ningbo Zhehua Heavy Steel Pipe Manufacturing Co., Ltd. ("Ningbo Zhehua") carried on customized processing services actively. To further Company's transformation, Ningbo Zhehua introduced two precision cold rolling production lines with capacity of 100,000 and 200,000 metric tons, respectively, to increase our cold rolled market shares and expand the scope of our existing steel pipe lines. These two production lines are now under installation and testing.

"We abandoned massive extensive growth model and are transforming from a traditional steel products manufacturer to an advanced service provider in fine finished steel supply chain. Our efforts in launching O2O E-commerce strategy, constantly improving fine finished steel customized processing model and developing emerging logistic distribution networking system are all our solid steps in reaching goal of transformation. We believe that our transformation and upgrading certainly help us to obtain competitive advantages." Ms. Chen concluded.

CHANGSHU, China, April 22, 2015 /PRNewswire/ -- Sutor Technology Group Limited (the "Company" or "Sutor") (Nasdaq: SUTR), one of the leading China-based manufacturers and service providers for fine finished steel products used by a variety of downstream applications, announced that it completed its upgrading of 200,000 metric tons pre-painted galvanized (the "PPGI") production line at Changshu Huaye Steel Strip Co., Ltd, a subsidiary of Sutor, and the subsidiary is ready to resume PPGI production immediately.

Lifang Chen, Chairwoman and CEO of Sutor commented, "We undertook the upgrading of the PPGI production line voluntarily. We upgraded the line to improve production efficiency and coating utilization, thereby resulting in energy-saving and cost-cutting. The replacement of two-roller coating technique by three-roller coating technique will make the surface of our new PPGI products more smooth and their painted color brighter. We believe that these new upgraded PPGI products will be more widely used in downstream industries such as new energy, high-end household appliances, IT, and building materials."

"In recent years, Sutor has been focusing on research efforts on market segmentation of our products. Through technology and equipment upgrading, the Company aims to add value to its products in the long run. Relying on our own technical and R&D teams, we provide customized products and services to target customers. We believe product improvement and innovation are our core competitiveness and recipe to become one of the best service providers in fine finished steel supply chain," Ms. Chen concluded.

CHANGSHU, China, April 22, 2015 /PRNewswire/ -- Sutor Technology Group Limited (the "Company" or "Sutor") (Nasdaq: SUTR), one of the leading China-based manufacturers and service providers for fine finished steel products used by a variety of downstream applications, announced that it completed its upgrading of 200,000 metric tons pre-painted galvanized (the "PPGI") production line at Changshu Huaye Steel Strip Co., Ltd, a subsidiary of Sutor, and the subsidiary is ready to resume PPGI production immediately.

Lifang Chen, Chairwoman and CEO of Sutor commented, "We undertook the upgrading of the PPGI production line voluntarily. We upgraded the line to improve production efficiency and coating utilization, thereby resulting in energy-saving and cost-cutting. The replacement of two-roller coating technique by three-roller coating technique will make the surface of our new PPGI products more smooth and their painted color brighter. We believe that these new upgraded PPGI products will be more widely used in downstream industries such as new energy, high-end household appliances, IT, and building materials."

"In recent years, Sutor has been focusing on research efforts on market segmentation of our products. Through technology and equipment upgrading, the Company aims to  add value to its products in the long run. Relying on our own technical and R&D teams, we provide customized products and services to target customers. We believe product improvement and innovation are our core competitiveness and recipe to become one of the best service providers in fine finished steel supply chain," Ms. Chen concluded.

CHANGSHU, China, March 31, 2015 /PRNewswire/ -- Sutor Technology Group Limited (the "Company" or "Sutor") (Nasdaq: SUTR), one of the leading China-based manufacturers and service providers for fine finished steel products used by a variety of downstream applications, announced that it held a Fine Finished Steel O2O Seminar at Crowne Plaza Shanghai Fudan on March 28, 2015. Aiming to make itself one of the best fine finished steel supply chain service providers, Sutor created a unique fine finished steel O2O (online-to-offline) marketing model in the ongoing transformation of its business model. The seminar attracted lots of strategic partners, including Samsung, Thyssenkrupp, and many important customers from China and abroad. Sutor's independent directors, Mr. Guoyou Shao and Mr. Lin Yang, also attended the seminar.

During the seminar, Sutor presented its value-added products of pre-painted hot dipped galvanized steel and JCOE steel pipes, and introduced its newly developed O2O marketing model. The O2O marketing model for fine finished steel is a multi-channel combination of placing orders, making payments, warehousing, logistics and financing. The launching of this model marks another step forward in Sutor's business transformation and upgrading. We will continue to seek and create more win-win collaboration models to benefit our customers, suppliers, and all stakeholders.

CHANGSHU, China, March 24, 2015 /PRNewswire/ -- Sutor Technology Group Limited (the "Company" or "Sutor") (Nasdaq: SUTR), one of the leading China-based manufacturers and service providers for fine finished steel products used by a variety of downstream applications, announced that on March 19, 2015 its subsidiary, Ningbo Zhehua Heavy Steel Pipe Manufacturing Co., Ltd ("Ningbo Zhehua"), entered into a new contract to supply approximately 3,000 metric tons of large-diameter submerged-arc straight seam welded pipes for a dredging project of Saudi Arabia National Oil Company. Ningbo Zhehua has received a payment deposit and expects to complete product delivery in the middle of April 2015.

Lifang Chen, Chairwoman and CEO of Sutor commented, "The products to be supplied under this contact are all high-valued welded pipes that meet American Petroleum Institute (the "API") standards. We are proud of Ningbo Zhehua's advanced technologies, which enables us to supply steel pipes for national projects both in China and aboard. Relying on outstanding products and services, we export steel pipes to overseas markets such as the Far East, European Union, Southeast Asia and Africa. We believe Ningbo Zhehua's receipt of European Union Pressure Equipment Directive and Construction Products Regulation certificates last year confirms the high quality of its products. To us, superior products and services are core values on which we can expand markets and build brand recognition, thereby laying a firm foundation for future grow."

Second Quarter 2015 Financial Results

• Revenue. For the three months ended December 31, 2014, our revenue was $85.3 million, compared to $128.3 million for the same period last year, a decrease of $43.0 million, or 33.5%
• EPS was (0) vs. last years same quarter of 0.15.

Ms. Lifang Chen, CEO and President of Sutor, commented, "We are pleased to see our performance turned from net loss for the first quarter of fiscal 2015 to profit for the second quarter. Although our second quarter revenue and net income decreased as compared with same period last year, both of them increased by 124.5% and 100.6%, respectively, compared with the first quarter of this fiscal year, which demonstrates the initial success of our business transformation as we are focusing more on sales quality improvement. We anticipate that we will continue to see improved results in the coming quarters both in overall gross margin and international sales after our PPGI production line upgrading is finished and operation of that line resumes, which are expected to be in the third fiscal quarter."

Ms. Chen continued, "The Chinese economy is undergoing a structural adjustment and experiencing a slowdown. However, we believe this process provides opportunities for Chinese steel enterprises to carry out business transformation and upgrading and we are trying to capitalize on this historical opportunity to change our business model, strengthen our brand awareness and enhance innovation with a goal to develop new markets and cultivate new drivers of profit growth of our company."

"Besides that, our PRC subsidiary, Sutor Technology engages in the development of online-to-offline (O2O) E-commerce. We believe that the combination of online promotional trading platform and traditional offline sales service not only maximizes our sales opportunity, but also reduces our procurement and sales cost. Following the trend of structural transformation and specialization in the world steel industry, we have made significant progress in taking potential merger and acquisition to consolidate resources of upstream and downstream. Our goal is to integrate all functions of R&D, sales, processing and logistics service together and upgrade ourselves from a traditional manufacturer of fine finished steel to a customized processing service provider. We will update the market on this development when it is appropriate," Ms. Chen concluded.

CHANGSHU, China, February 11, 2015 /PRNewswire/ -- Sutor Technology Group Limited (the "Company" or "Sutor") (Nasdaq: SUTR), one of the leading China-based manufacturers and service providers for fine finished steel products used by a variety of downstream applications, today announced that its subsidiary, Changshu Huaye Steel Strip Co., Ltd. ("Changshu Huaye"), entered into a non-binding letter of intent dated February 8, 2015 (the "LOI") with the shareholders of Shanghai Huaye Iron & Steel Group Co., Ltd. ("Shanghai Huaye"). The LOI contemplates a transaction in which Changshu Huaye will acquire Shanghai Huaye, a company incorporated and existing in China.

The Company expects that Changshu Huaye will be a controlling shareholder of Shanghai Huaye when this transaction is completed. Shanghai Huaye presently has eight subsidiaries, which have 53 precision processing lines, with a total annual processing capacity of approximately 10 million tons and a total annual storage capacity of approximately 15 million tons. Consummation of the transaction is subject to entry into a definitive agreement between the parties containing specific signing and closing terms and conditions yet to be negotiated.

Ms Lifang Chen, Chief Executive Officer and President of the Company commented, "We are pleased that we have seized the opportunity in industry transformation and taken an important step in seeking potential acquisition targets. After signing the LOI, we will carry out audit and assessment on Shanghai Huaye. We believe this transaction will provide a positive impetus for Sutor's business transformation. Our strategic expansion will make Sutor an integrated service provider of research and development, sales, processing, logistics and e-commerce of customized fine finished steel. We will provide an update on our progress of the transaction when and if appropriate."

CHANGSHU, China, February 6, 2015 /PRNewswire/ -- Sutor Technology Group Limited (the "Company" or "Sutor") (Nasdaq: SUTR), one of the leading China-based manufacturers and service providers for fine finished steel products used by a variety of downstream applications, today announced that on February 5, 2015 it received a letter from the staff of the Listing Qualification of the Nasdaq Stock Market LLC ("NASDAQ"), indicating that the Company was granted an additional 180 calendar day period, or until August 3, 2015 to satisfy with the $1.00 minimum closing bid price requirement under the Nasdaq Listing Rules.

NASDAQ's determination was based on the Company meeting the continued listing requirement for market value of publicly held shares and all other applicable requirements for initial listing on the NASDAQ Capital Market with the exception of the bid price requirement, and the Company's written notice to NASDAQ stating its intention to cure the deficiency during the additional compliance period by effecting a reverse stock split, if necessary.

The NASDAQ notification letter has no immediate effect on the listing or trading of the Company's common stock on the NASDAQ Capital Market. The Company will consider all available options to resolve the deficiency and regain compliance during the second compliance period.

ITEM 5.02. DEPARTURE OF DIRECTORS OR CERTAIN OFFICERS; ELECTION OF DIRECTORS; APPOINTMENT OF CERTAIN OFFICERS; COMPENSATORY ARRANGEMENTS OF CERTAIN OFFICERS.

On and effective December 22, 2014, Mr. Naijiang Zhou resigned as the Director and Chief Financial Officer of Sutor Technology Group Limited (the “Company”), effective immediately. Mr. Zhou’s resignation was due to personal reasons and was not a result of any disagreement with the Company on any matter relating to the Company’s operations, policies or practices. On the same day, the Board of Directors of the Company appointed Mr. Jun Xu as the Company’s Director and Chief Financial Officer, effective immediately.

Mr. Xu, age 37, has nearly fifteen years’ work experience in financial analysis and corporate management. Since May 2010, he has been the Chief Financial Officer of Kunshan Ripang Electronics Technology Co., Ltd., which is a subsidiary of XP Power Ltd., a company publicly traded on London Stock Exchange. Before that, Mr. Xu served as the Financial Manager at Hangzhou MORABU Electric Cable Co., Ltd, a Sino-foreign joint venture, from August 2006 through April 2010. From March 2002 through July 2006, Mr. Xu worked for Hangzhou Tongyuan Real Estate Co., Ltd., a Chinese state-owned enterprise, as Financial Manager. Mr. Xu is a candidate for a master’s degree in economics at Duke University, and he received a Bachelor’s degree in accounting from China University of Mining and Technology.

There is no family relationship exists between Mr. Xu and any directors or executive officers of the Company. In addition, there are no arrangements or understandings between Mr. Xu and any other person pursuant to which he was appointed as director and Chief Financial Officer, and there are no related party transactions with respect to Mr. Xu that would require disclosure under Item 404(a) of Regulation S-K.

CHANGSHU, China, December 22, 2014 /PRNewswire/ -- Sutor Technology Group Limited (the "Company" or "Sutor") (Nasdaq: SUTR), one of the leading China-based manufacturers and service providers for fine finished steel products used by a variety of downstream applications, today announced its subsidiary, Ningbo Zhehua Heavy Steel Pipe Manufacturing Co., Ltd ("Ningbo Zhehua"), recently entered into a new contract to process and deliver 5,000 metric tons of spiral seam and straight seam welded steel pipes. These products will be used as deep-sea main bridge piping of Pingtan Bridge that is a cross-sea bridge locates in Pingtan County in Fujian Province. The deliveries under this contract are to be made from December of 2014 to January of 2015.

Lifang Chen, Chairwoman and CEO of Sutor commented, "To us, the commission of processing the deep-sea Pingtan Bridge pipes is confirmation of our customers' confidence in the anti-corrosion property and high strength of our products and in our logistics capability. Our vertical integration has allowed us to benefit from economies of scale and thus keep production cost low. Ningbo Zhehua's advanced technologies and convenient geographical proximity to Ningbo Port, we expect our pipe processing service to be an attractive option for customers that demand high-quality finished products without concerning themselves with logistics of shipping the products."

"This new processing contract of Ningbo Zhehua is cumulation of our recent efforts to transform our business by offering steel processing services for customers, in addition steel manufacturing. We believe that our strategic expansion into the steel processing services area can make Sutor one of the best integrated service providers of fine finished steel manufacturing, processing and related logistics." Ms. Chen concluded.

First Quarter 2015 Financial Results

• Revenue. For the three months ended September 30, 2014, revenue was $38.0million, compared to $139.1 million for the same period last year, a decrease of $101.1 million, or 72.7%.
• EPS was $(0.12) vs. last years same quarterly earnings of $0.13.

Ms. Lifang Chen, CEO of Sutor, commented, "Based on our recent operating results and market outlook, we anticipate our performance for the second quarter of fiscal year 2015 will improve. We believe the recent net loss reflected the unusual challenges facing the Chinese steel industry and our company.

"It appears that the steel industry is at a cyclical bottom. The headwinds we encountered were stronger than we had expected. The Chinese economy is undergoing a structural adjustment. During the process, those companies without technology or markets for their products are being phased out. This structural change temporarily reduced demands for certain steel products, depressed prices to a multi-year low level, and altered our customers purchase patterns. Further, tight liquidity for some small and medium enterprises further constrained our customers' operations and affected our performance."

Ms. Chen continued, "To cope with these challenges, we are carrying out a number of strategic initiatives. We are taking a multi-faceted approach and transforming ourselves from a traditional steel manufacturer to a fine finished steel product and service provider. We are developing fee-based steel processing services to minimize the risks of declining steel prices. We believe that such services are more scalable and allow us to quickly adapt to the changes in the market place.

"We believe the growth of Chinese economy cannot be sustainable without a healthy and growing steel industry. We also believe the Chinese steel sector is at a cyclical bottom and the valuation of Chinese steel companies is generally depressed. This creates a tremendous opportunity for the steel industry to restructure and consolidate. We are taking advantage of this historical opportunity and actively evaluating merger and acquisition opportunities that are otherwise not available to us.We have engaged Ernst & Young as our financial advisor to help us evaluate and structure deals and to maximize our asset value. We believe we can become larger and stronger through steel industry restructuring and consolidation. We will update the market on this potential development when it is appropriate." Ms. Chen concluded

SUTOR TECHNOLOGY GROUP LIMITED AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS

AND COMPREHENSIVE INCOME

Management Discussion and Analysis

For the fiscal year ended June 30, 2014, revenue was $405.4 million compared to $612.1 million last year, a decrease of approximately $206.7 million, or 33.8%. Total sales volume in tons decreased approximately 39.3% in fiscal year 2014 as compared to last year, which reflected the impact of stagnant Chinese real estate markets, steel industry overcapacity as well as the Company’s transition from a pure fine-finished steel manufacturer to a steel product and processing service provider. For a typical product sales transaction, our product price covers the cost of raw materials as well as gross profits; while for a fee-based steel processing service, the price for our service does not contain the cost of raw materials as the customers buy the raw materials and we charge them only for a processing fee to cover processing expenses and a profit. Therefore, revenue from steel processing services is significantly lower than that from product sales.

Our business was relatively stable during the first three quarters of fiscal 2014 while our sales declined significantly during the fourth quarter. We believe a number of factors contributed to this change: First, the prices of steel products declined to a multi-year low level during the fourth quarter and the market generally believed that the near-term outlook remained bearish. As a result, very few customers were willing to place large orders with us and fulfilling small orders reduced our production efficiency. Second, the real estate markets in most cities in China were stagnant. In some markets, housing prices and sales declined so dramatically that the local governments had to repeal its restrictive policies to control housing prices and excessive investment in the real estate. A stagnant real estate market affected demands for a variety of steel products including steel products for construction and infrastructure as well as for household appliances. Moreover, banks in general tightened their policy of granting of new lines of credit to non-state-owned enterprises. Due to the tight liquidity of many small and medium enterprises (SMEs), which are our core clients, they were unable to expand their operations and some even had to reduce their operating scale, which significantly adversely affected our operations.

Net income, without including the foreign currency translation adjustment, decreased $9.8 million, or approximately 58.2%, to $7.1 million in fiscal year 2014, from $16.9 million in fiscal year 2013, as a cumulative result of the above factors.

CHANGSHU, China, November 25, 2014 /PRNewswire-FirstCall/ -- Sutor Technology Group Limited (the "Company" or "Sutor") (Nasdaq: SUTR), one of the leading providers of fine finished steel products and services used by steel fabricators and other applications in a variety of industries, today announced that it received a letter from the Listing Qualifications Department of The NASDAQ Stock Market, on November 20, 2014 (the "Letter"), informing the Company that it does not comply with the Nasdaq continued listing requirements set forth in Nasdaq Listing Rule 5250(c)(1), which requires the timely filing of periodic reports because the Company has not yet filed its Form 10-Q for the period ended September 30, 2014 (the "Form 10-Q"), and because the Company remains delinquent in filing its Form 10-K for the period June 30, 2014 (the "Form 10-K").

The Company has until December 15, 2014, to submit a plan to regain compliance with respect to the above delinquent reports. The Nasdaq Listing Rules provide that the Staff can grant the Company an exception of up to 180 calendar days from the filing's due date, or until April 13, 2015 to regain compliance if Nasdaq accepts the Company's plan of compliance.

As previously reported by the Company in its Form 12b-25 filed with the Securities and Exchange Commission on November 14, 2014, the filing of the Company's Form 10-Q has been delayed as a result of the change of the Company's auditor.

Item 4.01 Change in Registrant’s Certifying Accountant.

(a) Dismissal of Previous Independent Registered Public Accounting Firm.

i. Effective October 17, 2014, the Audit Committee of the Board of Directors (the “Audit Committee”) of Sutor Technology Group Limited (the “Company”) approved the dismissal of Grant Thornton, the China member firm of Grant Thornton International (“Grant Thornton”) as the Company's independent registered public accounting firm.

ii. Grant Thornton’s reports on the Company’s financial statements as of and for the fiscal years ended June 30, 2013 and 2012 did not contain an adverse opinion or disclaimer of opinion and were not qualified or modified as to uncertainty, audit scope, or accounting principles.

iii. Other than described below, during the Company’s two most recent fiscal years (ended June 30, 2014 and 2013) and during the subsequent interim period through October 17, 2014, there were (1) no disagreements with Grant Thornton on any matter of accounting principles or practices, financial statement disclosure, or auditing scope or procedures, which disagreements, if not resolved to the satisfaction of Grant Thornton, would have caused Grant Thornton to make reference to the subject matter of the disagreements in connection with its reports, and (2) no events of the type listed in paragraphs (A) through (D) of Item 304(a)(1)(v) of Regulation S-K.

In connection with the audit of the Company’s financial statements for the fiscal year ended June 30, 2014, Grant Thornton raised questions and planned to expand the scope of audit work on the revenue contributed from certain significant customers of the Company. As part of its audit scope, Grant Thornton selected the significant sales to these customers, which were reported as third-party sales, for testing. These transactions represented approximately two-thirds of unaudited fourth quarter revenue. Grant Thornton questioned whether the sales to these four customers in the fourth quarter satisfied revenue recognition criteria, due to certain facts related to the sales transactions, such as lack of fixed payment terms and the lack of cash receipts related to any of these transactions from the end of the fiscal year through the date we dismissed Grant Thornton.

In addition to questioning the sales for proper revenue recognition, Grant Thornton questioned the Company’s classification of the sales as third-party sales based on the fact that management of the majority of these customers were former employees of Shanghai Huaye Iron & Steel Group Co., Ltd., a PRC company of which the Company’s major shareholder and her husband are 100% owners, and three of the customers’ primary places of business resided at the related party facilities and location of one customer was not verified, as noted below. As the fourth quarter was a slow period for the steel industry with significant declines in steel prices and demand in China, Grant Thornton also questioned the substance of these significant sales in addition to the aspects of these sales mentioned previously.

As part of their procedures to complete their audit work related to these transactions, Grant Thornton would seek information that is not in the possession, custody or control of the Company. Grant Thornton indicated that the documentation we provided to substantiate the transactions did not satisfactorily achieve their audit objectives and they requested the following:

  · Financial records and other business or credit rating information of the customers in question
  · Information regarding the corporate structure of these customers and business agreements between those entities and our related party
  · Permission to perform site visits at the customer locations, interview management, and observe the inventory and sales records between the Company and the customers.

Initially the site visits were arranged by the customers with the consent of the Company, but after the customers requested to know Grant Thornton’s procedures in advance of the visit all four customers revoked their consent to allow Grant Thornton to perform site visitations.

In addition to revenue testing, Grant Thornton requested that the Company revise its analysis of inventory reserves and further evaluate the recoverability and classification of inventory advances paid to related parties due to downward trend in the steel prices and demand in the China market subsequent to the fiscal year-end period.

Grant Thornton also advised the Company and the Audit Committee that, depending upon what Grant Thornton learned from the procedures performed pursuant to its audit scope, it might request additional information. The Company has concluded that Grant Thornton’s proposed procedures may create risks for the Company with respect to the Company’s obligation to timely file its annual report on Form 10-K for the fiscal year 2014.

These issues and requests were not resolved to Grant Thornton’s satisfaction.

The Audit Committee has carefully considered the additional work proposed by Grant Thornton and discussed the disagreement with Grant Thornton. The Company has authorized Grant Thornton to respond fully to inquiries of the successor accountant of the Company concerning this matter.

(b) Engagement of New Independent Registered Public Accounting Firm

i. Concurrent with the decision to dismiss Grant Thornton as the Company’s independent auditor, the Audit Committee approved the engagement of BDO China Shu Lun Pan Certified Public Accountants LLP (“BDO”) as the Company’s new independent registered public accounting firm.

ii. During the Company’s two most recent fiscal years (ended June 30, 2014 and 2013) and during the subsequent interim period through October 17, 2014, the Company did not consult BDO with respect to (a) the application of accounting principles to a specified transaction, either completed or proposed; or the type of audit opinion that might be rendered on the Company’s consolidated financial statements, and neither a written report was provided to the Company or oral advice was provided that BDO concluded was an important factor considered by the Company in reaching a decision as to the accounting, auditing or financial reporting issue; or (b) any matter that was the subject of either a disagreement as defined in Item 304(a)(1)(iv) of Regulation S-K or a reportable event as described in Item 304(a)(1)(v) of Regulation S-K.

The Company has full confidence in BDO’s ability to conduct the audit work independently, diligently and expeditiously. In addition, the Company remains fully confident in all of its previously reported financials and filings as to their accuracy and does not expect any material changes.

The Company provided Grant Thornton with a copy of this disclosure on October 21, 2014, providing Grant Thornton with the opportunity to furnish the Company with a letter addressed to the Securities and Exchange Commission containing any new information, clarification of the Company's expression of its views, or the respect in which Grant Thornton does not agree with the statements contained herein. When received, a copy of Grant Thornton’s letter will be filed as an exhibit to an amendment of this Current Report.

The Letter states in part that the Nasdaq Staff has afforded the Company the opportunity to submit a plan prior to December 15, 2014 that addresses the details of the Company's plan to regain compliance with the Nasdaq Listing Rules. The Nasdaq Listing Rules provide that the Staff can grant the Company an exception of up to 180 calendar days from the filing's due date, or until April 13, 2015 to regain compliance if Nasdaq accepts the Company's plan of compliance.

The Letter advises that in determining whether to accept the Company's plan, the Nasdaq Staff will consider such things as the likelihood that the 10-K, along with any subsequent periodic filing that will be due, can be made within the 180 day period, the Company's past compliance history, the reasons for the late filing of the 10-K, other corporate events that may occur within the review period, the Company's overall financial condition, and the Company's public disclosures.

The Company plans to present its plan of compliance to Nasdaq as soon as practicable. However, there is no assurance that the compliance plan will be accepted by the Nasdaq Staff. If the Company's plan of compliance is not accepted, the Company would have the opportunity to appeal that decision to a Hearings Panel. 

CHANGSHU, China, September 29, 2014 /PRNewswire-FirstCall/ -- Sutor Technology Group Limited (the "Company" or "Sutor") (Nasdaq: SUTR), a leading Chinese non-state-owned manufacturers and service providers for fine finished steel products used by a variety of downstream applications, today announced it has filed with the United States Securities and Exchange Commission, Form 12b-25 Notification of Late Filing for its Annual Report on Form 10-K for the year ended June 30, 2014. The Form 12b-25 will allow the Company an additional 15 calendar days to file the Form 10-K which is due on October 13, 2014.

The reason for the delay is to allow the Company additional time to gather information required for an accurate and full completion of the Annual Report on Form 10-K. The filing delay is not the result of the need to restate any prior period financial results. The Company expects to file within the additional time allowed by the Form 12b-25. Upon filing on or before October 13, 2014, the Company's Annual Report on Form 10-K will be deemed to be timely filed.

Information regarding the Company's fiscal year end conference call date and time will be provided in a forthcoming news release.

CHANGSHU, China, August 12, 2014 /PRNewswire-FirstCall/ -- Sutor Technology Group Limited (the "Company" or "Sutor") (Nasdaq: SUTR), a leading China-based manufacturer and distributor of high-end fine finished steel products used by a variety of downstream applications, today announced that on August 8, 2014 it received a letter from the staff of the Listing Qualification of the NASDAQ Stock Market LLC (the "Staff"), indicating that the Company is not in compliance with the $1.00 minimum closing bid price requirement under the NASDAQ Listing Rules (the "Listing Rules").

The Listing Rules require listed securities to maintain a minimum bid price of $1.00 per share. If a NASDAQ-listed company trades below the minimum bid price requirement for 30 consecutive business days, it will be notified of the deficiency. Based upon the Staff's review, the Company no longer meets this requirement. However, the Listing Rules provide the Company with a compliance period of 180 calendar days, or until February 4, 2015 in which to regain compliance with this requirement.

To regain compliance with the minimum bid price requirement, the Company must have a closing bid price of $1.00 per share or more for a minimum of ten consecutive business days during this compliance period.

Third Quarter of Fiscal Year 2014 Results

• Revenue. For the three months ended March 31, 2014, revenue was $96.4 million, compared to $139.5 million for the same period last year, a decrease of $43.1 million, or 30.9%.
• Diluted Earnings per Share was $0.03 vs. last years same quarter of $0.10.

Mr. Zhuo Wang, CEO of Sutor, commented, "While the total revenue was down as we reduced sales of low margin products like acid-pickled (AP) steel and focused on producing high-end products, the reduction in the gross margin for our main product HDG steel was larger than expected. We were affected by the recent decelerated GDP growth in China. During the quarter, the prices of steel products declined sharply as the steel industry was undergoing transition to improve performance and due to reduced economic activities in several sectors. Many of Sutor's customers are small and medium-sized downstream manufacturers and some are steel trading companies. When the prices of steel products reached a multi-year low level and the overall liquidity in China was contracting, they were affected most and some faced liquidity reduction. To minimize the risks, some of our customers reduced procurements and others took a wait-and-see approach. "

Mr. Wang continued, "We believe we are exposed to an economic slowdown, which may remain for some time. As the on-going economic restructuring begins to yield positive results and China's economy resumes its upward trajectory, we anticipate the performance of the Chinese industrial sectors will start to improve. "

"To cope with the near term challenges, we have taken a number of initiatives to transform Sutor from a manufacturing company to a product and service provider: (1) Shift our strategy from pursuing sales volume and scale to providing more fee-based processing services and quality-centered product offerings; (2) Reduce sales of low gross margin products like AP steel and develop high growth and high margin products; (3) Improve procurement efficiency and reduce purchasing costs through competitive bidding on our Internet B2B platform; (4) Seek strategic industrial and financial partners to strengthen our market position and financial ability; and (5) Enhance our investor relations efforts and increase our exposure to the investment community." Mr. Wang concluded.

CHANGSHU, China, March 4, 2014 /PRNewswire-FirstCall/ -- Sutor Technology Group Limited (the "Company" or "Sutor") (Nasdaq: SUTR), a leading China-based manufacturer and distributor of high-end fine finished steel products used by a variety of downstream applications today announced that Changshu Huaye Steel Strip Co., Ltd., a subsidiary of Sutor, has entered into a supply contract with SAMSUNG Group to supply a total of 6,500 metric tons of aluminum-zinc alloy coated steel (also known as Galvalume). The contract is valued at approximately $5.2 million. According to the contract, the goods will be shipped to Samsung's operating base in Brazil and the delivery is expected to begin in mid April 2014.

Mr. Zhuo Wang, CEO of Sutor, commented, "I am pleased to report that we achieved high product quality within such a short period of time for our Galvalume products. We started commercial production of Galvalume steel during the fourth quarter of fiscal 2013 and produced less than 200 tons of the products in fiscal 2013. We increased our production to approximately 6,000 tons in the second quarter of fiscal 2014. The contract with Samsung proves our ability to supply to the leading consumer products companies in the world and demonstrates our brand recognition, product quality and our ability to quickly commercialize new products."

"We have a portfolio of products with flexible specifications and value added supplementary services targeting the consumer products markets. For example, our anti-fingerprints, anti-bacteria, and heat insulation lines of products allow us to gain access to a wide range of customers in a variety of sectors. With the new 500,000 metric tons cold-rolling production line expected to start commercial operation in May, we believe we would be in a better position to capitalize the economic transition in China," Mr. Wang added.

CHANGSHU, China, February 20, 2014 /PRNewswire-FirstCall/ -- Sutor Technology Group Limited (the "Company" or "Sutor") (Nasdaq: SUTR), a leading China-based manufacturer and distributor of high-end fine finished steel products used by a variety of downstream applications, today announced that Changshu Huaye Steel Strip Co., Ltd., a subsidiary of Sutor, has entered into two international sales agency agreements with two sales agencies located in the Middle East market (covering Jordan and Iraq) and South American market (targeting Chile and Bolivia) to supply a total of 15,000 metric tons of coated steel coils annually. According to the agreements, the contracts are valued between approximately $10 million and $12 million subject to the products to be ordered.

Mr. Zhuo Wang, CEO of Sutor commented, "Both clients have been our loyal customers for more than three years. They have increased their purchase volume lately, which demonstrates our strong brand recognition and company reputation in these markets. For the last several years, our products have been exported to more than 30 countries and international sales usually enjoy higher gross margins than domestic ones. We will continue to strengthen our global presence by providing high-quality and diverse product offerings as well as expanding our distribution engagements with overseas sales agencies."

Second Quarter 2014 Results

• In the second quarter of fiscal 2014, our revenue decreased from $157.9 million to $128.3 million, as compared with the same period last year
• Second quarter 2014 EPS of $0.15 vs $0.12 in the prior year period

We improved our product specifications to meet the market demand. We produced more HDG steel with thicker zinc coatings than we previously produced. We gained more traction for our new Galvalume product and substantially increased its production. We delivered more value-added customized services to retain customer loyalty and to gain new customers by extending our one-stop solution services further down-stream to cover certain steel processing services for selected customers. As a result, our gross margin increased to 10.6% from 7.7% and net income increased to $6.4 million from $4.8 million in the second quarter of fiscal 2014 as compared with the same period last year.

Ms. Lifang Chen, Chairwoman of Sutor, commented, "We ended the second quarter of fiscal 2014 with solid performance. During the quarter, we grew net income, improved cash flow from operations and reduced bank borrowings. With the new cold-rolling facility completed, we believe the Company will be in a better financial and operating situation and the management will have more leeway to consider various options for corporate development. In the near term, we will focus on fine-tuning the new production line and starting commercial production. In the longer term, we will continue to develop advanced fine-finished steel products to meet the growing need of the on-going economic transition and development in China. Further, we will continue to steadily cultivate our newly developed e-commerce business and make it an important part of our integrated manufacturing and supply-chain products and services."

CHANGSHU, China, January 21, 2014 /PRNewswire-FirstCall/ -- Sutor Technology Group Limited (the "Company" or "Sutor") (Nasdaq: SUTR), a leading China-based manufacturer and distributor of high-end fine finished steel products used by a variety of downstream applications, today announced it has completed construction of the new 500,000 metric tons (MT) cold-rolling production line and moved to the phase of trial production at Jiangsu Cold Rolled Technology Co., Ltd, a subsidiary of Sutor.

Lifang Chen, Chairwoman and CEO of Sutor commented, "During the trial production, we will carefully monitor the status of the new production line to ensure that the facility will achieve the designed performance when the commercial production begins. We expect that the new cold-rolling line will provide us with a wider range of product specifications and better product flatness and surface treatment than our existing cold-rolling production line. With the new line in commercial operation, we will have 750,000 MT of cold-rolling capacity to match our 700,000 MT of hot-dip galvanization capacity. We are optimistic that the new capacity will improve our operating efficiency, expand our product offerings and hence strengthen our competitiveness in the high-end product market. "

The timing of the commercial operation of the new production line is subject to the performance of trial production. The Company intends to update the market once the commercial operation commences.

CHANGSHU, China, December 12, 2013 /PRNewswire-FirstCall/ -- Sutor Technology Group Limited (the "Company" or "Sutor") (Nasdaq: SUTR), a leading China-based manufacturer and distributor of high-end fine finished steel products used by a variety of downstream applications, today announced its subsidiary Ningbo Zhehua Heavy Steel Pipe Manufacturing Co., Ltd. ("Ningbo Zhehua") won three contracts to supply approximately 4,000 metric tons of spiral seam steel pipes to three water transportation pipeline projects in Zhejiang Province. The contracts are valued at approximately $3 million. Deliveries of Company products are expected to begin in January 2014.

Lifang Chen, Chairwoman and CEO of Sutor commented, "As a result of Ningbo Zhehua's efforts to strengthen its capability of providing customized products and services for end customers, the company is able to gain access to more municipal projects related to water supply, waste water treatment and recycling of treated water. The recent series of bid wins of water transportation related projects demonstrated our success in product upgrading and in the company's efforts to address heightened concerns on environmental issues in China."

"As environmental protection has become a top priority for the new Chinese leadership, we expect China's green industry will take a prominent position in the years to come. Accordingly, Sutor's operating subsidiaries, covering fine finished steel and steel pipe businesses, are undergoing a transformation in order to take advantage of the fast growing green industry. In addition to providing products for water-related projects, Sutor is striving to expand its market share in the air filtration and purification industry by supplying qualified fine finished steel products to relevant equipment manufacturers. We believe the versatility of our products and our commitment to meet market demands will enable us to significantly increase our competitiveness in the long term," Ms. Chen continued.

First Quarter 2014 Financial Results

• Revenue. For the three months ended September 30, 2013, revenue was $139.1 million, compared to $117.2 millionfor the same period last year, an increase of $21.9 million, or 18.7%.
• Earnings per Shares. The EPS and weighted average shares outstanding were $0.13 and 41,314,527, respectively, for the first quarter of fiscal 2014, as compared with $0.05 and 40,235,700, respectively, for the same period last year.

Ms. Lifang Chen, Chairwoman and CEO of Sutor, commented, "This is the fourth quarter in a row in which we achieved a quarterly EPS of $0.10 or higher. We also generated more cash flows from operations. We are very pleased that our performance has stabilized during the last several quarters after a challenging fiscal 2012. In the coming months, our priority will be on completing the new production facility on budget and on schedule. We hope the new facility will enable us to better optimize our integrated production lines and further strengthen our competitiveness. In addition, we will continue to explore the potential of combining our manufacturing businesses with electronic commerce. We hope the latter will provide us with additional growth catalysts for the years to come."

Ms. Chen further commented "We believe the recent initiatives by the Chinese central government to control excess capacity in several industries including the iron and steel industry will benefit the leading producers of the industries. Although we are in the fine finished steel business, we believe a restructured upstream segment of the iron and steel industry with balanced supply and demand will benefit all the parties involved - producers and consumers alike. We hope we can take advantage of the opportunities created during the economic transformation process in China and successfully carry out our growth initiatives."

CHANGSHU, China, Oct. 16, 2013 /PRNewswire-FirstCall/ - Sutor Technology Group Limited (the "Company" or "Sutor") (Nasdaq:SUTR), a leading China-based non-state owned manufacturer and distributor of high-end fine finished steel products and welded steel pipes used by a variety of downstream applications, today announced the Jiangsu provincial government had renewed the High Tech Enterprise status of the Company's wholly-owned subsidiary, Changshu Huaye Steel Strip Co., Ltd.("Changshu Huaye").

As a result, Changshu Huaye is entitled to a preferred tax rate of 15% for the three years 2013 through 2015, compared with the normal 25% corporate tax rate.  Changshu Huaye was designated as a High Tech Enterprise beginning in 2010.

Ms. Lifang Chen, Chairlady and CEO of Sutor, commented, "The approval of the renewed High Tech Enterprise status demonstrates the Chinese government's acknowledgment of Sutor's commitment to becoming a leader in China's high-end steel industry and its endeavor to adhere to its strategy of driving the Company's growth via technological innovation. We believe this strategy strengthens the Company's core competencies and differentiates it from its competitors. While our current main business is traditional manufacturing business, we will accelerate our growth through technological innovation, expanding capacity as well as new business initiatives. We seek long-term sustainable growth to meet growing customer needs."

Fourth Quarter 2013 Financial Results

• Revenue. For the fiscal year ended June 30, 2013, revenue was $612.1 million compared to $531.6 million last fiscal year, an increase of approximately 15.1%.
•  Basic & Diluted Earnings per Share was $0.16 vs last years quarter of $0.08

Ms. Lifang Chen, Chairwoman and CEO of Sutor, commented, "We are very pleased that our performance of fiscal year 2013 rebounded strongly from a low level of the last several years. We attribute our success to our commitment to producing a portfolio of fine finished steel products to serve customers in a variety of industries including household appliances, green industries, IT, automobiles and construction and infrastructure. Our main factories are located in Changshu, a port city in Jiangsu province. Jiangsuis one of the largest provinces in China in terms of economic output and Changshu port processes a large portion of the steel products used in eastern China. Our vertically integrated business model combined with this strategic location gives us a natural competitive advantage which is hard for other steel processing companies to match."

Ms. Chen continued, "The Chinese economy is going through a transition from an investment and export driven economy with priority on growth to an economy where domestic consumption will play a more important role and sustainable growth will be the goal. Like in any economies, transition brings about both challenges and opportunities. We are no exception.  While our business segment for steel pipe products used  in the construction and infrastructure sectors suffered losses in recent years, our main products used for consumer durables and general industrial applications continue to enjoy growth and profits due to population growth and overall growing economic activities in China."

Ms. Chen further commented, "Going forward and in order to achieve sustainable growth, we have in place a number of strategies to cope with economic volatilities in the Chinese economy as well as the overcapacity problem in some sub-segments of the steel industry. First, we will continue to develop high-end products, particularly our hot-dip galvanized (HDG) and pre-painted galvanized (PPGI) products, which are especially well received in the overseas markets. Our market research shows that there is a strong demand for high-end steel products even when there are excess supplies for certain low end steel products. Second, we will continue to develop our recently established B2B online trading platform exclusively for the heavy industries. It is scalable and supplementary to our existing capital intensive and asset heavy steel processing business. We view it as a real option and hope it will become a significant business component of the Company in the future. Finally, we anticipate that the completion of the new 500,000-ton cold-rolled steel production line may contribute to our near term growth."

Ms. Chen concluded, "According to National Bureau of Statistics of China, The Chinese PMI for August was 51.0%.  It has been above 50.0% for consecutive eleven months. More importantly, all of the five component indices of the PMI index showed improvement over those for July. There are different assessments of the outlook of the Chinese economy.  But based on the latest economic indicators, we are cautiously optimistic about the economic activities for the rest of 2013. We do not foresee major problems related to the demand for our products or customers' ability to pay for our products and services."

ITEM 1.01. ENTRY INTO A MATERIAL DEFINITIVE AGREEMENT.

On July 5, 2013, Sutor Technology Group Limited (the “Company”) entered into a securities purchase agreement (the "Securities Purchase Agreement") with certain investors, pursuant to which, the Company issued and sold an aggregate of 1,041,665 shares of common stock, par value $0.001 per share of the Company (the “Shares”) to the investors, for an aggregate purchase price of $1.5 million.

The foregoing description of the Securities Purchase Agreement is qualified in its entirety by reference to the full text of the Securities Purchase Agreement, a form of which is attached hereto as Exhibit 10.1, and is incorporated herein by reference.

The issuance of the Shares to the investors was made in reliance on the exemption provided by Section 4(a)(2) of the Securities Act of 1933, as amended (the "Act"), for the offer and sale of securities not involving a public offering, Regulation D and Regulation S promulgated thereunder. None of the Shares have been registered under the Act and neither may be offered or sold in the United States absent registration or an applicable exemption from registration requirements. This current report on Form 8-K does not constitute an offer to sell, or a solicitation of an offer to buy, any security and shall not constitute an offer, solicitation or sale in any jurisdiction in which such offering would be unlawful.

CHANGSHU, China, June 5, 2013 /PRNewswire-FirstCall/ -- Sutor Technology Group Limited (the "Company" or "Sutor") (Nasdaq:SUTR), a leading China-based manufacturer and distributor of high-end fine finished steel products and welded steel pipes used by a variety of downstream applications, today announced Ningbo Zhehua Heavy Steel Pipe Manufacturing Co., Ltd. ("Ningbo Zhehua"), a subsidiary of Sutor, had entered into a partnership agreement with Zhejiang Longkey Anti-corrosion Co., Ltd. ("Zhejiang Longkey") to build an anti-corrosion coating line at Ningbo Zhehua's operating base in Ningbo, Zhejiang province.

According to the agreement, Zhejiang Longkey will be responsible for procurement, construction, operating, and maintenance of the coating line and Ningbo Zhehua will provide land and factory buildings. The production facilities will be housed in the existing buildings inside the fence of its factory. As a result, capital expenditures for Ningbo Zhehua will be minimal. The new coating line will be 100% owned by Zhejiang Longkey and is expected to start operations in the first quarter of fiscal 2014.

Through this agreement, Ningbo Zhehua will have the ability to bid on additional pipe manufacturing contracts that require special anti-corrosion processing: these are bids that Ningbo Zhehua has been unable to bid for in the past. Further, Zhejiang Longkey will refer customers to Ningbo Zhehua. Once the bids are awarded, Ningbo Zhehua will manufacture the pipes and complete the anti-corrosion process by using the line operated and maintained by Zhejiang Longkey's personnel. Zhejiang Longkey will charge an anti-corrosion fee which will be included in the selling prices of the pipes.

Mr. Yueming Shi , president of Zhejiang Longkey, said, "We are pleased to partner with Ningbo Zhehua. Its diversified product portfolio, large market share in Eastern China, and extensive expertise in the heavy steel pipe manufacturing sector are very appealing to our existing business and we look forward to exploring more opportunities in the near future."

Ms. Lifang Chen , Chairwoman and CEO of Sutor, commented, "Sutor is delighted to cooperate with Zhejiang Longkey, a leading company in the anti-corrosion field with Class-1 Qualification for Anti-corrosion Construction. Zhejiang Longkey specializes in anti-corrosion technologies and provides solutions for a variety of construction projects and industrial applications. Its technical expertise and commitment to quality are complementary to our products and services."

"Anti-corrosion is an important value-added process in the steel pipe manufacturing business. The partnership demonstrates our continuous efforts to improve the value of finished products and gain access to more sophisticated customers. Given the fact that Ningbo Zhehua has completed approximately 15,000 metric tons of supply contracts by using Zhejiang Longkey's anti-corrosion service in the past several months, we are encouraged by this joint operation," Ms. Chen concluded.

Third Quarter 2013 Financial Results

• Revenue was $139.6 Million vs last years 109.9 a 27% increase
• Net Income$3.88 Million vs last years$1.28 Million an increase of 203.1%
• EPS Fully Diluted was $0.10 vs last years $0.03 an increase 233.3%

Ms. Lifang Chen, CEO and Chairwoman of Sutor, commented: "Following a successful second quarterof fiscal 2013, we are pleased to report that the result of the third quarter exceeded our expectations. Further, we are on track to carry out our strategy to organically grow our production capacity, expand the asset-light B2B electronic commerce platform exclusively for the heavy industries, and selectively pursue merger and acquisition and joint-venture opportunities to accelerate our growth."

Ms. Chen concluded, The Chinese economy had a weak recovery during the last two quarters after several consecutive quarters' decline in GDP growth rate. China Purchasing Managers' Index (PMI) for the manufacturing sector has been above 50% for seven consecutive months since last October. Although the latest economic indicators showed some weakness, we believe the overall trend remains healthy. Based on the year-to-date results, we feel optimistic that we can end fiscal 2013 on a positive note. In the longer term, we believe our new cold-rolled production line of 500,000 tons annual capacity, which is expected to commence trial production later this year, our recent joint venture with China Railway Materials Wuhan Company, and our new galvolume steel products launched in January this year will become the additional drivers for our future growth. We look forward to reporting our progress in the coming months.

CHANGSHU, China, April 1, 2013 /PRNewswire-FirstCall/ -- Sutor Technology Group Limited (the "Company" or "Sutor") (Nasdaq: SUTR), a leading China-based manufacturer and distributor of high-end fine finished steel products and welded steel pipes used by a variety of downstream applications, today announced its subsidiary Ningbo Zhehua Heavy Steel Pipe Manufacturing Co., Ltd. ("Ningbo Zhehua") won a contract to supply 11,440 meters of spiral seam steel pipes for a water transmission pipeline project in Zhuji City, Zhejiang Province. The contract is valued at approximately $8.6 million. Deliveries are expected to begin in April 2013.

Lifang Chen , Chairwoman and CEO of Sutor commented, "We are pleased that following a bid process, Ningbo Zhehua won this major contract to supply its spiral seam steel pipes for this vital urbanization project for the city of Zhuji. This win is a demonstration of the high quality and brand recognition of our products. Ningbo Zhehua facility manufactures a variety of steel pipes, has six production lines and a total annual capacity of 400,000 metric tons. Ningbo Zhehua's large diameter steel pipe production line uses one of the most advanced technologies in the steel pipe industry."

Ms. Chen continued, "Improvement and expansion of water infrastructure remains an important element of China's urbanization plan which continues at an unprecedented rate. Currently China's urbanization ratio is approximately 48%, well below the 85% in the developed economies and the global average of 55%. The scale and pace of China's ongoing urbanization and the growth in domestic consumption are expected to drive the need for greater infrastructure investments and should increase the demand for a variety of high-end steel products. Sutor is well positioned to take advantage of these growth opportunities as our products are used in a variety of industries such as construction (buildings, bridges, water and sewage infrastructure, etc), oil and gas, household appliances, solar water heaters, medical instruments and automobiles."

CHANGSHU, China, April 1, 2013 /PRNewswire-FirstCall/ -- Sutor Technology Group Limited (the "Company" or "Sutor") (Nasdaq: SUTR), a leading China-based manufacturer and distributor of high-end fine finished steel products and welded steel pipes used by a variety of downstream applications, today announced its subsidiary Ningbo Zhehua Heavy Steel Pipe Manufacturing Co., Ltd. ("Ningbo Zhehua") won a contract to supply 11,440 meters of spiral seam steel pipes for a water transmission pipeline project in Zhuji City, Zhejiang Province. The contract is valued at approximately $8.6 million. Deliveries are expected to begin in April 2013.

Lifang Chen , Chairwoman and CEO of Sutor commented, "We are pleased that following a bid process, Ningbo Zhehua won this major contract to supply its spiral seam steel pipes for this vital urbanization project for the city of Zhuji. This win is a demonstration of the high quality and brand recognition of our products. Ningbo Zhehua facility manufactures a variety of steel pipes, has six production lines and a total annual capacity of 400,000 metric tons. Ningbo Zhehua's large diameter steel pipe production line uses one of the most advanced technologies in the steel pipe industry."

Ms. Chen continued, "Improvement and expansion of water infrastructure remains an important element of China's urbanization plan which continues at an unprecedented rate. Currently China's urbanization ratio is approximately 48%, well below the 85% in the developed economies and the global average of 55%. The scale and pace of China's ongoing urbanization and the growth in domestic consumption are expected to drive the need for greater infrastructure investments and should increase the demand for a variety of high-end steel products. Sutor is well positioned to take advantage of these growth opportunities as our products are used in a variety of industries such as construction (buildings, bridges, water and sewage infrastructure, etc), oil and gas, household appliances, solar water heaters, medical instruments and automobiles."

Fourth Quarter 2012 Results

• For the fiscal 2012 fourth quarter, Sutor generated revenue of approximately $183.6 million vs.  $109.9 million in the prior year.
• Net income of $3.3 million and EPS of $0.08 vs $1.2 million and $0.03 in prior year.

Ms. Lifang Chen, Chairwoman and CEO of Sutor, commented, "We are pleased that despite the challenging economic conditions in China and abroad, we generated record revenue and have continued to grow our business by developing new products, increasing our customer base, and by establishing a joint venture, and therefore positioned our Company well for sustainable growth in fiscal 2013 and beyond."

Ms. Chen concluded, "We believe our stock is extremely undervalued. Although factors like investors' sentiment and macro-economic conditions are beyond our control, we are doing everything we can as a public company to restore investor confidence. We have taken steps to strengthen our internal control procedures, engaged a top five globally-ranked audit firm, maintained a complete Board of Directors of both U.S. and Chinese experts, retained a reputable U.S. law firm as our legal counsel, and hired a U.S. based IR firm to improve shareholder communications. We encourage investors to visit our website for additional corporate news and to learn more about our Company. We'll continue to explore all options to protect and maximize shareholder value."

CHANGSHU, China, August 21, 2012 /PRNewswire-Asia-FirstCall/ -- Sutor Technology Group Limited (the "Company" or "Sutor") (Nasdaq: SUTR), a leading China-based non-state owned manufacturer and distributor of high-end fine finished steel products and welded steel pipes used by a variety of downstream applications, today announced that it has entered into a supply agreement for 12,000 metric tons of spiral seam steel pipes with Middle East Dredging Company ("MEDCO"), a company established in Qatar and specialized in capital dredging works, through a complementary fleet of dredging vessels, reclamation and other equipment. MEDCO intends to use the steel pipes for an oil transportation project in Qatar.

Under the agreement, the total contractual amount is approximately $10 million. Sutor expects to start delivering the steel pipes in September and complete the delivery by December 15, 2012.

Ms. Lifang Chen, Chairwoman and CEO of Sutor, commented, "Sutor is proud to partner with MEDCO, a leading dredging and reclamation contractor which has been involved in a number of prestigious projects in the Middle East. With this supply agreement, we believe Sutor's presence and reputation in the region have been enhanced and strengthened. In the highly competitive global steel industry, we believe that our focus on providing customers with outstanding service and superior products has made Sutor a supplier of choice for a growing list of customers in more than 30 countries."

CHANGSHU, China, June 26, 2012 /PRNewswire-Asia-FirstCall/ -- Sutor Technology Group Limited (the "Company" or "Sutor") (Nasdaq: SUTR), a leading China-based non-state-owned manufacturer and distributor of high-end fine finished steel products and welded steel pipes used by a variety of downstream applications, today announced that on June 25, 2012 it received a letter from the staff of the Listing Qualification of the NASDAQ Stock Market LLC (the "Staff"), indicating that the Company is not in compliance with the $1.00 minimum closing bid price requirement under the NASDAQ Listing Rules (the "Listing Rules").

The Listing Rules require listed securities to maintain a minimum bid price of $1.00 per share. If a NASDAQ-listed company trades below the minimum bid price requirement for 30 consecutive business days, it will be notified of the deficiency. Based upon the Staff's review, the Company no longer meets this requirement. However, the Listing Rules provide the Company with a compliance period of 180 calendar days, or until December 24, 2012 in which to regain compliance with this requirement.

To regain compliance with the minimum bid price requirement, the Company must have a closing bid price of $1.00 per share or more for a minimum of ten consecutive business days during this compliance period.

In the event that the Company does not regain compliance within this period, it may be eligible for additional time to regain compliance by satisfying certain requirements. However, if it appears to the Staff that the Company will not be able to cure the deficiency, or if the Company is otherwise not eligible, the Staff will notify the Company that its securities will be delisted from the NASDAQ Capital Market. However, the Company may still appeal the Staff's determination to delist its securities to a Hearing Panel. During any appeal process, the Company's common stock would continue to trade on the NASDAQ Capital Market.

The NASDAQ notification letter has no immediate effect on the listing or trading of the Company's common stock on the NASDAQ Capital Market. The Company is currently looking at all of the options available with respect to regaining such compliance.

CHANGSHU, China, June 13, 2012 /PRNewswire-Asia-FirstCall/ -- Sutor Technology Group Limited (the "Company" or "Sutor") (Nasdaq: SUTR), a leading China-based non-state owned manufacturer and distributor of high-end fine finished steel products and welded steel pipes used by a variety of downstream applications, today announced that its Board of Directors has approved a plan to form a joint venture among its indirect wholly owned subsidiary, Jiangsu Cold-Rolled Technology Co., Ltd. ("Cold-Rolled"), China Railway Materials Wuhan Company Limited ("CRM Wuhan"), a subsidiary of China Railway Materials Company Ltd., and Changshu Binjiang Urban Construction Investment & Management Company ("Changshu Binjiang").

Initially the joint venture will primarily be engaged in providing raw materials procurement, logistic and other related services to third parties. The equity interests in the joint venture for Cold-Rolled, CRM Wuhan and Changshu Binjiang are 39%, 51% and 10%, respectively. CRM Wuhan is a state-owned enterprise (SOE) supervised by the State-owned Assets Supervision and Administration Commission of the State Council (SASAC). It is reported that China Railway Materials Company, the parent of CRM Wuhan, is one of the Fortune 500 companies. Changshu Binjiang is affiliated with Changshu municipal government. The registered capital for the joint venture is Renminbi (RMB) 100 million (approximately US$16 million), among which, RMB 39 million (approximately US$6.24 million) will be contributed by Cold-Rolled.

Ms. Lifang Chen, Chairwoman and CEO of Sutor, commented, "We are very pleased that CRM Wuhan selected us as its partner for the joint venture. It reaffirms our position as one of the leading fine finished steel manufacturers in China. We believe this joint venture will elevate our position in the industry. We also intend to take advantage of CRM Wuhan's extensive business network and vast resources to secure our raw materials procurement on more favorable terms, reduce our financial expenses and strengthen our balance sheet."

"We believe the joint venture will improve our vertically integrated business model by extending our value chain into the upstream raw materials purchases. In the long term, we also believe it will open doors for other strategic growth opportunities," concluded Ms. Chen.

CHANGSHU, China, June 4, 2012 /PRNewswire-Asia-FirstCall/ -- Sutor Technology Group Limited (the "Company" or "Sutor") (Nasdaq: SUTR), a leading China-based non-state owned manufacturer and distributor of high-end fine finished steel products and welded steel pipes used by a variety of downstream applications, today announced that it has successfully developed self-cleaning pre-painted galvanization steel plate (PPGI) products used by large solar energy companies in China.

The self-cleaning PPGI products are featured with improved hydrophilic property and anti-contamination ability. Dust and other contaminants existing on the surface of these products can be washed away by rain. Although similar products have been used for the construction industry, Sutor improved and tailored the products for a large scale use by the solar energy industry. They are typically used to manufacture storage tanks of solar water heaters and related parts.

Ms. Lifang Chen, Chairwoman and CEO of Sutor, commented, "The introduction of the self-cleaning PPGI steel plate for the solar energy industry demonstrates our ability to produce high-end products to meet the needs of industry upgrading in China. As the only research center dedicated to fine finished steel research in Jiangsu Province, we will continue to capitalize on our leading position in the fine finished steel sector and develop new products to meet the growing consumer needs."

CHANGSHU, China, June 4, 2012 /PRNewswire-Asia-FirstCall/ -- Sutor Technology Group Limited (the "Company" or "Sutor") (Nasdaq: SUTR), a leading China-based non-state owned manufacturer and distributor of high-end fine finished steel products and welded steel pipes used by a variety of downstream applications, today announced that it has successfully developed self-cleaning pre-painted galvanization steel plate (PPGI) products used by large solar energy companies in China.

The self-cleaning PPGI products are featured with improved hydrophilic property and anti-contamination ability. Dust and other contaminants existing on the surface of these products can be washed away by rain. Although similar products have been used for the construction industry, Sutor improved and tailored the products for a large scale use by the solar energy industry. They are typically used to manufacture storage tanks of solar water heaters and related parts.

Ms. Lifang Chen, Chairwoman and CEO of Sutor, commented, "The introduction of the self-cleaning PPGI steel plate for the solar energy industry demonstrates our ability to produce high-end products to meet the needs of industry upgrading in China. As the only research center dedicated to fine finished steel research in Jiangsu Province, we will continue to capitalize on our leading position in the fine finished steel sector and develop new products to meet the growing consumer needs."

Third Quarter 2012 Results

• For the three months ended March 31, 2012, revenue was $109.9 million, compared to $101.4 million for the same period last year, an increase of $8.5 million, or 8.4%.
• Net income, without including the foreign currency translation adjustment, decreased by approximately $2.3 million, or 65.7%, to $1.2 million in the three months ended March 31, 2012, from $3.5 million in the same period in 2011, as a cumulative result of the above factors.

Ms. Lifang Chen, Chairwoman and CEO, commented, "Our performance was lower than that in the same quarter last year due to a combination of factors including the slowing down of the Chinese economic growth, equipment shutdown for energy-saving related renovation as well as the timing of project completion. Further, continued appreciation of the Chinese Yuan and lingering financial crises in Europe resulted in slower export sales. It was one of the most challenging quarterly performances for the last several years. We understand every industry and company may have its ups and downs."

"That being said, we are pleased with the fact that sales from our main HDG products were up approximately 36.1% during the quarter compared with the same quarter last year because demand exceeded supplies. As a result, we built up inventories and engaged in spot sales. We fully expect sequentially improved performance in the fourth fiscal quarter in an otherwise challenging but improving economic environment. I am also pleased to report that the construction of the new 500,000 metric tons of high-precision cold-roll steel production line is progressing well. We anticipate trial production will start in July."

"On the capital market, we'll continue to closely monitor the tradeoff between trading liquidity and share prices. We may resume repurchasing shares to protect and maximize shareholder value when appropriate. We may also ask the Board of Directors to approve new buyback programs after the existing program expires. Our near-term priority is to complete the new cold-roll production line on time and then try to maximize the asset value," concluded Ms. Chen.

Outlook

We believe as the inflation pressure in China is under control and the Chinese government may gradually improve monetary liquidity, the Chinese economic growth is expected to gain momentum and maintain a reasonable growth rate. For the steel industry, especially the downstream segment of the industry where our company is located in, we believe the average product price has reached a local bottom and has been stable for the last several months. As we believe the demand for our product is gradually increasing, we anticipate sequentially improved performance for the fourth fiscal quarter and for the next fiscal year.

Unaudited financial results for the second quarter of fiscal year 2012 ended December 31, 2011.

Second-Quarter 2012 Highlights:

Revenues (million)     2QFY2012  2QFY2011  Change

Revenues (million)       $107.9         $99.4       8.6%

Gross profit (million)    $10.4           $9.5         9.5%

Gross Margin               9.6%             9.6%         -

Net income (million)     $2.8             $2.9          -3.4%

EPS                              $0.07           $0.07          -

• Engaged Grant Thornton, the China member firm of Grant Thornton International, as its independent registered public accounting firm;
• Continued construction of the Company's new cold-roll production line of 500,000-tons designed annual capacity, which is expected to start commercial operations in the summer 2012;
• Repurchased 402,887 shares of the Company's common stock at the open market according to the Company's previously announced shares repurchase program; and
• Started to build a B2B (business to business) electronic trading platform exclusively for the steel industry; it is anticipated that the platform will initially be used to market Sutor's products with the option of expanding into a profit center via hosting other companies' trading activities.

Business Outlook

We maintain our previously announced anticipation that both revenue and net income of the Company will grow at a compound annual growth rate (CAGR) of approximately 25% to 35% for the next two fiscal years.

Second Quarter 2012 Results

• Revenue was approximately $107.9 million, compared to $99.4 million for the same period last year, an increase of approximately 8.6%
• Net income, without including the foreign currency translation adjustment, decreased approximately $0.1 million, or 3.4%, to $2.8 million in the three months ended December 31, 2011, from $2.9 million in the same period in 2010, as a cumulative result of the above factors.
• EPS for Second Quarter 2012 were $0.07 vs $0.07 in prior year

Ms. Lifang Chen, Chairlady and CEO, commented, "During the second fiscal quarter, we focused on seeking operating excellence and achieved growth in both revenue and gross profits despite the challenging macro-economic environment both at home and abroad. As China gradually transits from an export and investment-driven economy to a domestic-consumption economy, we will proactively develop new products to serve the growing consumer goods industries like solar water heaters, high-end household appliances, information technology and automobiles. Positioned in the downstream segment of the steel industry, we believe our businesses are affected more by the general conditions of the economy than the changes to the upstream iron and steel refining segment. We believe our integrated business model and superior geographic location near consumer centers and transportation hubs will enable us to benefit from the ongoing economic transition in China. We are looking forward to milestone events to celebrate the Company's 10th anniversary in 2012."

"Closely working with our new auditor, we will continue to enhance our corporate governance and provide timely and accurate financial information to our shareholders. We also intend to improve our communications with our shareholders and further reach out to the investment community in general. Finally, we will explore all options to improve shareholder value," concluded Ms. Chen.

Business Outlook

We maintain our previously announced anticipation that both revenue and net income of the Company will grow at a compound annual growth rate (CAGR) of approximately 25% to 35% for the next two fiscal years.

First Quarter 2012 Results

Fiscal 2011 Results

• For the fiscal year ended June 30, 2011, revenue was $431.7 million compared to $478.7 million last year, a decrease of approximately 9.8%.
• Net income, without including the foreign currency translation adjustment, increased $2.7 million, or approximately 23.9%, to $14.0 million in fiscal year 2011, from $11.3 million in fiscal year 2010
• Earnings per share for fiscal 2011 $0.34 vs $0.29 in 2010

Commenting on Sutor's operations, Ms. Lifang Chen, Chairwoman and CEO, said, "We ended fiscal year 2011 with improved gross margin, net income and earnings per share despite challenging economic condition.

Ms. Chen continued: "Since we were listed on Nasdaq Capital Market in February 2008, we have added 400,000 metric tons of hot-dipped galvanization and 400,000 metric tons of heavy steel pipe production capacities. In addition, a cold-roll production line of 500,000 metric tons annual capacity is planned for commercial operations next year. We would like to invite our investors to visit our manufacturing facilities and witness themselves how their investments are put into use. Despite the high volatility in the capital markets, we will remain focused on seeking operating excellence and pursuing outstanding customer services. We are committed to our shareholders, employees, and customers for the years to come."

Fourth Quarter Preliminary Results

Rodman and Renshaw on SUTR                       5/9/2011

F3Q11 Results More or Less In-line with Expectations; Maintain Rating and PT

Sutor Technology Group (“Sutor”, Ticker: SUTR, Market Outperform) reported mixed F3Q11 results that as a whole were in-line with our expectation. Total revenue in the quarter was $101.4 million, slightly below our estimate of $103.7 million. Gross profit came in at $8.6 million, also a bit shy of our estimate of $9.3 million. Operating income, however, was helped by lower than expected operating expenses and reached $5.6 million, almost in-line with our expectation of $5.7 million. Actual interest and tax expenses were also below our expectations, resulting in net income of $3.5 million, actually above our estimate of $2.8 million. As a result, diluted EPS for the quarter was $0.09, beating our estimate by couple pennies.

As of March 31, the company had cash, cash equivalents, and restricted cash of $75.0 million as well as $133.2 million of working capital. Stockholders’ equity stood at $187.6 million.

Our Take

Cost under control We are by and large satisfied with the quarterly performance and are especially encouraged by the company’s expense management discipline. Gross margin of 8.5%, while not as impressive as the 9.5% figure reported in F2Q11, was nevertheless decent and higher than a year ago. Changes in product mix and reduced lower margin steel trading business revenue were the major reasons for the improvement. Looking forward, we expect Sutor’s gross margin will hover around 9% for the next several quarters. SG&A, which looked to be near a breakout in F2Q11 mostly because of higher international shipping costs, were now under control. To reduce shipping cost, the company wisely adopted a FOB (Free on Board) method in F3Q11 rather than continuing with the CIF (Cost, Insurance and Freight) method that it used in the previous quarter. We are heartened by such a nimble move. As a whole, considering China is entering into a more inflationary environment that could prove supportive for Sutor’s product prices, and the company has been focusing on maximizing the utilization of its production capacity, we continue to take a constructive view on the Sutor’s margin outlook.

New cold-rolling facility to come on-line in C1H12 As Sutor has been running at more than 100% capacity of its existing cold-rolling production line, we eagerly await the development of its new 500,000 metric tons cold-rolling plant, which the company expects to start operation in the first half of calendar year 2012. The new facility should alleviate Sutor’s capacity constraint and provide a new push for its revenue and profit growth. It could also broaden the company’s product offerings and enhance margins.

Risks

Major risks to our rating and price target include both domestic and international macroeconomic risks, steel price volatility, highly fragmented and competitive industry, revenue and customer concentration, as well as country and political risks related to operating and investing in China.


Notice Regarding Privacy and Confidentiality:


This material has been prepared for informational purposes only. While it is based on information generally available to the public from sources we believe to be reliable, no representation is made that the subject information is accurate or complete. Past performance is not a guarantee nor does it necessarily serve as an indicator of future results. Price and availability are subject to change without notice. Additional information is available upon request.

Since Rodman & Renshaw, LLC is not a tax advisor, transactions requiring tax consideration should be reviewed carefully with your tax advisor. Similarly, Rodman & Renshaw, LLC is not a law firm and provides no legal opinions or legal advice.

Rodman & Renshaw, LLC may make a market in the securities being discussed.

Rodman & Renshaw, LLC and/or its officers or employees may have positions in any of the securities of this (these) issuer(s).

Member FINRA.
Member SIPC.

First Quarter Highlights:

"We are pleased to report another quarter of consistent profit and improved gross margin. The decline in total revenue was primarily due to our strategic decision to reduce our steel trading business. In addition, as the steel industry in China becomes more competitive and lower end products become more of a commodity, we are working hard to shift some of our high end capacity to more specialized, higher margin products. Our goal is to separate ourselves from the industry at the highest levels and to work as efficiently as possible.  As a result of this transition over the past quarter, we experienced a decrease from our overall pre-painted galvanized products. Going forward, we anticipate favorable top line growth on a year over year basis beginning next fiscal year," said Ms. Chen, Chairwoman and CEO of Sutor. "We are encouraged by the fact that demand for our products remained strong and the prices for our products increased between approximately 6.5% and 19.0% in the third fiscal quarter this year over the same quarter last year."

• Revenues were $101.4 million in the third fiscal quarter of 2011, compared to $114.5 million for the same period last year, a decrease of $13.1 million, or approximately 11.4%
• Income from operations was $5.6 million in the third fiscal quarter of 2011 as compared to $5.5 million in the same period last year, an increase of $0.1 million, or approximately 1.8%
• EPS of $0.09 vs. $0.09--flat on the year.

"We remain optimistic about the remainder of fiscal year 2011. In January, we received approximately 10,000 tons of international sales orders as compared with about 10,500 tons of such orders for the whole third quarter of FY2010. In the second quarter of FY2011, Sutor was honored as a High-Tech Enterprise by Jiangsu provincial government. This certification places Sutor among a selected few value-added steel producers in China that won both government and market recognition. Further, Sutor recently opened two new offices in metropolitan  Ningbo and Shanghai in an effort to attract talents, increase brand recognition and better service our customers," Ms. Chen further commented. "As we continue our strategies of expanding sales channels, optimizing product portfolio, enhancing research and development efforts, and improving brand recognition, we believe we can capitalize on the ongoing industrial upgrading and urbanization processes in China," concluded Ms. Chen.

Rodman and Renshaw on SUTR                  2/12/2011

Below Expectation F2Q11, Lowering PT to $5 

Sutor Technology Group (“Sutor”, Ticker: SUTR, Market Outperform) announced F2Q11 results that were mostly below our expectations. Total revenue decreased 13.7% YoY to $99.4 million, lower than our estimate of $111.7 million and Street consensus of $110.5 million. Despite the significant decline in revenue, gross profit grew 9.6% YoY to $9.5 million with a gross margin of 9.5%, beating our respective estimates of $9.1 million and 8.1%. Net income decreased by 27.2% YoY to $2.9 million, or $0.07 per diluted share, below our respective estimates of $3.4 million and $0.08 as well as Street consensus of $3.6 million and $0.09.

F2Q11 Highlights and Discussions 

Revenue decrease largely due to reduced steel trading business The significant drop in revenue was primarily due to reduced trading business at Sutor’s subsidiary Ningbo Zhehua Heavy Steel Pipe Manufacturing Co. (“Ningbo Zhehua”). During F2Q11, revenue from Ningbo Zhehua decreased by $10.2 million YoY to $8.4 million from $18.6 million a year ago. In addition, lower production volume of PPGI products also contributed to lower revenue. We believe it is management’s intention to reduce the revenue contribution from trading business as it carries lower margins and to focus on production of higher-margin products. Management expects the trading volume to remain low for the remainder of 2011. An encouraging sign of revenue recovery is that Sutor received approximately 10,000 tons of sales orders from aboard in January, almost the same amount received in the entire F3Q10. 

Significant gross margin expansion as a result of favorable product mix shift Gross margin expanded 200bps YoY and 120bps sequentially to 9.5% in F2Q11. The improvement was mostly due to product mix shift to higher-margin products. During the quarter, Sutor significantly reduced trading revenue which carried lower margins and increased production of higher-margin products. Management expects the gross margin will stay around 9% for the remaining quarters of 2011. We are encouraged by this improvement because Sutor’s gross margin had not been above 8.3% since the beginning of CY2009. 

Escalating expenses diminishing net profit Selling expenses rose 89.8% YoY to $2.0 million mainly due to sharply increased international shipping costs, which reached $1.2 million compared to $0.08 million last year. We believe that the shipping expenses could go even higher during the next quarters since international sales orders soared in January. G&A expenses increased 44.3% YoY to $1.7 million from $1.2 million a year ago. The opening of two new offices in Ningbo and Shanghai, attending international trade shows, and increased allowance for bad debt resulted in spike in G&A expenses. We expect G&A as a percentage of revenue will be lower during the rest of 2011 quarters as we believe some expense items such as opening new offices should not be repetitive in the remaining year. Interest expenses reached $2.3 million, compared to $1.3 million last year. The increase was mostly due to the higher cost of discounting bank acceptance notes.


Notice Regarding Privacy and Confidentiality:


This material has been prepared for informational purposes only. While it is based on information generally available to the public from sources we believe to be reliable, no representation is made that the subject information is accurate or complete. Past performance is not a guarantee nor does it necessarily serve as an indicator of future results. Price and availability are subject to change without notice. Additional information is available upon request.

Since Rodman & Renshaw, LLC is not a tax advisor, transactions requiring tax consideration should be reviewed carefully with your tax advisor. Similarly, Rodman & Renshaw, LLC is not a law firm and provides no legal opinions or legal advice.

Rodman & Renshaw, LLC may make a market in the securities being discussed.

Rodman & Renshaw, LLC and/or its officers or employees may have positions in any of the securities of this (these) issuer(s).

Member FINRA.
Member SIPC.

Rodman & Renshaw on SUTR

F1Q11 Results Mixed

Sutor Technology Group (“Sutor”, Ticker: SUTR, Market Outperform) reported mixed F1Q11 results. Total revenue was $101.9 million, significantly below our estimate of $131.0 million and Street consensus of $132.0 million. The below-expectation top line performance was largely due to a lower than expected production volume of PPGI as well as decreases in steel pipe trading operations. Helped by better than expected margins, however, gross profit for the quarter was $8.4 million, slightly below our estimate of $9.8 million. Net income was $3.4 million, in-line with our expectation, but slightly below the $3.7 million Street consensus. Diluted EPS for the quarter was $0.08, also in-line with our estimate, but one penny shy of the Street consensus. At the end of September, the company had cash and cash equivalent of $17.1 million as well as $45.1 million of restricted cash and $107.5 million of working capital.

Our Take 

We believe Sutor reported a respectable quarterly performance with the miss in revenue being buffered by improvements in gross margin and SG&A. Actual gross margin during the quarter was 8.4%, almost a whole percentage point higher than our estimate of 7.5%. A greater focus on advanced PPGI products with higher margins but requiring more sophisticated processing procedures and production time was a major reason for the improvement in gross margin but the decline in production volume. SG&A during F1Q11 were $3.0 million, below our estimate of $4.2 million. Net margin during F1Q11 was 3.3%, representing a 60bps improvement from F4Q10, also 70bps higher than our estimate. With the company’s focus on maximizing the utilization of its production capacity as well as searching for potential downstream acquisition targets, we take a constructive view on the company’s margin outlook in the near to medium term future. We also expect the company will continue to adjust its product mix in order to adapt to China's increasingly inflationary environment.

Maintaining Market Outperform Rating and $6 Price Target 

In light of the F1Q11 results, we have tweaked our financial model and projections. For fiscal year 2011, we now expect the company will realize revenue, gross profit, and net income of $454.4 million, $37.2 million, and $14.3 million, respectively. This also translates to a diluted EPS of $0.35 for F2011. We are maintaining our Market Outperform/Speculative Risk rating on the shares of Sutor and our price target of $6. The price target is based on Sutor shares trading at 15x our CY2011 EPS estimate of $0.40.

Risks 

Major risks include macroeconomic risk, steel price volatility, highly fragmented and competitive industry, revenue and customer concentration, as well as country and political risks related to operating in China.


Notice Regarding Privacy and Confidentiality: 

This material has been prepared for informational purposes only. While it is based on information generally available to the public from sources we believe to be reliable, no representation is made that the subject information is accurate or complete. Past performance is not a guarantee nor does it necessarily serve as an indicator of future results. Price and availability are subject to change without notice. Additional information is available upon request.

Since Rodman & Renshaw, LLC is not a tax advisor, transactions requiring tax consideration should be reviewed carefully with your tax advisor. Similarly, Rodman & Renshaw, LLC is not a law firm and provides no legal opinions or legal advice.

Rodman & Renshaw, LLC may make a market in the securities being discussed.

Rodman & Renshaw, LLC and/or its officers or employees may have positions in any of the securities of this (these) issuer(s).

Member FINRA.
Member SIPC.

Rodman & Renshaw on Sutor

4Q FY10: SUTR announced its 4Q FY10 (ended on June 30, 2010) revenue and net income of $125.3 MM and $3.4 MM, with a fully diluted EPS of $0.08. Top-line for the quarter grew by 14.1% Y-o-Y from $109.8 MM in 4Q FY09 helped by demand from China and abroad. 

 Full Year FY10: On a full year basis, SUTR generated total revenue and net income of $478.7 MM and $11.3 MM, with diluted EPS of $0.29. This compares to FY09’s results of $429.8 MM, $18.7 MM, and $0.49, respectively. Top-line growth reached 11.4%, primarily driven by a 27.1% increase in sales volume. Total shipment volume for FY10 was 746K tons, compared to 587K tons in FY09. By product mix, HDG (Hot Dip Galvanized Steel) contributed the largest portion of total sales, accounting for 48%, compared to 17% from PPGI (Pre-Painted Galvanized Steel), 12% from Cold Rolled Steel, 13% from Welded Steel Pipe, 8% from Acid Pickled Steel, and 2% from other steel products. 

 Export Sales Remain Robust: For FY10, export sales contributed $53.7 MM in revenue or ~11.2% of total, representing 18.3% Y-o-Y growth. This compares to $45.4 MM or 10.6% of total in FY09. This indicates continued penetration of SUTR’s higher-end products in overseas market. Management expects international sales to continue to grow in FY11 at a 12%~ 15% growth rate. 

Margin Pressure May Persist: We remain cautious on SUTR’s gross margin for the remainder of 2010 given the mixed signals from China’s soft-landing policy and production cuts in steel industry. In our view, steel makers’ production cuts could potentially affect the growth of the company’s processed volume, with COGS remaining at a relatively high level in the near-term. 

FY11 Estimates: Now we are projecting revenue and net income of $131.0 MM and $3.6 MM, with diluted EPS of $0.09 for 1Q FY11. For full year FY11, our estimates are $543.0 MM, $15.6 MM, and $0.39, respectively. Our full year revenue projection is based on our assumption of 820K tons of total shipment volume and ASP of $662 per ton. 

 Valuation: At current levels SUTR is trading at P/E multiples of ~5.2x, and ~4.3x to our CY2010 and CY2011 earnings estimates. On EV/EBITDA basis, the company is trading at ~5.5x and ~4.8x to our CY2010 and CY2011 forecasts. These multiples are below industry averages for similar players in the US and China. We believe SUTR should be trading at a minimum in line with industry averages given the growth opportunity associated with it. We are comfortable maintaining a $7.00 price target for SUTR. 

Investment Risks: (1) Revenue Concentration (2) Highly Fragmented and Competitive Industry (3) Steel Price Volatility (4) Change in government regulation Liquidity. 

Notice Regarding Privacy and Confidentiality:

This material has been prepared for informational purposes only. While it is based on information generally available to the public from sources we believe to be reliable, no representation is made that the subject information is accurate or complete. Past performance is not a guarantee nor does it necessarily serve as an indicator of future results. Price and availability are subject to change without notice. Additional information is available upon request.

Since Rodman & Renshaw, LLC is not a tax advisor, transactions requiring tax consideration should be reviewed carefully with your tax advisor. Similarly, Rodman & Renshaw, LLC is not a law firm and provides no legal opinions or legal advice.

Rodman & Renshaw, LLC may make a market in the securities being discussed.

Rodman & Renshaw, LLC and/or its officers or employees may have positions in any of the securities of this (these) issuer(s).

Member FINRA.
Member SIPC.

    Fiscal Fourth quarter results highlights:

                                  4Q 2010    4Q 2009             Change
    Revenues (million):           $125.3     $109.8              14.1%
    Gross profit (million):       $10.5      $6.3                66.7%
    Net income (million):         $3.4       $1.8                88.9%
    EPS:                          $0.08      $0.05               60.0%

    Fiscal year 2010 results highlights:

                                  FY2010      FY2009             Change
    Revenues (million):           $478.7      $429.8             11.4%
    Gross profit (million)        $32.8       $36.3             -9.6%
    Net income (million)          $11.3       $18.7             -39.6%
    EPS                           $0.29       $0.49             -40.8%

Commenting on Sutor's operations, Ms. Lifang Chen, Chairwoman and CEO, said, "We are pleased with our performance in the fiscal fourth quarter which demonstrated significant improvement over the same period last year. The record high annual revenues were the result of our continued effort to expand our markets despite the uncertainties during economic recovery. In the fourth quarter sales volume increased approximately 3.9% over the same period last year. For the fiscal year, sales volume was approximately 27.1% higher than fiscal year 2009. Demand for our products remained strong as our products are extensively used in almost all major sectors of the economy. Last fiscal year was a year of consolidation and stabilization and hence we are optimistic about the overall performance in fiscal year 2011."

 Ms. Chen continued, "We are pleased to see the continued increase in annual revenue attributable to our efforts to expand market share in both domestic and overseas markets. Although the record annual revenue did not transform to increased annual net income as a result of rising production costs and increased selling expenses, the widened sales channels have laid a solid foundation to expand future sales. Additionally, we made significant efforts to differentiate ourselves from other competitors through investing in research and development. We applied for 15 patents in fiscal year 2010, two of which have been approved. As of June 30, 2010, we held 23 patents and had 36 patent applications pending and believe our R&D initiatives will enhance Sutor's long-term competitive edge."

"Looking to fiscal year 2011, our priority is to maximize the capacity utilization rate, especially for our 400,000 MT hot-dip galvanization production lines that began operations at the end of September 2008. While we expect lingering uncertainty regarding general economic conditions, we will focus on generating cash from operations, reducing expenses, and improving operations to grow Sutor from both the top and bottom line. In addition, we aim to take advantage of the overcapacity situation in the upstream segment of the Chinese steel industry and reduce the costs of production. Further, we plan to expand our research center to develop high-performance and high margin steel sheets and composite steel sheets to enhance our product offerings and profitability. Finally, even though we believe our current corporate transactions are transparent, we will take additional measures to further improve corporate transparency and earnings quality. We will continue to pursue our vision of becoming the largest private fine processed steel manufacturer and contribute to the on-going industrial upgrading and urbanization processes in China," concluded Ms. Chen.

Added to the GeoSpecial list on July 20, 2009 @ $3.57

Catalyst: Re-pricing of Risk Premium.
Peak performance: Reached a high of $4.45 on July 28, 2009
Current Price: $2.04
 
Current road block:  No U.S. investor relation representation; Related party transactions are on the high side; Low pre-tax margins of 3.8%; High debt position of $107.7 million; Debt to Equity is a whopping 64.6%; Current ratio (current liabilities divided by current assets) is less than 2:1; Cash flow from operations is negative.

"Net cash used in operating activities was $7.2 million for the nine months ended March 31, 2010, a decrease of $61.7 million from $54.5 million net cash provided by operating activities for the same period last year.  Such decrease of net cash provided by operating activities was primarily attributable to decreased net income, increased advances to suppliers, partially offset by a reduction in account receivables. During the nine months ended March 31, 2010, we made more advances to our suppliers for the purchase of raw materials in anticipation of increased orders in the coming months."

Removed from the GeoSpecial list.  From a financial statement point of view, SUTR has a high risk profile, especially as most of its debt obligations are short-term. From an EPS growth point of view, SUTR’s picture has improved and is forecast to continue to improve entering into its fiscal 2011 year ending in June, when EPS is expected to grow 58.8%. The question becomes, how do we view SUTR as an investment option with its less than desirable financial statement position albeit an improving EPS picture? The GeoTeam is a big believer that EPS growth is the force that drives stock prices higher with quality considerations helping to determine the level of valuation multiples.  A most realistic scenario is that SUTR trades somewhere between its book value per share and 5 times 2011 EPS estimates of $0.54 . A most optimistic scenario, if the risk profile improves,  is that SUTR can attain a P/E multiple of 10 times earnings.  We are placing SUTR on the GeoSpecial on the Radar list as we await the release of its 2010 fourth quarter financial results.

The need for liquidity will likely continue to loom in the short-term.

"Our major sources of liquidity for the periods covered by this quarterly report were borrowings through short-term bank and private loans.  Our operating activities used $7.2 million of cash in the nine months ended March 31, 2010. As of March 31, 2010, our total indebtedness to non-related parties under existing short-term loans was $104.2 million, our short-term notes payable to related parties was $0.6 million, and our long-term notes payable to non-related parties was $2.9 million. We had no long-term notes payable to related parties."

"Short-term bank and private loans are likely to continue to be our key sources of financing for the foreseeable future, although in the future we may raise additional capital by issuing shares of our capital stock in an equity financing. We expect to renew our short term loans when they become due."

Excerpt from GeoBargain & Special Update - Performance Laggards Article

Sutor Tech Group (NASDAQ:SUTR)

SUTR has yet to see benefits as it reported its fourth straight decline in sales and EPS after missing 2010 first quarter analyst estimates. We will keep the stock coded as low end special situation play for long-term investors due to its low P/E and analyst estimates that show growth picking up in the second half of its fiscal year. However, by no means is our stance overly confident at this time.

See discussion notes

Ms. Lifang Chen, Chairperson and CEO of Sutor said, 'Like many companies in our industry, we are affected by the current global economic downtown. Despite the fact that we continued to face challenges during our third fiscal quarter, we nonetheless realized profits in the quarter while many companies in the steel industry suffered losses. Compared to the second fiscal quarter of 2009, our revenue increased by 8.0% in the third fiscal quarter, which we view as a positive sign and as validation of our development strategy and that our reaction to the volatile economic crisis has been swift and effective. We anticipate that we will continue to grow by taking advantage of a long-awaited resurgence in manufacturing and industrial development and activity and favorable economic results from the implementation of PRC government's active stimulus policies during the coming quarters.'

Source: See Release, May 14, 2009