BEIJING, Aug. 11 /PRNewswire-Asia/ -- China Solar & Clean Energy Solutions,
Inc. (Formerly known as "Deli Solar (USA), Inc.") (OTC Bulletin Board: CSOL)
("China Solar"), a premier manufacturer and distributor of solar water heaters,
space heating devices and provider of renewable energy solutions in the
People's Republic of China ("PRC"), today reported its financial results for
the second quarter ended June 30th, 2009.
Second Quarter 2009 Results
Second quarter 2009 net revenue was $9.66 million, a decrease of $6.18
million, or 39%, from $15.84 million for the same period last year. As the
Company shifted its focus to winning larger energy-saving projects, the sales
revenues for the heat-pipe equipments and energy-saving projects increased by
$2.35 million, or 40.2%, to $8.2 million due to the completion of several
large projects in the quarter; while the sales revenue for solar heaters,
biomass stoves and boiler related products decreased by 85.4% to $1.46 million
due to intensive competition in the market of solar heaters.
Net income was $1.1 million for the three months ended June 30, 2009, with
diluted earnings per share (EPS) of $0.07, primarily due to the disposal of
Shenzhen Pengsangpu Solar Industrial Products Corporation ("SZPSP") and an
increase in the sales of heat-pipe equipments and energy-saving projects. For
the first quarter of 2009, the net loss was $0.94 million with diluted loss
per share at $(0.07).
Cash and cash equivalents increased to $2.7 million as of June 30, 2009,
compared to $1.4 million as of March 31, 2008. The increase in cash and cash
equivalents is attributable to the increase in sales of heat pipe related
equipments and energy-saving projects and the divestiture of Shenzhen
Pengsangpu Solar Industrial Products Corporation ('SZPSP'), which had been a
major drag on profits.
Business Strategy and Outlook
Mr. Deli Du, Chief Executive Officer and President of China Solar,
commented, "Our strategy of business transition from being a product
manufacturer and distributor to a services and solutions provider has shown
indicators of success," said Mr. Du, "I am satisfied with the improvement of
our financial performance and successive winning bids in large projects by
Tianjin Huaneng. As we decide to focus our resources on more profitable
opportunities and effectively leverage our leading new energy technology,
partnerships with leading clean energy institutions, extensive industry
experience in new energy sector and nation-wide distribution network, we have
discovered greater synergies across our product and service offerings."
"I am also satisfied with the visible progress in our corporate-wide
efforts to improve our operating efficiency and internal controls to ensure
timely financial reporting and regulatory compliance. We began to implement a
company-wide ERP system as part of our efforts to standardize accounting
practices and to ensure China Solar is fully in compliance with requirements
by the Sarbanes-Oxley Act ("SOX"), laying a strong foundation for a
sustainable growth," said Mr. Du.
Looking ahead, "exciting developments are taking place in the solar energy
market in China, following the government's recent policies of a series of
solar subsidy programs. As one of the first industry players, we believe our
global experience combined with our existing capabilities and nationwide sales
network in China, as well as our strong government relationships give us a
unique opportunity to gain market share in the rapidly growing Chinese new
energy market. I firmly believe that China Solar will soon achieve solid
revenue growth and profits. We are dedicated to becoming a strong, profitable
and responsible enterprise to serve the best interests of our shareholders,"
concluded Mr. Du.
About China Solar & Clean Energy Solutions, Inc.
China Solar & Clean Energy Solutions, Inc. operates through its wholly
owned subsidiaries including Bazhou Deli Solar Energy Heating Co. Ltd. ("Deli
Solar (Bazhou)"), Beijing Deli Solar Technology Development Co., Ltd. and
Tianjin Huaneng Group, all located in the PRC. The Company manufactures and
distributes solar water heater and space heating devices for residential
customers, provides energy-saving solutions for real estate developers and
tailor-made solutions for utilization of industrial waste heat for industrial
customers in the PRC. For more information, please visit
http://www.delisolar.com .
Cautionary Statement Regarding Forward Looking Information
Safe Harbor Statement
Certain statements in this news release may contain forward-looking
information about China Solar & Clean Energy Solutions and its subsidiaries
business and products within the meaning of Rule 175 under the Securities Act
of 1933 and Rule 3b-6 under the Securities Exchange Act of 1934, and are
subject to the safe harbor created by those rules. The actual results may
differ materially depending on a number of risk factors including, but not
limited to, the general economic and business conditions in the PRC, market
and customer acceptance and demand for products, ability to market products,
fluctuations in foreign currency markets, the use of estimates in the
preparation of financial statements, the impact of competitive products and
pricing, the ability to develop and launch new products on a timely basis, the
regulatory environment, fluctuations in operating results, and various other
factors beyond its control. All forward-looking statements are expressly
qualified in their entirety by this Cautionary Statement and the risks factors
detailed in the Company's reports filed with the Securities and Exchange
Commission. China Solar & Clean Energy Solutions undertakes no duty to revise
or update any forward-looking statements to reflect events or circumstances
after the date of this release.
CHINA SOLAR & CLEAN ENERGY SOLUTIONS, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(Currency expressed in United States Dollars ("US$"), except for number of
shares)
June 30, 2009 December 31, 2008
(Unaudited)
ASSETS
Current assets:
Cash and cash equivalents $2,659,638 $1,820,882
Accounts receivable, net 8,457,470 5,962,051
Inventories 2,701,654 5,158,153
Other receivables and prepayments 7,708,106 6,705,578
Total current assets 21,526,868 19,646,664
Property and equipment, net 14,108,704 13,955,691
Goodwill 1,910,509 2,284,903
Intangible assets, net 1,668,329 1,709,184
Assets of discontinued operations -- 8,972,481
TOTAL ASSETS $39,214,410 $46,568,923
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable, trade $1,650,559 $1,148,428
Income tax payable 2,336,230 1,822,867
Other payables and accrued liabilities 5,149,009 7,296,294
Employee loan 1,378,182 1,474,085
Total current liabilities 10,513,980 11,741,674
Long-term liabilities:
Deferred tax liabilities -- 15,779
Liabilities of discontinued operations -- 4,182,671
Stockholders' equity
Convertible preferred stock: par
value $0.001, 25,000,000
shares authorized, zero and 373,566
shares issued and
outstanding, respectively -- 373
Common stock, $0.001 par value,
66,666,667 shares authorized,
14,173,016 (unaudited)
and 13,799,450 shares
issued and outstanding,
respectively 14,172 13,799
Additional paid-in capital 22,966,404 22,966,404
Accumulated other comprehensive loss 816,996 1,615,081
Retained earnings 3,520,184 3,365,788
Profit earning reserves -- 963,106
Less: Treasury stock (460,288) --
Total stockholders' equity 26,857,468 28,924,551
Minority interests 1,842,962 1,704,248
TOTAL LIABILITIES AND STOCKHOLDERS'
EQUITY $39,214,410 $46,568,923
CHINA SOLAR & CLEAN ENERGY SOLUTIONS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Currency expressed in United States Dollars ("US$"), except for number of
shares)
(Unaudited)
Three months ended June 30, Six months ended June 30,
2009 2008 2009 2008
Revenue, net $9,659,248 $15,843,782 $14,775,569 $24,143,858
Cost of revenue 7,787,925 11,896,829 11,729,756 17,741,845
Gross profit 1,871,323 3,946,953 3,045,813 6,402,013
Operation Expenses
Depreciation and
amortization 103,028 132,216 191,906 281,383
Selling and distribution 480,587 1,097,814 1,040,072 1,600,377
General and
administrative 651,166 1,012,727 1,550,535 1,614,380
Total operating expenses 1,234,781 2,242,757 2,782,513 3,496,140
Income from operations 636,542 1,704,196 263,300 2,905,873
Other income (expenses):
Other income 6,559 25,741 43,837 66,831
Interest income 2,451 1,638 2,456 1,638
Other expense (41,438) 6,839 (50,869) 6,839
Reversal of reserve for
bad debts 127,245 -- 127,245 --
Interest expense (39,490) (77,975) (86,649) (111,813)
Total other (expense)
income 55,327 (43,757) 36,020 (36,505)
Income from continued
operation before
income taxes 691,869 1,660,439 299,320 2,869,368
Income tax expenses 173,135 343,764 198,738 690,027
Net income from
continued operation
including non
controlling interest 518,734 1,316,675 100,582 2,179,341
Less: Net income
attributable to non
controlling interest 76,543 386,016 86,549 859,031
Net income from
continued operation
attributable to
common shareholder $442,191 $930,659 $14,033 $1,320,310
Net income (loss) from
discontinued operation
net of tax -- 165,555 (512,390) 165,555
Gain on sale of
discontinued operation
net of tax 652,753 -- 652,753 --
Net income 1,094,944 1,096,214 154,396 1,485,865
Basic
Continued operation 0.03 0.07 0.00 0.12
Discontinued operation 0.00 0.01 (0.04) 0.01
Gain on sale of
discontinued operation 0.05 0.00 0.05 0.00
0.08 0.08 0.01 0.13
Diluted
Continued operation 0.03 0.06 0.00 0.10
Discontinued operation 0.00 0.01 (0.03) 0.01
Gain on sale of
discontinued operation 0.04 0.00 0.04 0.00
0.07 0.07 0.01 0.11
Weighted average shares
outstanding - basic 14,173,016 13,075,468 14,125,984 10,612,185
Weighted average shares
outstanding - diluted 16,073,016 15,584,542 16,199,637 13,006,396
CHINA SOLAR & CLEAN ENERGY SOLUTIONS, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Currency expressed in United States Dollars ("US$"))
(Unaudited)
Six months ended June 30,
2009 2008
Cash flows from operating activities:
Net effect of discontinued operation $(3,245,825) $453,020
Net cash provided by operating activities 3,249,424 (3,690,958)
3,599 (3,237,938)
Cash flows from investing activities:
Acquisition of subsidiaries, net of cash
acquired -- (3,916,212)
Disposal subsidiary 439,122 --
Purchase of property, plant and equipment (231,528) (2,033,562)
Net effect of discontinued operation (8,420) --
Net cash provided by investing activities 199,174 (5,949,774)
Cash flows from financing activities:
Proceeds from non-controlling shareholder 51,231 --
Proceeds from private placement sale of stock -- 9,995,156
Proceeds from warrants exercised -- 107,500
Net cash provided by financing activities 51,231 10,102,656
Effect of exchange rate on cash (10) 307,592
NET CHANGE IN CASH AND CASH EQUIVALENTS 253,994 1,222,536
CASH AND CASH EQUIVALENTS, BEGINNING OF
PERIOD 2,405,644 5,466,637
CASH AND CASH EQUIVALENTS, END OF PERIOD $2,659,638 $6,689,173
SUPPLEMENTAL DISCLOSURE OF CASH FLOW
INFORMATION
Cash paid for income taxes $129,318 $199,025
Cash paid for interest expense $39,490 $143,696
NONCASH INVESTING AND FINANCING
TRANSACTIONS:
Issuance of common stock for acquisition of
SZPSP -- 2,839,458
Issuance of warrants for the acquisition of
SZPSP -- 92,193
Preferred share converted 373 1.136
For more information, please contact:
Peggy Yuan
Investor Relations
China Solar & Clean Energy Solutions, Inc.
Tel: +86-10-6386-0500
Email: ir@delienergy.com
