LIAONING PROVINCE, CHINA ("China Sun Group"), which through its
majority-owned subsidiary Da Lian Xin Yang High-Tech Development
Co. Ltd ("DLX") has the second largest cobalt series production
capacity in the People's Republic of China (PRC), announced its
financial results for the second quarter of fiscal 2008. Full
details for the three-month period ended November 30, 2007 are
available on its Quarterly Report on Form 10-QSB filed at
http://www.sec.gov.
Q2 Highlights
-- Revenue increased 208% from last year to a record $5.4
million.
-- GAAP Net income increased 994% from last year to a record
$497,255.
-- Basic and diluted earnings per share were $0.01, an increase
of 100% over last year.
Bin Wang, Chief Executive Officer of China Sun Group, said, "We
are very pleased to report strong year-over-year growth in our
second quarter of fiscal 2008. Our record sales are attributed to
increasing sales to new and existing customers by providing
technologically advanced, high-quality products and scalable
production capacity to meet pent-up global demand. Our
international sales are likely to continue as a greater number of
Original Equipment Manufacturers and other suppliers seek the cost
benefits and flexible production schedules related to importing
battery components from the PRC."
"Based on the progress we have made to date, we are on track to
more than doubling our annual revenue at the end of fiscal 2008
compared to fiscal 2007, with continued improvements to
profitability," concluded Wang.
Financial Results
Net revenue for the three months ended November 30, 2007 was
$5,357,190, an increase of 208%, from net revenue of $1,739,287 for
the comparable period in 2006. This gain in revenue was attributed
to increased customer demand and sales.
Gross profit for the three months ended November 30, 2007 was
$1,809,120, an increase of 233% from $543,206 for the comparable
period in 2006. The increase in gross profit was primarily due to
revenue generated by increased customer demand and production, and
consequently increased sales.
General and administrative expenses for the three months ended
November 30, 2007 were $518,765, an increase of 54% from $337,023
for the comparable period in 2006. The increase was primarily
attributable to the hiring of additional personnel and the costs in
setting up an administrative office in the United States.
Income from operations for the three months ended November 30,
2007 was $1,133,885, an increase of 1,069% compared to $96,938 for
the comparable period in 2006. The increase resulted primarily from
the increase in revenue.
Net income for the three months ended November 30, 2007 was
$497,255, or $0.01 per share, an increase of 994% as compared to
$45,464 for the comparable period in 2006.
The foreign currency translation gain for the three months ended
November 30, 2007 was $381,624.
Key Developments
During the second quarter of fiscal 2008, China Sun Group
continued to serve its customers in the PRC and capture new
customers in international markets such as Light-Future Co. Ltd. in
South Korea. The Company continues to pursue new market expansion
into East Asia, Southeast Asia, Europe and the United States, where
demand for lithium ion battery components to power mobile devices
and consumer electronics exceeds their supply.
Concurrent with increasing production and sales in the PRC, the
Company remained committed to innovating its products. It hired two
new research and development engineers, a graduate researcher and
six chemistry graduates at its electro-chemical testing center to
shore up its research and development team.
China Sun Group also completed the preliminary trial phase of
its tri-component anode product, which, when commercialized, will
provide greater safety and discharge at a stronger electrical
current for use in heavier capacity equipment and vehicles. In
addition, China Sun Group improved the quality of its production
lines by adding advanced technology that provided amalgamation
capabilities.
Since acquiring the prospecting and mining rights to a cobalt
mine in the African Congo, China Sun Group has made plans to
construct a processing plant in the Congo beginning in the third
quarter of fiscal 2008. Direct access to sourcing the raw material,
cobalt ore, from the mine will help China Sun Group avoid export
limitations imposed by the Congo, reduce freight expenses, and
support a stable supply of cobalt ore for production of finished
products, which will include lithium ion batteries.
About China Sun Group
China Sun Group High-Tech Co., ("China Sun Group") produces
anode materials used in lithium ion batteries. Through its
majority-owned operating subsidiary, Da Lian Xin Yang High-Tech
Development Co. Ltd ("DLX"), the Company primarily produces
cobaltosic oxide and lithium cobalt oxide. According to the China
Battery Industry Association, DLX has the second largest cobalt
series production capacity in the People's Republic of China.
Through its research and development division, DLX owns a
proprietary series of nanometer technologies that supply
state-of-the-art components for advanced lithium ion batteries.
Leveraging its state-of-the-art technology, high-quality product
line and scalable production capacity, the Company plans to create
a fully integrated supply chain from the primary manufacturing of
cobalt ore to finished products, including lithium ion batteries.
For more information, visit
http://www.china-sun.cn/English/Aboutus.asp.
Safe Harbor Statement
The statements contained herein that are not historical facts
are considered "forward-looking statements." Such forward-looking
statements may be identified by, among other things, the use of
forward-looking terminology such as "believes," "expects," "may,"
"will," "should," or "anticipates" or the negative thereof or other
variations thereon or comparable terminology, or by discussions of
strategy that involve risks and uncertainties. In particular,
statements regarding the potential growth of the markets are
examples of such forward-looking statements. The forward-looking
statements include risks and uncertainties, including, but not
limited to, the effect of political, economic, and market
conditions and geopolitical events; legislative and regulatory
changes that affect our business; the availability of funds and
working capital; the actions and initiatives of current and
potential competitors; investor sentiment; and our reputation. We
do not undertake any responsibility to publicly release any
revisions to these forward-looking statements to take into account
events or circumstances that occur after the date of this report.
Additionally, we do not undertake any responsibility to update you
on the occurrence of any unanticipated events, which may cause
actual results to differ from those expressed or implied by any
forward-looking statements. The factors discussed herein are
expressed from time to time in our filings with the Securities and
Exchange Commission available at http://www.sec.gov.
CONTACT: At the Company: Thomas Yang Assistant to the President
Tel: 917-432-9350 (U.S.) or 86 411 8289-7752 (China) Fax: 86 411
8289-2739 e-mail: Email Contact or Investor Relations: Peter Clark
OTC Financial Network Tel: +1 (781) 444-6100 ext. 629 Email Contact
www.otcfn.com/csgh
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