-- Revenue Increases 97.8% to $18.6 Million -- Net Income Increases
69.5% to $1.1 Million BEIJING, Aug. 15
/Xinhua-PRNewswire-FirstCall/ -- China Solar & Clean Energy,
Inc. (OTC:CSOL) (BULLETIN BOARD: CSOL) ("CSOL"), a premier
manufacturer and distributor of solar water heaters, renewable
energy solutions, and space heating devices in the People's
Republic of China, today announced its financial results for the
quarter ended June 30, 2008. Revenue increased approximately $9.2
million, or 98%, to $18.6 million for the fiscal quarter ended June
30, 2008, from $9.4 million in the same period in 2007. The overall
increase in revenue was primarily attributed to the acquisitions of
Tianjin Huaneng and Shenzhen Pengsangpu Solar Industrial Products
(SZPSP). Revenue from solar heater and boiler products increased
6.0% to approximately $10 million for the second quarter of 2008
from $9.4 million in the prior year period. Heat-pipe and
energy-saving products were $5.8 million and $2.8 million for the
second quarter of 2008, compared to no sales in both business
segments in the prior year period. For the six months ended June
30, 2008, sales revenue increased 117% to $26.9 million, compared
to $12.4 million in the prior year period. Gross profit increased
approximately $2.5 million, or 131%, to $4.5 million for the second
quarter of 2008 from $1.9 million for the same period in 2007. The
increase in gross profit was primarily due to the increase in sales
volume of higher-margin businesses acquired through Tianjin
Huaneng. Moreover, organic gross profit in the initial solar heater
and boiler business grew 6% to $2.0 million in the second quarter
of 2008, compared to the same period in the prior year. This
increase in organic gross profit was mostly due to a growth in
sales volume. Gross profit as a percentage of revenue was 23.9% for
the second quarter of 2008, an increase of 340 basis points from
20.5% in the same period in 2007. For the six month period, gross
profit increased 158% to $6.9 million, compared to $2.7 million in
the prior year period. Operating expenses increased 111% from $1.1
million in the second quarter of 2007 to $2.4 million in 2008.
Operating expenses as a percentage of sales increased to 12.9% as
compared to 12.1% in the prior year period. This increase was
mainly due to increases in sales and promotion expenditures and
acquisition costs of Tianjin Huaneng and SZPSP. For the six month
period, operating expenses increased 126% to $3.7 million as
compared to $1.6 million in the prior year period. Operating Income
increased 161% to $2.1 million for second quarter of 2008 from $0.8
million in the same period in 2007. As a percentage of sales,
operating income was 11.0% as compared to 8.3% in the prior year
period. For the six month period, operating income increased 207%
to $3.3 million as compared to $1.1 million in the prior year
period. Net income for the three months ended June 30, 2008 was
$1.1 million as compared to net income of $0.6 million in the prior
year period. Earnings available to common shareholders, on a fully
diluted basis, were negative ($0.05) for the second quarter of 2007
owing to a preferred stock beneficial conversion provision of
approximately $1 million during that period. Excluding that
provision earnings available to commons shareholders, on a fully
diluted basis, were $0.10 in the second quarter of 2007. For the
second quarter of 2008 earnings available to common shareholders on
a fully diluted basis were $.07. Diluted shares outstanding
increased 151% to 15.6 million in the second quarter of 2008 as
compared to 6.2 million in the prior year period. For the six
months ended June 30, 2008, net income increased 61% to $1.5
million as compared to $0.9 million in the prior year period.
Earnings available to common shareholders on a fully diluted basis
increased from a negative ($0.01) to $0.11 per share. "We are
pleased with our performance in the second quarter of 2008," stated
Mr. Deli Du, Chief Executive Officer of China Solar & Clean
Energy Solutions. "The heat pipe products division that we obtained
via our acquisition of Tianjin Huaneng continued to perform well.
Our energy savings product group, obtained via the acquisition of
Shenzhen Pengsangpu Solar Industrial Products (SZPSP), also
performed well in its first quarter as a part of our Company.
Combining these two groups with our solar heater and boiler
division we believe that we now have a broad, strong foundation of
energy-related products upon which we can build significant growth
in the future. We would continue to apply our experience to
broadening the distribution of each of our product groups while
also enhancing operating efficiencies. We believe that, in light of
the increasing cost of energy in China and throughout the world,
demand for our portfolio of products will continue to grow at a
high rate. We think that we are well positioned to benefit from
this trend and will continue to aggressively pursue growth in this
market." About China Solar & Clean Energy Solutions, Inc. China
Solar & Clean Energy Solutions, Inc. operates through its
wholly owned subsidiaries Bazhou Deli Solar Energy Heating Co. Ltd.
("Deli Solar (Bazhou)"), Beijing Deli Solar Technology Development
Co., Ltd. and its 51% ownership in Tianjin Huaneng Group, all
located in the PRC. The Company manufactures and distributes hot
water and space heating devices to customers in the PRC, in
addition to waste heat recovery systems. For more information,
please visit http://www.cn-sce.com/ . 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. Financial Tables CHINA SOLAR & CLEAN ENERGY
SOLUTIONS, INC. CONDENSED CONSOLIDATED STATEMENTS OF INCOME FOR THE
THREE AND SIX MONTHS ENDED JUNE 30, 2008 AND 2007 Currency
expressed in United States Dollars ("US$")) (Unaudited) Three
months ended Six months ended June 30, June 30, 2008 2007 2008 2007
Revenue, net $18,630,198 $9,418,160 $26,930,274 $12,414,023 Cost of
revenue 14,173,216 7,490,129 20,018,232 9,739,044 Gross profit
4,456,982 1,928,031 6,912,042 2,674,979 Operation Expenses
Depreciation and amortization 132,216 35,630 281,383 70,966 Selling
and distribution 1,118,041 237,502 1,620,604 281,532 General and
administrative 1,155,736 870,084 1,757,389 1,264,041 Total
operating expenses 2,405,993 1,143,216 3,659,376 1,616,539 Income
from operations 2,050,989 784,815 3,252,666 1,058,440 Other income
(expenses): Other income 25,741 -- 66,831 -- Interest income 1,638
78 1,638 1,735 Other expense (45,266) -- (45,266) -- Interest
expense (109,858) (97) (143,696) (97) Total other (expense) income
(127,745) (19) (120,493) 1,638 Income before income taxes 1,923,244
784,796 3,132,173 1,060,078 Income tax expenses 441,015 137,976
787,278 137,976 Minority interest 386,016 -- 859,031 -- NET INCOME
$1,096,213 $646,820 $1,485,864 $922,102 Computation of income
available to common stockholders: Net Income $1,096,213 $646,820
$1,485,864 $922,102 Preferred stock beneficial conversion --
(975,807) -- (975,807) NET INCOME AVAILABLE TO COMMON STOCK HOLDERS
$1,096,213 $(328,987) $1,485,864 $(53,705) Net income (loss) per
share -- basic $0.08 $(0.05) $0.14 $(0.01) Net income per share --
diluted $0.07 $(0.05) $0.11 $(0.01) Weighted average shares
outstanding -- basic 13,075,468 6,205,290 10,612,185 6,205,290
Weighted average shares outstanding -- diluted 15,584,542 6,205,290
13,006,396 6,205,290 CHINA SOLAR & CLEAN ENERGY SOLUTIONS, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS AS OF JUNE 30, 2008 AND
DECEMBER 31, 2007 (Currency expressed in United States Dollars
("US$"), except for number of shares) June 30, December 31, 2008
2007 (Unaudited) (Note 1) ASSETS Current assets: Cash and cash
equivalents $ 6,689,173 $ 5,466,637 Accounts receivable, net
9,262,801 7,453,009 Inventories 6,256,439 3,875,658 Other
receivables and prepayments 5,865,320 1,637,948 Total current
assets 28,073,733 18,433,252 Property, plant and equipment, net
12,191,828 8,819,216 Goodwill 4,705,591 1,789,324 Intangible
assets, net 1,673,660 1,597,921 Customer relationships, net
1,072,500 -- Intellectual property -- unpatented technology, net
916,500 -- TOTAL ASSETS $ 48,633,812 $ 30,639,713 LIABILITIES AND
STOCKHOLDERS' EQUITY Current liabilities: Accounts payable, trade $
1,831,368 $ 2,111,028 Income tax payables 1,538,863 1,108,433 Other
payables and accrued liabilities 10,158,585 8,552,452 Total current
liabilities 13,528,816 11,771,913 Deferred tax liabilities 265,664
-- Minority interests 1,879,303 935,825 Stockholders' equity:
Convertible preferred stock: par value $0.001; 25,000,000 shares
authorized, 638,082 (unaudited) and 1,774,194 shares issued and
outstanding, respectively 638 1,774 Common stock, $0.001 par value;
66,666,667 shares authorized; 13,527,630 (unaudited) and 6,205,690
shares issued and outstanding, respectively 13,527 6,205 Additional
paid-in capital 22,288,728 9,260,607 Accumulated other
comprehensive income 1,642,153 1,134,270 Retained earnings
9,014,983 7,529,119 Total stockholders' equity 32,960,029
17,931,975 TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 48,633,812
$ 30,639,713 For more information please contact: Dan Joseph ICR,
Inc. Tel: +86-21-6122-1077 Bill Zima ICR, Inc. Tel: +1-203-682-8200
DATASOURCE: China Solar & Clean Energy, Inc. CONTACT: Dan
Joseph, +86-21-6122-1077; Bill Zima, +1-203-682-8200, both of ICR,
Inc. Web Site: http://www.cn-sce.com/
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