BEIJING, June 1 /PRNewswire-Asia-FirstCall/ -- China Solar &
Clean Energy Solutions, Inc. ("CSOL" or "China Solar" or the
"Company") (OTC Bulletin Board: CSOL), a premier manufacturer and
distributor of solar water heaters, renewable energy solutions, and
space heating devices in the People's Republic of China, last
Thursday reported its financial results for the first quarter ended
March 31, 2009. Mr. Deli Du, Chief Executive Officer and President
of CSOL, commented, "As the first quarter is the solar industry's
seasonally slowest in terms of manufacturing and sales, we focused
our corporate efforts on completing our planned business
transition. We undertook company-wide efforts to improve our
operating efficiency and internal controls. We began to implement a
company-wide ERP system as part of our accounting systems upgrade
to ensure CSOL will be fully compliant with strict requirements by
the Sarbanes-Oxley Act ("SOX") and other pertinent financial
regulations. We engaged our staff in ongoing training led by
experienced consultants to help standardize our financial
reporting. We hired an excellent financial executive, as we are
very pleased with the arrival of Ms. Yinan Zhao as our Acting Chief
Financial Officer. We welcome her solid knowledge of financial
systems and markets, extensive experience in accounting, taxation,
and asset valuation functions, and impressive professional
certifications including Certified Public Accountant (CPA),
Certified Tax Administrator (CTA) and Certified Valuation Analyst
(CVA). To that extent, although our broad efforts to upgrade our
systems and internal controls caused our delayed quarterly filing,
I am satisfied with our visible progress during the first quarter,
as we continue to lay a strong foundation for the remainder of 2009
and beyond." First Quarter 2009 Results First quarter 2009 revenue
of $6.2 million decreased by $2.1 million, or 25.4%, from $8.3
million in the first quarter of 2008, primarily due to lower sales
from the Solar Heater and Heat Pipe segments. Revenues for the
Solar Heater/Boiler Related Products segment decreased by $1.2
million, or 45.3%, to $1.5 million, due to deeper price competition
and fewer units shipped. Heat Pipe revenues decreased by $1.9
million, or 34.8%, to $3.6 million, as the Company shifted its
focus on winning large energy projects which typically require
longer completion terms. Energy-saving revenues and Solar Heat
Collector revenues were $0.4 million and $0.7 million,
respectively, versus zero revenue in the first quarter of 2008, as
the Company completed its acquisition of Shenzhen Peng Sang Pu
("SZPSP") at the end of March 2008. Gross profit in the first
quarter of 2009 decreased by $1.3 million, to $1.2 million, as
compared to $2.5 million for the same period last year.
Correspondingly, gross margin decreased to 19.4% from 29.6% in the
prior year's first quarter, mainly due to a combination of lower
prices and higher costs of key raw materials, such as stainless
steel. Operating expenses increased to $2.1 million for the first
quarter of 2009, as compared to $1.3 million a year ago, primarily
due to the subsequent increase in administrative, sales,
depreciation and amortization expenses related to the acquisition
of SZPSP. Operating loss was ($0.9) million in the first quarter
2009, as compared to income from operations of $1.2 million a year
ago. Similarly, first quarter 2009 net loss was ($0.9) million,
versus net income of $0.4 million in the same period of 2008.
Consequently, net loss per share was ($0.07) in the first quarter
of 2009, as compared to diluted net income per share of $0.03 in
the first quarter of 2008. Cash and cash equivalents decreased to
$1.4 million as of March 31, 2009, compared to $2.4 million as of
December 31, 2008, due to net operating loss and net increase in
working capital during the quarter. Net cash used in operating
activities was $0.8 million for the first quarter of 2009, as
compared to net cash used in operating activities of $4.1 million
for the first quarter of prior year. While accounts receivable
decreased to $6.7 million from $7.3 million as of December 31,
2008, inventories increased to $7.2 million from $6.9 million.
Accounts payable decreased to $4.7 million from $5.3 million, and
other payables and accrued liabilities decreased by approximately
$1.0 million to $7.3 million from $8.4 million. The net increase in
working capital was partially due to the consolidation of SZPSP.
Business Discussion "While we continue to invest into our corporate
infrastructures in preparation for our return to revenue growth and
profitability, we have yet to realize immediate benefits from these
investments, and therefore, our first quarter 2009 revenue and
profits declined accordingly. However, I remain optimistic in China
Solar's valuable assets and franchises. I am energized by our solid
management team and our disciplined efforts to streamline
operations and enhance systems to ensure timely financial reporting
and regulatory compliance. I believe that once we complete our
transition, we can maintain a solid financial team and system,
improve internal controls, and enhance corporate transparency. We
aim to utilize these improvements for the full benefit of our
shareholders. "In addition, we continue to expand our nation-wide
distribution channels and integrate our diverse resources to
achieve greater synergies across our product and service offerings,
as well as our various subsidiaries. We seek to leverage our
marketing and promotion efforts to enhance our brand awareness
across both the consumer and government sectors. We are expanding
our partnerships and innovating joint-capabilities with leading
clean energy institutions as we bid for key wins in new
State-sponsored energy projects. "Looking ahead, I am confident in
our management team and in our competitive advantages, and I
believe China Solar will emerge from the currently challenging
economic cycle a strong and profitable industry leader. I am
optimistic about our solid portfolio of technologies and products
in development. I remain encouraged by the government's initiatives
to expand the availability of and access to electricity in China's
immense rural areas, which will create substantially higher demand
for our products and solutions. I am excited by our unique business
model and pioneering solutions for solar projects in hot water
systems throughout China's numerous Universities. "As we near the
completion of our business transition, I firmly believe that CSOL
will eventually achieve strong revenue growth, margin expansions,
and solid profits and cash flows in the near future. We are
dedicated to growing a strong, profitable and responsive enterprise
at China Solar, and importantly, to serving the best interests of
our supportive shareholders and to maximizing our shareholders'
value," concluded Mr. Du. 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., Shenzhen PengSangPu Solar
Industrial Products Corporation 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.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. For more
information, please contact: Peggy Yuan Investor Relations China
Solar & Clean Energy Solutions, Inc. Tel: +86-10-6386-0500
Email: Michael Tieu ICR Tel: +86-10-6599-7960 Email: CHINA SOLAR
& CLEAN ENERGY SOLUTIONS, INC. CONDENSED CONSOLIDATED
STATEMENTS OF OPERATIONS (Currency expressed in United States
Dollars ("US$"), except for number of shares) (Unaudited) For the
three months ended March 31, 2009 2008 Revenue, net $ 6,195,691 $
8,300,076 Cost of revenue 4,991,878 5,845,016 Gross profit
1,203,813 2,455,060 Operating expenses Depreciation and
amortization 304,988 149,167 Selling and distribution 545,899
502,563 General and administrative 1,266,344 601,653 Total
operating expenses 2,117,231 1,253,383 Other income (expenses):
Other income 38,807 41,090 Interest income 37,532 -- Other expense
(9,431) -- Interest expense (47,159) (33,838) Total other income
19,749 7,252 Income before income taxes and minority interest
(893,669) 1,208,929 Income tax expenses 36,873 346,263 Minority
interest 10,006 473,015 NET INCOME/(LOSS) $ (940,548) $ 389,651 NET
INCOME/(LOSS) AVAILABLE TO COMMON STOCKHOLDERS $ (940,548) $
389,651 Net income/(loss) per share - Basic $ (0.07) $ 0.05 Net
income/(loss) per share - Diluted $ (0.07) $ 0.03 Weighted average
shares outstanding - Basic 13,799,450 8,009,713 Weighted average
shares outstanding - Diluted 13,799,450 15,284,770 CHINA SOLAR
& CLEAN ENERGY SOLUTIONS, INC. CONDENSED CONSOLIDATED BALANCE
SHEETS (Currency expressed in United States Dollars ("US$"), except
for number of shares) March 31, December 31, 2009 2008 (Unaudited)
ASSETS Current assets: Cash and cash equivalents $ 1,361,842 $
2,404,996 Investment, at fair value 95,086 -- Accounts receivable,
net 6,658,667 7,284,255 Inventories 7,240,423 6,950,844 Other
receivables and prepayments 6,706,201 7,870,575 Lease receivables,
current 156,199 156,579 Total current assets 22,218,418 24,667,249
Property and equipment, net 15,306,283 15,366,009 Goodwill
2,284,903 2,284,903 Other intangible assets, net 3,536,044
3,596,184 Lease receivables, non current 684,528 654,578 TOTAL
ASSETS $44,030,176 $46,568,923 LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities: Accounts payable, net $ 4,696,729 $ 5,301,349
Income tax payable 2,210,157 2,236,298 Other payables and accrued
liabilities 7,343,061 8,386,698 Total current liabilities
14,249,947 15,924,345 Long-term liabilities: Deferred tax
liabilities 15,779 15,779 Minority interests 1,713,804 1,704,248
Stockholders' equity: Convertible preferred stock: par value
$0.001, 25,000,000 shares authorized, 373,566 (unaudited) 373,566
shares issued and outstanding, respectively 373 373 Common stock,
$0.001 par value, 66,666,667 shares authorized, 13,799,450
(unaudited) and 13,799,450 shares issued and outstanding,
respectively 13,799 13,799 Additional paid-in capital 22,966,404
22,966,404 Accumulated other comprehensive loss 1,681,724 1,615,081
Retained earnings 2,425,240 3,365,788 Profit earning reserves
963,106 963,106 Total stockholders' equity 28,050,646 28,924,551
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $44,030,176 $46,568,923
CHINA SOLAR & CLEAN ENERGY SOLUTIONS, INC. CONSOLIDATED
STATEMENTS OF CASH FLOWS (Currency expressed in United States
Dollars ("US$")) (Unaudited) Three months ended March 31, 2009 2008
Cash flows from operating activities: Net cash used in operating
activities $ (829,589) $(4,104,526) Cash flows from investing
activities: Purchase of property, plant and equipment (185,122)
(730,974) Cash paid for investment in acquisition (95,086) -- Net
cash used in investing activities (280,208) (730,974) Cash flows
from financing activities: Proceeds from private placement sale of
stock -- 9,995,156 Proceeds from warrants exercised -- 107,500 Net
cash provided by financing activities -- 10,102,656 Foreign
currency translation adjustment 66,643 -- NET CHANGE IN CASH AND
CASH EQUIVALENTS (1,043,154) 5,267,156 CASH AND CASH EQUIVALENTS,
BEGINNING OF PERIOD 2,404,996 5,466,637 CASH AND CASH EQUIVALENTS,
END OF PERIOD $ 1,361,842 $10,733,793 SUPPLEMENTAL DISCLOSURE OF
CASH FLOW INFORMATION: Cash paid for income taxes $ 63,014 $ 31,978
Cash paid for interest expenses $ 47,159 $ 33,838 DATASOURCE: China
Solar & Clean Energy Solutions, Inc. CONTACT: Peggy Yuan,
Investor Relations of China Solar & Clean Energy Solutions,
Inc., +86-10-6386-0500, or ; or Michael Tieu of ICR,
+86-10-6599-7960, or , for CSOL Web Site: http://www.delisolar.com/
Copyright