BEIJING, June 30 /PRNewswire-Asia-FirstCall/ -- Qiao Xing Mobile
Communication Co., Ltd. ("Qiao Xing Mobile" or the "Company")
(NYSE:QXM), a domestic manufacturer of mobile handsets in China,
today announced its revised financial results for the fourth
quarter and the full year ended December 31, 2008. After the
Company's earnings release on May 12, 2009, Qiao Xing Mobile
continued to finalize its full year 2008 financial results and
determined that it was necessary to record a non-cash intangible
asset impairment charge to write-down the value of its CECT brand
due to the Company's strategic shift to focus more on its high-end
VEVA brand. The impairment charge resulted in a RMB22.3 million
decrease in the Company's full year net income from the previously
reported RMB446.1 million to RMB423.8 million and a RMB0.39
decrease in its diluted earnings per share from RMB7.38 to RMB6.99.
For the fourth quarter ended December 31, 2008, the impairment
charge reduced the Company's net income from RMB56.3 million to
RMB34.0 million while diluted earnings per share decreased from
RMB0.93 to RMB0.56. The full impact of the impairment charge on the
Company's financial statements is set out in the attached
statements. About Qiao Xing Mobile Communication Co., Ltd. Qiao
Xing Mobile Communication Co., Ltd. is a domestic manufacturer of
mobile handsets in China. The Company manufactures and sells mobile
handsets based primarily on GSM, TD-SCDMA and WCDMA standards. It
operates its business primarily through CEC Telecom Co., Ltd., or
CECT, its 96.6%-owned subsidiary in China. In 2008, Qiao Xing
Mobile introduced the VEVA series of mobile phones and began to
open its own retail stores to target mid-income consumers in major
cities throughout China. Through its manufacturing facility in
Huizhou, Guangdong Province, China, and two research and
development centers in Huizhou and Beijing, the Company develops,
produces and markets a wide range of mobile handsets, with
increasing focus on differentiated products that generate higher
profit margins. For more information, please visit
http://www.qxmc.com/ . Qiao Xing Mobile Communication Co., Ltd. and
Subsidiaries Unaudited Condensed Consolidated Balance Sheets
(Amounts in thousands) December 31, 2008 Previously Revised
announced RMB RMB Assets Cash 2,907,148 2,907,148 Restricted cash
136,299 136,299 Accounts receivable, net 462,282 462,282 Bills
receivable 43,516 43,516 Inventories 183,169 183,169 Prepayments to
suppliers 363,907 363,907 Prepaid expenses and other current assets
38,996 38,996 Deferred income taxes 6,994 6,994 Deferred debt
issuance costs, net 34,689 34,689 Total current assets 4,177,000
4,177,000 Property, machinery and equipment, net 167,233 167,233
Land use rights 35,304 35,304 Equity investment 7,803 7,803
Goodwill 112,814 112,814 Other intangible assets, net 22,766 49,001
Total assets 4,522,920 4,549,155 Liabilities, minority interests
and shareholders' equity Short-term borrowings 983,950 983,950
Accounts payable 52,047 52,047 Prepayments from customers 42,551
42,551 Accrued liabilities 50,014 50,014 Amounts due to related
parties 11,155 11,155 Other payables and current liabilities 7,227
7,227 Income taxes payable 38,462 38,462 Embedded derivative
liability 124,130 124,130 Convertible notes 206,211 206,211 Total
current liabilities 1,515,747 1,515,747 Deferred income taxes 320
4,255 Total liabilities 1,516,067 1,520,002 Minority interests
92,065 92,065 Shareholders' equity 2,914,788 2,937,088 Total
liabilities, 4,522,920 4,549,155 minority interests and
shareholders' equity Qiao Xing Mobile Communication Co., Ltd. and
Subsidiaries Unaudited Condensed Consolidated Statements of
Operations (Amounts in thousands, except share and per share data)
Year ended Three months ended December 31, 2008 December 31, 2008
Previously Previously Revised announced Revised announced RMB RMB
RMB RMB Revenues 2,153,873 2,153,873 557,847 557,847 Cost of goods
sold (1,287,096) (1,287,096) (336,749) (336,749) Gross profit
866,777 866,777 221,098 221,098 Selling and distribution expenses
(146,551) (146,551) (35,388) (35,388) General and administrative
expenses (44,231) (44,231) (8,838) (8,838) Research and development
expenses (29,242) (29,242) (8,545) (8,545) Amortization of
intangible assets (11,727) (11,727) (1,190) (1,190) Impairment of
intangible assets (26,235) -- (26,235) -- Operating income 608,791
635,026 140,902 167,137 Interest income 24,405 24,405 4,658 4,658
Interest expense (165,506) (165,506) (65,783) (65,783) Foreign
exchange gain (loss), net (5,142) (5,142) 1,700 1,700 Gain (loss)
on remeasurement of embedded derivatives 144,939 144,939 (7,774)
(7,774) Loss on extinguishment of convertible debts (10,634)
(10,634) -- -- Other income (loss), net (1,431) (1,431) 1,642 1,642
Income before income tax expense, minority interests and
extraordinary item 595,422 621,657 75,345 101,580 Income tax
expense (155,717) (159,652) (37,395) (41,330) Income before
minority interests and extraordinary item 439,705 462,005 37,950
60,250 Minority interests (15,901) (15,901) (3,901) (3,901) Income
before extraordinary item 423,804 446,104 34,049 56,349
Extraordinary item - gain on acquisition of additional equity
interest in CECT -- -- -- -- Net income 423,804 446,104 34,049
56,349 Earnings per share: - Basic 7.52 7.91 0.56 0.93 - Diluted
6.99 7.38 0.56 0.93 Weighted average number of shares outstanding:
- Basic 49,216,000 49,216,000 47,610,000 47,610,000 - Diluted
56,386,000 56,386,000 47,610,000 47,610,000 For further
information, contact: Ms. Shi Heng Qiao Xing Mobile Communication
Co., Ltd. Tel: +86-10-8219-3706 Email: DATASOURCE: Qiao Xing Mobile
Communication Co., Ltd. CONTACT: Ms. Shi Heng of Qiao Xing Mobile
Communication Co., Ltd., +86-10-8219-3706, or Web site:
http://www.qxmc.com/
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