Asia Carbon Industries, Inc. (OTCBB: ACRB) ("Asia Carbon," or the
"Company") today announced its earnings for the quarter ended March
31, 2011. The Company, whose shares trade in the U.S. under the
stock symbol "ACRB," filed its quarterly report on Form 10-Q with
the Securities and Exchange Commission on May 16, 2011.
Highlights of First Quarter 2011 Financials
-- Revenues for the first quarter of 2011 increased 154% to $13.44 million
in 2011, from $5.29 million for the same period in 2010.
-- Gross profit increased 302% to $3.18 million in the first quarter of
2011 from $0.79 million for the same period in 2010.
-- Net income for the first quarter of 2011 increased 564% to $2.1 million
in 2011 from $0.32 million for the same period in 2010.
-- Earnings per share were at $0.04 for the first quarter of 2011,
compared to $0.01 for the same period in 2010.
-- Weighted average basic shares outstanding for the first quarter in 2010
were 50,608,077, a 16% increase, as compared to 43,678,272 for the same
period in 2010.
The Company's sales for the three months ended March 31, 2011
totaled $13,441,516, an increase of $8,146,643, or 154%, compared
to $5,294,873 for the three months ended March 31, 2010. The
increase in sales was primarily attributed to the expansion in
sales of the Company's two newest products; N220-W, a wet-process
carbon black, which launched in November of 2010, and naphthalene
oil, which began selling in July 2010. Together, these two products
accounted for 50% of revenue for the quarter and 82% of the
increase in sales in the three months ended March 31, 2011.
During the three months ended March 31, 2011, the Company sold
5,463 metric tons of N220-W, generating revenue of $6,245,563 and
naphthalene oil accounted for $448,075 in revenue from 500 metric
tons of product sales for the quarter. Sales generated by the
Company's three dry process carbon black products, N330, N660 and
N220-D accounted for $6,747,878 in sales.
The average sales price of all carbon products was $1,070 per
metric ton during the first quarter of 2011, an increase of $299
per ton, or 42%, from $771 per ton during the first quarter of
2010.
Gross profit for the three months ended March 31, 2011 was
$3,181,432, an increase of $2,390,771, or 302%, compared to
$790,661 in the comparable period of 2010. The gross profit margin
also increased, to 24% for the quarterly period ended March 31,
2011, from 15% for the same period in 2010, primarily as a result
of the increased percent of sales from the higher margin wet
process product and sale of naphthalene oil.
Net income was $2,105,473 for the three months ended March 31,
2011, an increase of $1,788,205, or 564%, compared to $317,268 for
the same period in 2010. Again, the increase in net income is the
result of the contribution of N220-W and naphthalene oil.
Yao Guoyun, Asia Carbon's Chairman of the Board and Chief
Executive Officer, commented, "We are very excited to report our
first quarter results to our shareholders. The Company's
performance is a direct result of the successful implementation of
the expansion plans we laid out at the time we brought Asia Carbon
public; expanding our overall manufacturing capacity and
transforming our existing production lines from dry-process to the
higher quality wet-process production."
Ms. Guoyun went on to say, "Demand for our products remains
strong, particularly for N220-W, and we are hopeful that our
continued growth will be well received by the public markets as we
look to them for capital to facilitate the further expansion of our
manufacturing and distribution capabilities."
Ms. Guoyun commented further on the Company's transition from a
private to a public company, saying, "We became a public company
through a registration statement on Form S-1 rather than a reverse
merger, and while it was a somewhat slower process, our management
team felt this was the appropriate approach for Asia Carbon and its
shareholders. We have always, and will continue to adhere to the
rules and regulations associated with being a public company in the
United States."
Comparison of Sales for the Three Months Ended March 31,
2011 2010
------------------------- -------------------------
Sales Metric Tons Sales Metric Tons
------------ ------------ ------------ ------------
N220 - D $ 2,327,289 2,220 $ 1,829,960 2,275
N330 2,212,873 2,221 1,738,667 2,304
N660 2,207,716 2,236 1,726,246 2,288
N220 - W 6,245,563 5,463 - -
Naphthalene oil 448,075 500 - -
------------ ------------ ------------ ------------
Total Sales $ 13,441,516 12,640 $ 5,294,873 6,867
============ ============ ============ ============
ASIA CARBON INDUSTRIES INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME
(UNAUDITED)
Three Months Ended
March 31,
--------------------------
2011 2010
------------ ------------
Net Sales $ 13,441,516 $ 5,294,873
Cost of Sales 10,260,084 4,504,212
------------ ------------
Gross Profit 3,181,432 790,661
------------ ------------
Operating Expenses:
Depreciation 56,919 16,186
Bad debts 3,282 (3,621)
Selling 71,076 35,922
Professional fees 108,897 187,322
Other 50,630 34,213
------------ ------------
Total 290,804 270,022
------------ ------------
Income From Operations 2,890,628 520,639
------------ ------------
Other Income and (Expense)
Interest expense (27,178) (35,644)
------------ ------------
Income Before Provision for Income Tax 2,863,450 484,995
Provision for Income Tax 757,977 167,727
------------ ------------
Net Income 2,105,473 317,268
Other Comprehensive Income (Loss) 160,042 (591)
------------ ------------
Comprehensive Income $ 2,265,515 $ 316,677
============ ============
Net Income Per Share - Basic and Diluted $ 0.04 $ 0.01
============ ============
Weighted Average Shares Outstanding - Basic
and Diluted 50,608,077 43,678,272
============ ============
ASIA CARBON INDUSTRIES INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
March 31, December 31,
2011 2010
------------ ------------
(Unaudited)
ASSETS
Current Assets:
Cash and equivalents $ 7,568,601 $ 5,717,142
Accounts receivable, net 6,081,007 6,034,573
Inventories 1,690,873 1,476,061
Prepaid expenses 6,108 6,061
------------ ------------
Total Current Assets 15,346,589 13,233,837
------------ ------------
Property and Equipment, Net 10,846,982 11,031,788
------------ ------------
Other Assets:
Idle assets, net 927,193 959,967
Land use rights, net 212,246 211,770
------------ ------------
Total Other Assets 1,139,439 1,171,737
------------ ------------
TOTAL ASSETS $ 27,333,010 $ 25,437,362
============ ============
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities:
Short term debt $ - $ 1,312,163
Accounts payable 4,721,189 3,913,207
Accrued liabilities 203,987 163,518
Taxes payable 990,040 896,351
Due to shareholder 20,011 19,855
------------ ------------
Total Current Liabilities 5,935,227 6,305,094
------------ ------------
Commitments and Contingencies
Stockholders' Equity:
Series A Convertible Preferred Stock, $0.001 par
value, 5,000,000 authorized, none issued and
outstanding - -
Blank Check Preferred Stock, $0.001 par value,
5,000,000 authorized, none issued and
outstanding - -
Common stock, $0.001 par value, 100,000,000
authorized, 50,608,077 issued and outstanding
at March 31, 2011 and December 31, 2010 50,608 50,608
Additional paid-in capital 5,533,737 5,533,737
Statutory reserves 1,224,559 1,224,559
Retained earnings 12,733,483 10,628,010
Accumulated other comprehensive income 1,855,396 1,695,354
------------ ------------
Total Stockholders' Equity 21,397,783 19,132,268
------------ ------------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 27,333,010 $ 25,437,362
============ ============
About Asia Carbon Industries, Inc.
Asia Carbon Industries Inc. is an emerging, China-based producer
of a series of high quality carbon black products under the brand
name "Great Double Star." The Company was established in 2003 in
Shanxi, China's highest coal producing province. Asia Carbon is one
of the top ten carbon black producers in the province and has
established relationships with a high-profile customer base. The
Company went public in 2010 through a registration statement on
Form S-1 which was declared effective by the SEC on October 26,
2010, and is currently in the process of expanding its
manufacturing capacity to meet the anticipated demand.
This release shall not constitute an offer to sell or the
solicitation of an offer to buy nor shall there be any sale of
these securities in any state in which such offer, solicitation or
sale would be unlawful prior to registration or qualification under
the securities laws of any such State.
Forward-looking statements:
The above news release contains forward-looking statements. The
statements contained in this document that are not statements of
historical fact, including but not limited to, statements
identified by the use of terms such as "anticipate," "appear,"
"believe," "could," "estimate," "expect," "hope," "indicate,"
"intend," "likely," "may," "might," "plan," "potential," "project,"
"seek," "should," "will," "would," and other variations or negative
expressions of these terms, including statements related to
expected market trends and the Company's performance, are all
"forward-looking statements" within the meaning of the Private
Securities Litigation Reform Act of 1995 and involve a number of
risks and uncertainties. These statements are based on assumptions
that management believes are reasonable based on currently
available information, and include statements regarding the intent,
belief or current expectations of the Company and its management.
Prospective investors are cautioned that any such forward-looking
statements are not guarantees of future performances, and are
subject to a wide range of external factors, uncertainties,
business risks, and other risks identified in filings made by the
company with the Securities and Exchange Commission. Actual results
may differ materially from those indicated by such forward-looking
statements. The Company expressly disclaims any obligation or
undertaking to update or revise any forward-looking statement
contained herein to reflect any change in the company's
expectations with regard thereto or any change in events,
conditions or circumstances upon which any statement is based.
Company contact: Mark Lubchenco Asia Carbon Industries, Inc.
Phone +1-646-328-1502
Asia Carbon Industries (CE) (USOTC:ACRB)
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