ACRB Asia Carbon Industries Inc (CE)

NEW YORK, Aug. 14, 2013 /PRNewswire/ -- Asia Carbon Industries, Inc. ("Asia Carbon", or the "Company") today announced its earnings for the quarter ended June 30, 2013. The Company, whose shares trade in the U.S. on the OTCQB Tier of the OTC Markets under the stock symbol "ACRB", filed its quarterly report on Form 10-Q with the Securities and Exchange Commission on August 14, 2013.

The Company also reported the completion of the conversion of its three remaining dry production lines to special carbon black ("SCB") production lines. Initiated in October 2012, the project was implemented as part of the Company's strategy to broaden its product line and increase revenues. SCB is typically used in products which require higher quality carbon black, and is generally priced at a substantial premium to traditional carbon black. The transition required the suspension of much of the Company's production, which in turn negatively impacted the Company's operating results for the first half of 2013.

Yao Guoyun, Asia Carbon's Chairwoman of the Board and Chief Executive Officer, commented, "We appreciate our shareholders' and customers' support throughout the renovation of our manufacturing facility. While the transition did require an interruption of much of our production for the first half of 2013, we were able to remain profitable throughout the process. In fact, the gross profit margin in our second quarter of 2013 is higher than that in the same period of 2012, which is 24% versus 22%"

Ms. Yao went on to say "This was a critical step in Asia Carbon's expansion strategy. Our ability to produce and sell specialty carbon black not only enables us to better serve market demand, but also provides the opportunity for significant improvements to revenues and margins going forward."

Overview of Second Quarter 2013 Financials

Net Sales for the three months ended June 30, 2013 were $5,487,310, a $7,707,224 or 58% decline as compared to $13,194,534 for the same period in the prior year. The decrease in sales was primarily due to the suspension of production for the conversion to SCB, and a decrease in unit sales prices reflective of lower coal tar oil prices, the primary raw material for carbon black production.

The average selling prices for the Company's products during the three months ended June 30, 2013 was $796 per metric ton, a decrease of 14% from $929 in the same period of 2012. The Company sold 6,890 metric tons of carbon black and naphthalene oil in the second quarter of 2013, a decrease of 7,318 metric tons or 52% compared to 14,208 metric tons in the same period of 2012.

Gross profit was $1,299,793 for the three months ended June 30, 2013, a decrease of $1,636,880, or 56%, compared to $2,936,673 in the same period of 2012, consistent with the decline in sales.  The gross profit margin was 24% and 22% for the three months ended June 30, 2013 and 2012, respectively.

Net income for the three months ended June 30, 2013, was $622,522, a decrease of $1,248,955, or 67%, compared to $1,871,477 in the same period of 2012. The decrease in net income reflects the decline in gross profit and higher operating expenses, which were partly offset by lower income taxes.

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" 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:  Elaine Zhao
Asia Carbon Industries, Inc.
Phone: +1-626-386-8062

SOURCE Asia Carbon Industries, Inc.