China Digital Communication Group Reports Strong Third Quarter Financial Results
15 Novembre 2005 - 2:00PM
PR Newswire (US)
-- Net Income Up 478% and Revenues Increase 242% Year-over-Year in
Q3 2005 -- LOS ANGELES and SHENZHEN, China, Nov. 15
/PRNewswire-FirstCall/ -- China Digital Communication Group
(OTC:CHID) (BULLETIN BOARD: CHID) , one of the fastest growing
battery components manufacturers in China, announced today that it
has filed its Form 10-QSB for the third quarter ended September 30,
2005 at http://www.sec.gov/. Financial results were slightly higher
than its previously announced guidance issued in a press release on
November 1, 2005. The Company reported third quarter 2005 revenues
of $3,405,238, representing an increase of 242% compared to
pro-forma unaudited revenues of $994,963 in the third quarter of
2004 and 2% greater than revenues of $3,316,327 reported in the
second quarter of 2005. The Company attributes its triple-digit
growth trend to the expansion of the Company's product lines to
meet the needs of its existing clients and to service new clients
gained in the third quarter of 2005 as compared to 2004. The
Company reported net income of $748,488, or $0.01 per fully diluted
share, in the third quarter of 2005, representing an increase of
478% compared to unaudited net income of $129,441, or $0.00 per
fully diluted share, reported in the third quarter of 2004. On a
sequential basis, net income in the third quarter of 2005 increased
7% from net income of $698,656 reported in the second quarter of
2005. Share calculations are based on fully diluted shares
outstanding totaling 54,460,626 in the third quarter of 2005 and
47,975,000 in third quarter of 2004. The Company's cost of sales
for the third quarter of 2005 totaled 71.08% of net sales compared
to 75.56% of net sales for the third quarter of 2004. The
percentage decrease was due to maturity of the Company's production
process and improvements made to increase efficiency. The Company's
operating expenses for the third quarter of 2005 were 3.72% of net
sales, compared to 10.88% of net sales for the third quarter of
2004. This decrease was primarily due to the growth in the
company's revenue in the third quarter 2005. Through its wholly
owned subsidiary, Shenzhen E'Jenie ("E'Jenie"), China Digital
manufactures and distributes lithium battery shells and related
products primarily in China. Based upon specifications from its
customers, E'Jenie develops, customizes and produces steel,
aluminum battery shells (ABS), aluminum caps, and lithium batteries
for mobile phones, PDAs and MP3s and other small electronic
consumer products. Yi Bo Sun, China Digital's Chairman and Chief
Executive Officer, stated, "During the third quarter, we continued
to ramp-up our production lines to meet new orders for our
products, including continued growth in our ABS product line. In
addition to serving an expanded client base, we are focused on
building new distribution channels that can grow our domestic
market share and create an international presence. With our recent
test product agreement to sell our lithium ion batteries throughout
20 stores of a major U.S. retailer, we are making strides in
serving the consumer electronics market overseas. We expect our
strong growth trend to continue through the fourth quarter of 2005
and beyond." Use of Pro Forma Past Results Sales and earnings
comparisons with 2004 are based on pro forma figures. For the first
three quarters of 2004, China Digital was a shell company with no
significant revenues. On November 15, 2004 it acquired its
operating subsidiary, E'Jenie Science & Technology Co. Ltd.
("E'Jenie"). In order to present an accurate picture of revenue and
profit trends, the results stated here for 2004 consist of sales
and profit from E'Jenie, as if China Digital had owned the
subsidiary for the comparable period. About China Digital
Communication Group China Digital Communication Group, through its
Shenzhen E'Jenie subsidiary, is a rapidly growing manufacturer of
battery shells and related technology for use in electronic
products, primarily mobile phones. Since December 2003, the Company
has adopted the approach of using licenses, joint ventures, mergers
and acquisitions to bring battery and telecom equipment makers in
China to markets overseas. The Company's products now power digital
cameras, camera phones, PDAs and laptop computers in East Asia and
beyond. China Digital is continuing its expansion across China,
while also seeking distribution partners in the United States. For
more information, visit http://www.chinadigitalgroup.com/.
Forward-looking statement: Except for the historical information,
the matters discussed in this news release may contain
forward-looking statements, including, but not limited to, factors
relating to future sales. These forward-looking statements may
involve a number of risks and uncertainties. Actual results may
differ materially based on a number of factors, including, but not
limited to, uncertainties in product demand, risks related to doing
business in China, the impact of competitive products and pricing,
changing economic conditions around the world, release and sales of
new products, and other risk factors detailed in the company's most
recent annual report and other filings with the Securities and
Exchange Commission. For further information, contact: At the
Company: China Digital Communication Group Roy Teng 310-461-1322
E-mail: http://www.chinadigitalgroup.com/ Investor Relations: OTC
Financial Network Peter Clark 781-444-6100, x629
http://www.otcfn.com/chid DATASOURCE: China Digital Communication
Group CONTACT: Roy Teng of China Digital Communication Group,
+1-310-461-1322, ; or Peter Clark of OTC Financial Network,
+1-781-444-6100, ext. 629, Web site:
http://www.chinadigitalgroup.com/
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