HUIZHOU, China, May 31, 2011 /PRNewswire-Asia-FirstCall/ -- Qiao
Xing Universal Resources, Inc. (NASDAQ: XING) ("XING" or the
"Company"), a leading company in the molybdenum mining business as
well as a company with substantial assets in the resources
industry, today announced its unaudited consolidated financial
results for the fiscal year ended December 31, 2010.
"Our mining operations grew significantly in 2010 as our mining
operations began to contribute significantly to our financial
results. Furthermore, we completed two additional mine acquisitions
at the end of 2010 and these two operational and producing mines
will contribute substantially in 2011," stated Mr. Ruilin Wu, the Company's Chairman and Chief
Executive Officer. "As seen by the impressive rise in revenue and
net income in 2010, we are continuing to implement our strategy of
becoming a pure-play resources company even as we work to finalize
our options as relates to our remaining telecommunications
business."
In fiscal 2010, the Company generated strong results from its
mining business with revenues of RMB300.4
million (US$45.5 million),
compared to RMB193.9 million in
fiscal 2009, and net income in fiscal 2010 of RMB 90.6 million (US$13.7
million) compared to RMB64.2
million in fiscal 2009. This represents an increase in
mining revenues and net income of 55% and 41%, respectively.
Meanwhile, the Company's 56% owned subsidiary, Qiao Xing Mobile
Communication Co., Ltd. ("QXM"), strategically contracted its
mobile phone business due to an unfavorable competition environment
so as to limit its operating losses as it assesses its corporate
options. Due to the operating losses attributable to its QXM
subsidiary, the Company recorded a net loss of RMB 57.3 million (US$8.7
million) on a consolidated basis, compared to a consolidated
net loss of RMB 259.9 million in
2009. As of December 31, 2010, the
Company had cash and equivalents of RMB
3,178.1 million (US$481.5
million) on its consolidated balance sheet.
During the past year, the Company completed two acquisitions:
(1) The acquisition of a 100% equity interest in Balinzuo Banner
Xinyuan Mining Co., Ltd. ("Xinyuan"), which owns a mine with
estimated ore reserves of 9,749,000 tons which primarily contains
lead, zinc and copper, and; (2) the acquisition of a 34.53% equity
interest in Chifeng Aolunhua Mining Co., Ltd. ("Aolunhua").
Aolunhua owns a copper-molybdenum mine with reserves of 372.9
million tons of ore that contains molybdenum metal, copper and
silver. XING recently completed all of its financial purchase
obligations for these two mining assets. The Company also owns the
right to receive the expected residual returns from Chifeng Haozhou
Mining Limited ("Haozhou") with estimated proven reserves of 30,985
tons of molybdenum metal (at an average grade of 0.40%) and
reserves of other minerals. With available current cash on
hand and operating cash flow to be generated by its diversified
mining assets, the Company believes that it is well positioned to
optimize the operation of its mining business as well to increase
its presence in the resources industry in 2011 and beyond.
XING is continuing to assess the various alternatives available
to it in terms of divesting of its QXM subsidiary. The
Company will seek to announce its strategy as to QXM concurrent
with its filing of its Form 20-F in June
2011. The Company's strategic plan is to optimize the
operation of its mining assets, acquire future high potential
mining assets and to become a pure resources company. The
Company believes that its state-of-the-art mining operations, its
management expertise and its acquisitions strategy will enable it
to generate a high return on its assets as it seeks to maximize
value for shareholders.
Unaudited consolidated balance sheets as of December 31, 2010 and 2009, as well as unaudited
statements of operations for the years ended December 31, 2010, 2009 and 2008 are as
follows:
QIAO XING
UNIVERSAL RESOURCES, INC. AND SUBSIDIARIES
CONSOLIDATED
BALANCE SHEETS
AS OF
DECEMBER 31, 2009 AND 2010
|
|
|
|
|
2009
|
|
2010
|
|
|
|
|
RMB'000
|
|
RMB'000
|
|
US$'000
|
|
|
|
|
|
|
|
|
|
|
ASSETS
|
|
|
|
|
|
|
|
|
Current assets:
|
|
|
|
|
|
|
|
|
Cash and cash
equivalents
|
|
|
3,709,503
|
|
3,178,156
|
|
481,539
|
|
Restricted cash
|
|
|
251,720
|
|
37,758
|
|
5,720
|
|
Accounts receivable,
net
|
|
|
123,082
|
|
247,953
|
|
37,569
|
|
Inventories
|
|
|
98,012
|
|
61,848
|
|
9,371
|
|
Prepaid expenses
|
|
|
184,339
|
|
87,174
|
|
13,208
|
|
Other current assets
|
|
|
37,025
|
|
37,112
|
|
5,623
|
|
Due from related
parties
|
|
|
25
|
|
24
|
|
4
|
|
Deferred income
taxes-current
|
|
|
15,942
|
|
-
|
|
-
|
|
Assets held for sale
|
|
|
163,000
|
|
-
|
|
-
|
|
Due from discontinued
operations
|
|
|
200,000
|
|
-
|
|
-
|
|
Total current assets
|
|
|
4,782,648
|
|
3,650,025
|
|
553,034
|
|
Property, machinery and
equipment, net
|
|
|
170,485
|
|
269,895
|
|
40,893
|
|
Proven and probable
reserves
|
|
|
712,121
|
|
672,610
|
|
101,911
|
|
Construction in
progress
|
|
|
86,591
|
|
61,824
|
|
9,367
|
|
Investment at cost
|
|
|
5,000
|
|
184,860
|
|
28,009
|
|
Goodwill
|
|
|
82,058
|
|
-
|
|
-
|
|
Value beyond proven and probable
reserves
|
|
|
67,295
|
|
67,295
|
|
10,196
|
|
Other acquired intangible
assets, net
|
|
|
4,433
|
|
-
|
|
-
|
|
Acquisition deposit
|
|
|
-
|
|
352,800
|
|
53,455
|
|
Deferred income
taxes-noncurrent
|
|
|
-
|
|
1,143
|
|
173
|
|
Total assets
|
|
|
5,910,631
|
|
5,260,452
|
|
797,038
|
|
|
|
|
|
|
|
|
|
|
LIABILITIES
|
|
|
|
|
|
|
|
|
Current liabilities:
|
|
|
|
|
|
|
|
|
Short-term bank
borrowings
|
|
|
884,708
|
|
446,000
|
|
67,576
|
|
Accounts payable
|
|
|
60,750
|
|
40,349
|
|
6,114
|
|
Other payables
|
|
|
57,238
|
|
100,881
|
|
15,285
|
|
Accrued liabilities
|
|
|
40,472
|
|
25,237
|
|
3,824
|
|
Deposits received
|
|
|
1,310
|
|
1,310
|
|
198
|
|
Deferred revenues
|
|
|
16,370
|
|
3,902
|
|
591
|
|
Due to related
parties
|
|
|
5,118
|
|
9,324
|
|
1,413
|
|
Taxation payable
|
|
|
15,016
|
|
15,912
|
|
2,411
|
|
Embedded derivative
liability
|
|
|
63,096
|
|
20,113
|
|
3,047
|
|
Convertible notes
|
|
|
233,716
|
|
112,162
|
|
16,994
|
|
Assets retirement
obligation
|
|
|
4,013
|
|
10,837
|
|
1,642
|
|
Deferred income
taxes-current
|
|
|
-
|
|
1,421
|
|
215
|
|
Total current
liabilities
|
|
|
1,381,807
|
|
787,448
|
|
119,310
|
|
Shareholders' loans
|
|
|
6,732
|
|
6,509
|
|
986
|
|
Warrants
liabilities
|
|
|
148,921
|
|
69,831
|
|
10,580
|
|
Deferred income
taxes-noncurrent
|
|
|
175,281
|
|
167,258
|
|
25,343
|
|
Total liabilities
|
|
|
1,712,741
|
|
1,031,046
|
|
156,219
|
|
|
|
|
|
|
|
|
|
|
Commitments and
contingencies
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
SHAREHOLDERS' EQUITY
|
|
|
|
|
|
|
|
|
XING equity:
|
|
|
|
|
|
|
|
|
Common
stock, par value RMB0.008
(equivalent of US$0.001);
authorized
200,000,000
shares as of December
31, 2009 and
2010; outstanding and
fully paid –82,327,993 as of
December
31, 2009
and 95,802,363
as of
December 31,2010
|
|
|
602
|
|
693
|
|
104
|
|
Additional
paid-in capital
|
|
|
2,404,998
|
|
2,627,793
|
|
398,151
|
|
Retained
earnings
|
|
|
796,736
|
|
728,646
|
|
110,401
|
|
Cumulative
translation adjustments
|
|
|
(160,532)
|
|
(154,218)
|
|
(23,366)
|
|
Total XING
equity
|
|
|
3,041,804
|
|
3,202,914
|
|
485,290
|
|
Noncontrolling
interest
|
|
|
1,156,086
|
|
1,026,492
|
|
155,529
|
|
Total equity
|
|
|
4,197,890
|
|
4,229,406
|
|
640,819
|
|
Total liabilities and
shareholders' equity
|
|
|
5,910,631
|
|
5,260,452
|
|
797,038
|
|
|
|
The
accompanying notes are an integral part of these consolidated
financial statements.
|
|
|
|
|
|
|
|
|
|
QIAO XING
UNIVERSAL RESOURCES, INC. AND SUBSIDIARIES
CONSOLIDATED
STATEMENTS OF OPERATIONS
AND
COMPREHENSIVE INCOME (LOSS)
FOR THE
YEARS ENDED DECEMBER 31, 2008, 2009 AND 2010
|
|
|
|
|
2008
|
|
2009
|
|
2010
|
|
|
|
|
RMB'000
|
|
RMB'000
|
|
RMB'000
|
|
US$'000
|
|
Net sales
|
|
|
2,153,873
|
|
1,826,799
|
|
1,155,942
|
|
175,143
|
|
Cost of goods sold
|
|
|
(1,287,096)
|
|
(1,474,930)
|
|
(1,077,857)
|
|
(163,312)
|
|
Gross profit
|
|
|
866,777
|
|
351,869
|
|
78,085
|
|
11,831
|
|
Operating expenses:
|
|
|
|
|
|
|
|
|
|
|
Selling expenses
|
|
|
(146,551)
|
|
(110,444)
|
|
(112,832)
|
|
(17,096)
|
|
General and administrative
expenses
|
|
|
(59,794)
|
|
(114,807)
|
|
(69,843)
|
|
(10,582)
|
|
Research and
development
|
|
|
(29,242)
|
|
(36,404)
|
|
(18,943)
|
|
(2,870)
|
|
Amortization of acquired
intangible assets
|
|
|
(11,727)
|
|
(4,733)
|
|
(4,433)
|
|
(672)
|
|
Impairment of assets held for
sale
|
|
|
-
|
|
(5,957)
|
|
-
|
|
-
|
|
Impairment of
goodwill
|
|
|
-
|
|
-
|
|
(82,058)
|
|
(12,433)
|
|
Impairment of
acquired intangible assets
|
|
|
(26,235)
|
|
(13,600)
|
|
-
|
|
-
|
|
Income from
operations
|
|
|
593,228
|
|
65,924
|
|
(210,024)
|
|
(31,822)
|
|
Interest income
|
|
|
54,821
|
|
28,641
|
|
24,357
|
|
3,690
|
|
Exchange (loss) gain,
net
|
|
|
(16,971)
|
|
406
|
|
(4,090)
|
|
(620)
|
|
Interest expense
|
|
|
(311,710)
|
|
(222,804)
|
|
(46,894)
|
|
(7,105)
|
|
(Loss)
gain on remeasurement of embedded
derivatives
|
|
|
160,036
|
|
(8,258)
|
|
19,006
|
|
2,880
|
|
Gain on disposal of interests in
subsidiaries
|
|
|
2,269
|
|
-
|
|
-
|
|
-
|
|
Gain (loss) on issue/repurchase
of stocks by subsidiaries
|
|
|
4,351
|
|
-
|
|
-
|
|
-
|
|
Gain (loss) on extinguishment of
convertible notes
|
|
|
(10,634)
|
|
(15,261)
|
|
10,025
|
|
1,519
|
|
Impairment of investment at
cost
|
|
|
-
|
|
(2,802)
|
|
-
|
|
-
|
|
Unrealized gain (loss) on
derivatives
|
|
|
-
|
|
(4,673)
|
|
48,745
|
|
7,386
|
|
Other income
(loss), net
|
|
|
(3,700)
|
|
166
|
|
(1,468)
|
|
(222)
|
|
Income (loss)from
continuing operations before income tax
|
|
|
471,690
|
|
(158,661)
|
|
(160,343)
|
|
(24,294)
|
|
Provision for
income tax
|
|
|
(155,717)
|
|
(43,939)
|
|
(47,847)
|
|
(7,250)
|
|
Income (loss) from continuing
operations, net of tax
|
|
|
315,973
|
|
(202,600)
|
|
(208,190)
|
|
(31,544)
|
|
Discontinued operations,
net of tax
|
|
|
(290,953)
|
|
(139,782)
|
|
-
|
|
-
|
|
Net income
(loss)for the year
|
|
|
25,020
|
|
(342,382)
|
|
(208,190)
|
|
(31,544)
|
|
Net (income) loss attributable
to the noncontrolling interest
|
|
|
(161,814)
|
|
82,486
|
|
150,808
|
|
22,850
|
|
Net income
(loss)
|
|
|
(136,794)
|
|
(259,896)
|
|
(57,382)
|
|
(8,694)
|
|
|
|
|
|
|
|
|
|
|
|
|
Other comprehensive
income (loss) -
Translation
adjustments
|
|
|
(33,815)
|
|
(85,883)
|
|
6,314
|
|
957
|
|
Comprehensive income
(loss)
|
|
|
(170,609)
|
|
(345,779)
|
|
(51,068)
|
|
(7,737)
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic earnings (loss)
per common share:
|
|
|
|
|
|
|
|
|
|
|
Continuing operations
|
|
|
4.98
|
|
(1.91)
|
|
(0.63)
|
|
(0.10)
|
|
Discontinued
operations
|
|
|
(9.40)
|
|
(2.22)
|
|
|
|
|
|
Extraordinary gain
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
|
(4.42)
|
|
(4.13)
|
|
(0.63)
|
|
(0.10)
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted earnings (loss)
per common share:
|
|
|
|
|
|
|
|
|
|
|
Continuing operations
|
|
|
3.51
|
|
(1.91)
|
|
(0.63)
|
|
(0.10)
|
|
Discontinued
operations
|
|
|
(9.40)
|
|
(2.22)
|
|
|
|
|
|
Extraordinary gain
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
|
(5.89)
|
|
(4.13)
|
|
(0.63)
|
|
(0.10)
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average number of
shares outstanding
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
|
30,949,000
|
|
62,837,000
|
|
91,179,000
|
|
91,179,000
|
|
Diluted
|
|
|
30,949,000
|
|
62,837,000
|
|
91,179,000
|
|
91,179,000
|
|
|
|
|
|
|
|
|
|
|
|
|
Amounts attributable to
shareholders
|
|
|
RMB'000
|
|
RMB'000
|
|
RMB'000
|
|
US$'000
|
|
Income (loss) from continuing
operations, net of taxes
|
|
|
154,159
|
|
(120,114)
|
|
(57,382)
|
|
(8,694)
|
|
Discontinued operations, net of
taxes
|
|
|
(290,953)
|
|
(139,782)
|
|
-
|
|
-
|
|
Net income (loss)
|
|
|
(136,794)
|
|
(259,896)
|
|
(57,382)
|
|
(8,694)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Foreign Exchange Rate Used
The United States dollar (US$)
amounts disclosed in this press release are presented solely for
the convenience of the reader. Translations of the amounts from
Renminbi (RMB) into United States
dollars for the convenience of readers were calculated at the noon
purchase rate of US$1.00 =
RMB6.60 on December 31, 2010 in New York City for cable transfers of RMB as
certified for customs purposes by the Federal Reserve Bank of
New York. No representation is
made that the RMB amounts could have been, or could be, converted
into U.S. Dollars at that rate on December
31, 2010, or on any other specific date. The percentages
stated are calculated based on RMB.
About Qiao Xing Universal Resources, Inc.
Qiao Xing Universal Resources, Inc. is a leading player in the
molybdenum mining industry with substantial assets in the resources
industry. XING focuses on mining and processing rare metal ores and
several strategically important base-metal ores, including
molybdenum, copper lead and zinc. XING currently owns a 100% equity
interest in Balinzuo Banner Xinyuan Mining Co., Ltd. and a 34.53%
equity interest in Chifeng Aolunhua Mining Co., Ltd, as well as the
right to receive 100% of the expected economic residual returns
from Chifeng Haozhou Mining Co., Ltd.
XING was one of the first Chinese companies to be listed on
NASDAQ (in 1999) as one of the leading players in the
telecommunication-terminal product business in China. In 2007, XING made the strategic
decision to diversify into the resources industry. Since then, XING
has made several acquisitions in the resources industry and
divested its fixed-line and budget mobile phone businesses.
To reflect this change, XING changed its corporate name to
Qiao Xing Universal Resources, Inc., effective January 28, 2010.
XING is well positioned to optimize the operation of its mining
business as well to increase its presence in the resources industry
in 2011 and beyond. XING will continue to seek opportunities to
acquire future high potential mining assets. At the same time, XING
is also working to divest its remaining mobile-phone business to
become a pure-play resources company.
Cautionary Note Regarding Forward Looking Statements
This press release contains forward-looking statements that
involve risks and uncertainties. These include statements about our
expectations, plans, objectives, assumptions, performance or future
events. In some cases, you can identify forward-looking statements
by terminology such as "anticipate," "estimate," "plans,"
"potential," "projects," "continuing," "ongoing," "expects,"
"management believes," "we believe," "we intend" and similar
expressions. These statements involve estimates, assumptions and
uncertainties that could cause actual results to differ materially
from those expressed. You should not place undue reliance on these
forward-looking statements. Forward-looking statements
include all statements other than statements of historical facts,
such as statements regarding the Company's plans to improve
efficiencies in the day-to-day operations of its mines, the
Company's plans to enhance production processes and management
efficiencies, the Company's plans to develop more efficient
production processes for molybdenum exploration and extraction and
the Company's transition to a pure resources company and bigger
player within the resources industry. Readers are cautioned that
forward-looking statements are not guarantees of future performance
and actual results may differ materially from those projected,
anticipated or assumed in the forward-looking statements.
Forward-looking statements involve inherent risks and
uncertainties. A number of factors could cause actual results to
differ materially from those contained in any forward-looking
statement. Information regarding these factors is included in our
filings with the SEC. The Company does not undertake any obligation
to update any forward-looking statements. All information provided
in this press release is as of May 31,
2011.
Company
Contact:
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Qiao Xing Universal
Resources
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Rick Xiao, Vice President
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Phone: +86-752-282-0268
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Email:
rick@qiaoxing.com
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USA IR
Agency Contacts:
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CCG Investor Relations
Inc.
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Mabel Zhang, Associate
Partner
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+1
310-954-1383
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Email:
mabel.zhang@ccgir.com
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David Rudnick, Account
Manager
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+1 646-626-4172
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Email:
david.rudnick@ccgir.com
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SOURCE Qiao Xing Universal Resources, Inc.