Asia Carbon Industries, Inc. (OTCBB: ACRB) ("Asia Carbon") today
announced its earnings for the year ended December 31, 2010. The
Company, whose shares trade in the U.S. under the stock symbol
"ACRB," filed its annual report on Form 10-K with the Securities
and Exchange Commission on March 30, 2011.
Overview of 2010 Financials
-- Revenues increased 44% to $29.69 million in 2010 from $20.65 million
in 2009.
-- Gross profit increased 28.7% to $5.69 million in 2010 from $4.42
million in 2009.
-- Net income increased 9.6% to $3.27 million in 2010 from $2.98 million
in 2009.
-- Earnings per share were unchanged at $0.07 earnings per share for both
2009 and 2010.
-- Weighted average basic shares outstanding in 2010 were 48,512,458, a
17% increase as compared to 41,300,303 in 2009.
Sales for the year ended December 31, 2010 were $29,686,876, an
increase of $9,038,190, or 44% compared to $20,648,686 in sales
reported for the year ended December 31, in 2009, confirming the
figures announced in the Company's preliminary earnings release.
The increase in sales was largely attributed to sales of the
Company's first product manufactured on its wet production line;
N220-W, which commenced production on October 26, 2010. Sales of
N220-W were $4,297,037 for the quarter.
The increase in revenue was also impacted by an increase in the
Company's carbon black unit selling price. In 2009 Asia Carbon
lowered product unit prices in response to the global financial
crisis and related decrease in demand. However, recent market
corrections and resulting return in product demand, in addition to
an increase in raw material costs, prompted management to increase
its pricing. This action has been accepted by customers, as
evidenced by the increase in product sales. The Company sold 32,156
tons of carbon black in 2010, an increase of 3,598 tons, compared
to 28,558 tons in 2009.
The final factor in the Company's increase in revenue was the
sale of naphthalene oil, a by-product of its production process.
Introduced at the end of the third quarter 2010, Asia Carbon sold
1,049 tons of naphthalene in 2010, generating revenue of $869,040
for the year.
Net income for the year ended December 31, 2010 totaled
$3,273,857, an increase of $288,009, or 10% compared to the net
income of $2,985,848 in 2009.
Yao Guoyun, Asia Carbon's Chairman of the Board and Chief
Executive Officer, commented, "We are pleased to report our 2010
results. The year saw the turnaround from the earlier global
financial crisis, we were able to complete the conversion of one of
our dry-method production lines to the more profitable, more
efficient wet process production, and we launched our Naphthalene
Oil product."
Ms. Guoyun went on to say, "We anticipate these growth trends to
endure as automobile demand continues to grow in China. Since Asia
Carbon's primary customers are domestic tire manufacturers, we
expect demand for our products to continue to grow. As we continue
our plans for conversion of our dry process facilities to
wet-processing, we will be able to provide the market with higher
quality, and in turn higher priced carbon black."
Ms. Guoyun also commented on the Company's transition from a
private to a public company, saying, "Asia Carbon became a public
company through a registration statement on Form S-1 which was
reviewed by the SEC and declared effective in October of last year.
We hope to maintain a mutually beneficial relationship with our
investors as we execute our plans for expansion."
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.
ASIA CARBON INDUSTRIES INC AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME
YEARS ENDED DECEMBER 31,
2010 2009
------------ ------------
Net Sales $ 29,686,876 $ 20,648,686
Cost of Sales 23,989,951 16,223,823
------------ ------------
Gross Profit 5,696,925 4,424,863
------------ ------------
Operating Expenses:
Depreciation 221,296 58,917
Bad debts 58,052 (10,213
Selling 172,322 124,687
Professional fees 380,088 -
Other 161,485 122,286
------------ ------------
Total 993,243 295,677
------------ ------------
Income From Operations 4,703,682 4,129,186
------------ ------------
Other Income and (Expense)
Interest income 9,805 -
Interest expense (137,921 (146,738
------------ ------------
Total Other Income and (Expenses) (128,116 (146,738
------------ ------------
Income Before Provision for Income Tax 4,575,566 3,982,448
Provision for income tax 1,301,709 996,600
------------ ------------
Net Income 3,273,857 2,985,848
Other comprehensive income (loss) 598,353 24,353
------------ ------------
Comprehensive Income $ 3,872,210 $ 3,010,201
============ ============
Net Income Per Share - Basic and Diluted $ 0.07 $ 0.07
============ ============
Weighted Average Shares Outstanding - Basic and
Diluted 48,512,458 41,300,303
============ ============
CONSOLIDATED BALANCE SHEETS
DECEMBER 31,
2010 2009
------------ ------------
ASSETS
Current Assets:
Cash and equivalents $ 5,717,142 $ 2,172,641
Accounts receivable, net of allowance of $97,640
and $36,840, as of 2010 and 2009, respectively 6,034,573 2,930,329
Inventories 1,476,061 1,272,127
Prepaid expenses 6,061 30,860
------------ ------------
Total Current Assets 13,233,837 6,405,957
------------ ------------
Property and Equipment, Net 11,031,788 9,985,427
------------ ------------
Other Assets:
Idle assets 959,967 -
Xigu loan receivable - 146,500
Land use rights, net of amortization 211,770 73,062
------------ ------------
Total Other Assets 211,770 219,562
------------ ------------
TOTAL ASSETS $ 25,437,362 $ 16,610,946
============ ============
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities:
Short term debt $ 1,312,163 $ 1,294,190
Accounts payable and accrued liabilities 4,076,725 1,904,561
Taxes payable 896,351 421,157
Due to shareholder 19,855 -
------------ ------------
Total Current Liabilities 5,388,888 3,198,751
------------ ------------
TOTAL LIABILITIES 6,305,094 3,619,908
------------ ------------
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 and 36,239,494 issued
and outstanding at 2010 and 2009, respectively
Additional paid-in capital 5,533,737 3,229,086
Stock to be issued - 50,000
Statutory reserves 1,224,559 834,046
Retained earnings 10,628,010 7,744,666
Accumulated other comprehensive income 1,695,354 1,097,001
------------ ------------
Total Stockholders' Equity 19,132,268 12,991,038
------------ ------------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 25,437,362 $ 16,610,946
============ ============
Company contact: Mark Lubchenco Asia Carbon Industries, Inc.
Phone +1-646-328-1502
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