2014

Asia Carbon Industries, Inc. Announces First Quarter Financial Results

NEW YORK, May 15, 2012 /PRNewswire-Asia/ -- Asia Carbon Industries, Inc. ("Asia Carbon", or the "Company") today announced its earnings for the quarter ended March 31, 2012. 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 May 15, 2012.

Highlights of First Quarter 2012 Financials

  • Revenues for the quarter ended March 31, 2012 were $12.6 million, down 6% from $13.4 million for the same period in 2011.
  • Gross profit was $2.93 million in the quarter ended March 31, 2012, a decrease of 8% from $3.18 million for the same period in 2011.
  • Net income for the quarter ended March 31, 2012 was $1.81 million, a decrease of 14% from $2.11 million for the same period in 2011.
  • Earnings per share remained at $0.04 for the quarter ended March 31, 2012 and 2011, respectively.
  • Tonnage sales of carbon black increased to 12,573 tons in the quarter ended March 31, 2012, up 3.5% from 12,140 tons in the same period in 2011.
  • Naphthalene oil sales more than doubled to 1,050 tons in the quarter ended March 31, 2012, as compared to 500 tons in the same period of 2011.

Sales for the three months ended March 31, 2012 totaled $12,581,692, a decrease of $859,824, or 6%, compared to $13,441,516 for the comparable period of 2011. The decline in sales was mainly attributable to the decrease in the market selling price of carbon black.

Unit sales of carbon black products increased to 12,573 tons in the quarter ended March 31, 2012, up 3.5% from 12,140 tons for the same period in 2011, while the average sales price of these products decreased 13% to $933 per metric ton in the quarter ended March 31, 2012 from $1,070 per ton in the quarter ended March 31, 2011. This decline of unit sales price was somewhat offset by the increase in unit sales.

The Company's total carbon black production capacity was 61,000 tons per annum as of March 31, 2012 and 2011, respectively. The annualized production/total capacity utilization rate was 82% and 80%, respectively, during three months ended March 31, 2012 and 2011.

Gross profit was $2,925,952 in the three months ended March 31, 2012, a decrease of $255,480, or 8%, compared to $3,181,432 in the three months ended March 31, 2011. The gross profit rate was 23% for the three months ended March 31, 2012, compared to 24% for the same period in 2011.

Net income for the first quarter was $1,807,081 a decrease of 14%, compared to $2,105,473 in the three months ended March 31, 2011. Net income per share was $0.04 in in the quarter ended March 31, 2012 and 2011, respectively.

Yao Guoyun, Asia Carbon's Chairman of the Board and Chief Executive Officer, commented, "I am pleased with Asia Carbon's performance this quarter. Carbon black unit sales increased 3.5% and naphthalene oil sales more than doubled compared to the same period of 2011. And while our results were affected by depressed carbon black market prices, we believe this trend has reversed and anticipate that prices will shortly return to previous levels."

Ms. Yao further stated, "Carbon black is a critical material for tire manufacturers, and China's tire production continues to increase. This is true for our customers, many of whom are expanding their operations. In order to meet continuing demand for our products, management is evaluating a number of options to build capacity, both organically and through acquisitions. Either alternative would be funded through a combination of operating income and outside sources."

COMPARISON OF SALES FOR THE THREE MONTHS ENDED MARCH 31, 2012 AND 2011



2012

2011

Product

Sales

Quantity

Sales

Quantity


(Metric Ton)


(Metric Ton)

N220

$ 7,815,209

8,000

$ 8,572,852

7,683

N330

1,990,807

2,284

2,212,873

2,221

N660

1,922,322

2,289

2,207,716

2,236

Naphthalene oil

853,354

1,050

448,075

500

Total Sales

$ 12,581,692

13,623

$  13,441,516

12,640

 

ASIA CARBON INDUSTRIES, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME

(UNAUDITED)





Three Months Ended March 31,


2012

2011




Net Sales

$     12,581,692

$     13,441,516

Cost of Sales

9,655,740

10,260,084

Gross Profit

2,925,952

3,181,432




 Operating Expenses:



 Depreciation

25,808

56,919

 Bad debts

14,192

3,282

 Selling

91,691

71,076

 Professional fees

106,500

108,897

 Other

163,888

50,630

Total Operating Expenses

402,079

290,804

Income From Operations

2,523,873

2,890,628

Other Income (Expense)



 Interest income

11,060

6,994

 Interest expense

(45,634)

(34,172)

 Total Other Income (Expense)

(34,574)

(27,178)

Income Before Provision for Income Tax

2,489,299

2,863,450

Provision for Income Tax

682,218

757,977

Net Income

1,807,081

2,105,473




Other Comprehensive Income (Loss)

(15,411)

160,042

Comprehensive Income

$       1,791,670

$       2,265,515




Net Income Per Share - Basic

$              0.04

$              0.04

Weighted Average Shares Outstanding - Basic

51,194,583

50,608,077

Net Income Per Share - Diluted

$              0.04

$              0.04

Weighted Average Shares Outstanding - Diluted

51,194,583

50,608,077

 

ASIA CARBON INDUSTRIES, INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS



March 31,

December 31,


2012

2011

ASSETS

(Unaudited)


Current Assets:



 Cash and equivalents

$     7,748,503

$     8,092,411

 Accounts receivable, net

5,464,606

4,404,319

 Inventories                                                  

3,290,128

3,146,756

 Prepaid expenses

343,852

11,138

Total Current Assets   

16,847,089

15,654,624

 Property, Plant and Equipment, Net

18,919,105

18,431,407

 Other Assets:



Land use rights, net

215,761

217,145

Total Other Assets

215,761

217,145

 TOTAL ASSETS

$   35,981,955

$   34,303,176




LIABILITIES AND STOCKHOLDERS' EQUITY



 Current Liabilities:



Short term debt

$    1,375,121

$    1,376,074

Accounts payable

3,167,641

4,009,531

Accrued liabilities

200,966

153,735

Taxes payable

876,970

694,219

Investor deposit payable

-

49,985

Due to shareholder

26,400

26,415

Total Current Liabilities

5,647,098

6,309,959




Stockholders' Equity:



Common stock, $0.001 par value, 100,000,000 authorized, 52,134,830 and  50,978,580 issued and outstanding at March 31, 2012 and December 31, 2011, respectively

52,135

50,979

Additional paid-in capital

6,491,153

5,942,339

Statutory reserves

2,025,737

2,025,737

Retained earnings

18,945,194

17,138,113

Accumulated other comprehensive income

2,820,638

2,836,049

Total Stockholders' Equity

30,334,857

27,993,217




TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY

$   35,981,955

$   34,303,176

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:

Michael Segal
Asia Carbon Industries, Inc.
Phone +1-646-623-6999

SOURCE Asia Carbon Industries, Inc.




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