China Gerui Advanced Materials Celebrates New Facility Operation and Hosts Investor Day
ZHENGZHOU, China, July 15, 2011 /PRNewswire-Asia-FirstCall/ -- China Gerui Advanced Materials Group Limited (NASDAQ: CHOP) ("China Gerui," or the "Company"), a leading high precision, cold-rolled steel producer in China, today announced that the Company has commenced operation of two cold-rolled, wide-strip steel production lines with 150,000 tons of annual capacity as well as one additional plating line with 200,000 tons of annual capacity.
China Gerui's on-going Capacity Expansion Plan is a key component of its continued growth and evolution in the high-end, specialized cold-rolled steel sector. The newly added facility, which marks the completion of Phase I of the Capacity Expansion Plan, brings cold-rolled steel production up to a total of 400,000 tons per year and raises the Company's value-added plating capability to 250,000 tons of total capacity per year. The new capacity is expected to ramp up to a normalized utilization rate of approximately 75% within six months consistent with China Gerui's 2011 guidance and will help it to maintain a blended gross margin of 30%.
The Company held a ribbon cutting ceremony on June 29, 2011 to debut Phase I of the new facility and in attendance were local government officials, members of the media, industry participants, customers, suppliers, investors, analysts, the Board of Directors and senior management of China Gerui. The event was followed by an Investor Day where investors and analysts toured the state-of-the-art facility and interacted with China Gerui management to learn about the new facility and to receive an update on the Company's business and strategy. Photos and video clips of the new facility can now be accessed via the Company's website, http://www.geruigroup.com.
"Completion of our new facility is a major milestone in our growth plan and bolsters our capabilities to further tailor products to customer specifications as well as to meet pent-up demand," Mr. Mingwang Lu, Chairman and Chief Executive Officer, stated. "The final phase will add 100,000 more tons of capacity by the end of 2011, bringing us to a total of 500,000 tons of annual specialized cold-rolled steel production capacity. The addition of wide-strip capacity with value-added, higher-margin plating capability for 50% of our output will open up new markets and further strengthen our leading position in the sector," he continued.
Media Update
The new facility opening and ribbon cutting event was featured by several Chinese media outlets including China Daily, the largest state-funded English language daily newspaper in China. The article can also be accessed online at http://www.chinadaily.com.cn/usa/business/2011-06/30/content_12809531.htm.
Investor Day Agenda
Topics covered as part of the investor and analyst event included a local government update, a steel industry outlook and perspective by an industry expert, customer and supplier testimonials, commentary by the Company's auditor and an extended tour of the new facility.
Ye Congfa, an industry expert from China Iron & Steel Research Institute, indicated that high-value, high precision, ultra-thin cold-rolled steel is in short supply in China, forcing it to look to imports for 90% of its 10 million tons of specialized product a year. China Gerui, with its capacity to serve the market with both narrow- and wide-strip cold-rolled steel, maintains an advantage relative to foreign competitors due to lower production costs, its strong domestic presence and its reputation for a very high standard of quality.
Harry Edelson, a director of the Company's board and a veteran venture capitalist, reviewed the history of the Company and addressed additional measures of legal and financial diligence that the Company has undertaken and highlighted the differences in regulatory and other due diligence reviews required to effect a merger via a special purpose acquisition company ("SPAC"), such as China Gerui, as opposed to a reverse merger ("RTO").
Also present at the event was customer representative Yong Wang, Senior Engineer from Wuhan Academy of Post and Telecommunications whose subsidiary companies are primarily engaged in fiber optic cable manufacturing. Yong Wang said, "China Gerui's products conform exactly to our stated specifications, reflecting a high degree of engineering and manufacturing expertise. Knowing that we have a consistent source of supply for this highly specialized steel, in both narrow- and wide-strip, has been a key to keeping our products competitive in the marketplace." The Company's vastly increased production capacity will enable it to continue to precisely meet customer's needs and enhance the firm's migration to higher margin products as well as develop high-end technology products.
About China Gerui Advanced Materials Group Limited
China Gerui Advanced Materials Group Limited is a leading niche and high value-added metal processing company in China. The Company produces high-end, high-precision, ultra-thin, high- strength, cold-rolled steel products that are characterized by stringent performance and specification requirements that mandate a high degree of manufacturing and engineering expertise. China Gerui's products are not standardized commodity products. Instead, they are tailored to customers' requirements and subsequently incorporated into products manufactured for various applications. The Company sells its products to domestic Chinese customers in a diverse range of industries, including the food packaging, telecommunication, electrical appliance, and construction materials industries. For more information, please visit http://www.geruigroup.com.
Safe Harbor Statement
Certain of the statements made in this press release are "forward-looking statements" within the meaning and protections of Section 27A of the Securities Act of 1933, as amended and Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements include, among others, statements with respect to our beliefs, plans, objectives, goals, expectations, anticipations, assumptions, estimates, intentions, and future performance, and involve known and unknown risks, uncertainties and other factors, which may be beyond our control, and which may cause the actual results, performance, capital, ownership or achievements of the Company to be materially different from future results, performance or achievements expressed or implied by such forward-looking statements. All statements other than statements of historical fact are statements that could be forward- looking statements. You can identify these forward-looking statements through our use of words such as "may," "will," "anticipate," "assume," "should," "indicate," "would," "believe," "contemplate," "expect," "estimate," "continue," "plan," "point to," "project," "could," "intend," "target" and other similar words and expressions of the future.
All written or oral forward-looking statements attributable to us are expressly qualified in their entirety by this cautionary notice, including, without limitation, those risks and uncertainties described in our annual report on Form 20-F for the year ended December 31, 2010 and otherwise in our SEC reports and filings. Such reports are available upon request from the Company, or from the Securities and Exchange Commission, including through the SEC's Internet website at http://www.sec.gov. We have no obligation and do not undertake to update, revise or correct any of the forward-looking statements after the date hereof, or after the respective dates on which any such statements otherwise are made.
Company Contact: |
Investor Relations Contact: |
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Email: [email protected] |
CCG Investor Relations |
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Website: www.geruigroup.com |
David Rudnick |
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Phone: 1-646-626-4172 |
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Email: [email protected] |
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SOURCE China Gerui Advanced Materials Group Limited
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