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Fushi Copperweld Corrects Administrative Errors in Financial Tables

BEIJING, Nov. 8, 2011 /PRNewswire-Asia-FirstCall/ -- Fushi Copperweld, Inc. (Nasdaq: FSIN), the leading global manufacturer and innovator of copper-clad bimetallic wire used in a variety of telecommunication, utility, transportation and other electrical applications, today issued new financial tables that correct certain administrative errors in the tables released with the Company's earnings announcement for the third quarter of 2011 issued on November 3, 2011.

For the 2011 third quarter and nine-month periods, all financial figures are correct. However, there are errors which primarily relate to the labeling of certain line items in the Company's balance sheet and income statement, which were included in the November 3, 2011 earnings release. For the 2010 prior-year periods, there are also corrections to certain financial figures in the financial statement tables, which are set forth below:

  • Diluted earnings per share for the 2010 nine-month period was $0.93, not $0.94; and
  • End of period cash as of September 30, 2010 was $117.9 million, not $73.8 million as listed on November 3, 2011
  • Gain on cross-currency interest swap derivative for the 2010 nine-month period was $128,861, not a loss of $753,666 as listed on November 3, 2011. The difference reflects the exclusion of a change in derivative liability -- conversion option of $882,527, which was included incorrectly.

The financial statements as filed in the Company's 8-K filing on November 4, 2011 are accurate and do not need correction.

The corrected tables are attached to this release.

About Fushi Copperweld

Fushi Copperweld Inc., through its wholly owned subsidiaries, Fushi International (Dalian) Bimetallic Cable Co. Ltd., and Copperweld Bimetallics LLC, is the leading manufacturer and innovator of copper-clad bimetallic engineered conductor products for electrical, telecommunications, transportation, utilities and industrial applications. With extensive design and production capabilities, and a long-standing dedication to customer service, Fushi Copperweld is the preferred choice for bimetallic products worldwide.

Safe Harbor Statement

This press release may include certain statements that are not descriptions of historical facts, but are forward-looking statements. Forward-looking statements can be identified by the use of forward-looking terminology such as "will" "believes", "expects" or similar expressions. These forward-looking statements may also include statements about our proposed discussions related to our business or growth strategy, which is subject to change. Such information is based upon expectations of our management that were reasonable when made but may prove to be incorrect. All of such assumptions are inherently subject to uncertainties and contingencies beyond our control and upon assumptions with respect to future business decisions, which are subject to change. We do not undertake to update the forward-looking statements contained in this press release. For a description of the risks and uncertainties that may cause actual results to differ from the forward-looking statements contained in this press release, see our most recent Annual Report filed with the Securities and Exchange Commission (SEC) on Form 10-K, and our subsequent SEC filings. Copies of filings made with the SEC are available through the SEC's electronic data gathering analysis retrieval system (EDGAR) at www.sec.gov.

For more information, please contact:


Investors

Jolin Qiao

Investor Relations Officer - Fushi Copperweld Inc

Phone +1.931.433.0482

E-mail: IR@fushicopperweld.com

Web: www.fushicopperweld.com



--Tables Follow --

FUSHI COPPERWELD, INC. AND SUBSIDIARIES

UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS

AS OF SEPTEMBER 30, 2011 AND DECEMBER 31, 2010



September 30,

December 31,


2011

2010


USD

USD

ASSETS



Current assets:



Cash

163,624,276

123,000,338

Accounts receivable, net of allowance for doubtful accounts

73,913,870

65,765,722

Inventories

18,899,317

16,143,922

Advances to suppliers

8,586,217

15,022,976

Prepaid expenses and other current assets

1,042,982

743,206

Total current assets

266,066,662

220,676,164




Property, plant and equipment, net

119,064,234

124,177,512

Intangible assets, net

468,518

577,587

Land use rights, net

13,246,167

13,089,733

Deposits for land use rights

9,957,883

9,623,181

Goodwill

1,788,231

1,669,789

Other non-current assets

518,477

443,397

Total assets

411,110,172

370,257,363

LIABILITIES AND SHAREHOLDERS’ EQUITY



Current liabilities:



Current portion of long-term bank loan

650,000

650,000

Accounts payable

5,361,105

3,241,428

Accrued expenses and other current liabilities

14,128,367

15,542,111

Total current liabilities

20,139,472

19,433,539

Long-term bank loan

5,200,000

5,687,500

Deferred income tax liabilities

673,470

669,540

Other non-current liabilities

-

65,057

Total liabilities

26,012,942

25,855,636




Shareholders’ equity:



Common stock, $0.006 par value, 100,000,000 shares authorized; 38,204,138 and 38,099,138 shares issued and outstanding as of September 30, 2011 and December 31, 2010, respectively

229,226

228,596

Additional paid-in capital

169,028,404

167,596,792

Retained earnings

166,871,835

140,462,840

Accumulated other comprehensive income

48,967,765

36,113,499

Total shareholders’ equity

385,097,230

344,401,727

Commitments and contingencies

-

-

Total liabilities and shareholders’ equity

411,110,172

370,257,363



FUSHI COPPERWELD, INC. AND SUBSIDIARIES

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME

FOR THE THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2011 AND 2010

(UNAUDITED)



Three-Month Period Ended
September 30,

Nine-Month Period Ended
September 30,


2011

2010

2011

2010


USD

USD

USD

USD






Revenues

74,279,340

66,507,433

219,158,766

195,062,641

Cost of revenues

54,353,890

46,842,955

161,047,950

137,986,750

    Gross profit

19,925,450

19,664,478

58,110,816

57,075,891






Selling expenses

1,127,259

1,457,154

3,519,065

4,074,280

General and administrative expenses

5,061,337

3,117,062

15,035,656

10,923,878

    Total operating expenses

6,188,596

4,574,216

18,554,721

14,998,158






    Income from operations

13,736,854

15,090,262

39,556,095

42,077,733






Interest income

222,852

200,295

663,776

590,236

Interest expense

(116,378)

(120,176)

(340,282)

(697,367)

Gain on cross-currency interest swap derivative

-

-

-

128,861

Loss on extinguishment of HY notes

-

-

-

(2,395,778)

Other expense, net

(757,407)

(176,001)

(1,677,122)

(194,445)

    Total other expense, net

(650,933)

(95,882)

(1,353,628)

(2,568,493)






    Income before income taxes

13,085,921

14,994,380

38,202,467

39,509,240

Income tax expense

4,137,255

2,072,009

11,793,472

5,197,187






    Net income

8,948,666

12,922,371

26,408,995

34,312,053






Other comprehensive income:





Foreign currency translation adjustment, net of nil income taxes

5,322,885

4,433,165

12,854,266

6,198,740






     Comprehensive income

14,271,551

17,355,536

39,263,261

40,510,793






Earnings per share:





Basic

0.23

0.34

0.69

0.94

Diluted

0.23

0.34

0.69

0.93




FUSHI COPPERWELD, INC.  AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

FOR THE NINE MONTHS ENDED September 30, 2011 AND 2010

(UNAUDITED)



Nine-Month Period Ended September 30,


2011

2010


USD

USD

Cash flows from operating activities:



Net cash provided by operating activities

40,676,212

23,215,333




Cash flows from investing activities:



Payment for acquisitions of Jinchuan and Hongtai

-

(6,375,000)

Cash acquired from acquisitions of Jinchuan and Hongtai

-

901,442

Purchases of property and equipment

(1,160,718)

(1,869,029)

Net cash used in investing activities

(1,160,718)

(7,342,587)




Cash flows from financing activities:



Proceeds from interest-free loans provided by Mr. Li Fu

-

15,000,000

Payment for acquisition of  Jinchuan

(4,819,107)

-

Repayment of revolving line of credit

-

(4,033,783)

Proceeds from long-term bank loans

-

6,500,000

Repayment of long-term bank loans

(487,500)

-

Repayment of notes payable

-

(35,600,000)

Proceeds from issuance of common stock

-

59,800,050

Proceeds from exercise of warrants and stock options

628,495

1,207,824

Transaction costs paid in connection with issuance of common stock

-

(3,438,550)

Net cash (used in) provided by financing activities

(4,678,112)

39,435,541




Effect of foreign currency exchange rate changes on cash

5,786,556

1,960,862

Net increase in cash

40,623,938

57,269,149




Cash at beginning of period

123,000,338

60,597,849

Cash at end of period

163,624,276

117,866,998




Supplemental disclosure of cash flow information:



Interest paid

340,282

1,425,833

Income taxes paid

7,665,233

6,161,271

Non-cash investing and financing activities



Accrual for the acquisition of Jinchuan

-

4,819,107

Issuance of common stock in connection with the acquisition of Hongtai

-

2,600,000

Payable for purchase of property and equipment

554,538

314,294



SOURCE Fushi Copperweld, Inc.



RELATED LINKS
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