General Steel Completes Restatement of 2009, 2010 and First Quarter 2011 Financial Results Restatements Have No Material Impact on Reported Revenue or Cash Balances
BEIJING, Aug. 30, 2012 /PRNewswire-Asia-FirstCall/ -- General Steel Holdings, Inc. ("General Steel" or "the Company") (NYSE: GSI), one of China's leading non-state-owned producers of steel products and aggregators of domestic steel companies, today announced that it has filed amended annual reports on Form 10-K/A for the year ended December 31, 2010 and amended quarterly reports on Form 10-Q/A for the quarters ended June 30, 2010, September 30, 2010 and March 31, 2011 with the U.S. Securities and Exchange Commission ("SEC").
With these restatements complete, the Company is focused on the audit process on its outstanding financial statements and expects to file its quarterly reports on Form 10-Q for the periods ended June 30, 2011, September 30, 2011, March 31 and June 30, 2012, as well as its Annual Report on Form 10-K for the year ended December 31, 2011 with SEC as soon as possible.
"We view the completion of these amended filings as an important step forward for our Company and are grateful for the tremendous effort put forth by our finance team, our auditors and the OCA staff over the last year that has enabled us to reach this stage in the process," said John Chen, Chief Financial Officer of General Steel. "We continue to move ahead and look forward to completing our outstanding filings."
Henry Yu, Chief Executive Officer of General Steel added, "While our finance team has been intently focused on resolving these accounting issues, we have made great progress toward strengthening our operational capabilities to support the Company's long-term growth. Our business and strategy remain on track, and we are poised to benefit from the ongoing investment in the development of China's Greenfield Western region. We have a solid reputation throughout the industry, partnerships with leading government-owned entities and a meaningful geographic advantage. We look forward to leveraging these strengths to advance our business and help build shareholder value."
As previously disclosed, these amended filings follow a reassessment of the accounting treatment for certain reimbursements received from June 2009 to March 2011 with regard to General Steel's collaboration with Shaanxi Iron and Steel Group, Co. Ltd. ("Shaanxi Steel") on the construction of manufacturing equipment by Shaanxi Steel at the Longmen Joint Venture facility. Following discussions with its current and former auditors and guidelines from the Office of the Chief Accountant of the SEC, the Company concluded that, except for the reimbursement for site preparation costs, the amount of reimbursement previously recorded as income should be deferred and recognized as a component of the property that was sub-leased during construction, to be amortized to income over the remaining term of the 40-year sub-lease. This deferral had no impact on the Company's previously reported revenue or cash balances.
About General Steel Holdings, Inc.
General Steel Holdings, Inc., (NYSE: GSI), headquartered in Beijing, China, operates a diverse portfolio of Chinese steel companies. With 7 million metric tons of crude steel production capacity under management, its companies serve various industries and produce a variety of steel products including rebar, high-speed wire and spiral-weld pipe. General Steel Holdings, Inc. has steel operations in Shaanxi and Guangdong provinces, Inner Mongolia Autonomous Region and Tianjin municipality. For more information, please visit www.gshi-steel.com.
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This press release may contain certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements are based on management's current expectations or beliefs about future events and financial, political and social trends and assumptions it has made based on information currently available to it. The Company cannot assure that any expectations, forecasts or assumptions made by management in preparing these forward-looking statements will prove accurate, or that any projections will be realized. Actual results could differ materially from those projected in the forward-looking statements as a result of inaccurate assumptions or a number of risks and uncertainties. These risks and uncertainties are set forth in the Company's filings under the Securities Act of 1933 and the Securities Exchange Act of 1934 under "Risk Factors" and elsewhere, and include: (a) those risks and uncertainties related to general economic conditions in China, including regulatory factors that may affect such economic conditions; (b) whether the Company is able to manage its planned growth efficiently and operate profitable operations, including whether its management will be able to identify, hire, train, retain, motivate and manage required personnel or that management will be able to successfully manage and exploit existing and potential market opportunities; (c) whether the Company is able to generate sufficient revenues or obtain financing to sustain and grow its operations; (d) whether the Company is able to successfully fulfill our primary requirements for cash; and (e) other risks, including those disclosed in the Company's Form 10-K, filed with the SEC. Forward-looking statements contained herein speak only as of the date of this release. The Company does not undertake any obligation to update or revise publicly any forward-looking statements, whether to reflect new information, future events or otherwise.
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