China Ruitai Boosts Customer Base by 20% During 2010

Company utilizes aggressive price promotion on key cellulose ether products to secure more market share

Jun 21, 2010, 08:00 ET from China Ruitai International Holdings Co., Ltd.

FEICHENG, China, June 21 /PRNewswire-Asia-FirstCall/ -- China Ruitai International Holdings Co., Ltd. ("China Ruitai" or the "Company") (OTC Bulletin Board: CRUI), a manufacturer and distributor of cellulose ether additives for use in the production of pharmaceuticals, construction materials, PVC products, foods and beverages and cosmetics, today announced that through the first five months of 2010 it has increased its customer base by 20% through an aggressive pricing promotion for targeted customers in China.

As a result of decreased cotton production stemming from a cold winter and drought in key cotton producing regions in northern China, the principal raw material of China Ruitai's cellulose ether product line experienced increases in the first quarter of the year. To offset the increase in its raw materials, the Company's production and sales strategy is being shifted to higher margin products including ethyl cellulose, hydroxypropyl methyl cellulose and film coating pre-mixed reagent. In combination with this marketing shift, China Ruitai also deployed an aggressive price promotion that offered a targeted customer base 2009 pricing for initial orders placed in 2010. This promotion was specifically presented to the Company's closest competitors' customers and because Ruitai's competitors increased their prices across the board, the Company's offer was well-received and effective to obtain new customers.

The pricing promotion secured an additional 468 customers during the program's five month period, which yielded approximately $2.7 million in revenue. The total number of Ruitai customers now totals 2,193, an approximate 20% increase in the Company's customer base from the end of 2009. The new customers represented manufacturers who require hydroxypropyl methyl cellulose (HPMC) and ethyl cellulose (EC) to produce their finished goods. HPMC is widely used in the constructive materials industry and particularly those who produce putties, mortar, paints and plasters. Additional customers were secured by the promotion of EC for manufacturers in the pharmaceutical sector who rely on EC for use in the production of pharmaceuticals.

"Due to a colder than normal winter, we were able to anticipate and plan for higher cotton pricing," began Mr. Damming Ma, CEO of China Ruitai. "As the immediate reaction of most producers was to raise customer list prices, we took a more aggressive approach by targeting our competitor's customer base to gain market share. This strategy caught our competitors off guard with several smaller producers closing down and has positioned China Ruitai for further growth. Our leading position in the industry, production capacity, and financial strength provided us ability to support our program. We plan to increase prices incrementally through 2010 to more adequately align prices with raw material costs, which are expected to improve margins. Despite the increase, China Ruitai will remain one of the most cost effective suppliers in the market."

About China Ruitai International Holdings Co.

China Ruitai, through its wholly-owned subsidiary, Pacific Capital Group and its majority-owned subsidiary, TaiAn, is engaged in the production, sales, and exportation of deeply processed chemicals, with a primary focus on non-ionic cellulose ether products. Cellulose ether is an organic chemical that dissolves in water and other organic solvents. Due to the surface-active properties of cellulose ether, it acts as a thickener and stabilizer in aqueous solutions, making it a beneficial additive in a wide variety of commercial industries and products, including, but not limited to the pharmaceutical industry, the construction industry, PVC products, food and beverage products, petroleum, and cosmetics. Specific examples of applications in which cellulose ether products are used include: as a stabilizer and thickener in latex paint; in mortar dry mix for building materials; to improve the performance of resin in PVC production; as a membrane reagent, stabilizer, and thickener in pharmaceuticals; and to improve jam, ice cream, toothpaste and lipsticks in the food and cosmetic industries. TaiAn is one of the largest non-ionic cellulose ether producers in China.

Forward-Looking Statements

Certain statements in this release and other written or oral statements made by or on behalf of the Company are "forward-looking statements" within the meaning of the federal securities laws. Statements regarding future events and developments and our future performance, as well as management's expectations, beliefs, plans, estimates or projections relating to the future are forward-looking statements within the meaning of these laws. The forward-looking statements are subject to a number of risks and uncertainties including market acceptance of the Company's services and projects and the Company's continued access to capital and other risks and uncertainties. The actual results the Company achieves may differ materially from any forward- looking statements due to such risks and uncertainties. These statements are based on our current expectations and speak only as of the date of such statements.

    For additional information contact:

    China Ruitai International Holdings Co., Ltd.
     Ms. Crystal Tang, VP of Finance
     Add:   1221 Avenue of Americas Suite 4200
            New York, NY 10020
     Tel:   +1-212-899-5131
     Fax:   +1-212-899-3189

    HC International, Inc.
     John Mattio, Senior Vice President
     Add:   420 Lexington Avenue
            New York, New York
     Tel:   +1-203-616-5144

SOURCE China Ruitai International Holdings Co., Ltd.