BEIJING, Aug. 25 /PRNewswire-Asia-FirstCall/ -- LianDi Clean Technology Inc. (OTC Bulletin Board: LNDT), ("LianDi" or the "Company"), a provider of clean technology, downstream flow equipment, engineering services and software to China's leading petroleum and petrochemical companies, today announced the signing of a new software contract with PetroChina Company Limited totaling approximately $13 million.
"We are delighted PetroChina has chosen our software for its command centers," stated Mr. Jianzhong Zuo, Chairman, Chief Executive Officer and President of the Company. "This major contract with one of China's largest companies, indeed one of the largest companies in the world, reinforces the market acceptance of the technical capabilities of our software. We look forward to working with PetroChina to help further improve its operating efficiencies across other parts of its workflow."
LianDi will implement its proprietary logistics optimization software to automate various parts of PetroChina's oil production process, including production planning, logistics, demand forecasting and scheduling management. By installing LianDi's software across multiple parts of its operations, including oil refining and oil distribution, PetroChina will have better access to more data across several parts of its business. The Company will install the software platform across logistics dispatch command centers in six provinces, as well as provide specific programming implementation services.
Management expects to complete the current contract, totaling approximately $13 million in revenues, in 12 months. The Company intends to discuss deploying software and services to additional PetroChina facilities located in other provinces once the six pilot deployments are operational.
In fiscal year 2010, the Company generated total software sales of $6.4 million, 33% higher than in 2009. In the first quarter of fiscal 2011, which ended on June 30, 2010, the Company's software sales increased 300% year-over-year to $2.8 million. Gross margins on total software sales have historically been 85%-95%, significantly higher than the Company's average of 25%-35%.
About LianDi Clean Technology Inc.
LianDi was established in July 2004 to serve the largest Chinese petroleum and petrochemical companies. Through its four operating subsidiaries, Hua Shen Trading (International) Ltd., Petrochemical Engineering Ltd., Bright Flow Control Ltd. and Beijing JianXin Petrochemical Engineering Ltd., the Company distributes a wide range of customized valves and equipment and provides associated value-added technical and integration services. The Company also develops and markets proprietary optimization software for the polymerization process. In addition, LianDi is focused on the large, rapidly growing, clean technology market for oil refineries, projected to reach over $1 billion in the next 10 years. This market is expected to benefit from favorable Chinese government policies, including tax benefits and other incentives.
About PetroChina Company Limited
PetroChina Company Limited primarily engages in the exploration, production, and sale of crude oil and natural gas primarily in the People's Republic of China. The company operates in four segments: Exploration and Production, Refining and Chemicals, Marketing, and Natural Gas and Pipeline. The Exploration and Production segment explores, develops, produces, and sells crude oil and natural gas. As of December 31, 2009, it had 11,263 million barrels of proved reserves of crude oil; and 63,244 billion cubic feet of proved reserves of natural gas. The Refining and Chemicals segment refines crude oil and petroleum products; and produces and markets petrochemical products, derivative petrochemical products, and other chemical products. This segment's product line comprises processed crude oil, gasoline, kerosene, diesel, ethylene, synthetic resins, synthetic fiber materials, polymers, synthetic rubber, and urea. The Marketing segment engages in the marketing of refined products and trading business. As of December 31, 2009, it operated 17,262 service stations. The Natural Gas and Pipeline segment involves in the transmission of natural gas, crude oil, and refined products, as well as in the sale of natural gas. As of December 31, 2009, its pipelines measured a total length of 50,627 kilometers, including 28,595 kilometers of natural gas, 13,164 kilometers of crude oil, and 8,868 kilometers of refined product pipelines. The company was founded in 1988 and is headquartered in Beijing, the People's Republic of China. PetroChina Company Limited is a subsidiary of China National Petroleum Corporation.
Cautionary Statement Regarding Forward-Looking Information
This press release may contain certain "forward-looking statements" relating to the business of LianDi and its subsidiary companies. All statements, other than statements of historical fact included herein are, "forward-looking statements," including statements regarding: the impact of the proceeds from the private placement on the Company's short term business and operations; the general ability of the Company to achieve its commercial objectives, including the ability of the Company to sustain growth; the business strategy, plans and objectives of the Company and its subsidiaries; and any other statements of non-historical information. These forward-looking statements are often identified by the use of forward-looking terminology such as "believes," "expects" or similar expressions, involve known and unknown risks and uncertainties. The Company's actual results could differ materially from those anticipated in these forward-looking statements as a result of a variety of factors, including those discussed in the Company's periodic reports that are filed with the Securities and Exchange Commission and available on its website (http://www.sec.gov )
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SOURCE LianDi Clean Technology Inc.