Pingtan Marine Enterprise Ltd. Reports Financial Results For The First Quarter Ended March 31, 2014

3/31/2014

(Unaudited)

12/31/2013

(Audited)

Cash and Cash Equivalents

$26.0

$8.2

Total Current Assets

55.2

28.8

Total Assets

377.4

357.9

Total Current Liabilities

52.8

51.2

Total Long-term Debt, net of current portion

52.0

54.5

Total Liabilities

104.7

105.7

Shareholders' Equity

272.7

252.2

Total Liabilities and Shareholders' Equity

377.4

357.9

Book Value Per Share (in $)

$3.45

$3.19

(A) Represents the consolidation retrospectively restated as if Pingtan Marine Enterprise Ltd. (formerly known as China Growth Equity Investment Ltd.) completed its merger with China Dredging Group Co., Ltd. and the share purchase of Merchant Supreme Co., Ltd. on January 1, 2013 rather than on February 25, 2013.

PINGTAN MARINE ENTERPRISE LTD. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)
(IN U.S. DOLLARS)

  For the Three Months Ended
March 31, 

2014

 2013 (A)

Revenue

$     65,582,952

$     19,669,476

Cost of revenue

(41,541,994)

(14,292,134)

Gross profit

24,040,958

5,377,342

Selling and marketing expenses

(670,951)

(194,688)

General and administrative expenses

(620,915)

(301,342)

Operating income

22,749,092

4,881,312

Other income/(expense)

   Interest income

3,424

1,096

   Interest expenses

(1,372,941)

(685,377)

   Subsidy income

524,421

35,387

   Sundry income

89

2,003

   (Loss)/Gain on foreign exchange, net

(223,233)

207,984

Total other expense

(1,068,240)

(438,907)

Income from continuing operations before income taxes

21,680,852

4,442,405

Income tax expense

-

-

Net income from continuing operations

21,680,852

4,442,405

Net income from discontinued operations, net of

   income tax expense

-

9,340,136

Consolidated net income

$     21,680,852

$    13,782,541

Basic and diluted earnings per share

From continuing operations

$          0.27

$          0.06

   From discontinued operations

-

0.11

   Net income

$          0.27

$          0.17

Weighted average number of ordinary shares outstanding

- Basic and diluted

79,055,053

79,055,053

(A) Represents the consolidation retrospectively restated as if Pingtan Marine Enterprise Ltd. (formerly known as China Growth Equity Investment Ltd.) completed its merger with China Dredging Group Co., Ltd. and the share purchase of Merchant Supreme Co., Ltd. on January 1, 2013 rather than on February 25, 2013.

PINGTAN MARINE ENTERPRISE LTD. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS (UNAUDITED)
(IN U.S. DOLLARS)

March 31, 2014

December 31, 2013

(Unaudited)

(A)

Assets

Current assets

Cash

$     26,039,273

$      8,156,599

Accounts receivable

16,601,060

9,133,130

Inventories

11,790,469

9,095,736

Prepaid expenses and deposits

719,383

2,380,874

Other receivables

1,874

11,665

Total current assets

55,152,059

28,778,004

Other assets

Other receivables

1,181,681

1,213,440

Long-term investment

3,378,161

3,468,953

Prepaid fixed asset deposits

-

1,928,700

Prepaid operating license rights

213,220,339

215,381,356

Property, plant and equipment, net

104,451,702

107,178,269

Total other assets

322,231,883

329,170,718

Total assets

$    377,383,942

$    357,948,722

Liabilities and equity

Current liabilities

Accounts payable - third parties

$      2,489,257

$      2,184,964

- related parties

9,051,769

13,807,605

Receipt in advance

-

297,034

Short-term loans

10,808,850

9,085,353

Long-term loans - current portion

24,535,905

20,252,077

Accrued liabilities and other payables

3,542,520

3,851,047

Advance from a director

650,000

-

Deferred income

1,688,115

1,733,485

Total current liabilities

52,766,416

51,211,565

PINGTAN MARINE ENTERPRISE LTD. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS (UNAUDITED) (CONTINUED)

(IN U.S. DOLLARS)

March 31, 2014

December 31, 2013

(Unaudited)

(A)

Other liabilities

Long-term loans, net of current portion

51,959,333

54,499,727

Total other liabilities

51,959,333

54,499,727

Total liabilities

104,725,749

105,711,292

Shareholders' equity

Ordinary shares, 225,000,000 shares authorized

with $0.001 per share; 79,055,053 shares issued and

outstanding as of March 31, 2014 and December 31, 2013

79,055

79,055

Statutory reserves

22,410,773

22,410,773

Retained earnings

221,022,364

199,341,512

Accumulated other comprehensive income

29,146,001

30,406,090

Total shareholders' equity

272,658,193

252,237,430

Total liabilities and shareholders' equity

$    377,383,942

$    357,948,722

(A) Represents the consolidation retrospectively restated as if Pingtan Marine Enterprise Ltd.

(formerly known as China Growth Equity Investment Ltd.) completed

its merger with China Dredging Group Co., Ltd. and the share purchase of Merchant Supreme Co., Ltd.

on January 1, 2013 rather than on February 25, 2013.

PINGTAN MARINE ENTERPRISE LTD. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)
(IN U.S. DOLLARS)

For the Three Months Ended March 31,

2014

 2013 (A)

Cash flows from operating activities

Net income

$     21,680,852

$     13,782,541

Discontinued operations, net of tax

-

(9,340,136)

Income from continuing operations

21,680,852

4,442,405

Adjustments to reconcile net income to net

cash provided by operating activities

Depreciation of property, plant and equipment

1,004,698

760,401

Amortization of operating license rights

2,161,017

-

Changes in operating assets and liabilities

Accounts receivable

(7,802,740)

9,300,852

Inventories

(2,969,237)

(527,208)

Prepaid expenses and deposits

1,619,089

392,674

Other receivables

9,603

(7,587,081)

Accounts payable - third parties

365,972

2,250,318

               - related parties

(4,449,061)

5,280,689

Receipt in advance - third parties

(292,855)

417,066

                - related parties

-

(7,964,540)

Accrued liabilities and other payables

(999,575)

641,562

Net cash provided by operating activities from continuing operations

10,327,763

7,407,138

Cash flows from investing activities

Proceeds from deferred income

-

9,401,148

Purchase of property, plant and equipment

(299,428)

(12,868,150)

Refunds from fixed assets deposits

1,901,560

-

Advance to related parties

-

(9,125,403)

Net cash provided by/(used in) investing activities from continuing operations

1,602,132

(12,592,405)

Cash flows from financing activities

Proceeds from short-term loans

8,707,682

9,727,422

Repayment of short-term loans

(6,722,024)

(23,259,126)

Proceeds from long-term loans

3,745,867

-

Advance from a director

650,000

-

Advance from related parties

-

17,609,551

Net cash provided by financing activities from continuing operations

6,381,525

4,077,847

PINGTAN MARINE ENTERPRISE LTD. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) (CONTINUED)

(IN U.S. DOLLARS)

  For the Three Months Ended
March 31, 

2014

2013 (A)

Cash flow from discontinued operations

Net cash provided by operating activities from discontinued operations

-

24,068,420

Net cash provided by investing activities from discontinued operations

-

2,405,595

Net cash provided by financing activities from discontinued operations

-

5,017,690

Net cash provided by discontinued operations

-

31,491,705

Net increase in cash

18,311,420

30,384,285

Effect of exchange rate

(428,746)

235,221

Cash at the beginning of period ⁽¹⁾

8,156,599

175,488,715

Cash at the end of period ⁽²⁾

$     26,039,273

$     206,108,221

Supplemental disclosure of cash flow information:

Cash paid:

Interest paid

$      1,641,419

$       685,377

Supplemental disclosure of non-cash transaction eliminated in above:

Payable for purchase of ship equipment

$        784,825

$                  -

Proceeds from deferred income

$                  -

$      7,550,451

Deposit on setting up Joint Venture netted of

   accounts payable - related party

$                  -

$      6,090,302

(1) Includes cash and cash equivalents of discontinued operations of $nil and $168,627,930 at the beginning of the year in 2014 and 2013, respectively.

(2) Includes cash and cash equivalents of discontinued operations of $nil and $200,247,921 as of March 31, 2014 and 2013, respectively.

(A) Represents the consolidation retrospectively restated as if Pingtan Marine Enterprise Ltd. (formerly known as China Growth Equity Investment Limited) completed its merger with China Dredging Group Co., Ltd. and the share purchase of Merchant Supreme Co., Ltd. on January 1, 2013 rather than on February 25, 2013.