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China Growth Development Inc Highlights Second Quarter 2009 Financial Results
China Growth Development Inc. (OTCBB:CGDI), a Chinese commercial property developer, investor, and operator of commercial property in Shanxi Provence, China, reported financial results for the second quarter ended June 30, 2009 on August 14, 2009.
Second Quarter 2009 Highlights
-- Net revenue increased to 4.18 million, a 12% increase from the second quarter of 2008.
-- Net income rose to $1.67million for the quarter ended June 30, 2009, a 70% increase year-over-year.
-- Earnings per share of $.03 for the quarter on a fully diluted basis as compared to $.02 from the second quarter of previous year.
“We are pleased at our progress and ability to deliver solid results this quarter," stated Mr. Sam Liu, COO of China Growth Development Inc. “Our expansion projects have lead the way to increased revenue, and that is a perfect example of our growth strategy succeeding. We are focused on continuing that strategy of growth via expansion, development, and acquisition throughout the third and fourth quarters of 2009.”
Second Quarter 2009 Financial Results
Revenue for the second quarter of 2009 was $4.18 million, a 12 percent increase as compared to $3.74 million for the same period in 2008, largely driven by the expansion of shopping malls and the initialization of their operations. Also, the associated deferred revenue collected previously from commercial tenants started to amortize and recognize over the leasing period. Management service income collected from the new commercial tenants also increased revenue. In addition, management also increased the management service income per square meter at several clothing mall booths at Xicheng Shopping Mall.
Selling, general and administrative expenses were $2.29 million, an 11% decrease from $2.58 million as compared for the same period in 2008. The higher expenses for the quarter ended June 30, 2008 were mainly due to one-time charges incurred in the closing of the reverse acquisition.
Income from continuing operations increased by $1.1 million, from $1.0 million for the quarter ended June 30, 2008 to $2.1 million for the quarter ended June 30, 2009, a 111% increase. Such increase was mainly attributable to increases in net revenue and other income as listed in the quarterly filing.
Income tax expense increased by $447,793 from $22,534 for the quarter ended June 30, 2008 to $447,793 for the quarter ended June 30, 2009. The increase was mainly due to change in the effective tax rate to our operations in PRC, increasing from 2.25% for the second quarter of 2008 to 21.20% for the current quarter, due to the lack of favorable tax policy granted by local governments to the Company.
Net income attributable to the common stockholders was $1,034,313 for the quarter ended June 30, 2009, compared to $608,754, for the quarter ended June 30, 2008, an increase of $425,558 or 70%. The higher net income for the current quarter was attributable to the increased net revenue and other income as described above and in the company’s quarterly filing.
Liquidity and Capital Resources
The Company currently generates its cash flow through operations which it believes will be sufficient to sustain current level operations for at least the next twelve months. In 2009, we intend to continue to work to expand our presence in the commercial real estate market, including the potential acquisition of another shopping mall.
To the extent we are successful in growing our business, identifying potential acquisition targets and negotiating the terms of such acquisition, and the purchase price includes a cash component, we plan to use our working capital and the proceeds of any financing to finance such acquisition costs.
2009 – 2010 Outlook
Over the course of the next few years, we intend to grow and expand our commercial real estate business. We currently generate positive cash flow and we expect to acquire an additional 2 shopping centers within the next three years.
lol... Im was thinking Wednesday, but typed Thursday.
yup dreadful thursdays, the day not to look at your portfolio. Thursdays are my buy days.
Thursday? hmmmm someone needs to get some rest.
Cross your fingers for a PR over the weekend!!! Its dreadful Thursdays, could see a dip today. But a little less than 30% of outstanding shares to play with. Low shares vs great balance sheet would be good anyway you look at it.
Looking very nice. I will try to grab some. Good Luck..
I see ask at ranging form .40-.85
time to send corporate an email!!!! I'd like to see stabilization at 1.00 by the the time Q3 hits, maybe by the end of the month... need a PR to pass along to some friends my good CEO...
yea more than likely I'll jump back in but I place my orders towards the close. I'm def holding this one
Never too late to add when they're eps positive and have $2.85 in real estate holdings/share.
I added Monday and again this morning.
I can't see this going back to where it was under .20 again. It got beat down because they were hit by one time charges (from the reverse merger) in the 2008 annual report that broght them from the .12+/share they were on track to report down to .05/share.
Those one time charges are history, management's shares are locked tight for 9 more months, they just opened a mall with 100% occupancy and have another on the way.
So I added yesterday and today.
I'm disappointed that I didn't buy 10,000 shares when I had the opportunity.
I dont think we'll have to wait long for this one for this one to hit 1.00, last company I had that was undervalued was NFES, got in at .07 cents and watched it ride to 1.60 in less than 2 months.
Real estate holdings = $97M. That's $2.85/share.
yep. Anyone who has done their dd on this one probably won't settle for .30/share. I'm looking for .80-1.00 by eoy here.
Management and 5% stakeholders own 31M of the 34M shares. Per the terms of their May 2008 reverse merger, these shares are locked and can not be sold until May 2010.
Think they'll do everything they can to get the share price much higher than this for when they can start selling 9 months from now? Hell yes.
oh yea- I agree 110%.
Amazing market cap of $7M when they have $100M in real estate holdings, and are eps positive and growing revenues/income qoq and yoy.
This company made .11/share in 2007, then went public and got hit with major one time expenses in the reverse merger last year, bringing eps down to .05 for the year.
With the new expansion announced last week at 100% capacity, I think they're looking at .12-.15 this year.
this is definitely going to be a mover,
low shares outstanding,
superb balance sheet.
Company is definitely undervalued. Last company I had was NFES... China is definitely where its at. I'm going back in cause it the market seems bearish, what this company needs is some press.
non- current deferred reveneus up to $32M or almost $1/share
revenue up 12% (not great, but will increase by $1.9M with new mall announced yesterday)
Operating income up 64%
Net income up 70%
BV $1.37/share
And that lovely non-current deferred revenue of about $1/share waiting to hit the books.
I changed my mind, lol.
Sold some LLFH (have long term core psoition) after up 75% in a week.
Am sitting at bid .15 now after loking at the last two filings again.
This could be a major mover from here with a decent report.
PE is under 4, and they've got a boatload of revenues pre-booked as we've discussed.
I'm in a "show me the money" stance with this one.
Will add shares if they report on time and impress.
Added 25,000 shares this week.With a decent quarter we will trade higher.
I might have to add IF they report ON TIME and make at lease .03 for Q2.
China Growth Development Achieves Full Occupancy of Newest Shopping Mall, Primed to Add 1.9 Million in Annual Revenue
http://ih.advfn.com/p.php?pid=nmona&cb=1250181323&article=39033833&symbol=NB%5ECGDI
Mostly from the filings. The website has been down. I think they're re-working it.
do you know where I can get information on this company?
I haven't looked at the filing in detail yet to comment- been busy. Will look tomorrow and post on it. A quick glance says they're strong in revenues but spending too much in managemet fees, salaries, etc. Need more time to study it. Considering how bad Q4 was that brought down eps for the year to only .05, this report looks like an improvement on the surface.
Not sure to make of the Q, Company looks like it's making great money, but it's not reaching the PubCo. Any feedback/ideas?
Well I did add on the report. Got some at .08 (!)
This company's worth a helluva lot more than that.
They had about $1M in one time charges that hit them hard, plus an increase in tax rate. Revenues up, shareholder equity up, they still made .05/share and are cash flow positive.
Anything under .10 is a great buy IMO.
I'm here.
Not nearly the report I expected.
I have free shares that I'll hold, but won't add on this report.
Well, maybe they shouldn't file at all...share price going up very nicely without it!
I'm not a fan of late filing either. Am holding my shares, but now adding until they file and I see the growth.
Check out CHFI.OB, (China Finance) a difficult one to value, but looks ready to head back up off recent lows. I'm starting to but that one too. I have a feeling management is buying shares down here now and am waiting for Form 4s to confirm.
cgdi(e): the non-current deferred revenue makes it look interesting.
i'm not a big fan of their quarterly revenues though. we are at a P/S of 1/4 based on the last quarterly. we can afford to be pickier. I'm going to go ahead and be pickier on this one
Have faith, it's holding up well. If they can get their numbers out soon we'll blast through prior levels if the numbers are anywhere near where we thing they'll be.
URGGHHH
This non filing is for the birds. Hell, we're nearly half way through 2009 and still waiting on their 2008 numbers.
Incidentally, I am NOT suggesting to sell CGDI to buy FUFW....only that FUFW deserves a look if you like turn-around candidates.
OT/ While waiting for the 10-K here, I've been looking at another China microcap that's been badly beaten down and barely trading now.
FUFW.OB (Fuda Faucet Works)
Looks like a potential turn-around candidate. I've done a lot of research on it, emails, calls etc. and think it's worth a modest position here.
Incidentally, I probably look at 30+ china microcaps before buying a single share of one.
CYXN at .08 was like that, as was CDGI at .10, and now FUFW.OB
I have some initial dd posted on the FUFW board that I'll add to soon.
Ugh, got the E today, hopefully this doesn't last.
I'm predicting $.11 a share in EPS, but we shall see
They're going to file within 5 days according to email I got from them yesterday afternoon.
As for eps, I guessing .10/share
Well,there's strength on the bid today.
Looks like we may have hit bottom at the open and stock will be in stronger hands now after the flush of the last two days.
Let's cross our fingers...
well...they need to file 10-K and soon, or risk the "E".
The initial good momentum on fundamantal value here is gettin crushed because they aren't filing on time...which is an unfortunate risk with many of these China stocks unfortunately.
Long term, I remain bullish, but short term wouldn't be surprised to see .10 and below again if they don't file their annual report soon.
yep.
Steady uptrend should continue (with a pullback along the way here and there) after the 10-K is out tomorrow.
They've got the growth, the fundamentals, the hard assets of $1.89/share, revenue of .70/share yet to be accounted for, and fiscally sound money management by ownership.
All this one needs is exposure, and that's coming.
$1+ by eoy.
Board started today on Investor Vilage if anyone interested:
http://www.investorvillage.com/iv2/smbd.asp?mb=16153&pt=m
CGDI - this thing is on fire.
China Stock, I fixed the website. I was only temporary mod, if you're interested in taking over, let me know...
"non-current deferred revenue was $25,724,975"
This is UNHEARD of in a penny stock!
read on here...
http://www.investorvillage.com/iv2/smbd.asp?mb=9845&mn=898&pt=msg&mid=7054707
Correct website link (the I-box above is wrong)
The I-box above has the wrong link for the URL to the CGDI.OB website.
Here is correct link:
http://www.chinagrowthdevelopment.com
Pics of their properties:
http://www.chinagrowthdevelopment.com/cgdi_subsidiary.html
Management shares locked until May 2010...and no IR firm (yet)!
Management owns 31M of the 35M shares of this company, and their shares are LOCKED until May 2010. They can't sell a single share until then.
So...it's pretty easy to see what will happen next: Management/insiders will want to maxamize the share price (hell, at least get it to book value of $1.00/share!) by May 2010,(a year from now).
Hiring a good IR firm soon after annual numbers are released, supplying 2009 projected eps, and a few good PRs on their future growth plans in the next few weeks seems like a given here.
Buying now and holding for 12 months while management gets the word out to maxamize their share value is a no brainer.
2008 full year earnings should be out next week.
Probably around .10/share for the year or better, for a ttm PE well below 1 here.
The value of their commercial holdings alone are listed at $66M as of the November filing. With only 35M shares fully diluted, that value translates to $1.90/share!
Add to that value the fact that they are cash flow positive, made .08/share for the first 9 months of 2008, and have managable debt load they can pay down with cash flows from operations ($2.4M in operating income for last reported quarter), and I see a truly undiscovered diamond here.
Hell, this company could stop operations tomorrow, sell off their assets, pay all debt, and shareholders would realize nearly $1.20/share!
CGDI.OB won't be undiscovered much longer.
I'm buying here.
This one's gotten waaay too cheap.
I'll post some dd I have on it in a few days.
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CGDI.OB China Growth Development
China Growth Development, Inc. (CGDI), is the largest investor, owner and manager of commercial real estate in the capital city of Taiyuan, located in the Shanxi Province of southern China.
China Growth Development, Inc., owns and manages 4,200 commercial units valued at over $90M within its six strategically located shopping centers, servicing an urban population of 3.4 million people.
Website:
http://www.chinagrowthdevelopment.com
Pics of Current Properties:
http://www.chinagrowthdevelopment.com/cgdi_subsidiary.html
Video of Taiyuan- including shopping district:
(slow to download- but worth the wait!) http://www.taiyuan.gov.cn/tygovwww/english/spty.htm
PICS OF A FEW OF CGDI's PROPERTIES TAKEN 11/2009
Recent News:
China Growth Development Achieves Full Occupancy of Newest Shopping Mall, Primed to Add 1.9 Million in Annual Revenue - August 13, 2009
"We are pleased to announce that our newest shopping mall has reached full occupancy, which translates to increased annual revenue growth for the company,” stated Sam Liu, COO. “The tenants normally pay in advance for up to a 10 year lease period, and this is a significant factor in reducing China Growth Development Inc.‘s exposure to fluctuations in the commercial real estate
The company notes that China's economy has experienced significant growth over the past few years and that has increased the demand for commercial space.
China Growth Development Inc. intends to grow and expand its commercial real estate business. The company desires to acquire an additional 2 shopping centers within the next three years in addition to capitalizing on existing development rights.
“We aim to have these and future developments enhance China Growth Development’s balance sheet and thus shareholder value,” added Mr. Liu.
China Growth Development Inc Highlights Second Quarter 2009 Financial Results - August 20, 2009
Second Quarter 2009 Highlights
-- Net revenue increased to 4.18 million, a 12% increase from the second quarter of 2008.
-- Net income rose to $1.67million for the quarter ended June 30, 2009, a 70% increase year-over-year.
-- Earnings per share of $.03 for the quarter on a fully diluted basis as compared to $.02 from the second quarter of previous year.
“We are pleased at our progress and ability to deliver solid results this quarter," stated Mr. Sam Liu, COO of China Growth Development Inc. “Our expansion projects have lead the way to increased revenue, and that is a perfect example of our growth strategy succeeding. We are focused on continuing that strategy of growth via expansion, development, and acquisition throughout the third and fourth quarters of 2009.”
2009 – 2010 Outlook
Over the course of the next few years, we intend to grow and expand our commercial real estate business. We currently generate positive cash flow and we expect to acquire an additional 2 shopping centers within the next three years.
SEC Filings: (click here)
Share Structure:
Outstanding Shares: 34,970,007
Insider Shares: 31,121,327 (All insider shares are locked/unavailabe for sale until May 2010 per terms of the reverse merger)
Approximate Float: 3,848,680
Contact:
China Growth Development, Inc.
USA Office
927 Canada Court
City of Industry, California 91748
USA
Phone: 626-581-9098
Fax: 626-581-9138
info@chinagrowthdevelopment.com
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