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May 2010 Rodman & Renshaw London conference presentation
http://wsw.com/webcast/rrshq17/liwa/
I agree ... poor wording on their part but they were undoubtedly just referring to the earnings PR, although I do appreciate being able to go through the statements for a few hours before the call.
Then why spend the time and money releasing news that they would be releasing it on wed may 5th...they are idiots and they hurt shareholders. Not just me saying it...have a look for yourself...
http://www.thelion.com/bin/aio_msg.cgi?cmd=search&symbol=liwa
I think they probably just wanted to give people a chance to really go through the filing prior to the call
How about these idiots! They put out a news that they will release earnings on May 5th before the start of trading and then shareholders come home today to see that the fuking clowns release earnings midday today during the worse day the markets have seen all year....classic stupid ass management screwing shareholders....
Q1 CC on May 5:
DANYANG, China, May 3 /PRNewswire-Asia/ -- Lihua International, Inc., (Nasdaq:LIWA - News) ("Lihua" or the "Company"), a leading Chinese developer, designer, manufacturer, marketer and distributor of low cost, high quality alternatives to pure copper superfine and magnet wire, as well as copper rod products, today announced that it will report financial results for the first quarter ended March 31, 2010 on Wednesday, May 5, 2010, before the start of trading in the U.S.
The Company will host a conference call to discuss the results on Wednesday, May 5, 2010 at 8:00 a.m. Eastern time. Interested parties may access the conference call by dialing 1-877-941-4778 in the U.S. and Canada, or 1-480-629-9763 internationally.
For those unable to participate, an audio replay of the call will be available beginning approximately one hour after the conclusion of the live call through May 12, 2010. The audio replay can be accessed by dialing 1-800-406-7325 from the U.S or Canada, or 1-303-590-3030 internationally, and entering access ID No. 4292292.
The call will be also be available as a live, listen-only webcast under the "Events and Presentations" page on the "Investor Relations" section of the Company's website at http://www.lihuaintl.com/Investor_Relations/Events_Presentations.html . Following the live webcast, an online archive will be available for 90 days.
About Lihua International, Inc.
Lihua International, through its two wholly-owned subsidiaries, Lihua Electron and Lihua Copper, is a leading value-added manufacturer of copper replacement products for China's rapidly growing magnet and fine wire market. Lihua is one of the first vertically integrated companies in China to develop, design, manufacture, market and distribute lower cost, high quality, alternatives to pure copper magnet wire. Lihua's products include copper-clad aluminum wire ("CCA") and recycled scrap copper wire and are sold in China either directly to manufacturers or through distributors in the wire and cable industries and manufacturers in the consumer electronics, white goods, automotive, utility, telecommunications and specialty cable industries. Lihua's corporate and manufacturing headquarters are located in the heart of China's copper industry in Danyang, Jiangsu Province. Additional company information can be found at http://www.lihuaintl.com .
To be added to the Company's email distribution for future news releases, please send your request to lihua@tpg-ir.com .
For more information, please contact:
The Piacente Group, Inc.
Investor Relations
Brandi Floberg or Lee Roth
Tel: +1-212-481-2050 +1-212-481-2050
Email: lihua@tpg-ir.com
No question.
I also received a call from Lee Roth at TPG who confirmed the gross margin numbers that I backed out of the 10K.
Good news is they are increasing wire capacity and will be able to channel the copper rod into the wire processing, thus reducing their raw material costs and improving their overall margins.
Thanks for that, I see on page 30 they show the income statement with line items breaking out the wire sales from the copper rod sales.
It looks as though the gross margins are around 28% on the aggregated wire sales and ~10% for the copper rod.
Thanks - I should have checked there first. Here's a couple relevant snippets from the 10K.
As of December 31, 2009, our scrap copper refinery capacity was approximately
25,000 tons per annum. To the extent our downstream wire-drawing capacity permits, we process our copper rod into copper wire. Because our
output of copper rod exceeds our capacity to process it into copper wire, we sell our excess copper rod to other wire manufacturers for further
processing. During the nine months ended September 30, 2009, we sold 5,761 tons of copper wire and 8,032 tons of copper rod. We currently
are working to expand our wire drawing capacity so that we can use a greater proportion of our copper rod rather than selling it to other
manufacturers, thereby increasing our profit margins and overall profitability.
Our gross margin is also affected by our product mix. We produce and sell products according to customer orders. CCA magnet wire and CCA
tin plated wire are final products from which we will derive the highest production markup, or gross profit. We also generate a significant
portion of revenue from selling semi-finished products such as CCA fine wire at a lower production cost markup, or gross profit. The March 2009 launch of our scrap copper refinery business has changed our product mix and gross margins. Generally, copper rod
contributes a lower gross profit margin compared to finished wire products. We are still at an early development stage of this new business
segment, and our copper rod production capacity exceeds our copper wire drawing capacity. Therefore, we currently must sell a percentage of
our copper rod production into the open market on an unimproved basis, at lower profit margins. However, we expect a gradual ramping up of
our wire production facilities and thus we will likely be able to utilize a substantial proportion of our copper rod production capacity as raw
material for our copper wire production. As a result, we expect to sell more copper wire at higher profit margins than copper rod over time.
Unfound gem, the spell check put unfounded in sorry
The margins are in the 10k and the conference call gives the tonnage numbers. Liwa is really an unfounded gem. They have a patented technology that allows recycled copper to have the purity of newly mined copper. The only thing is liwa can make wire much cheaper this way, and has a nice costs advantage from new copper. This is why all their production is pre sold. What's keeping them from growing is the 25 ton smelter. But the recent secondary solved that, by planning a 100 ton super smelter. With the new smelter liwa could produce revenues in excess of 750 million.
The copper rod is not the business they are in . It is what they make with excess smelter capacity, and by end of 2nd q they won't be making any more till new smelter
Hi Chad, no worries regarding the posts. I thought it was a shame that there wasn't more activity on this board.
I'm also curious as to the margin breakdowns and have sent an email to Lihua's internal IR. I'll post here when I receive a response.
Ken
Thanks for all of the posts; I was revisiting LIWA this weekend as well.
Do you have any information on the margins per product - CCA Wire, Copper Wire, and Copper Rod? Looks like for 2011, they are substantially increasing the copper rod capacity. I'm curious as to how much will be sold as copper rod, and how much will be used in the manufacture of wire.
Chad
LIWA prospectus and 10K
Prospectus from April 2010 financing: http://www.sec.gov/Archives/edgar/data/1399521/000114420410019251/v180562_424b5.htm
2009 10K: http://www.sec.gov/Archives/edgar/data/1399521/000114420410016785/v178648_10k.htm
LIWA 2009 results and 2010 guidance:
DANYANG, China, March 31 /PRNewswire-Asia/ -- Lihua International, Inc. (Nasdaq:LIWA - News) ("Lihua" or the "Company"), a leading Chinese developer, designer, manufacturer, marketer and distributor of low cost, high quality alternatives to pure copper superfine and magnet wire, as well as copper rod products, today announced financial results for the fourth quarter and 12 months ended December 31, 2009.
Fourth Quarter Financial Highlights
-- Sales increased 367% year-over-year to $51.3 million.
-- Gross profit increased 178% year-over-year to $10.9 million.
-- Net income increased 275% to $7.3 million, or $0.30 per share, compared
with $1.9 million, or 0.13 per share in the fourth quarter of 2008. Net
income for the fourth quarter of 2009 included a $0.5 million non-cash
charge for the change in fair value of warrants issued to investors in
conjunction with the Company's issuance of convertible Preferred Stock
in October 2008. Excluding the non-cash charge, non-GAAP net income
for the 2009 fourth quarter was $7.7 million, or $0.32 per share.
-- Adjusted EBITDA increased 227% year-over-year to $10.0 million.(1)
-- Strong balance sheet, with $34.6 million in cash and cash equivalents
as of December 31, 2009.
(1) Adjusted EBITDA is a non-GAAP measurement that the Company uses as
a metric to provide information about Lihua's operating trends.
Lihua defines adjusted EBITDA as net income before discontinued
operations, interest expense, income taxes, depreciation and
amortization, non-operating income (expense), and non-cash share-
based compensation expenses.
Full-Year 2009 Financial Highlights
-- Full-year 2009 sales increased 223% to $161.5 million.
-- Full-year 2009 gross profit increased 116%, to $36.2 million, or 22.4%
of sales, compared with $16.8 million, or 33.6% of sales in 2008.
-- Full-year net income improved 43% to $16.8 million, or $0.88 per
diluted share, compared with net income of $11.7 million, or $0.70 per
share in 2008. Net income for 2009 included an $8.8 million non-cash
charge for the change in fair value of warrants issued to investors in
conjunction with the Company's issuance of convertible Preferred Stock
in October 2008. Excluding the non-cash charge, Non-GAAP net income
for the year was $25.6 million, or $1.34 per diluted share.
-- Adjusted EBITDA increased 118.3% to $33.0 million, compared with 2008.
2009 and Recent Business Highlights
-- Began production on four new proprietary high speed manufacturing lines
in September 2009 to increase annual CCA wire and copper wire capacity
from 18,000 tons to 25,500 tons.
-- Began production on two new high-speed copper magnet wire and copper
fine wire production lines in February 2010. Lihua also announced plans
to add four additional production lines by end of first half 2010 to
increase annual production capacity of copper wire to 25,000 tons.
-- Announced plans to add four new high-speed CCA wire production lines in
2010 to increase annual CCA wire production capacity from 7,500 tons to
10,000 tons by the end of 2010.
-- Completed initial public offering on NASDAQ on September 10, 2009 for
net proceeds of $7.9 million.
"In 2009 we more than doubled our annual CCA and copper wire sales and demonstrated clear growth across key operating metrics," said Jianhua Zhu, Chairman and Chief Executive Officer of Lihua. "We believe this growth reflects the continued demand for pure copper alternatives in a broad range of end markets, as well as heightened contribution from our copper recycling facility, which accounted for approximately 75% of our total sales in 2009. Since we launched our copper recycling business in the first quarter of 2009, it has become an integral part of our business and enabled us to capture new market share as we can now compete in the broader market as a preferred, low-cost copper alternative provider.
"In line with our growth strategy, we continue to expand our business operations. In February we launched the first two of our 10 new production lines planned for 2010, which we believe will increase our production capacity by approximately 40%. We expect that the addition of these lines will improve our gross margin profile, as it will enable us to convert a larger portion of our recycled copper rod products into higher margin superfine and copper magnet wire products and increase the production capacity of our higher margin CCA wire business. With these expansion plans in place, we expect to increase our gross profit by approximately 30-35% and our non-GAAP net income by approximately 35-40% in 2010," Mr. Zhu concluded.
Fourth Quarter 2009 Financial Results
Sales for the fourth quarter of 2009 increased 367% to $51.3 million, compared with sales of $11.0 million in the fourth quarter of 2008. The increase in sales was driven by strong market demand for Lihua's CCA and copper wire products, an increase in the average selling price of copper wire and copper rod products based on an increase in the average price of copper, an increase in production capacity and the addition of Lihua's copper recycling business, which commenced operations at the end of the first quarter of 2009.
Gross profit for the fourth quarter of 2009 was $10.9 million, or 21% of sales. This compares with gross profit of $3.9 million, or 36% of sales, for the fourth quarter of 2008. The year-over-year decrease in gross margin was primarily due to the addition of the copper recycling operation to Lihua's product mix, which produces lower margin copper rod. In March of 2009, Lihua commenced production of recycling scrap copper into copper rod with a consistently high purity content, which meets both government and industry standards for pure copper. Due to current drawing and enameling capacity constraints, Lihua can process only a portion of this copper rod into value added fine and super fine copper wire products and sells the remaining copper rod into the market at a lower gross margin. Lihua expects gross margins to increase in future periods as it continues to ramp up the conversion of copper rod products into higher margin super fine and copper magnet wire products. Gross profit dollars per ton increased 4% on a sequential quarter basis to $1,672 in the fourth quarter of 2009 from $1,613 per ton in the third quarter of 2009.
Selling, general and administrative (SG&A) expenses for the fourth quarter of 2009 were $1.7 million, compared with $1.2 million for the same period in 2008. The increase in SG&A for the 2009 period was attributable to increased costs related to product distribution and insurance as a result of expanded business volume, increased expenses associated with being a public company and expenses associated with expansion of the Company's scale of operations.
Interest income for the fourth quarter of 2009 was $36,000, compared with $40,000 for the fourth quarter of 2008. Interest expense for the fourth quarter of 2009 was $54,000, compared with $162,000 for the same period in the prior year. The decrease in interest expense was mainly due to the repayment of short term bank loans, which were used for working capital purposes.
For the three months ended December 31, 2009, the provision for income tax expense was $1.5 million, compared with $382,000 for the three months ended December 31, 2008. The effective tax rate ("EIT") for the 2009 and 2008 periods was 17%.
For the fourth quarter of 2009, Lihua's other comprehensive income including foreign currency translation adjustment gains was $20,635, compared with a loss of $(183,546) in the fourth quarter of 2008. The foreign currency translation adjustment is based on the average exchange rate of the RMB compared with the US dollar in the respective reporting period.
Net income for the fourth quarter of 2009 was $7.3 million, or $0.30 per share based on 24.2 million weighted average shares outstanding. This compares with net income of $1.9 million, or $0.13 per share based on 15.3 million weighted average shares outstanding during the same period in 2008. Excluding a non-cash charge of $455,000 related to the fair value of warrants, non-GAAP net income increased 299% in the fourth quarter of 2009 to $7.7 million, or $0.32 per share, compared with the same period in 2008.
Adjusted EBITDA for the three months ended December 31, 2009 increased by 227% to $10.0 million, compared with the same period in the prior year.
Balance Sheet
As of December 31, 2009, Lihua had $34.6 million in cash and cash equivalents, compared with $26.0 million as of December 31, 2008.
As of December 31, 2009, Lihua had total debt of $2.2 million, which relates to short-term bank loans used for working capital purposes. This compares with $6.1 million as of December 31, 2008.
Outlook
Lihua is targeting 2010 gross profit of $47.1 million to $48.9 million and non-GAAP net income of $34.6 million to $35.8 million, representing year-over-year growth of 30-35% and 35-40%, respectively. The Company expects that 2010 growth will be largely the result of continued strong demand in China for recycled copper and copper alternatives in the household appliance, consumer white goods and infrastructure markets.
In addition to steadily expanding its CCA wire production capacity, Lihua is committed to the growth of its scrap copper recycling business, to meet strong market demand. In order to better meet this expected growth in demand, Lihua plans to add a total of 10 new proprietary high-speed production lines in 2010, which will increase its annual capacity by nearly 40%.
In February, the company completed the first two new copper wire production lines, and anticipates that it will complete the build out of four additional copper wire production lines during the first half of 2010. These six new lines will bring Lihua's annual copper magnet and copper fine wire production capacity to 25,000 tons from approximately 18,000 tons at the end of 2009. Lihua expects to launch the remaining four production lines during the second half of 2010, which will bring its CCA fine and magnet wire capacity to 10,000 tons annually, compared with current annual capacity of 7,500 tons. The Company anticipates funding these capacity increases from existing cash on the balance sheet and operating cash flow generated in 2010.
Conference Call and Webcast
Management of Lihua International will host a conference call today, Wednesday, March 31, 2010 at 8:00 a.m. Eastern time to discuss fourth quarter and full-year 2009 financial results.
Individuals interested in participating in the conference call may do so by dialing 1-877-941-2322 begin_of_the_skype_highlighting 1-877-941-2322 end_of_the_skype_highlighting begin_of_the_skype_highlighting 1-877-941-2322 end_of_the_skype_highlighting toll free from the U.S. or Canada, or 1-480-629-9715 begin_of_the_skype_highlighting 1-480-629-9715 end_of_the_skype_highlighting from outside the U.S. Those interested in listening to the conference call live via the Internet may do so by visiting the Investor Relations section of the Company's Web site at: http://www.lihuaintl.com/Investor_Relations/Events_Presentations.html .
A telephone replay will be available for 48 hours following the conclusion of the call by dialing 1-800-406-7325 begin_of_the_skype_highlighting 1-800-406-7325 end_of_the_skype_highlighting from the U.S. or Canada, or 1-303-590-3030 begin_of_the_skype_highlighting 1-303-590-3030 end_of_the_skype_highlighting from outside the U.S., and entering access ID number 4272185. A webcast replay will be available for 90 days.
About Non-GAAP Financial Measures
EBITDA Calculation For
Three Months Ended 12 Months Ended
December 31, December 31,
2009 2008 2009 2008
Net income $7,269,849 $1,939,273 $16,779,276 $11,701,879
Depreciation
and amortization 680,493 243,281 1,652,863 812,339
Share-based
compensation
expense 79,537 367,250 331,440 367,250
Change in fair
value of
warrants 455,344 -- 8,831,161 --
Interest
income (35,998) (40,315) (173,807) (68,353)
Interest
expenses 53,730 162,203 335,335 514,950
Provision for
income tax 1,486,220 381,550 5,247,647 1,792,681
EBITDA 9,989,175 3,053,242 33,003,915 15,120,746
The Company uses adjusted EBITDA as a measure of the Company's operating trends. Investors are cautioned that adjusted EBITDA is not a measure of liquidity or of financial performance under Generally Accepted Accounting Principles (GAAP). The adjusted EBITDA numbers presented may not be comparable to similarly titled measures reported by other companies. Adjusted EBITDA, while providing useful information, should not be considered in isolation or as an alternative to net income or cash flows as determined under GAAP. Consistent with Regulation G under the U.S. federal securities laws, the non-GAAP measures in this press release have been reconciled to the nearest GAAP measure, and this reconciliation is located under the heading "Adjusted EBITDA Reconciliation" following the Consolidated Statements of Operations included in this press release.
About Lihua International, Inc.
Lihua International, through its two wholly-owned subsidiaries, Lihua Electron and Lihua Copper, is a leading value-added manufacturer of copper replacement products for China's rapidly growing copper wire and copper replacement product market. Lihua is one of the first vertically integrated companies in China to develop, design, manufacture, market and distribute lower cost, high quality alternatives to pure copper magnet wire and pure copper alternative products. Lihua's products include copper-clad aluminum wire ("CCA") and pure copper products including copper wire and copper rod, which are produced from recycled scrap copper. Lihua's products are sold in China either directly to manufacturers or through distributors in the wire and cable industries and manufacturers in the consumer electronics, white goods, automotive, utility, telecommunications and specialty cable industries. Lihua's corporate and manufacturing headquarters are located in the heart of China's copper industry in Danyang, Jiangsu Province. For more information, visit: http://www.lihuaintl.com .
To be added to the Company's email distribution for future news releases, please send your request tolihua@tpg-ir.com.
Safe Harbor Statement
This press release contains certain statements that may be deemed to be "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. All statements, other than statements of historical facts, that address activities, events or developments that the Company expects, projects, believes or anticipates will or may occur in the future, including, without limitation, statements about its business or growth strategy, general industry conditions including availability of copper or recycled scrap copper, future operating results of the Company, capital expenditures, expansion and growth opportunities, bank borrowings, financing activities and other such matters, are forward-looking statements. Although the Company believes that its expectations stated in this press release are based on reasonable assumptions, actual results may differ from those projected in the forward-looking statements.
Please note that information in this press release reflects management views as of the date of issuance.
For more information, please contact:
Lihua International, Inc.
Daphne Huang
EVP of Finance and Director of Investor Relations
Tel: +1-516-717-9939 begin_of_the_skype_highlighting +1-516-717-9939 end_of_the_skype_highlighting
Email: Daphne_huang@lihuaintl.com
The Piacente Group, Inc.
Investor Relations
Brandi Floberg or Lee Roth
Tel: +1-212-481-2050 begin_of_the_skype_highlighting +1-212-481-2050 end_of_the_skype_highlighting
Email: lihua@tpg-ir.com
Tables Follow
LIHUA INTERNATIONAL, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
As of December 31,
2009 2008
ASSETS
CURRENT ASSETS
Cash and cash equivalents $34,614,838 $26,041,849
Restricted cash 575,000 1,750,000
Notes receivable, net -- 321,892
Accounts receivable, net 10,996,430 5,042,739
Other receivables and current assets 493,006 --
Prepaid land use right - current
portion 172,515 172,353
Deferred income tax assets 98,068 --
Inventories 17,534,254 586,938
Total current assets 64,484,111 33,915,771
OTHER ASSETS
Property, plant and equipment, net 18,424,080 7,440,943
Construction in progress 59,558 6,017,941
Deposits for plant and equipment 28,163 1,077,892
Prepaid land use right - long-term
portion 8,168,039 8,332,732
Intangible assets 2,812 4,214
Deferred income tax assets -- 23,395
Total non-current assets 26,682,652 22,897,117
Total assets $91,166,763 $56,812,888
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES
Short term bank loans $2,196,772 $6,145,202
Accounts payable 4,923,360 1,643,544
Other payables and accruals 681,097 830,744
Income taxes payable 1,584,292 401,436
Total current liabilities 9,385,521 9,020,926
Total liabilities 9,385,521 9,020,926
Series A redeemable convertible
preferred stock: $0.0001 par value:
10,000,000 shares authorized
(liquidation preference of $2.20
per share), none and 6,818,182
shares issued and outstanding -- 13,116,628
SHAREHOLDERS' EQUITY
Series A convertible preferred
stock: $0.0001 par value
(liquidation preference of
$2.20 per share), 10,000,000
shares authorized, none issued
and outstanding -- --
Common stock, $0.0001 par value:
75,000,000 shares authorized,
24,154,083 and 15,000,000
shares issued and outstanding 2,416 1,500
Additional paid-in capital 39,921,717 7,976,976
Statutory reserves 5,400,994 2,603,444
Retained earnings 33,826,885 21,521,937
Accumulated other comprehensive
income 2,629,230 2,571,477
Total shareholders' equity 81,781,242 34,675,334
Total liabilities and
shareholders' equity $91,166,763 $56,812,888
LIHUA INTERNATIONAL, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
(Audited) (Unaudited)
For the 12 Months Ended For the 3 Months Ended
Dec. 31, Dec. 31,
(USD) 2009 2008 2009 2008
Sales 161,543,434 50,006,057 51,263,898 10,969,010
Cost of sales (125,310,613) (33,202,344) (40,383,813) (7,053,530)
Gross profit 36,232,821 16,803,713 10,880,085 3,915,480
Selling expenses (1,722,242) (700,029) (480,100) (133,899)
Admin expenses (3,991,801) (1,907,043) (1,171,466) (1,089,069)
SG&A (5,714,043) (2,607,072) (1,651,566) (1,222,968)
Income from
operations 30,518,778 14,196,641 9,228,519 2,692,512
Interest income 173,807 68,353 35,998 40,315
Interest expenses (335,335) (514,950) (53,730) (162,203)
Exchange income
(expense) -- -- 545 --
Merger cost -- (259,225) -- (259,225)
Change in fair
value of warrants (8,831,161) -- (455,344) --
Other income
(expenses) 500,834 3,741 81 9,424
Total other
income (8,491,855) (702,081) (472,450) (371,689)
Income before tax 22,026,923 13,494,560 8,756,069 2,320,823
Income tax (5,247,647) (1,792,681) (1,486,220) (381,550)
Net income 16,779,276 11,701,879 7,269,849 1,939,273
Net income per
share
Basic $0.94 $0.75 $0.30 $0.13
Diluted $0.88 $0.70 $0.29 $0.12
Basic 17,822,890 14,187,945 24,118,183 14,678,571
Diluted 19,128,231 15,327,422 25,423,524 15,818,048
LIHUA INTERNATIONAL, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(AMOUNTS EXPRESSED IN US DOLLAR)
Year Ended December 31,
2009 2008
CASH FLOWS FROM OPERATING ACTIVITIES
Net income $16,779,276 $11,701,879
Adjustments to reconcile net income to
cash provided by operating activities:
Depreciation and amortization 1,652,863 812,339
Merger expenses -- 259,225
Share-based compensation costs 331,440 367,250
Warrants issued for services -- 90,000
Change in fair value of warrants 8,831,161 --
Deferred income tax benefits (74,621) (23,022)
(Increase) decrease in assets:
Accounts receivable (5,946,526) 701,310
Notes receivable 322,061 470,299
Other receivables and current assets (492,804) 10,259
Inventories (16,939,820) 2,154,764
Increase (decrease) in liabilities:
Accounts payable 2,932,371 (994,285)
Other payables and accruals (150,322) 312,986
Income taxes payable 1,181,995 (25,302)
Net cash provided by operating
activities 8,427,074 15,837,702
CASH FLOWS FROM INVESTING ACTIVITIES
Payment of merger expenses for reverse
acquisition -- (259,225)
Repayment from a related party -- 4,168,699
Purchase of property, plant and
equipment (5,094,444) (4,852,020)
Prepayment for land use right -- (3,750,540)
Net cash used in investing activities (5,094,444) (4,693,086)
CASH FLOWS FROM FINANCING ACTIVITIES
New short-term bank loans 2,196,772 11,950,700
Repayments of short-term bank loans (6,150,962) (10,222,888)
Repayment to related parties -- (2,667,675)
Release of restricted cash related to
Private Placement 1,175,000 --
Proceeds from exercise of warrants 125,650 --
Proceeds from Private Placement, net
of restricted cash held in escrow -- 11,906,538
Proceeds from public offering of
common stock, net of expenses of
$1,336,000 7,864,000 --
Net cash provided by financing
activities 5,210,460 10,966,675
Foreign currency translation
adjustment 29,899 716,909
INCREASE IN CASH AND CASH EQUIVALENTS 8,572,989 22,828,200
CASH AND CASH EQUIVALENTS, at the
beginning of the year 26,041,849 3,213,649
CASH AND CASH EQUIVALENTS, at the end
of the year $34,614,838 $26,041,849
NON-CASH INVESTING AND FINANCING
TRANSACTIONS:
Shares-based compensation to employees
and directors $331,440 $367,250
Warrants issued for services -- 90,000
$331,440 $457,250
SUPPLEMENTAL DISCLOSURE INFORMATION
Cash paid for interest $335,335 $514,950
Cash paid for income taxes $ 4,140,273 $1,841,005
LIWA latest investor presentation
http://www.lihuaintl.com/PDF/pdfurl/Lihua%20PPT%20-%20April%202010%20-%20FINAL.pdf
LIWA news.Lihua Public Offering of 3,726,708 Common SharesLast update: 4/8/2010 6:13:00 PMDANYANG, China, April 8, 2010 /PRNewswire via COMTEX/ -- Lihua International, Inc., (LIWA) ("Lihua" or the "Company"), a leading Chinese developer, designer, manufacturer, marketer and distributor of low cost, high quality alternatives to pure copper superfine and magnet wire, as well as copper rod products, today announced that it is offering 3,726,708 shares of its common stock. In connection with this offering, the Company has granted the underwriters a 45-day option to purchase up to 559,006 shares of common stock to cover over-allotments, if any. The Company intends to use the majority of the proceeds from this offering for the construction of a new smelting facility, which is expected to accelerate the production of refined copper products. Construction of this new facility is expected to begin in the fourth quarter of this year. Any remaining proceeds will be used for general working capital purposes. Rodman & Renshaw, LLC, a subsidiary of Rodman & Renshaw Capital Group, Inc. (RODM), is acting as sole book running
Was a pretty safe options play....glad it worked out!
Thanks for the call a while back on the Apr 7.50 calls. Much appreciated.
earning out WOWSA!
Lihua International Reports Fourth Quarter and Full-Year 2009 Financial Results
Lihua Achieves 2009 GAAP Net Income of $16.8 Million on $161.5 Million in Revenue and Exceeds Gross Profit and Non-GAAP Net Income Guidance
Full Year Revenue up 223%, Gross Profit up 116%, Non-GAAP Net Income up 119%, Excluding $8.8 Million Non-Cash Charge, and Adjusted EBITDA up 118%
prnewswire
DANYANG, China, March 31 /PRNewswire-Asia/ -- Lihua International, Inc. (Nasdaq:LIWA - News) ("Lihua" or the "Company"), a leading Chinese developer, designer, manufacturer, marketer and distributor of low cost, high quality alternatives to pure copper superfine and magnet wire, as well as copper rod products, today announced financial results for the fourth quarter and 12 months ended December 31, 2009.
Fourth Quarter Financial Highlights
-- Sales increased 367% year-over-year to $51.3 million.
-- Gross profit increased 178% year-over-year to $10.9 million.
-- Net income increased 275% to $7.3 million, or $0.30 per share, compared
with $1.9 million, or 0.13 per share in the fourth quarter of 2008. Net
income for the fourth quarter of 2009 included a $0.5 million non-cash
charge for the change in fair value of warrants issued to investors in
conjunction with the Company's issuance of convertible Preferred Stock
in October 2008. Excluding the non-cash charge, non-GAAP net income
for the 2009 fourth quarter was $7.7 million, or $0.32 per share.
-- Adjusted EBITDA increased 227% year-over-year to $10.0 million.(1)
-- Strong balance sheet, with $34.6 million in cash and cash equivalents
as of December 31, 2009.
(1) Adjusted EBITDA is a non-GAAP measurement that the Company uses as
a metric to provide information about Lihua's operating trends.
Lihua defines adjusted EBITDA as net income before discontinued
operations, interest expense, income taxes, depreciation and
amortization, non-operating income (expense), and non-cash share-
based compensation expenses.
Full-Year 2009 Financial Highlights
-- Full-year 2009 sales increased 223% to $161.5 million.
-- Full-year 2009 gross profit increased 116%, to $36.2 million, or 22.4%
of sales, compared with $16.8 million, or 33.6% of sales in 2008.
-- Full-year net income improved 43% to $16.8 million, or $0.88 per
diluted share, compared with net income of $11.7 million, or $0.70 per
share in 2008. Net income for 2009 included an $8.8 million non-cash
charge for the change in fair value of warrants issued to investors in
conjunction with the Company's issuance of convertible Preferred Stock
in October 2008. Excluding the non-cash charge, Non-GAAP net income
for the year was $25.6 million, or $1.34 per diluted share.
-- Adjusted EBITDA increased 118.3% to $33.0 million, compared with 2008.
2009 and Recent Business Highlights
-- Began production on four new proprietary high speed manufacturing lines
in September 2009 to increase annual CCA wire and copper wire capacity
from 18,000 tons to 25,500 tons.
-- Began production on two new high-speed copper magnet wire and copper
fine wire production lines in February 2010. Lihua also announced plans
to add four additional production lines by end of first half 2010 to
increase annual production capacity of copper wire to 25,000 tons.
-- Announced plans to add four new high-speed CCA wire production lines in
2010 to increase annual CCA wire production capacity from 7,500 tons to
10,000 tons by the end of 2010.
-- Completed initial public offering on NASDAQ on September 10, 2009 for
net proceeds of $7.9 million.
"In 2009 we more than doubled our annual CCA and copper wire sales and demonstrated clear growth across key operating metrics," said Jianhua Zhu, Chairman and Chief Executive Officer of Lihua. "We believe this growth reflects the continued demand for pure copper alternatives in a broad range of end markets, as well as heightened contribution from our copper recycling facility, which accounted for approximately 75% of our total sales in 2009. Since we launched our copper recycling business in the first quarter of 2009, it has become an integral part of our business and enabled us to capture new market share as we can now compete in the broader market as a preferred, low-cost copper alternative provider.
"In line with our growth strategy, we continue to expand our business operations. In February we launched the first two of our 10 new production lines planned for 2010, which we believe will increase our production capacity by approximately 40%. We expect that the addition of these lines will improve our gross margin profile, as it will enable us to convert a larger portion of our recycled copper rod products into higher margin superfine and copper magnet wire products and increase the production capacity of our higher margin CCA wire business. With these expansion plans in place, we expect to increase our gross profit by approximately 30-35% and our non-GAAP net income by approximately 35-40% in 2010," Mr. Zhu concluded.
Fourth Quarter 2009 Financial Results
Sales for the fourth quarter of 2009 increased 367% to $51.3 million, compared with sales of $11.0 million in the fourth quarter of 2008. The increase in sales was driven by strong market demand for Lihua's CCA and copper wire products, an increase in the average selling price of copper wire and copper rod products based on an increase in the average price of copper, an increase in production capacity and the addition of Lihua's copper recycling business, which commenced operations at the end of the first quarter of 2009.
Gross profit for the fourth quarter of 2009 was $10.9 million, or 21% of sales. This compares with gross profit of $3.9 million, or 36% of sales, for the fourth quarter of 2008. The year-over-year decrease in gross margin was primarily due to the addition of the copper recycling operation to Lihua's product mix, which produces lower margin copper rod. In March of 2009, Lihua commenced production of recycling scrap copper into copper rod with a consistently high purity content, which meets both government and industry standards for pure copper. Due to current drawing and enameling capacity constraints, Lihua can process only a portion of this copper rod into value added fine and super fine copper wire products and sells the remaining copper rod into the market at a lower gross margin. Lihua expects gross margins to increase in future periods as it continues to ramp up the conversion of copper rod products into higher margin super fine and copper magnet wire products. Gross profit dollars per ton increased 4% on a sequential quarter basis to $1,672 in the fourth quarter of 2009 from $1,613 per ton in the third quarter of 2009.
Selling, general and administrative (SG&A) expenses for the fourth quarter of 2009 were $1.7 million, compared with $1.2 million for the same period in 2008. The increase in SG&A for the 2009 period was attributable to increased costs related to product distribution and insurance as a result of expanded business volume, increased expenses associated with being a public company and expenses associated with expansion of the Company's scale of operations.
Interest income for the fourth quarter of 2009 was $36,000, compared with $40,000 for the fourth quarter of 2008. Interest expense for the fourth quarter of 2009 was $54,000, compared with $162,000 for the same period in the prior year. The decrease in interest expense was mainly due to the repayment of short term bank loans, which were used for working capital purposes.
For the three months ended December 31, 2009, the provision for income tax expense was $1.5 million, compared with $382,000 for the three months ended December 31, 2008. The effective tax rate ("EIT") for the 2009 and 2008 periods was 17%.
For the fourth quarter of 2009, Lihua's other comprehensive income including foreign currency translation adjustment gains was $20,635, compared with a loss of $(183,546) in the fourth quarter of 2008. The foreign currency translation adjustment is based on the average exchange rate of the RMB compared with the US dollar in the respective reporting period.
Net income for the fourth quarter of 2009 was $7.3 million, or $0.30 per share based on 24.2 million weighted average shares outstanding. This compares with net income of $1.9 million, or $0.13 per share based on 15.3 million weighted average shares outstanding during the same period in 2008. Excluding a non-cash charge of $455,000 related to the fair value of warrants, non-GAAP net income increased 299% in the fourth quarter of 2009 to $7.7 million, or $0.32 per share, compared with the same period in 2008.
Adjusted EBITDA for the three months ended December 31, 2009 increased by 227% to $10.0 million, compared with the same period in the prior year.
Balance Sheet
As of December 31, 2009, Lihua had $34.6 million in cash and cash equivalents, compared with $26.0 million as of December 31, 2008.
As of December 31, 2009, Lihua had total debt of $2.2 million, which relates to short-term bank loans used for working capital purposes. This compares with $6.1 million as of December 31, 2008.
Outlook
Lihua is targeting 2010 gross profit of $47.1 million to $48.9 million and non-GAAP net income of $34.6 million to $35.8 million, representing year-over-year growth of 30-35% and 35-40%, respectively. The Company expects that 2010 growth will be largely the result of continued strong demand in China for recycled copper and copper alternatives in the household appliance, consumer white goods and infrastructure markets.
In addition to steadily expanding its CCA wire production capacity, Lihua is committed to the growth of its scrap copper recycling business, to meet strong market demand. In order to better meet this expected growth in demand, Lihua plans to add a total of 10 new proprietary high-speed production lines in 2010, which will increase its annual capacity by nearly 40%.
In February, the company completed the first two new copper wire production lines, and anticipates that it will complete the build out of four additional copper wire production lines during the first half of 2010. These six new lines will bring Lihua's annual copper magnet and copper fine wire production capacity to 25,000 tons from approximately 18,000 tons at the end of 2009. Lihua expects to launch the remaining four production lines during the second half of 2010, which will bring its CCA fine and magnet wire capacity to 10,000 tons annually, compared with current annual capacity of 7,500 tons. The Company anticipates funding these capacity increases from existing cash on the balance sheet and operating cash flow generated in 2010.
Conference Call and Webcast
Management of Lihua International will host a conference call today, Wednesday, March 31, 2010 at 8:00 a.m. Eastern time to discuss fourth quarter and full-year 2009 financial results.
Individuals interested in participating in the conference call may do so by dialing 1-877-941-2322 toll free from the U.S. or Canada, or 1-480-629-9715 from outside the U.S. Those interested in listening to the conference call live via the Internet may do so by visiting the Investor Relations section of the Company's Web site at: http://www.lihuaintl.com/Investor_Relations/Events_Presentations.html .
A telephone replay will be available for 48 hours following the conclusion of the call by dialing 1-800-406-7325 from the U.S. or Canada, or 1-303-590-3030 from outside the U.S., and entering access ID number 4272185. A webcast replay will be available for 90 days.
About Non-GAAP Financial Measures
EBITDA Calculation For
Three Months Ended 12 Months Ended
December 31, December 31,
2009 2008 2009 2008
Net income $7,269,849 $1,939,273 $16,779,276 $11,701,879
Depreciation
and amortization 680,493 243,281 1,652,863 812,339
Share-based
compensation
expense 79,537 367,250 331,440 367,250
Change in fair
value of
warrants 455,344 -- 8,831,161 --
Interest
income (35,998) (40,315) (173,807) (68,353)
Interest
expenses 53,730 162,203 335,335 514,950
Provision for
income tax 1,486,220 381,550 5,247,647 1,792,681
EBITDA 9,989,175 3,053,242 33,003,915 15,120,746
The Company uses adjusted EBITDA as a measure of the Company's operating trends. Investors are cautioned that adjusted EBITDA is not a measure of liquidity or of financial performance under Generally Accepted Accounting Principles (GAAP). The adjusted EBITDA numbers presented may not be comparable to similarly titled measures reported by other companies. Adjusted EBITDA, while providing useful information, should not be considered in isolation or as an alternative to net income or cash flows as determined under GAAP. Consistent with Regulation G under the U.S. federal securities laws, the non-GAAP measures in this press release have been reconciled to the nearest GAAP measure, and this reconciliation is located under the heading "Adjusted EBITDA Reconciliation" following the Consolidated Statements of Operations included in this press release.
About Lihua International, Inc.
Lihua International, through its two wholly-owned subsidiaries, Lihua Electron and Lihua Copper, is a leading value-added manufacturer of copper replacement products for China's rapidly growing copper wire and copper replacement product market. Lihua is one of the first vertically integrated companies in China to develop, design, manufacture, market and distribute lower cost, high quality alternatives to pure copper magnet wire and pure copper alternative products. Lihua's products include copper-clad aluminum wire ("CCA") and pure copper products including copper wire and copper rod, which are produced from recycled scrap copper. Lihua's products are sold in China either directly to manufacturers or through distributors in the wire and cable industries and manufacturers in the consumer electronics, white goods, automotive, utility, telecommunications and specialty cable industries. Lihua's corporate and manufacturing headquarters are located in the heart of China's copper industry in Danyang, Jiangsu Province. For more information, visit: http://www.lihuaintl.com .
To be added to the Company's email distribution for future news releases, please send your request tolihua@tpg-ir.com.
Safe Harbor Statement
This press release contains certain statements that may be deemed to be "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. All statements, other than statements of historical facts, that address activities, events or developments that the Company expects, projects, believes or anticipates will or may occur in the future, including, without limitation, statements about its business or growth strategy, general industry conditions including availability of copper or recycled scrap copper, future operating results of the Company, capital expenditures, expansion and growth opportunities, bank borrowings, financing activities and other such matters, are forward-looking statements. Although the Company believes that its expectations stated in this press release are based on reasonable assumptions, actual results may differ from those projected in the forward-looking statements.
Please note that information in this press release reflects management views as of the date of issuance.
For more information, please contact:
Lihua International, Inc.
Daphne Huang
EVP of Finance and Director of Investor Relations
Tel: +1-516-717-9939
Email: Daphne_huang@lihuaintl.com
The Piacente Group, Inc.
Investor Relations
Brandi Floberg or Lee Roth
Tel: +1-212-481-2050
Email: lihua@tpg-ir.com
Tables Follow
LIHUA INTERNATIONAL, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
As of December 31,
2009 2008
ASSETS
CURRENT ASSETS
Cash and cash equivalents $34,614,838 $26,041,849
Restricted cash 575,000 1,750,000
Notes receivable, net -- 321,892
Accounts receivable, net 10,996,430 5,042,739
Other receivables and current assets 493,006 --
Prepaid land use right - current
portion 172,515 172,353
Deferred income tax assets 98,068 --
Inventories 17,534,254 586,938
Total current assets 64,484,111 33,915,771
OTHER ASSETS
Property, plant and equipment, net 18,424,080 7,440,943
Construction in progress 59,558 6,017,941
Deposits for plant and equipment 28,163 1,077,892
Prepaid land use right - long-term
portion 8,168,039 8,332,732
Intangible assets 2,812 4,214
Deferred income tax assets -- 23,395
Total non-current assets 26,682,652 22,897,117
Total assets $91,166,763 $56,812,888
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES
Short term bank loans $2,196,772 $6,145,202
Accounts payable 4,923,360 1,643,544
Other payables and accruals 681,097 830,744
Income taxes payable 1,584,292 401,436
Total current liabilities 9,385,521 9,020,926
Total liabilities 9,385,521 9,020,926
Series A redeemable convertible
preferred stock: $0.0001 par value:
10,000,000 shares authorized
(liquidation preference of $2.20
per share), none and 6,818,182
shares issued and outstanding -- 13,116,628
SHAREHOLDERS' EQUITY
Series A convertible preferred
stock: $0.0001 par value
(liquidation preference of
$2.20 per share), 10,000,000
shares authorized, none issued
and outstanding -- --
Common stock, $0.0001 par value:
75,000,000 shares authorized,
24,154,083 and 15,000,000
shares issued and outstanding 2,416 1,500
Additional paid-in capital 39,921,717 7,976,976
Statutory reserves 5,400,994 2,603,444
Retained earnings 33,826,885 21,521,937
Accumulated other comprehensive
income 2,629,230 2,571,477
Total shareholders' equity 81,781,242 34,675,334
Total liabilities and
shareholders' equity $91,166,763 $56,812,888
LIHUA INTERNATIONAL, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
(Audited) (Unaudited)
For the 12 Months Ended For the 3 Months Ended
Dec. 31, Dec. 31,
(USD) 2009 2008 2009 2008
Sales 161,543,434 50,006,057 51,263,898 10,969,010
Cost of sales (125,310,613) (33,202,344) (40,383,813) (7,053,530)
Gross profit 36,232,821 16,803,713 10,880,085 3,915,480
Selling expenses (1,722,242) (700,029) (480,100) (133,899)
Admin expenses (3,991,801) (1,907,043) (1,171,466) (1,089,069)
SG&A (5,714,043) (2,607,072) (1,651,566) (1,222,968)
Income from
operations 30,518,778 14,196,641 9,228,519 2,692,512
Interest income 173,807 68,353 35,998 40,315
Interest expenses (335,335) (514,950) (53,730) (162,203)
Exchange income
(expense) -- -- 545 --
Merger cost -- (259,225) -- (259,225)
Change in fair
value of warrants (8,831,161) -- (455,344) --
Other income
(expenses) 500,834 3,741 81 9,424
Total other
income (8,491,855) (702,081) (472,450) (371,689)
Income before tax 22,026,923 13,494,560 8,756,069 2,320,823
Income tax (5,247,647) (1,792,681) (1,486,220) (381,550)
Net income 16,779,276 11,701,879 7,269,849 1,939,273
Net income per
share
Basic $0.94 $0.75 $0.30 $0.13
Diluted $0.88 $0.70 $0.29 $0.12
Basic 17,822,890 14,187,945 24,118,183 14,678,571
Diluted 19,128,231 15,327,422 25,423,524 15,818,048
LIHUA INTERNATIONAL, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(AMOUNTS EXPRESSED IN US DOLLAR)
Year Ended December 31,
2009 2008
CASH FLOWS FROM OPERATING ACTIVITIES
Net income $16,779,276 $11,701,879
Adjustments to reconcile net income to
cash provided by operating activities:
Depreciation and amortization 1,652,863 812,339
Merger expenses -- 259,225
Share-based compensation costs 331,440 367,250
Warrants issued for services -- 90,000
Change in fair value of warrants 8,831,161 --
Deferred income tax benefits (74,621) (23,022)
(Increase) decrease in assets:
Accounts receivable (5,946,526) 701,310
Notes receivable 322,061 470,299
Other receivables and current assets (492,804) 10,259
Inventories (16,939,820) 2,154,764
Increase (decrease) in liabilities:
Accounts payable 2,932,371 (994,285)
Other payables and accruals (150,322) 312,986
Income taxes payable 1,181,995 (25,302)
Net cash provided by operating
activities 8,427,074 15,837,702
CASH FLOWS FROM INVESTING ACTIVITIES
Payment of merger expenses for reverse
acquisition -- (259,225)
Repayment from a related party -- 4,168,699
Purchase of property, plant and
equipment (5,094,444) (4,852,020)
Prepayment for land use right -- (3,750,540)
Net cash used in investing activities (5,094,444) (4,693,086)
CASH FLOWS FROM FINANCING ACTIVITIES
New short-term bank loans 2,196,772 11,950,700
Repayments of short-term bank loans (6,150,962) (10,222,888)
Repayment to related parties -- (2,667,675)
Release of restricted cash related to
Private Placement 1,175,000 --
Proceeds from exercise of warrants 125,650 --
Proceeds from Private Placement, net
of restricted cash held in escrow -- 11,906,538
Proceeds from public offering of
common stock, net of expenses of
$1,336,000 7,864,000 --
Net cash provided by financing
activities 5,210,460 10,966,675
Foreign currency translation
adjustment 29,899 716,909
INCREASE IN CASH AND CASH EQUIVALENTS 8,572,989 22,828,200
CASH AND CASH EQUIVALENTS, at the
beginning of the year 26,041,849 3,213,649
CASH AND CASH EQUIVALENTS, at the end
of the year $34,614,838 $26,041,849
NON-CASH INVESTING AND FINANCING
TRANSACTIONS:
Shares-based compensation to employees
and directors $331,440 $367,250
Warrants issued for services -- 90,000
$331,440 $457,250
SUPPLEMENTAL DISCLOSURE INFORMATION
Cash paid for interest $335,335 $514,950
Cash paid for income taxes $ 4,140,273 $1,841,005
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if it breaks through 9.81 right now it can run all the way to 10.50-11, I can see it hitting 12 very soon.
I'm only seeing Rodman & Renshaw covering, with an estimate of $20. Are you aware of other analysts? I started a position today and will look to add.
I'm surprised no one is posting here, many analysts have 1 year targets of 18+, I bought a bunch of shares under 8, sold some today at 9.60, still got more than 2/3rd of my position. Looking for 12+
Listen to Roth capital conference. They seem bullish. I dont have price target but this has upside potential.
I hope you're right. My EOY prediction is 11.5.
hopefully we can both agree that going forward LIWA will earn
.31 or better a quarter and that is 1.24 eps per yr x 13p/e =16.12 stock price
It's a double
Capacity increases take a long time to reach full 100% output increases and to reflect in earnings. Some of it as well as better pricing is already reflected in the YOY 180% rev. growth in 1H 09, that's 2.8x last year's revenues! 2H09 rev = 25236m, I am assuming 25236x2.8=70,660m for 2H09 to account for all that growth. Your prediction is way too rosy. A an investor, I'd rather have a "conservative" prediction than a too optimistic one.
read the cut and past from my post, they are adding capacity, so output is increasing q over q. and making wire instead of rods, which is higher margins, but my example was for 1Q 2010 forward
i read the 1 st Q 10Q and it talked about the output increases underway. I went to FSIN'S 10q and got the tonage pricing and added that back in to LIWA'S number's with the new capacity. Also if the market starts to look at PEG instead of PE in 2011 they are gowing to more than double there capacity for CCA
I think your estimate is way too high. Assuming 3Q and 4Q will have same growth of rev as 1Q and 2Q average, 2009 rev may be about 140m, net inc. about 22.7m. Based on same OS as now, eps will be about 0.96 IMO.
this is from thier 1Q 10Q. From the expansion they describe here and looking at there best competitor's books they should bring in an additional .19 a quarter= .49 1q earnings and then
1.96 yr x 13 pe= 25.48stock price
I hope I am right.....can't wait till the market sees this, will be a quick double!
In 2009, as we accelerate to expand, we expect continued capital expenditure for maintaining existing machines and adding manufacturing equipment in our new facility, which is adjacent to our old facility. In the new production facilities we currently have two horizontal smelters, which can produce 25,000 tons refinery copper per year, we plan to have one new vertical smelter in 2011 while increasing our refinery copper capacity to 100,000 tons per year. With our current capacity of production lines, we can produce 6,000 tons of CCA wire and 6,000 tons of copper wire. Therefore, we plan to have six new production lines in production by the end of 2009 while increasing our copper wire production capacity to 14,000 tons per year. Of that capacity, 10,000 tons per year will be copper magnet wire and 4,000 tons per year will be copper fine wire. We also plan to have another four production lines in production by the end of 2009, increasing our CCA wire production capacity to 7,500 tons per year. Of that capacity, 5,500 tons per year will be CCA magnet wire and 2,000 tons per year will be CCA fine wire. We believe that our existing cash, cash equivalents and cash flows from operations, and our revolving credit facility, will be sufficient to meet our presently anticipated future cash needs to bring all of our facilities into full production. We may, however, require additional cash resources due to changing business conditions or other future developments, including any investments or acquisitions we may decide to pursue.
It's nice to see another LIWA believer on iHub. I bought in on 9/4 and like what I'm seeing so far.
My next DDRX?
I will update Ibox as time allows but this quiet IPO seems way undervalued.
Will add more as time allows.
Our sales and net income have increased substantially during the last three years and in 2009. We generated sales of $15.7 million, $32.7 million and $50.0 million for the years ended December 31, 2006, 2007 and 2008, respectively. We achieved net income of $4.5 million $7.7 million and $11.7 million for the years ended December 31, 2006, 2007 and 2008, respectively. During the six months ended June 30, 2009, we achieved revenue of $69.4 million and net profit of $10.7 million, up 180.1% and 83.1% from the same period last year.
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Company Website: http://www.lihuaintl.com
SEC Filings: http://www.sec.gov/cgi-bin/browse-edgar?action=getcompany&CIK=0001399521
Profile (per 2013 10-K Filing): We are a vertically integrated company in China which develops, designs, manufactures, markets and distributes low cost, high quality refined copper products including copper anode, copper rod, pure superfine copper wire, and copper-clad aluminum superfine wire (“CCA”), which is an alternative to pure superfine copper wire. We also use recycled scrap copper as a raw material to produce refined copper products including copper anode and copper rod. Copper anode is the raw material for copper cathode, which is the fundamental building block for pure copper products. We use the copper rod we produce as raw material for the production of pure copper wire. Primarily because of its high electrical conductivity, pure copper wire is used in many components in a wide variety of motorized and electrical appliances such as dishwashers, microwaves and automobiles. In most instances, our CCA wire and refined copper rod and wire products are an excellent, less costly substitute for pure copper cable and wire products.
We sell copper anode primarily to a few large copper cathode producers in China. We sell our rod and wire products to down stream manufacturers including fine and superfine wire processors and small and micro electronic motor manufacturers who in turn sell to the consumer electronics, white goods, automotive, utility, telecommunications and specialty cable industries. Our track record and reputation for producing high quality products in large quantities has paved the way for expansion of our customer base. In the PRC, the market for copper products is large and growing. As a result, there is solid demand for all of our products. Essentially all of our product sales are made to domestic customers in the PRC.
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