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FXP is fun to watch :) Hope when I go to Ningbo and Beijing the Yuan has tanked :) Dollar will go very far.
Thanks. FXP at $90.8 in PM
I picked up FXP today at $84. It's looking great for tomorrow since HSI & SSEC are down 2% tonight :)
#msg-26943539 ProShares UltraShort China ETF: Caveat Emptor!
yes! nice pop! on volume....
no pinks here... ty...
Noah Education Announces Results for the Second Fiscal Quarter Ended December 31, 2007
Tuesday February 19, 5:00 pm ET
SHENZHEN, China, Feb. 19 /Xinhua-PRNewswire/ -- Noah Education Holdings Ltd. ("Noah") (NYSE: NED - News), a leading provider of interactive education content in China, today announced its unaudited financial results for the fiscal quarter ended December 31, 2007, which is the second quarter for Noah's fiscal year ending June 30, 2008.(1)
Highlights for the Second Fiscal Quarter Ended December 31, 2007
-- Total net revenues were RMB122.4 million (US$16.8 million), a decrease
of 2.6% over the corresponding period last year.
-- Net income was RMB13.8 million (US$1.9 million), an increase of 199.9%
year-over-year. Net income excluding share-based compensation expenses
and the change in the fair value of warrants (non-GAAP) was RMB27.7
million, an increase of 75.5% year-over-year.
-- Basic and diluted earnings per share were RMB0.40 (US$0.05) and RMB0.38
(US$0.05), compared to RMB1.58 (US$0.21) and RMB1.50 (US$0.20) of the
previous quarter, respectively. Basic and diluted earnings per share
excluding share-based compensation expenses and the change in the fair
value of warrants (non-GAAP) were RMB0.79 (US$0.11) and RMB0.77
(US$0.11), compared to RMB1.85 (US$0.25) and RMB1.83 (US$0.24) of the
previous quarter, respectively.
-- Total sales volume of handheld Digital Learning Devices (DLDs) for the
second quarter decreased 16.5% year-over-year to approximately 111,000.
-- E-dictionary sales volume decreased to approximately 173,000 from
229,000 in the second quarter of the previous year.
-- Total coursewares available increased to approximately 32,000 from
30,000 in the previous quarter and 21,000 in the second quarter of the
previous year. During the quarter, Noah rolled out China's first
graphic calculator technology in DLDs.
-- During the quarter, the company opened 6 new after-school tutoring
centers in Chengdu, Chongqing and Beijing, bringing the total number of
such centers to 9.
"Overall this quarter has been a solid one for Noah,'' said Mr. Dong Xu, Noah's Chairman and Chief Executive Officer. ''Sales of our DLDs were down primarily due to the market reaction to a missing environmental compliance sticker on one of our products and our subsequent voluntary action to address customer concerns regarding this issue (''the missing label issue''). In response, we implemented a comprehensive review of our quality-control programs to ensure that such an occurrence does not take place again, and we also launched an aggressive brand-building campaign to assure students and their families that all of our products meet the highest quality standards. By the end of the quarter, sales of our DLDs were back on track. We are confident that the missing label issue is behind us and that with the introduction of new product offerings such as graphic calculator technology, revenue growth in the coming quarters will be strong.''
Mr. Xu continued, ''We are also very pleased to announce the launch of a new school initiative during the last quarter, which has placed Noah products, content and services directly in front of students and teachers in a number of primary and middle schools across China, reaching over a half million students so far. Going forward we plan to roll out this initiative in many more schools with a goal of reaching millions more. Not only is this new initiative successful in raising visibility and strengthening brand-loyalty, it also helps students to better understand the breadth and depth of our superior content offerings and is exceedingly cost effective in terms of utilizing our marketing and sales dollars. This and other initiatives continue to build upon our vision of becoming the number one provider of supplemental education products, content and services in China.''
Financial Results for the Fiscal Quarter Ended December 31, 2007
For the second fiscal quarter of 2008, Noah reported net revenues of RMB122.4 million (US$16.8 million), a 2.6% decrease over net revenues of RMB125.7 million in the second quarter of the previous year. The decrease was primarily attributable to the negative impact caused by the missing label issue.
Total sales volume of DLDs for the quarter was 111,000, a 16.5% decrease from approximately 133,000 in the second quarter of fiscal year 2007.
E-dictionary sales volume decreased to approximately 173,000, a 24.5% decrease over 229,000 sold in the same year-ago period.
Total coursewares available increased to approximately 32,000 from 30,000 in the previous quarter and 21,000 in the second quarter of the previous year and graphic calculator technology was added to certain DLD products used to teach mathematics.
Gross profit margins were 46.7% compared to 47.6% in the corresponding period last year. The decrease was primarily attributable to the write down of the NP800 due to the missing label issue.
Total operating expenses as a percentage of net revenue were 50.9%, compared to 50.8% in the corresponding period last year. Sales and marketing expenses were RMB40.0 million, or 32.7% of revenues, compared to RMB34.2 million, or 27.2% of revenues in the corresponding period last year.
Operating margin for the quarter was 5.3% compared to 6.7% in the corresponding period last year. Excluding share-based compensation expenses, operating margin for the quarter was 16.4%, compared to 15.5% in the corresponding period last year.
Total share-based compensation expenses, which were allocated to related operating costs and expenses, increased 21.6% to RMB13.6 million (US$1.9 million) up from RMB11.2 million in the corresponding period last year.
Net income for the quarter was RMB13.8 million (US$1.9 million), a 199.9% increase over RMB4.6 million in the second fiscal quarter of 2007. Net income excluding share-based compensation expenses and the change in the fair value of warrants (non-GAAP) was RMB27.7 million, an increase of 75.5% year-over- year.
Basic and diluted earnings per share amounted to RMB0.40 (US$0.05) and RMB0.38 (US$0.05) compared to RMB 1.58 (US$0.21) and RMB 1.50 (US$0.20) of the previous quarter, respectively. Each ADS represents one ordinary share. The weighted averaged ordinary shares outstanding in calculating basic and diluted earnings per share were 34,925,840 and 36,022,820, respectively.
Net income excluding share-based compensation expenses and the change in the fair value of warrants was RMB27.7 million (US$3.8 million). Basic and diluted earnings per share excluding share-based compensation expenses and the change in the fair value of warrants were RMB0.79 (US$0.11) and RMB0.77 (US$0.11), respectively.
As of December 31, 2007, Noah had cash and cash equivalents of RMB1.05 billion (US$144.1 million).
Financial Results for the Six Months Ended December 31, 2007
For the six months ended December 31, 2007, Noah reported net revenues of RMB369.9 million (US$50.6 million), a 22.3% increase over net revenues of RMB302.5 million in the corresponding period last year.
Operating margin for the six months ended December 31, 2007 was 15.5% compared to 13.6% in the six months ended December 31, 2006.
Net income for the six months ended December 31, 2007 was RMB58.3 million (US$8.0 million), a 59.7% increase over RMB36.5 million in the six months ended December 31, 2006. Basic and diluted earnings per share amounted to RMB1.69 (US$0.23) and RMB1.63 (US$0.22), respectively.
Net income excluding share-based compensation expenses and the change in the fair value of warrants (non-GAAP) for the six months ended December 31, 2007 was RMB79.8 million (US$10.9 million), representing a 67.4% increase year-over-year. Basic and diluted earnings per share excluding share-based compensation expenses and the change in the fair value of warrants were RMB2.39 (US$0.33) and RMB2.30 (US$0.31), respectively.
Outlook for Fiscal Year 2008
Noah expects its total net revenue for fiscal year 2008 (July 1, 2007 to June 30, 2008) to be in the range of RMB680 million (US$93 million) to RMB690 million (US$94 million), representing year-over-year growth in the range of 22% to 24%, respectively. Noah expects net profits in fiscal year 2008 to be in the range of RMB115 million (US$15.7) to RMB120 million (US$16.4), representing year-over-year growth in the range of 74% to 81%. This forecast reflects Noah's current and preliminary view, which is subject to change.
Conference Call Information
Noah's management will host an earnings conference call at 8 p.m. on February 19, 2008 U.S. Eastern Standard Time (9 a.m. on February 20, 2008 Beijing/Hong Kong time).
Dial-in details for the earnings conference call are as follows:
US: +1-617-597-5307
Hong Kong: +852-3002-1672
Please dial-in 10 minutes before the call is scheduled to begin and provide the passcode to join the call. The passcode is "Noah earnings call".
A replay of the conference call may be accessed by phone at the following number until March 19, 2007:
International: +1-617-801-6888
Passcode: 51558775
Additionally, a live and archived webcast of this conference call will be available at http://ir.noahtech.com.cn .
About Noah
Noah Education Holdings Limited (''Noah'') (NYSE: NED - News) is a leading provider of interactive education content in China. Noah develops and markets interactive multimedia learning materials mainly to complement prescribed textbooks used in China's primary and secondary school curricula. Noah delivers content primarily through handheld digital learning devices, or DLDs. In 2007, Noah opened its first after-school tutoring center in Chengdu, China as part of its strategy to become China's leading brand in supplemental education content and service. For more information about Noah, please visit http://www.noahtech.com.cn .
Safe Harbor Statement
This press release contains forward-looking statements that reflect Noah's current expectations and views of future events that involve known and unknown risks, uncertainties and other factors that may cause our actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. Noah has based these forward-looking statements largely on its current expectations and projections about future events and financial trends that it believes may affect its financial condition, results of operations, business strategy and financial needs. You should understand that our actual future results may be materially different from and worse than what Noah expects. Information regarding these risks, uncertainties and other factors is included in Noah's filings with the SEC.
GA, looks like it turned north.... expecting good things....
Both APWR & TITN went up really nicely after alerted last week in high $16s.
When it goes...it is going to really go! Did you look at the other one? WNRC. Interested to see what a chartist thinks. Keep in mind, I've never put much of anything into charting. Just momentum and news.
see if it turns north tuesday
GA reports on Wednesday. I think I am going to take a position.
Should see good yearly and sequential growth... IPO'ed at the $20 range, and has been trending at $10 since..... See what you think.
GIANT INTERACTIVE GROUP INC. ANNOUNCES
THIRD QUARTER 2007 RESULTS
SHANGHAI, PRC — November 19, 2007 — Giant Interactive Group Inc. (NYSE: GA), one of China’s leading online game developers and operators in terms of revenues, announced today its unaudited financial results for the third quarter ended September 30, 2007.
Third Quarter 2007 Highlights:
• Net revenue for the third quarter of 2007 was RMB405.2 million (US$54.1 million), an increase of 164.2% over the third quarter of 2006 and 9.5% over the second quarter of 2007.
• Gross profit for the third quarter of 2007 was RMB359.8million (US$48.0million), an increase of 152.8% over the third quarter of 2006 and 8.5% over the second quarter of 2007. Gross profit margin for the third quarter of 2007 was 88.8%.
• Net income for the third quarter of 2007 was RMB290.2 million (US$38.7 million), an increase of 152.6% over the third quarter of 2006 and 9.8% over the second quarter of 2007. Net income margin for the third quarter of 2007 was 71.6%.
• Net income per ordinary share for the third quarter of 2007 was RMB1.44 (US$0.19), compared to RMB0.57 for the third quarter of 2006. After the recent initial public offering, each ADS represents one ordinary share.
• Active Paying Accounts (“APA”) for ZT Online in the third quarter of 2007 reached 1,318,000, an increase of 88.9% from the third quarter of 2006 and 5.6% from the second quarter of 2007.
• Average Revenue Per User (“ARPU”) for ZT Online in the third quarter of 2007 was RMB305.2, an increase of 38.8% from the third quarter of 2006 and 3.3% from the second quarter of 2007.
• Average Concurrent User (“ACU”) for ZT Online in the third quarter of 2007 was 481,000, an increase of 77.6% from the third quarter of 2006 and a decrease of 6.6% from the second quarter of 2007.
• Peak Concurrent User (“PCU”) for ZT Online in the third quarter of 2007 was 888,000, an increase of 59.2% from the third quarter of 2006 and a decrease of 17.2% from the second quarter of 2007.
Mr. Yuzhu Shi, Chairman and Chief Executive Officer of Giant Interactive Group Inc. (“Giant”), commented, “2007 has been a historic year for Giant, highlighted by our successful listing on the NYSE on November 1, 2007. Our listing represents a major milestone towards our goal of becoming the largest online game developer and operator in Asia. Our passion for games remains the main driving force behind our strategy, while our strong R&D and technology capabilities, extensive distribution and marketing support network and clear insight into the Chinese mass market continue to underpin our growth. As such, we are pleased to announce strong earnings for the third quarter of 2007 with 164.2% growth in net revenue and a 152.6% increase in net income, as well as continued strong high gross profit and net income margins. Our ZT Online game continued to deliver solid performance with the successful launch of the expansion packs and with the execution of our marketing strategy of targeting new users in medium and smaller cities. The increases in both APA and ARPU demonstrate the continued expansion of our paying player base and increasing player loyalty to ZT Online. The development of our second major game, Giant Online, is on track and feedback from closed beta testing has been very positive.”
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“We are excited for our future prospects.” Mr. Shi continued, “We believe with the recent milestones and our unwavering commitment to game play, we are well positioned to enhance our market leadership.”
Third Quarter 2007 Unaudited Financial Results
Total net revenue. Total net revenues for the third quarter of 2007 were RMB405.2 million (US$54.1 million), representing a 9.5% increase compared to RMB370.2 million in the second quarter of 2007, and a 164.2% increase compared to RMB153.4 million in the third quarter of 2006.
Online game net revenues for the third quarter of 2007 were RMB404.0 million (US$53.9 million), an increase of 9.7% from RMB368.4 million in the second quarter of 2007, and an increase of 163.4% from RMB153.4 million in the third quarter of 2006. The significant year-over-year increase in online game net revenues was mainly due to the strong performance achieved by ZT Online, especially from our recent expansion pack release in the third quarter of 2007. Although both ACU and PCU had a slight decrease in the third quarter of 2007 as compared to those in the second quarter of 2007 due to the game rule change instituted by us to discourage “gold farming” activities in June of 2007, we believe that the recent expansion pack Zhong Zhi Cheng Cheng (“ZZCC”) released in July has enhanced our player interactivity and loyalty to the game, and helped drive APA and ARPU up by 5.6% and 3.3%, respectively, from the second quarter 2007. In addition, the ZZCC expansion pack has led to improved ACU and PCU during the course of the third quarter 2007.
Cost of Services. Cost of services for the third quarter of 2007 was RMB45.4 million (US$6.1 million), representing a 311.2% increase over the same period last year, and an increase of 17.7%, over the second quarter of 2007. The quarter-over-quarter rise in cost of services was mainly due to a RMB2.8 million increase in co-location and Internet access costs, a RMB1.7 million increase in depreciation of servers and an increase of RMB0.8 million in compensation costs. The increased costs related to these items were a result of the expansion of our business, including the purchase of additional servers to provide better service and performance for current game players and the expansion of our infrastructure capabilities in advance of the launch of both ZT Online expansion packs and Giant Online.
Gross Profit and Gross Margin. Gross profit for the third quarter of 2007 was RMB359.8 million (US$48.0 million), representing a RMB28.2 million sequential increase and a significant RMB217.5 million year-over-year increase. Gross margin for the third quarter of 2007 was 88.8%, down slightly from 92.8% in the third quarter of 2006 and 89.6% in the second quarter 2007. The slight decrease in gross margin was mainly due to increased investment in services, as we further developed infrastructure and technology platforms in anticipation of the launch of both ZT Online expansion packs and Giant Online.
Operating Expenses. Total operating expenses for the third quarter of 2007 were RMB70.2 million (US$9.4 million), representing an increase of 3.3% from RMB67.9 million in the second quarter of 2007, and an increase of 152.6% from RMB27.8 million in the third quarter of 2006. The sequential increase in operating expenses is mainly attributable to the rise in research and product development and sales and marketing expenses, while the year-over-year increase in operating expenses was primarily a result of continuous investment to accelerate our business expansion.
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Research and product development expenses were RMB7.2 million (US$1.0 million), an increase of 118.9% from RMB3.3 million in the previous quarter, and up 141.8% from RMB3.0 million in the third quarter of 2006. The increased expenses resulted from the hiring of additional senior game architects and engineers in an effort to further strengthen R&D capabilities, enrich our game designs and drive the launch of expansion packs for ZT Online and Giant Online.
Sales and marketing expenses increased to RMB59.6 million (US$8.0 million) for the third quarter 2007, up 34.3% from RMB44.4 million in the previous quarter and up 169.9% from RMB22.1million in the third quarter of 2006. We have significantly expanded our liaison personnel from 1,300 as of June 30, 2007 to 2,500 as of October 1, 2007, in order to accelerate our marketing campaigns aimed at increasing penetration in China’s medium and small cities. We have also added 220 liaison offices during the third quarter, bringing the total number of our liaison offices to be over 470 as of September 30, 2007, and increased our advertising initiatives to support our sales and marketing efforts in these cities.
General and administrative expenses were RMB20.1 million (US$2.7 million) in the third quarter of 2007, representing a sequential decrease of 0.6% from RMB20.2 million. The relative stability of general and administrative expenses quarter-over-quarter is mainly attributable to our ongoing efforts to optimize operational and cost efficiency.
Income Tax Expense. There was no income tax expense to report in the third quarter of 2007 due to the current tax holiday we are experiencing.
Net Income. Net income for the third quarter of 2007 was RMB290.2 million (US$38.7 million), a year-over-year increase of 152.6% from RMB114.9 million, a quarter-over-quarter increase of 9.8% from RMB264.2 million. Net income margin was up slightly to 71.6% for the third quarter of 2007, as compared to 71.4% in the preceding quarter and 74.9% in the third quarter of 2006.
Cash and Cash Equivalents. Cash and cash equivalents as of September 30, 2007 grew to RMB1,170 million (US$156.1 million) from RMB98.9 million as of June 30, 2007. This increase was mainly due to the receipt of RMB900.0 million from Jiante, a related party of the Company, as payment for advances provided by Giant earlier in 2007.
Advance from Distributors. Advance from distributors increased by RMB55.2 million from RMB63.4 million as of June 30, 2007 to RMB118.6 million (US$15.8 million) as of September 30, 2007, which was mainly due to the increase in sales of prepaid game cards at the end of September 2007. Since the first week of October was Chinese National Holiday and there was no sale of prepaid game cards in that week, all the cards were sold just before the National Holiday.
Currency Convenience Translation
Amounts in US$ are presented for the convenience of the reader and are translated at the noon buying rate of US$1.00 to RMB7.4928 on September 28, 2007 in the City of New York for cable transfers of RMB as certified for customs purposes by the Federal Reserve Bank of New York. No representation is made that the RMB amounts could have been, or could be, converted into US$ at such rate.
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Business Highlights and Outlook
ZT Online—The latest expansion pack, Zhong Zhi Cheng Cheng (“ZZCC”) for ZT Online, was released in July 2007 and has been well received by the players. We believe that this pack has greatly improved the community features of ZT Online by further enhancing the interactivity amongst players through development and expansion of collaborative and combative features in the game. It further enhances the retention of players and player loyalty to the game.
With unwavering commitment to game play, we continue to develop new enhancements and features to deliver a better gaming experience. Another expansion pack of ZT Online is expected to be released in the fourth quarter of 2007, and beta testing of it is already in progress. The new version includes innovations in online game design to further enhance the geographical and dimensional interactive experience for players. Also, the ZT Online PTP version is aimed at deepening our penetration into other uncaptured niche segment and public beta testing has been in process since September.
Giant Online— Engineering testing, internal tests and closed beta testing for this highly anticipated game were successfully completed by the end of August. The dual version beta test commenced in September with over 100,000 daily registered volunteer participants and concurrent user of 30,000 as of the end of the third quarter of 2007. Giant Online has already been commercially launched in the fourth quarter of 2007 and we anticipate to start ramping up users by the first quarter of 2008.
King of Kings III—Developments to launch King of Kings III, which Giant acquired from a Taiwan-based company, continues to remain on schedule and will soon enter into the internal testing phase.
Initial Public Offering—On November 1, 2007, Giant Interactive Group successfully listed on the New York Stock Exchange in an initial public offering of 57,197,423 shares and a new issuance of 1,612,903 shares to a third-party cornerstone investor. After inclusion of an additional 8,579,613 ADSs, representing the over-allotment shares, the total offering size was approximately US$1.04 billion.
Fourth Quarter Guidance— Based on the current outlook, Giant expects to generate total net revenues for the fourth quarter in the range of RMB425 million to RMB430 million.
Who's Minding the Minders of Chinese Accounting?
By LESLIE P. NORTON
INVESTORS WHO BUY THE U.S.-listed shares of small Chinese companies depend on financial auditors to offer independent and expert oversight of their corporate statements. These investors also rely on the Public Company Accounting Oversight Board (PCAOB), the quasi-government agency created by the U.S. to supervise the country's auditors after the Enron and other accounting scandals that occurred early this decade.
Yet red flags from this hot, fast-growing slice of the stock market often seem to go unmentioned by U.S. auditors and regulators.
We previously raised the issue of auditor independence in a story about American Dairy (ticker: ADY), a Chinese milk-powder company that jolted shareholders in December by saying it had dismissed its independent accounting firm, withdrawn its 2007 revenue and profit guidance, and was the subject of an informal Securities & Exchange Commission probe ("Curdled Expectations," Dec. 17, 2007). American Dairy's independent U.S. accountant, Murrell Hall McIntosh, was working with a Hong Kong auditor, Henny Wee, who, it turned out, was a principal in Belmont Capital Group, a firm that provided capital-raising and consulting services to American Dairy before its public listing. The SEC is investigating whether Wee was truly independent. After our story, the company's shares collapsed and ADY since has hired Grant Thornton as its independent auditor.
[stockhats]
Auditors and regulators aren't doing all they should to protect investors from problems at U.S.-listed Chinese companies.
But American Dairy is just one of 170 small Chinese companies that have come public in the U.S. since 2000 via a "reverse merger." In these transactions a privately held Chinese company hooks up with a shell company that has a U.S. listing. This way the Chinese outfit avoids much of the time, expense and regulatory scrutiny that comes with a traditional initial public offering.
The same U.S. auditor, Murrell Hall, was also working with Wee when he introduced OraLabs, a shell company, to Belmont, which then introduced it to China Precision Steel (CPSL). The meetings, described in proxy filings, took place in December 2005 -- long after the date Wee told the SEC he ended his business ties with Belmont. Belmont signed a consulting agreement with China Precision, and was paid with shares ultimately representing 11% of the company.
This pattern "shares many similarities" with the relationship among American Dairy, Murrell Hall, Wee and Belmont, says Todd Fernandez, senior research analyst at proxy-research firm Glass Lewis, and "raises serious questions about auditor independence." Wee and Murrell Hall didn't respond to requests for comment. Tracy Hung Wan, CEO of Belmont, referred Barron's to proxy filings with the SEC. The SEC and China Precision wouldn't comment.
There are many reasons accounting problems seem rife in Chinese companies. Kenneth Banet, the partner overseeing Grant Thornton's China practice, explains that Chinese reporting is tax-oriented, and companies don't report sales until customers pay their bills because sales tax is due immediately on receivables. Companies frequently underreport sales and profit to avoid being on the hook for taxes they haven't received. They also often borrow from related-party companies without repaying. (These related parties are common in China because laws limit the kinds of businesses single companies may conduct.) But to list in the U.S., a company must bring its numbers into compliance with U.S. accounting principles and correct any misreporting before an independent auditor signs off on the statements.
Audits of Chinese reverse mergers are even more complicated. For one thing, the Chinese partners usually are opaque, with ownership structured through British Virgin Islands holding companies. The SEC doesn't scrutinize reverse mergers, until the new company raises funds. As a result, investors depend heavily on those in a position of oversight -- such as auditors.
The way advisers are paid in reverse mergers can pose conflicts for supposedly independent auditors. Peter Humphrey, founder of Beijing-based ChinaWhys, which helps multinationals investigate potential fraud in their Asian operations, says that consultants helping Chinese entities list through a reverse merger are often compensated with up to 15% of the stock of the new public company. "The auditors, who are paid by the lead consultants, at least indirectly become stakeholders. In some cases they may even receive actual shares," Humphrey says.
In China, U.S. auditors frequently use contractors to review corporate financials, which also can cause problems. The PCAOB periodically inspects auditors. Mark West, the board's regional associate director, says "inspection teams [have] reported several deficiencies regarding the use of other auditors, including firms reporting on the financial statements as principal auditor when their participation was not sufficient to enable them to serve in that capacity."
All of these shortcomings can lead to more restatements. Puda Coal (PUDC), for instance, said it "mistakenly" overstated 2007 revenue guidance by 34% and net income guidance by 59%, but didn't realize it for more than six months. And China BAK Battery's shares have lost more than half their value after it restated three years of financials in 2006.
The PCAOB's database can help identify problems. One auditor of Chinese companies like China Clean Energy (CCGY) and China Kangtai Cactus Biotech (CKGT) is Michael T. Studer of Freeport, N.Y. In 2006, during an inspection, the PCAOB found "deficiencies of such significance that it appeared...the Firm (Studer) did not obtain sufficient competent evidential matter to support its opinion on the issuer's financial statements." Moreover, in 2004, the National Association of Securities Dealers expelled Studer's firm and barred him from association with any securities firm.
A spokesman for Studer said the firm "will of course comply with any directives" from the PCAOB. He added the NASD bar did not involve any accounting or auditing matters and is on appeal in federal court.
The Bottom Line:
Beware of Chinese companies coming public in the U.S. via reverse mergers. Their accounting can be murky, financial restatements are rising and conflicts of interest abound.
Sky One Medical (CSKI) and China Education Alliance (CEUA) hired auditors at Sherb & Co., in Boca Raton, Fla. PCAOB's database has a June 2007 entry reporting "deficiencies" in an inspection of Sherb. The auditor's registration file also includes a letter in which Sherb asks the PCAOB not to deny its registration based on a pending securities class-action lawsuit that accused Sherb of signing off on alleged revenue fabrication by a Boca Raton-based financial-services company.
Christopher Valleau, who runs Sherb's China practice, says the PCAOB inspection found a single audit deficiency that didn't pertain to a Chinese client, and that it "is not uncommon or unusual for any quality firm that audits public companies to have at least one comment from PCAOB staff." Sherb has made partners more responsible for any problems, he says, and improved education. The class-action suit, he adds, was settled "without any finding of fault against our firm" and never went to trial.
As for Murrell Hall's recent decision to stop auditing Chinese reverse mergers, Valleau say it's a non-event. "If Ernst & Young left, it would impact the landscape. But not Murrell Hall, and not us. There are plenty of firms out there doing what we do."
i would wait for the weekly to start looking better... jmo
FXP.. looks like it's almost time to pick up shares. Because.. FXI.. resistance at $154 and it's almost there now.
any time... u2
Thanks MT. Have a good one bud.
FXP, the ProShares UltraShort FTSE/Xinhua China 25
But, I doubt you'll see much in a chart, its experience in knowing how the market goes.
Pull up WNRC too. No chartist saw it coming back off its lows and its doing a slow and steady march back up.
Do you know of any Ulta short China etf's? We can get mtcinco to give us a annotated chart. TIA
Wonder what happens when China continues to build capacity at a faster rate then their consumer base (U.S. Included) grows. I also wonder what happens when the U.S. dollar falls so low that all of the sudden Chinese goods become regular price (i.e. expensive). I also wonder what happens when China starts imposing safety and quality regulations (as they have) to make exporting from China more difficult.
China will no doubt be around and a major world player for many years to come, but... expecting the bottom to fall out. Especially as the U.S. Economy is going to get slapped in the next 1-3 months.
7:33AM China Fire & Sec Grp reports Q4, issues Y08 guidance (CFSG) 11.88 : Co reports Q4 revs of $13.7 mln vs $12.4 mln consensus; co sees pro forma net income of approx $4.0 mln. Co sees Y08 EPS of at least $0.78 vs $0.76 consensus; co sees revs of at least $66.6 mln vs $63.4 mln consensus, with net income of at least $22.3 mln. "China Fire & Security's core business serving the Chinese iron and steel industry remains very strong. We do not anticipate any impact from a downturn in the United States economy; our customers are building capacity and upgrading existing plants to meet domestic demand. In addition, we are expanding into other sectors including transportation and nuclear power plants. The Company is also signing agreements with distributors in India to sell our LHD as well as our fire extinguishing products and systems."
About the 10th time I've heard about that stock. Definitely a good PR plan in place or just a lot of buzz. We'll see.
Looking forward to the Market downturn in 30-60 days. Be prepared.
CHRI.OB - All the Right Ingredients per Actionstocks:
If one was to ask the average man in the street where he thought he’d get the best investment returns, almost invariably he’d say “China” and for good reason. For the past 12 years, China’s been growing at a rate above 6%, and in the past 4 years alone , it’s been closer to 12%.Compared to the rather dismal growth rate the US economy has been experiencing, it makes a lot of sense to consider the Chinese alternative.
But history is full of good intentioned ideas that shipwrecked on the way to glory. China is certainly no different. Just because a company is based in China, or has a China based market, or creates and produces in China, it doesn’t necessarily mean that company is going to be a success. History unfortunately, is full of Chinese companies that met the same rocky reef and sank. So then, what makes the difference between a company that makes US Analysts warm and fuzzy, yet crashes on the rocks, versus the Chinese company that succeeds and grows? It’s the culture acceptance.
China is a country wrapped in thousands of years of culture, and what plays well in the US or Europe, may not necessarily play so well there. Attitudes and culture form the basis for homegrown demand in China. So it goes without saying, that the single best idea one could possibly launch is a company that appeals to the wants and desires of Chinese culture, but also finds a niche on the global stage. Satisfy these two situations, and you’ve dialed in the basic ingredients for a very successful company.
China Health Resource Inc has done just that, and could very well be a tremendous investing opportunity. First, let’s discuss who they are, and what they bring to the table. Through its subsidiary, Suining Yinfa DAR Industrial Co., Ltd, China Health Resource, Inc. (CHRI) is committed to developing traditional Chinese herbal medicine and produces, processes and sells one of the major Chinese herbs, Dahurian Angelica Root. This herb is widely used by many to alleviate pain, high blood pressure, cancer and many other illnesses.
At first blush one might think that this is nothing to get very excited about, I mean we’re talking about some “herbal medicine”. But you’d be sadly mistaken. Herbal medicine has been part of the Chinese culture for thousands of years and the standard Chinese apothecary is brimming with traditional herbal cures. So ingrained in the history of China is the natural approach to healing, that its modern medicines that have to fight for “shelf space”.
So, if we look at CHRI as a well accepted Chinese company, we are already in the driver seat. But, what about the rest of the world? This is where CHRI is going to deliver the “two” in the classic “one/two” punch. A movement has been going on for some 30 plus years in the developed countries to explore the more natural homeopathic and herbal approach to curing illness, and the statistics are quite stunning. In the US, where the FDA, and AMA blanket the airwaves with the most modern of medical drug allure, herbal medicine is growing at a brisk 20%+ per annum, and in Europe, where a more natural approach to such things is, well, more natural to them, the growth rate exceeds 30%. Combined, the total dollars spent on herbal related medicines is north of 25 billion dollars per year, and growing at those incredible rates we mentioned.
It’s always been my approach that when dissecting a business to determine if it warrants a closer look, one of the most basic necessities is that there is demand and growth. The natural medicine segment of the healthcare market certainly delivers on that, and with China Health Resource we reap the benefits of the acceptance of the Chinese marketplace. This is paramount, and what will indeed separate the winners from the wannabee’s. When you look at the one billion plus possible consumers in China, the single most important question you can ask is, “will the Chinese buy it”. With herbal medicine, the answer’s already been carved in historical stone. Yes indeed they will.
There is a litany of topics that make China Health an interesting company, and we’ve only discussed one of them here. We’ve settled the “is there any demand” question quite remarkably. We haven’t even touched on their bellwether product called DAR or Dahurian Angelica Root. It is widely accepted that when boiled, and applied in various forms DAR has been shown to cure the common cold, headache, toothache and stomach-ache and is used also used in pain, high blood pressure, and even cancer treatments. We also haven’t touched on the recent blockbuster news that they have received what one could consider the equivalent to a Chinese FDA approval for manufacture and distribution of this popular medicine.
China Health Resource has a lot potential, and we’ve only addressed one avenue of it here. It’s our opinion that you should pull up a chair and take a few minutes to get acquainted with CHRI, it might be one of the best friendships you make in your investing career.
CHART PLAY AND HOT SECTORS
I would say it was a good day for China:
CHL 76.28 +0.78
EDU 53.80 +0.50
* YGE 23.90 +3.15
* STV 22.61 +0.39
* CSR 15.85 +0.91
* NCTY 18.00 +1.25
NTES 17.57 +0.42
FSIN 20.04 +0.46
JRJC 15.58 +0.30
* SDTH 14.27 +0.35
XIN 13.19 +0.19
* SCR 11.35 +0.14
GA 10.75 +0.03
CFSG 11.45 +0.84
* CHBT.OB 12.00 -0.05
WATG 9.38 +0.15
* ASIA 9.28 +0.64
AAAC.OB 7.90 +0.02
* ADY 10.61 +0.81
TCM 7.9999 +0.0199
GSI 8.15 -0.16
VIT 6.31 +0.04
RCH 6.75 -0.15
HLSYF.OB 8.05 +0.05
WH 7.5500 +0.0700
GRRF 7.38 +0.11
* NED 6.5600 +0.0700
CAAS 6.21 +0.07
KUN 5.5399 +0.0599
* VISN 8.41 +0.81
LONG 8.27 +0.23
FUQI 9.86 +0.01
* CHNG.OB 6.80 +0.05
* CDS 6.63 +0.03
CTDC 5.80 +0.39
* XFML 4.79 +0.21
* GLUU 5.55 +0.24
* CEUA.OB 3.61 +0.26
SVA 4.01 -0.04
CPSL 5.16 +0.05
* CHCG.OB 2.45 -0.25
CHGS.OB 3.00 -0.05
ACTS 3.75 +0.18
HRAY 3.40 +0.06
* IMM 2.2100 -0.0400
CBEH.OB 4.50 0.00
CIWT.OB 2.30 +0.10
CPHI.OB 2.90 -0.04
GFRE.OB 2.58 +0.05
CCGY.OB 1.75 -0.01
AIDA.OB 1.25 0.00
CKGT.OB 0.898 0.000
CHRN.OB 1.01 0.00
Accumulate some APWR and TITN if u like China plays. Both are ready for breakouts
CHRI.OB Share Price Explodes 63.93% After Releasing News
After announcing that Mr. Jia Minru, a physician and professor of the Chinese Medicine University, joined their team, China Resources’ (CHRI.OB) share price immediately sky rocketed and is currently trading at $.17, 63.93% higher than yesterday’s close.
Mr. Jia Minru will be responsible for deep development, high-tech development, and systematic research of deep processed products of Chuan DAR GAP. He brings 40+ years of research experience in medicine and herb resource development to the company. Previously he was the advisor of the Chinese Medicine Academy, the dean of Chinese Medicine University, the deputy dean of Chinese Medicine Association, director of Chinese Medicine and Herb Committee, and a member of Sichuan New Medicine Assessment Center.
We announced that the Company was a “One to Watch” last week before the recent explosion in volume and price increase. China Health Resources is a leading industrialized agricultural corporation focused on the production and processing of dahurian angelica root, a widely used herb in China known to be a vital ingredient in Chinese medicine.
Red Storm Still Rising
China’s economic expansion has been on the march for so long it actually took Mother Nature herself to cool it down a bit. The worst snowstorms in 50 years have analysts predicting that the economy will slow just enough to for the government to ease macroeconomic controls to stem inflationary concerns. If recent history is any indicator it is likely for the rapid growth to return. Downturns caused by national calamities such as the SARS outbreak have been shrugged off by the economy as it has continued to post double digit GDP growth. Though there are valid concerns that the economy is under an unsustainable growth rate, economists agree that it is likely for the economy to continue to grow at a blistering rate, just maybe not quite as fast-paced as a few years ago.
Many analysts are predicting that the economic impact of the snowstorm will be marginal at best, and will in fact just spur future growth. Glaring vulnerabilities in the power grid and transportation system are likely to be targets of investment as the government works to prevent the type of stoppage that happened with the storm. The losses in industrial production are expected at 2%, mainly due to the transportation gridlock that occurred. This is expected to be offset by further growth later in the year. A possible concern for government regulators is the likelihood of food prices spiking, thereby increasing inflationary concerns. World Bank economists are in agreement that like the industrial output loss, a surge in food prices will be short-lived.
Overview
The economy of China is the second largest in the world after the United States when compared on a Purchase Power Parity basis. If compared on a nominal GDP basis the economy is the fourth largest in the world coming in behind the United States, Japan, and Germany respectively. China has been the fastest growing economy for a quarter century posting double digit GDP gains throughout that time period. Poverty has been reduced drastically due to per capita income increasing at an annual rate of 8% for the past three decades. In the past 25 years nearly 400 million people in the country have been lifted out of the extreme poverty levels, with less than 5% still subsisting on less than $1 a day. A consequence of this rapid growth has been the rising income inequalities, leading to the IMF classification of personal income as low.
China’s government has emphasized raising personal income and consumption and introducing new management systems to help increase productivity. The government has also focused on foreign trade as a major catalyst for economic growth. The restructuring of the economy and resulting productivity gains have contributed the rapid growth GDP growth experienced by China since 1978. Some economists believe that Chinese economic growth has been in fact understated during much of the 1990s and early 2000s, failing to fully factor in the growth driven by the private sector and that the extent at which China is dependent on exports is exaggerated. China’s rapid growth is not without systemic problems and key bottlenecks continue to constrain growth. Available energy is insufficient to run at fully-installed industrial capacity, the transport system is inadequate to move sufficient quantities of such critical items as coal, and the communications system cannot yet fully meet the needs of an economy of China's size and complexity.
2007 Economic Statistics (Compiled Chinese Economic Statistics)
According to preliminary estimation, the gross domestic product (GDP) for the year was 24,661.9 billion Yuan, up by 11.4 percent, or 0.3 percentage point higher than that in the previous year, representing a fifth successive year of over 10 percent growth.
In 2007, the total output of grain reached 501.50 million tons, an increase of 3.5 million tons over the previous year, up by 0.7 percent. It was the fourth year of high production in the history, or the four consecutive years of increase for the first time since 1985.
In 2007, the value added of the industrial enterprises above the designated size was up by 18.5 percent (up by 17.4 percent in December), or 1.9 percentage points higher.
In 2007, the total investment in fixed assets reached 13,723.9 billion Yuan, a year-on-year growth of 24.8 percent, with an increase of 0.9 percentage points over the previous year.
In 2007, the per capita disposable income of urban population was 13,786 Yuan, a growth of 17.2 percent, or a real growth of 12.2 percent, which was 1.8 percentage points higher over that in the previous year.
Small Cap Investor Outlook
The outlook for Chinese investments is on the whole positive. There may yet be hiccups that have not completely filtered through the market, such as a possible US recession affecting Chinese exports, or a slowdown in consumer spending. Companies like China America Holdings (OTCBB: CAAH) are uniquely positioned in the market thanks to its holdings in both the United States and China. China America takes advantage of multiple facets of the Chinese economy including manufacturing and technology. Its Big Tree Toy subsidiary expects $2 million in orders from Groupe Casino in 2008 alone. CAAH also has its Sense technologies subsidiary which focuses on security applications like explosive sensors and biometrics. These products have far reaching applications in both the private sector and in government industries within China as well as the United States.
Overall, continued growth is forecasted by most analysts. Rebuilding and investment is expected to increase as China recovers from the snowstorm. This event laid bare glaring holes within China’s infrastructure, and the Chinese government has promised to institute multiple projects to offset future problems caused by weather related events. This investment will only spur the economy along on its unparalleled growth track.
you make money on cjgh and if you do that is great but kimchi reading chart now and see sar line as possible oportunity to break upside with eccellent news.
Here's one for this New Year....CJGH up on this mornings news!
Looking for a potential order from China for the 2008 Olympics for WENR's airship surveillance business. Trading under the symbol WNRC.pk
GLUU up 12% after hours with their 4th quarter #'s.
http://biz.yahoo.com/bw/080211/20080211006438.html?.v=1
Dolt. Ni Hao is Mandarin (Chinese) for Hello, how are you?
Going to China soon. Tied in with several Chinese companies. Look for further devaluation of the US dollar, making the US debt worthless, then look for the dismantling of the Chinese Yuan just like we did to the Japanese Yen in the 1990s.
Since Mattel its much harder to get certificates to export from China, the next market is Bangkok/Thailand and Phillipines...quality is much better than China, though a little more expensive, however not expecting Thailand's overall market to explode like China's did. Making it the true Asian Gem.
cheers!! or something like that...
Happy Chinese New Year all!
Gung Hey Fat Choy!
thx! 2.50 coming soon jmo...
<VBG> (nice one with AYSI)
I watched all the guys on the VMC board talking about it under a dollar, and never really looked into it. LOL.
We don't speak Spanish on this board. <VBG>
Ni hao.
Stock market Hen Gui. Bu hao.
Hen hao stock picks Mashang.
It was up a bit yesterday with the news I believe. I don't follow the stock that much. I just post news when I read, and find it to be something worth looking at....
How come its dropping on news? Maybe not wat the stree wants to hear?
China Shenghuo to Market 12Ways(R) Skin Care Products in the U.S. through Agreement with Home Shopping Group
Thursday February 7, 8:00 am ET
KUNMING, China, Feb. 7 /Xinhua-PRNewswire/ -- China Shenghuo Pharmaceutical Holdings, Inc. ("China Shenghuo," "the Company") (Amex: KUN - News), which is engaged in the research, development, manufacture, and marketing of pharmaceutical, nutritional supplement and cosmetic products in the People's Republic of China ("PRC"), today announced it will begin selling its 12Ways® Skin Care products in the United States during the first quarter of 2008.
Under a non-exclusive agreement signed with cable television and online retailer Home Shopping Group ("HSG"), China Shenghuo will launch a multi- channel marketing campaign to promote 12Ways beauty products via HSG's Web site, e-mail distribution and television commercials.
The inaugural U.S. campaign is designed to introduce five of the best- selling 12Ways products to the U.S. market, and there is potential for future sales expansion if the campaign is successful. The products will be sold as a skin care kit including moisturizer, toner, skin care mask, lotion and capsule taken to improve internal health.
"We are very pleased to partner with HSG to sell 12Ways, marking our entry into the U.S. market," said Mr. Gui Hua Lan, China Shenghuo's Chairman and Chief Executive Officer. "12Ways is a safe, natural cosmetics series derived from traditional Chinese medicine and therapy that has a long history in China. From China to the West, we believe 12Ways will be well received by the U.S. market and appeal to increasingly health-conscious consumers."
"We are excited to welcome 12Ways Skin Care into the Home Shopping Group family," said Vanessa Gomez, a senior buyer for Home Shopping Group. "These products passed through a substantial approval process, and we believe they will be well received by American consumers deciding to be more proactive about their health in the new year."
About Home Shopping Group
The Home Shopping Group is located in the Arvida Park of Commerce in Boca Raton, Florida. The Home Shopping Group uses a combination of proven marketing methods and innovative new forms of advertising to introduce products to the direct response marketplace.
About China Shenghuo Pharmaceutical Holdings, Inc.
Founded in 1995, China Shenghuo Pharmaceutical Holdings, Inc. ("China Shenghuo" or "the "Company") is a leading specialty pharmaceutical company that focuses on the research, development, production and marketing of Sanchi- based medicinal products. Through its subsidiary, Kunming Shenghuo Pharmaceutical (Group) Co., Ltd. ("Kunming Shenghuo"), it owns thirty-one SFDA (State Food and Drug Association)-approved medicines, including the flagship product Xuesaitong Soft Capsules, which has already been listed in the Insurance Catalogue. At present, China Shenghuo incorporates a sales network of agencies and representatives throughout China, which markets Sanchi-based traditional Chinese medicine to hospitals and drug stores as prescription and OTC drugs primarily for the treatment of cardiovascular, cerebrovascular and peptic ulcer disease. The Company also exports medicinal products to Asian countries such as Indonesia, Russia and Kyrgyzstan. For more information, please visit http://www.shenghuo.com.cn
Safe Harbor Statement Under the Private Securities Litigation Reform Act of 1995: This press release contains certain "forward-looking statements," as defined in the United States Private Securities Litigation Reform Act of 1995, that involve a number of risks and uncertainties. There can be no assurance that such statements will prove to be accurate and the actual results and future events could differ materially from management's current expectations. Such factors include, but are not limited to, the acceptance of 12Ways products in the U.S., the company's reliance on one supplier for Sanchi, ability to develop and market new products, ability to establish and maintain a strong brand, continued maintenance of certificates, permits and licenses required to conduct business in China, protection of company's intellectual property rights, market acceptance of the company's products, changes in the laws of the People's Republic of China that affect the company's operations, the company's ability to obtain all necessary government certifications and/or licenses to open and operate retail specialty counters to offer its cosmetic products and conduct the company's business, cost of complying with current and future governmental regulations and the impact of any changes in the regulations on the company's operations and other factors detailed from time to time in the Company's filings with the United States Securities and Exchange Commission and other regulatory authorities. The company undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.
Contact:
China Shenghuo Pharmaceutical Holdings, Inc.
Ms. Gao Qionghua, CFO
Phone: +86-871-7282608
Email: qionghua_kmsh@163.com
CCG Elite Investor Relations
Crocker Coulson, President
Phone: +1-646-213-1915 (New York)
Email: crocker.coulson@ccgir.com
Not sure if you follow chinese stocks, but if you do, here's CNSJ trades at t.70 fully reporting and BB. News was welcomed by many, thanks and have a good day.
ML
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