CNYD: Q4 Earnings PR :

China Yida Reports Record Fourth Quarter and Fiscal Year 2009 Results 03/23 07:30 AM



FUZHOU, China, March 23 /PRNewswire-Asia-FirstCall/ -- China Yida Holding Company (CNYD:$14.00,00$0.95,007.28%) ("China Yida" or the "Company"), a leading diversified entertainment and media enterprise in China, today announced financial results for the fourth quarter and fiscal year ended December 31, 2009.
(Logo: http://www.newscom.com/cgi-bin/prnh/20091012/CNM039LOGO )

Fourth Quarter 2009 Highlights
-- Total net revenue increased 58.1% to $14.5 million, compared to $9.2
million in the fourth quarter of 2008
-- Net revenue from the tourism business increased 112.5% year over year
to $6.0 million, with a gross margin of 60.2%
-- Net revenue from the media business increased 34.2% year over year to
$8.5 million, with a gross margin of 91.1%
-- Gross profit grew 61.7% to $11.4 million, compared to $7.0 million in
the same period last year
-- Operating income grew 97.9% to $9.6 million, compared to $4.9 million
in the fourth quarter of 2008
-- Net income increased 27.5% to $5.9 million, compared to $4.7 million in
the same period last year
-- Fully diluted EPS was $0.34 per share, compared to $0.27 in the fourth
quarter of 2008
-- Opened Shangping Tulou cluster, part of Hua'An Tulou's World Heritage
tourism destination
-- Listed its common stock on the NASDAQ Capital Market

Full Year 2009 Highlights
-- Total net revenue increased 67.4% to $51.2 million, compared to $30.6
million in 2008
-- Net revenue from the tourism business increased 170.7% year over year
to $20.0 million, with a gross margin of 79.5%
-- Net revenue from the media business increased 35.2% year over year to
$31.5 million, with a gross margin of 79.2%
-- Gross profit grew 77.4% to $40.6 million, compared to $22.9 million in
2008
-- Operating income grew 81.1% to $34.4 million, compared to $19.0 million
in 2008
-- Net income increased 39.4% to $25.5 million, compared to $18.3 million
in 2008
-- Fully diluted EPS was $1.47 per share, compared to $1.27 in 2008
-- Re-opened Hua'An Tulou Cluster including Shangping Tulou
-- Entered into a six-year exclusive agreement with China's Railway Media
Center to create "Journey through China on the Train" infomercial
programs

Dr. Chen Minhua, Chairman and Chief Executive Officer of China Yida (CNYD:$14.00,00$0.95,007.28%) , stated, "We are very pleased to report another quarter of record results, and particularly delighted with the triple-digit year-over-year growth of our tourism business. The strong growth was the combined result of the increase in number of tourist destinations under management, marketing efforts nationwide as well as favorable macro-economic policies, which aim to promote Chinese domestic consumption to reduce reliance on exports. Our advertising business also experienced strong growth this quarter and delivered superior profitability because of higher demand for airtime at FETV. In addition we further expanded the coverage of our 'Journey through China on a Train' infomercial program to 36 rail lines and 738 trains as of the end of 2009. This program is an important part of our strategy to raise awareness about our tourism destinations all over the country."
Fourth Quarter 2009 results
Total net revenue increased by 58.1% to $14.5 million, compared with $9.2 million in the fourth quarter of 2008.
Tourism Business
Net revenue from the tourism business increased 112.5% to $6.0 million, compared with $2.8 million in the fourth quarter of 2008. Cost of revenue from the tourism business, mainly consisting of Chinese business tax at a rate of 5%, tickets profit sharing with local government, and depreciation of fixed assets at tourism destinations, was $2.4 million, up 1552.5% from $0.14 million in the same period of last year. Gross margin from the tourism business was 60.2% for the fourth quarter of 2009, compared to 94.9% a year ago. The year-over-year decrease was because tickets profit sharing and depreciation expenses of the fixed assets at tourism destinations were reclassified from Operating Expenses to Cost of Revenue in the fourth quarter of 2009. These changes were made to more accurately reflect the way in which the segment's results are reported. Certain reclassifications have been made to prior period amounts to conform to the current period presentation.
During the fourth quarter of 2009, the total number of visitors that entered the Great Golden Lake was around 163,000, an increase of 63%, compared with 100,000 in the same period of last year. Revenue from the Great Golden Lake totaled $4.9 million for the fourth quarter of 2009.
During the fourth quarter of 2009, Hua'An Tulou accepted 55,000 visitors, and contributed $1.03 million of revenues to the Company.
Media Business
Net revenue from the media business grew 34.2% to $8.5 million, compared with $6.4 million in the same period of last year. This increase was due to higher demand for airtime at FETV. By the end of 2009, FETV's audience rating was 0.58, compared to 0.56 at the end of 2008 and 0.12 at the end of 2003.
Cost of revenue from the media business, mainly including Chinese business tax at a rate of 8.5%, procurement cost for TV programs and depreciation of media equipment, was $0.8 million, down 64.6% from $2.2 million in the same period of last year. The decrease was mainly because of much lower TV program procurement cost in the fourth quarter of 2009. Gross margin for the media business was 91.1% for the fourth quarter of 2009, compared to 61.1% a year ago.
Gross profit for China Yida (CNYD:$14.00,00$0.95,007.28%) 's consolidated operations was $11.4 million in the fourth quarter of 2009, representing a gross margin of 78.4%, compared to $7.0 million and 76.7 % for the comparable period of 2008.
Total operating expense decreased by 19.0% to $1.8 million in the fourth quarter of 2009, compared with $2.2 million in the fourth quarter of 2008. Selling expenses and G&A expenses for the three months ended December 31, 2009 decreased 2.2% and 31.3% year over year to $0.9 million and $0.9 million respectively. The Company's selling activities and daily operations in the fourth quarter of 2009 were in line with its increased revenues. The year-over-year decrease was because tickets profit sharing and depreciation expenses of the fixed assets at tourism destinations were reclassified from Operating Expenses to Cost of Revenue in the fourth quarter of 2009. These changes were made to more accurately reflect the way in which the segment's results are reported. Certain reclassifications have been made to prior period amounts to conform to the current period presentation.
Operating income increased by 97.9% to $9.6 million, compared with $4.9 million a year ago. Operating margin for the fourth quarter of 2009 was 66.2%, compared with 52.9% for the fourth quarter of 2008.
Net income for the fourth quarter of 2009 was $5.9 million, or $0.34 per diluted share, an increase of 27.5%, compared with a net income of $4.7 million, or $0.27 per diluted share, in the fourth quarter of 2008.
Full Year 2009 Results
Total net revenue increased by 67.4% to $51.2 million, compared with $30.6 million in 2008.
Net revenue from the media business increased by 35.2% to $31.5 million, driven by higher demand for airtime at FETV. Currently, FETV's airtime is sold mainly through 15 advertising agencies, which are long-term partners of China Yida (CNYD:$14.00,00$0.95,007.28%) . The three largest distributors accounted for 20% of FETV's revenue in 2009.
Net revenue from the tourism business increased by 170.7% to $19.7 million, as compared to $7.3 million in 2008. The increase was primarily attributable to higher number of visitors to the Great Golden Lake, which increased from approximately 320,000 in 2008 to approximately 640,000 in 2009, as well as the revenue contributed by Hua'An Tulou, which was reopened in 2009. In 2009, Hua'An Tulou had 95,000 visitors, and contributed over $1.7 million to the Company's total revenue. The Company expects to attract 160,000 visitors in 2010 to this destination.
Gross profit for 2009 increased 77.4% year over year to $40.6 million, with gross margin of 79.3%. Operating income increased 81.1 % year over year to $34.4 million, mainly because of increasing costs of maintenance and promotion for the Great Golden Lake.
Provision for income taxes in 2009 was $8.9 million, representing an effective tax rate of 25.9%, compared to $0.7 million and 3.5% in 2008. The increase of effective tax rate was because the income tax exemption for our advertising operation, the FETV, expired by the end of 2008. The statutory income tax rate for the Company's different business lines was 25% in 2009.
Net income was $25.5 million, or $1.47 per fully diluted share, an increase of 39.4% compared with a net income of $18.3 million, or $1.27 per share, for 2008.
Financial Condition
As of December 31, 2009, the Company reported $5.8 million in cash and cash equivalents. Working capital was $1.6 million with a current ratio of 1.3. The Company also reported $2.5 million in bank loan, which is due in March 2012. As of December 31, 2009, the Company had $77.7 million in shareholders' equity compared to $52.1 million at the end of 2008.
On January 28, 2010, the Company closed a registered direct offering of 2,489,721 common shares at a purchase price of $11.50 per share for aggregate proceeds of approximately $28.6 million. After giving effect to the registered direct offering, the Company will have 19,551,785 shares of common stock outstanding.
China Yida (CNYD:$14.00,00$0.95,007.28%) generated $30.0 million in cash flow from operating activities in 2009 and spent $36.1 million on capital expenditures, which were primarily used for the construction of entertainment facilities at Yunding Park and Hua'An Tulou cluster. The Company expects a residual scheduled payment of $10.0 million in 2010 related to the construction of Yunding Park. Management believes the current cash and operating cash flow will be sufficient to fund the company's ongoing projects and growth strategy.
2010 Outlook and Guidance
In 2010, management expects a moderate organic growth in advertising revenues from FETV. The Company will continue its marketing efforts to expand the coverage of 'Journey through China on a Train' infomercial program all over China. During the first half of 2010 management expect this program to reach 44 rail lines.
On November 25, 2009, China'sState Council approved Guidelines to Accelerate the Development of the Tourism Industry in China, defining it as a strategic pillar of the national economy, which will create a more favorable industry environment for China Yida (CNYD:$14.00,00$0.95,007.28%) .
The Company will also benefit from rapidly growing consumer spending on leisure activities in China as a result of increased disposable income and a growing middle class. With GDP per capita in China currently at US$3,000 growth in tourism is expected to accelerate.
Management believes the Company's tourism business will achieve strong growth in 2010 both at existing and newly opened tourist attractions. The expressway connecting Wuyi Mountain and the Great Golden Lake is expected to be completed and put into use by September 2010, which management believes will bring more tourists to the Great Golden Lake destination. The construction of Yunding Park was affected by too many unexpected rainy days and the management now expects to open it to visitors in the third quarter of 2010.
"Our successful business model, proven management capability and access to capital continue to bring many new opportunities from different provinces in China. We are now carefully evaluating these new projects in order to provide shareholders with the most ideal investment opportunities and hope to be in a position to make an announcement in the near future," Dr. Chen Minhua added.
Conference Call
China Yida (CNYD:$14.00,00$0.95,007.28%) will hold a conference call at 09:00 a.m. Eastern Time on Tuesday, March 23, 2010 to discuss its fourth quarter and fiscal year 2009 results. To participate in the live conference call, please dial the following number five to ten minutes prior to the scheduled conference call time: 866-672-3985. International callers may dial 706-902-4207. The conference ID for this call is 63519136. If you are unable to participate in the call at this time, a replay will be available for two weeks starting on Tuesday, March 23, 2010 at 12:00 p.m. EDT. To access the replay, dial 800-642-1687, international callers may dial 706-645-9291. The Conference Replay pass-code is 63519136.
About China Yida (CNYD:$14.00,00$0.95,007.28%)
China Yida Holding Co. (CNYD:$14.00,00$0.95,007.28%) is a leading diversified entertainment enterprise focused on China's fast-growing media and tourism industries and headquartered in Fuzhou City, Fujian province of China. The Company's media business provides operations management services; including channel, column and advertisement management for television station, presently the Fujian Education Television Station ("FETV", a top-rated provincial education television station), and "Journey through China on the Train" ("CRTV", the only railway on-board media authorized by Ministry of Railways). Additionally, the Company provides tourism management services, and specializes in the investment and development of natural, cultural and historic scenic sites. China Yida (CNYD:$14.00,00$0.95,007.28%) currently operates the Great Golden Lake tourist destination (Global Geopark, including Golden Lake, Shangqing River, Zhuanyuan Rock, Luohan Mountain and Taining Old Town.), Hua'An Tulou tourist destination (World Culture Heritage, including Dadi Tulou cluster and the Shangping Tulou cluster), and China Yunding tourist destination (National Park, including Colorful Rock Valley, Yunding Paradise, Yunding Waterfall, South Heavenly Mountain, and Seven Star Lake). The Company's operating scenic sites are over 300 square kilometers in the area. For further information, please contact the Company directly, or visit its Web site at http://www.yidacn.net .
Forward-Looking Statements
Certain statements in this press release that are not historical facts are "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements may be identified by the use of words such as "anticipate, "believe," "expect," "future," "may," "will," "would," "should," "plan," "projected," "intend," and similar expressions. Such forward-looking statements, involve known and unknown risks, uncertainties and other factors that may cause the actual results, performance or achievements of China Yida Holding Co., Inc. (the "Company") to be materially different from those expressed or implied by such forward-looking statements. The Company's future operating results are dependent upon many factors, including but not limited to: (i) the Company's ability to obtain sufficient capital or a strategic business arrangement; (ii) the Company's ability to build and maintain the management and human resources and infrastructure necessary to support the anticipated growth of its business; (iii) competitive factors and developments beyond the Company's control; and (iv) other risk factors discussed in the Company's periodic filings with the Securities and Exchange Commission, which are available for review at www.sec.gov.

For more information, please contact:

China Yida Holding Company (CNYD:$14.00,00$0.95,007.28%) George Wung CFO
Phone: +1-909-843-6358
Email: ir@yidacn.net

CCG Investor Relations
Crocker Coulson, President
Phone: +1-646-213-1915
Ed Job, CFA
Phone: +86-21-5175-7780
Email: ed.job@ccgir.com

SOURCE China Yida Holding Company (CNYD:$14.00,00$0.95,007.28%)

-Fernando

LPIH Longwei Petroleum Announces Revised Fiscal 2010 and 2011 Guidance

http://www.prnewswire.com/news-releases/longwei-petroleum-announces-revised-fiscal-2010-and-2011-guidance-89916002.html

CCME/CNYD - Comparative Valuation.

Here is a valuation comparison between CCME and CNYD. They are both in a similar industry, have high margins, are growing earnings at 50%+, and are both very undiscovered. I believe once they are noticed they will garner a similar valuation of 15-20, probably no later than the end of 2010.


1)CCME: 39.5M O/S. Current Market Cap: $460M

2009E Net Income - $42M
2010E Net Income - $83.6M

2009 P/E - 10.95
2010 P/E - 6.51 (including 7M incentive shares)


2)CNYD: 20.4M O/S. Current Market Cap: $227M

2009E Net Income - $27M (my estimate)
2009E Net Income - $42M (my estimate)

2009 P/E - 8.4
2010 P/E - 5.04


Potential gain using 2010 numbers and 15-20 P/E:

1) CCME $1.80 eps*: $27 to $36
Potential gain: 131% to 208%
*Includes 7M incentive shares
Future Market Cap: $1.26B to $1.67B

2) CNYD $2.20 eps: $33 to $44
Potential gain: 196% to 295%
Future Market Cap: $673M to $898M


Notes:

1) CNYD's projections are based on my personal calculations, but I consider them to be of a conservative nature. I believe revenue from Yunding Park in 2010 will be much higher than what I used. The summary below explains my reasoning for reaching $42M Net Income for 2010.

2) CCME's projections include the 7M incentive shares because that dilution will occur if the $83.6M is hit, even though the extra shares will not show up until 2011. Actual results will look better at year-end then what I have used, but investors will most likely have priced in the dilution so I included it here.


CNYD Summary:
http://investorshub.advfn.com/boards/read_msg.aspx?message_id=46161683

CCME Summary:
http://investorshub.advfn.com/boards/read_msg.aspx?message_id=46374933


-Adam

CNYD: Listened to the Q4 2009 CC:

1)Toulou going to around 160k+ visitors in 2010 (Add another 3.5M revenue to 2009 numbers since we did 50k in 2009 and 1.7M ish rev)....
2) Yunding 50M RMB 2010 expectation ($7.3M revenue)
3) Train segment did 1.6M revenue in 2009 and they expect 3.5x to 5x in 2010. So assume 4x or an additional 4.5M revenue in 2010.

3.5 + 7.3 + 4.5 = 15.3M revenue added from that alone in 2010.

Total 2009 revenue was 51.2M. The above brings us to 66.5M or 30% revenue growth.

This is not including ANY growth from the FE-TV segment (31.5M in 2009, will grow at least 10% or 3.15M more revenue)...Or ANY growth from the Golden Lake (18.5M revenue in 2009, should grow at LEAST 35% in 2010 or 6.5M)

If you tack that expected growth on as well, that means another 9.65M revenue more or 76.15M revenue expected for 2010.

76.15M would mean = 49% revenue growth... And this is with a conservative 10% growth for FE-TV and 35% for Golden-Lake.

Shrug. This means big EPS growth, which is why I am holding my shares.

Note: This does not include any possible acquisitions from the latest financing deal.

Anyone disagree with anything?

-Fernando

CCLTF/CCLWF - $3.46 EPS 2009 ($26.2M Net Income)

Net revenue was (US$ 128.7 million), an increase of 13.3% from 2008.

Gross profit was (US$ 43.5 million), an increase of 22.3% from 2008.

Gross profit margin was 33.8%, compared to 31.3% in 2008. Gross margin was 36% in Q4/2009.

Non-GAAP profit before tax excluding the merger costs incurred in Success Winner Limited's reverse recapitalization was RMB 238.6 million (US$ 34.9 million), up 26.2% from RMB 189.1 million in 2008;

Non-GAAP net profit excluding the merger costs incurred in Success Winner Limited's reverse recapitalization was RMB 179.3 million (US$ 26.2 million), up 8.6% from RMB 165.0 million in 2008

Earnings per fully diluted share were RMB 23.65 (US$ 3.46) compared to RMB 28.73 (US$ 4.13) in 2008.

Tiles: 'the average selling price per square meter increased by 5.5% in the fourth quarter of 2009 compared with the same period in 2008.'

Cash and bank balances(as of Dec 31st/2009)were RMB 150.1 million (US$ 22.0 million), compared with RMB 162.3 million (US$ 23.7 million) as of September 30, 2009. The decrease in cash and bank balances was a compound result of RMB 81.4 million (US$ 11.9 million) of cash provided by the reverse recapitalization transaction with China Holdings Acquisition Corp., offset by the partial payment of RMB 145 million (US$ 21.2 million) in the fourth quarter of 2009 for the acquisition of the Gaoan plant.

Bank borrowings have gone down from RMB 34.5 million (US$ 5.0 million) as of September 30, 2009 to RMB 26.5 million (US$ 3.9 million) as of December 31, 2009 due to repayments in the fourth quarter of 2009.

Business Outlook: China Ceramics' nine production lines at the Jinjiang facility and three production lines at the Gaoan facility are all running at full capacity.The current annual production capacity at the Jinjiang facility is 28 million square meters and 10 million square meters at the Gaoan facility. The annual production capacity at the Gaoan facility is expected to reach 42 million square meters by the end of 2011. Mr. Huang added, "Our immediate focus for 2010 is increasing our production capacity to meet growing market demand for our products. We also expect to continue to benefit from the central government's RMB4 trillion stimulus plan and China's continued urbanization." The Company's backlog of orders for delivery in the first quarter was at approximately RMB 242.2 million (US$ 35.5 million), representing a year-over-year revenue growth rate of 35.9% compared to the first quarter of 2009. The expected sales volume is 9.1 million square meters, which would represent a 30.1% year-over-year growth in sales volume from 7.0 million square meters sold in the comparable period of 2009.

"We are pleased to report another strong quarter that exceeds our revenue and net income guidance for the full year," said Mr. Jiadong Huang, Chief Executive Officer of China Ceramics. "Our rapid growth was driven by our ability to increase our production volume to meet continued robust market demand. The majority of our revenues come from the domestic market in China, which we believe will continue to exhibit growth in the quarters ahead."


http://xsltm1.finance.vip.sp2.yahoo.com/news/China-Ceramics-Reports-prnews-3608578805.html?x=0

-Adam

Updated projections for CCLWF using actual 2009 numbers

Share price: $9.00
Shares o/s: 8.9M
Warrant price: $1.46
Warrant strike price: $7.50
Warrants o/s: 15.55M(will raise $116.5M when converted)

The projections include the cash and use 25.7M o/s(includes the warrants) and are based on announced 2009 numbers:

2009 Net Income = $26.20M($1.02 eps using 25.7M o/s)
$9.00(share price) - $4.57(cash) = $4.43 adjusted share price.
$4.43/$1.02(Expected 2010 eps) = PE of 4.34

Projections(using 2009 eps of $1.02):

PE of 5 = $9.67(intrinsic value of warrants = $2.17)
PE of 6 = $10.69(intrinsic value of warrants = $3.19)
PE of 7 = $11.71(intrinsic value of warrants = $4.21)
PE of 8 = $12.73(intrinsic value of warrants = $5.23)
PE of 9.5 = $14.25(intrinsic value of warrants = $6.75)

Warrant potential:

Share price of $11 = $3.50(140% upside)
Share price of $12 = $4.50(208% upside)
Share price of $13 = $5.50(277% upside)
Share price of $14.25 = $6.75(362% upside)


Summary:
Using the cash method for the warrants it only requires a trailing PE of 9.5(which brings the o/s to 25.7M) to make it to the $14.25 redemption price for the warrants. It currently has a PE of 4.34 on a trailing 2009 basis.


-Adam

Updated projections for CCLWF using actual 2009 numbers

Share price: $9.00
Shares o/s: 8.9M
Warrant price: $1.46
Warrant strike price: $7.50
Warrants o/s: 15.55M(will raise $116.5M when converted)

The projections include the cash and use 25.7M o/s(includes the warrants) and are based on announced 2009 numbers:

2009 Net Income = $26.20M($1.02 eps using 25.7M o/s)
$9.00(share price) - $4.57(cash) = $4.43 adjusted share price.
$4.43/$1.02(Expected 2010 eps) = PE of 4.34

Projections(using 2009 eps of $1.02):

PE of 5 = $9.67(intrinsic value of warrants = $2.17)
PE of 6 = $10.69(intrinsic value of warrants = $3.19)
PE of 7 = $11.71(intrinsic value of warrants = $4.21)
PE of 8 = $12.73(intrinsic value of warrants = $5.23)
PE of 9.5 = $14.25(intrinsic value of warrants = $6.75)

Warrant potential:

Share price of $11 = $3.50(140% upside)
Share price of $12 = $4.50(208% upside)
Share price of $13 = $5.50(277% upside)
Share price of $14.25 = $6.75(362% upside)


Summary:
Using the cash method for the warrants it only requires a trailing PE of 9.5(which brings the o/s to 25.7M) to make it to the $14.25 redemption price for the warrants. It currently has a PE of 4.34 on a trailing 2009 basis.


-Adam

Updated projections for CCLWF using actual 2009 numbers

Share price: $9.00
Shares o/s: 8.9M
Warrant price: $1.46
Warrant strike price: $7.50
Warrants o/s: 15.55M(will raise $116.5M when converted)

The projections include the cash and use 25.7M o/s(includes the warrants) and are based on announced 2009 numbers:

2009 Net Income = $26.20M($1.02 eps using 25.7M o/s)
$9.00(share price) - $4.57(cash) = $4.43 adjusted share price.
$4.43/$1.02(Expected 2010 eps) = PE of 4.34

Projections(using 2009 eps of $1.02):

PE of 5 = $9.67(intrinsic value of warrants = $2.17)
PE of 6 = $10.69(intrinsic value of warrants = $3.19)
PE of 7 = $11.71(intrinsic value of warrants = $4.21)
PE of 8 = $12.73(intrinsic value of warrants = $5.23)
PE of 9.5 = $14.25(intrinsic value of warrants = $6.75)

Warrant potential:

Share price of $11 = $3.50(140% upside)
Share price of $12 = $4.50(208% upside)
Share price of $13 = $5.50(277% upside)
Share price of $14.25 = $6.75(362% upside)


Summary:
Using the cash method for the warrants it only requires a trailing PE of 9.5(which brings the o/s to 25.7M) to make it to the $14.25 redemption price for the warrants. It currently has a PE of 4.34 on a trailing 2009 basis.


-Adam

You are right, but the market will probably use $3.46 eps as their number when doing projections.

I personally will use $2.94 eps(8.9M o/s) but that's just me.

No matter which way you cut it China Ceramics is extremely undervalued at present levels :)

-Adam

2009 EPS $2.94(using current 8.9 O/S)

Even using their current share count of 8.9M it still looks very cheap at 3.1x trailing PE, especially when they are projecting 30% growth going forward.


-Adam

Nothing that really stands out so far. I really like that fact that gross margins are expanding every quarter and were sitting at 36% as of Q4/09, and that the three production lines at the new facility are already being used at full capacity.

They also have appointed two new directors to the board effective April 1st/2010.


-Adam

CCLTF/CCLWF - $3.46 EPS 2009 ($26.2M Net Income)

Net revenue was (US$ 128.7 million), an increase of 13.3% from 2008.

Gross profit was (US$ 43.5 million), an increase of 22.3% from 2008.

Gross profit margin was 33.8%, compared to 31.3% in 2008. Gross margin was 36% in Q4/2009.

Non-GAAP profit before tax excluding the merger costs incurred in Success Winner Limited's reverse recapitalization was RMB 238.6 million (US$ 34.9 million), up 26.2% from RMB 189.1 million in 2008;

Non-GAAP net profit excluding the merger costs incurred in Success Winner Limited's reverse recapitalization was RMB 179.3 million (US$ 26.2 million), up 8.6% from RMB 165.0 million in 2008

Earnings per fully diluted share were RMB 23.65 (US$ 3.46) compared to RMB 28.73 (US$ 4.13) in 2008.

Tiles: 'the average selling price per square meter increased by 5.5% in the fourth quarter of 2009 compared with the same period in 2008.'

Cash and bank balances(as of Dec 31st/2009)were RMB 150.1 million (US$ 22.0 million), compared with RMB 162.3 million (US$ 23.7 million) as of September 30, 2009. The decrease in cash and bank balances was a compound result of RMB 81.4 million (US$ 11.9 million) of cash provided by the reverse recapitalization transaction with China Holdings Acquisition Corp., offset by the partial payment of RMB 145 million (US$ 21.2 million) in the fourth quarter of 2009 for the acquisition of the Gaoan plant.

Bank borrowings have gone down from RMB 34.5 million (US$ 5.0 million) as of September 30, 2009 to RMB 26.5 million (US$ 3.9 million) as of December 31, 2009 due to repayments in the fourth quarter of 2009.

Business Outlook: China Ceramics' nine production lines at the Jinjiang facility and three production lines at the Gaoan facility are all running at full capacity.The current annual production capacity at the Jinjiang facility is 28 million square meters and 10 million square meters at the Gaoan facility. The annual production capacity at the Gaoan facility is expected to reach 42 million square meters by the end of 2011. Mr. Huang added, "Our immediate focus for 2010 is increasing our production capacity to meet growing market demand for our products. We also expect to continue to benefit from the central government's RMB4 trillion stimulus plan and China's continued urbanization." The Company's backlog of orders for delivery in the first quarter was at approximately RMB 242.2 million (US$ 35.5 million), representing a year-over-year revenue growth rate of 35.9% compared to the first quarter of 2009. The expected sales volume is 9.1 million square meters, which would represent a 30.1% year-over-year growth in sales volume from 7.0 million square meters sold in the comparable period of 2009.

"We are pleased to report another strong quarter that exceeds our revenue and net income guidance for the full year," said Mr. Jiadong Huang, Chief Executive Officer of China Ceramics. "Our rapid growth was driven by our ability to increase our production volume to meet continued robust market demand. The majority of our revenues come from the domestic market in China, which we believe will continue to exhibit growth in the quarters ahead."


http://xsltm1.finance.vip.sp2.yahoo.com/news/China-Ceramics-Reports-prnews-3608578805.html?x=0

-Adam

CCLTF/CCLWF - $3.46 EPS 2009 ($26.2M Net Income)

Net revenue was (US$ 128.7 million), an increase of 13.3% from 2008.

Gross profit was (US$ 43.5 million), an increase of 22.3% from 2008.

Gross profit margin was 33.8%, compared to 31.3% in 2008. Gross margin was 36% in Q4/2009.

Non-GAAP profit before tax excluding the merger costs incurred in Success Winner Limited's reverse recapitalization was RMB 238.6 million (US$ 34.9 million), up 26.2% from RMB 189.1 million in 2008;

Non-GAAP net profit excluding the merger costs incurred in Success Winner Limited's reverse recapitalization was RMB 179.3 million (US$ 26.2 million), up 8.6% from RMB 165.0 million in 2008

Earnings per fully diluted share were RMB 23.65 (US$ 3.46) compared to RMB 28.73 (US$ 4.13) in 2008.

Tiles: 'the average selling price per square meter increased by 5.5% in the fourth quarter of 2009 compared with the same period in 2008.'

Cash and bank balances(as of Dec 31st/2009)were RMB 150.1 million (US$ 22.0 million), compared with RMB 162.3 million (US$ 23.7 million) as of September 30, 2009. The decrease in cash and bank balances was a compound result of RMB 81.4 million (US$ 11.9 million) of cash provided by the reverse recapitalization transaction with China Holdings Acquisition Corp., offset by the partial payment of RMB 145 million (US$ 21.2 million) in the fourth quarter of 2009 for the acquisition of the Gaoan plant.

Bank borrowings have gone down from RMB 34.5 million (US$ 5.0 million) as of September 30, 2009 to RMB 26.5 million (US$ 3.9 million) as of December 31, 2009 due to repayments in the fourth quarter of 2009.

Business Outlook: China Ceramics' nine production lines at the Jinjiang facility and three production lines at the Gaoan facility are all running at full capacity.The current annual production capacity at the Jinjiang facility is 28 million square meters and 10 million square meters at the Gaoan facility. The annual production capacity at the Gaoan facility is expected to reach 42 million square meters by the end of 2011. Mr. Huang added, "Our immediate focus for 2010 is increasing our production capacity to meet growing market demand for our products. We also expect to continue to benefit from the central government's RMB4 trillion stimulus plan and China's continued urbanization." The Company's backlog of orders for delivery in the first quarter was at approximately RMB 242.2 million (US$ 35.5 million), representing a year-over-year revenue growth rate of 35.9% compared to the first quarter of 2009. The expected sales volume is 9.1 million square meters, which would represent a 30.1% year-over-year growth in sales volume from 7.0 million square meters sold in the comparable period of 2009.

"We are pleased to report another strong quarter that exceeds our revenue and net income guidance for the full year," said Mr. Jiadong Huang, Chief Executive Officer of China Ceramics. "Our rapid growth was driven by our ability to increase our production volume to meet continued robust market demand. The majority of our revenues come from the domestic market in China, which we believe will continue to exhibit growth in the quarters ahead."


http://xsltm1.finance.vip.sp2.yahoo.com/news/China-Ceramics-Reports-prnews-3608578805.html?x=0

-Adam

CCME - A good question from the CCME board

A few questions for anyone in the know on this. On the China Stocks board, there is a discussion about the risk to CCME once the operating agreements with the different bus lines expire - i.e. the risk of competitors coming in and outbidding CCME. My question is regarding the equipment in the buses that CCME installs. Off the top of my head I think I remember reading that it cost $1000 to equip each bus. Is this capital investment of equipment owned by CCME or do the bus companies take ownership? If CCME owns the equipment in these buses, it would seem they are at a much better competitive advantage to other companies in any future bidding war given their costs to continue business would be much less than the cost of another company to start up. Of course, the lifespan of the equipment installed may realistically not last beyond the lifespan of the operating agreement making this argument void.


-Adam

CCME - The bus operators

To solve the problem of what will CCME do after their exclusive rights and contracts expire I think it's valuable to think about what the bus operator will be dealing with come contract renewal time.

So why would the bus operator want to keep CCME instead of going with a rival?

1) CCME pays more: This is the obvious one. CCME moves up their concession fees enough to satisfy the bus operators. CCME may be large enough by then that they could offer competitive concession fees and still have excellent margins. The larger they become the better the economies of scale are and the more valuable they are perceived by the large multinational corporations who advertise with them(because of the ever larger bulk discounts they can provide). Right now CCME seems to be the low-cost provider in the outdoor advertising space and that could be the ace-in-the-hole to ward off significant competitive threats in the future(make the competition think they will not be able to compete and they may choose not to even try; CCME wins by no-contest because they look unbeatable).

2) CCME is a trusted, valuable partner: The bus operators need to look out for their riders, so they will want to make sure the programming and ads are high quality and of good taste. If CCME can prove they care about the riders and want to create the best possible experience it could provide a level of goodwill with the bus operators during negotiation time.

3) CCME has the best programming available and therefore will keep the bus riders the most satisfied: This could be a valuable competitive advantage if they decided to pursue this avenue. They could constantly upgrade the quality of the media presented in order to make the bus operators think their bus riders would miss not having CCME programming.

4) CCME has some other sort of leverage which makes it advantageous for the bus operators to sign contract renewals instead of considering rivals. Not sure what this would be but needed to include it to account for the unknowns.


-Adam

CCME - A possible real concern in the long-term.

In my opinion this is one of the biggest unknowns(and potential negatives) about CCME. What will happen when the exclusive rights run out and the bus operator contracts come up for renewal? How much more in concession fees will they have to pay to secure additional contracts? Who will hold the power during negotiations CCME or the bus operators, and will a competitor come in and try to undercut their bids severely to gain market share?

I hope CCME has a large enough first-mover advantage to fight off any large-pocketed competitors because right now I can't see how they are protected. These questions require considerable further thought so I'm just scratching the surface to see what others think.

Long-term: Competition in the space. If the business proves to be lucrative, better funded and more connected competitors may enter. Ultimately, it's the bus operators that have the leverage here, they own the real capital involved.


-Adam

CCME - Guidance

You cannot calculate growth using the bus totals because the size of the network would have been different in Q1, Q2, Q3, and Q4 with net income rising from $7.2M in Q1 to $14.2M in Q4, a 100% increase. Plus Q4/2009 would have a smaller network than 2010 because they announced partnership agreements in Q1/2010.

Mr. Cheng, Chairman and CEO “Our network has grown with the signing of several new agreements with bus operators. As of today, our network includes 49 bus operator partners, up from 46 at the end of November; these agreements run from three to eight years. The total number of buses equipped with our television systems is now over 21,000, increasing approximately by more than 1,000 buses since the end of November.”


A different way to do it:

They have mentioned Q1/2010 will be slightly lower than Q4/2009, so we can use Q4/2009 as a base starting point and project the following baseline numbers(excluding all the variable increases), except we can include the known network additions they announced in Q1/2010: Q1($13M), Q2($14.5M, Q3($14.5M, Q4($16M) = $58M.

Increase in ad rates(10% overall increase). On $130M revenue(roughly Q4 x 4) is an extra $13M revenue and approx. $6.5M net income. So that brings the total to $64.5M.

Increase in direct ad clients(15-20% increase). They mentioned how nearly 35% of their advertising revenue in 2010 would come from direct clients and how it was only 16%(up to Q3/09) and 21% in Q4, so that's an additional 15-20% increase(direct ad client rates are 15% higher than agency ad rates). So using $130M again(roughly Q4 x 4) means and additional $20-30M will be from direct ads and that's will bring in an additional $3-4.5M(20M x 15%) in increased ad fees. Added net income on that should be at least $3M with economies of scale. That brings the total to $67.5M.

So my extremely rough napkin math gets us within $4M of the guidance, using only $130M for revenue where they have said revenue should be at least $150M for 2010. Tack a 45% profit margin on the additional $20M in revenue and you get an additional $9M in net income. That brings the total to $76.5M.


-Adam

CCME - I personally believe the guidance is conservative.

With expanding margins via an increase in direct clients, plus an already implemented increase in ad rates of 10-15%, plus a full year's revenue from 21,000 buses, and it's doesn't take much to get to $70+ million in net income.


-Adam

CCME

I know VISN's problems were company specific and the advertising industry is quite strong, but to a new investor just beginning their DD VISN is the most comparable to CCME since it involves buses. That's why I said it could be a short-term 'perception' ngative.

This thought experiment is not an attempt to bash CCME but on the contrary. It's a way to gain a deeper conviction for the company because it leads to a more balanced assessment of it's potential. Many on this board mention the positives of CCME and omit the bad stuff, and I thought it would be interesting to see what potential negatives are out their in investors minds.


-Adam

CCME - For those who are bored this weekend.

Since the positives of CCME have become fairly obvious and well-known to this board, I thought an interesting thought experiment for those so inclined would be to list as many negatives as we possibly can to see if anyone has missed anything.

Here is one:

1) Short-term perception risk: new investors are comparing it to VISN and thinking they are in the exact same industry and therefore are not believing CCME's numbers(or guidance) is for real. They might be thinking the positives are temporary and CCME will eventually succumb to the same negative forces that hit VISN's margins and profitability.

Result: it may take longer than many of us first thought for CCME to get out from under the shadow of VISN's poor results.


-Adam

I agree, and it's much better to look at the bright side of things. If it went straight up after earnings it wouldn't be nearly as valuable a teaching tool, and we wouldn't be able to look back a few months from now and say 'do you remember how crazy that sell-off was on April Fools day. In retrospect I guess it's fitting it happened today.

I'll admit I definitely was fooled today into buying more since I decided to go even more overweight when it dipped below $13.50 because I thought it must be near the bottom. Happy with my purchase but would have been happier if I got it under $13.

Still believe CCME is one of the absolute safest places to have my money right now even if it continues down some more next week. Eventually, eventually, eventually we WILL go up over $20, then over $30!

Good things never come easy so there was no reason for gains in CCME to be different. It actually will work out well for my brother if it stays below $13 on Monday because I begin managing his money next week and CCME is my first buy for him.

Have a great Easter everyone.


-Adam

CCME - Regarding sell-off

1) I think a bunch of investors were expecting a quick jump into the stratosphere and became disenchanted when the morning rally faded. Now they are dumping because their impatient.

2) Others are probably selling to lighten their holdings because they think they will get in cheaper next week. And some potential new buyers are probably holding off their purchase for the same reason.

3) And the 10-K release hasn't taken effect yet because it takes time to due proper DD, so first the financials have to be updated on all the sites, then the investors have to find CCME, then DD has to be performed, and then they look for an entry point. At least that's how the types of investors we want(institutions) will do it. So even investors who are quick with their DD probably aren't buying because today it's been dropping like a stone.

All conjecture, but that's my take on it.


-Adam

CCME - Regarding sell-off

1) I think a bunch of investors were expecting a quick jump into the stratosphere and became disenchanted when the morning rally faded. Now they are dumping because their impatient.

2) Others are probably selling to lighten their holdings because they think they will get in cheaper next week. And some potential new buyers are probably holding off their purchase for the same reason.

3) And the 10-K release hasn't taken effect yet because it takes time to due proper DD, so first the financials have to be updated on all the sites, then the investors have to find CCME, then DD has to be performed, and then they look for an entry point. At least that's how the types of investors we want(institutions) will do it. So even investors who are quick with their DD probably aren't buying because today it's been dropping like a stone.

All conjecture, but that's my take on it.


-Adam

Market sentiment - Example

Look at how many of the regular contributors to this board have mentioned they are moving to partial cash or all cash...there have been quite a few, so the selling has already begun for many here.

I personally am 100% invested so it's a personal choice.


-Adam

Our stocks always seem to be a forward indicator.

At least that is what I have observed since entering the china space a little over a year ago. Many jump out early in anticipation of a down market because they know the chinese companies will get hit harder than most, but then jump back in early too because they know they will rebound quicker aswell.

Just a personal observation. I have done no DD on LTUS so do not know why it's getting hit so hard.


-Adam

S&P up 11.5% since Feb 8th.

And the rise has basically been straight up. It can't keep going up forever like that so this is probably the beginning of another correction like we saw in January. Earnings don't mean a lot when the market sentiment is negative. But the positive earnings results will eventually allow our Chinese stocks to reach higher high's because they will have stronger financials backing them when we get back into a market upswing.

Patience is all that is required like usual.


-Adam

EDS - Took a look a couple months back.

With the industry EDS is in the strength of the brand would determine if they were successful and with so many world-class competitors it's a tough go. And I have difficulty quantifying the brand's staying power if I don't have direct contact with it and therefore I avoided this one for that reason. If they had a decade or two of strong financial results based on their brand names I could overlook it since that would show they could adapt with the industry and still remain on top, but without that I usually stay away.


-Adam

APBS - Have not started a position yet.

I'm also curious about the cash flow. They make 10M, don't mention any capex, and only have 3M from operating...something doesn't jive. Where is the money going?

If it get's below $4 again I will consider starting, but need some answers before adding significantly.


-Adam

APBS - entrances

I'm sure the cemetery itself has many entrances, but the 8-K read as though it was a main access road farther out. It did mention that the road will eventually be connected to the main highway and that further disruptions are unlikely.


-Adam

APBS - choppy results

1) The FY2009 results had negative growth because a bridge on the main access road to the cemetery was being upgraded due to the Three Gorges Dam raising the water level of the region and therefore was shutdown for a while.

2) I do not know the exact reason for them projecting a drop in income for 2012 but my guess is it has to do with the expansion of phase three and the extra costs involved.

3) They may have to purchase the 70+ extra acres, unsure as of now. If they did it probably wouldn't cost much more than $12M if the cost/per acre is similar to the land they purchased for $2M.

4) The $10M capital raise is an issue for me aswell, but the uplisting will help avoid a poor deal.


I am still searching for info on this one since it's still fairly new. I haven't started a position but I think it has more potential than it seems at first glance. There are a lot of upfront costs involved with cemeteries and they are still in the development stages but are quite profitable nonetheless. Based on the projections I don't think they accounted for much of their intended price increase to $7,500 so their could be some hidden upside potential. I have to work the numbers some more to see if that's the case.


-Adam

Sorry everyone for my error regarding the March 29th release date. I was obviously dilusional when I thought I read that somewhere. Going crazy at 30, not a good sign :(


-Adam

APBS - Growth, Cash Flow, and Land

1) Growth strategy - They plan on revenue growth of 25%. They plan on continuing to sell plots in the second phase of the cemetery development project, and continue development of the third phase. Presently their average selling price per unit is $4,750, and they wish to increase this to $7,500(Urban cemeteries command upwards of $10,000 per unit). They mention it's not unusual for a graveyard plot to be more expensive than a home. They consider themselvea a premier destination which should help command the higher price. Acquisitions are a longer-term strategy, as is their Long Qiau lake tourism project(not sure what their intentions are with this).

2) Good question. Not 100% sure about the low cash flow. Will have to dig deeper. As for the inventory re-evaluation, I think it just means they sold off some finished plots. I agree the explanation is odd. This inventory definition is from the 8K - Inventory consists of completed cemetery plots ready for sale. Inventory includes all direct costs associated with land development and construction of cemetery plots, including interest, costs of land use rights based on units of production and other carrying costs incurred. Inventory is valued at the lower of cost or market (determined on a weighted average cost basis) or net realizable value.

3) Land - Total available land for cemetery development is 94 acres. A little over 18 acres has been developed so far: 100% of Foguang(7.2 acres), 93% developed GuiYuan 1(11.5 acres), and 3% developed GuiYuan 2(11.5 acres). They have land-use rights on the remaining 70 acres granted by the local government which they intend to develop(they pay $22,000 per year for the rights). That leaves 80% of total cemetery acreage available for future development.


Sidenote: Gross margin was 42.6% in FY2008, 45.7% in FY2009, and 54% in the first nine months of FY2010. They have projected the gross margin to be 55.1% for FY2011. They have slowly been increasing their average price per unit and margins will improve dramatically if they can get anywhere close to the $7,500 per unit since thats a 58% price increase from $4,750.


Rough Valuation:(FY ends March 31st)
Share Count: 11M(13.4M with warrants included)
FY2010E Net Income: $12.1M
Expected 2010 EPS: $1.10(0.90 diluted)
Present Share price: $4.30
PE of 3.9(4.78 diluted) Margin of safety is there especially since its a steady consistent earner(especially with their plans for uplisting). Not a lot of surprises with a cemetery.



Investor Presentation
http://app.quotemedia.com/quotetools/showFiling.go?webmasterId=95523&name=ARTISTRY%20PUBLICATIONS%20INC:%208-K,%20Sub-Doc%202&link=http%3A//quotemedia.10kwizard.com/filing.xml%3Frid%3D12%26ipage%3D6781454%26DSEQ%3D2%26SQDESC%3DSECTION_EXHIBIT%26doc%3D2&cp=on&type=HTML



-Adam

Our investing criterium must be similar.

I'm not in PUDA right now either but probably will be after the next financing. Was in LLEN but sold it all to buy PUDA under $5.

NEP should probably be on my list and I owned it back when it made it's move from $7 to $11 but sold out to lock in gains. Have been tempted to get back in but there always seems to be something cheaper around.

Haven't done much dd on CHOP.

I took a serious look at YONG last week but didn't pull the trigger. A little regrettable now after today's pop. It's another one I'm looking at.


-Adam

CCME CNYD CCLTF/CCLWF LPIH PUDA SOKF APBS

Please feel free to post info on any of the following.

You may also post about other stocks which you believe are of very high quality in terms of value/management/competitive advantage/sustainability/predictability/growth etc. Please state your reason(s) when posting

Thanks,


Adam

New use for this board - Info Archive.

I have decided to discontinue posting my trades on this board. I usually build a position over time and I found it inhibitive to update this board in mid-stream, and then found it burdensome to go back and search out the specifics of each trade in order to post them here.

Instead I am going to use this board as an archive of information about each of the companies I am interested in. That will allow quick reference whenever asked a question or if quick decisions need to be made.

Others can post info here whenever they want. I will list the companies I am following in a sticky note, so any relevent info regarding those companies can be freely posted.

Thanks for understanding,


Adam

CCME has been updated on Google Finance.

Includes some accurate financials now.

http://www.google.com/finance?q=AMEX%3ACCME


-Adam

CCME has been updated on Google Finance.

Includes some accurate financials now.

http://www.google.com/finance?q=AMEX%3ACCME


-Adam

The way I read it the PR they mention will probably be reporting the actual earnings instead of when the earnings release will be.


-Adam

I think I must have dreamt that earnings were today because I was the one who posted about it but cannot for the life of me find where I read it. Sorry for the 'possible' misinformation, but I'm still holding out that I did read it somewhere otherwise I may be going crazy ;0

Doesn't matter a lot anyways since it will be by Wednesday at the latest.


-Adam

O/T Buffett quote about chasing a stock up.

In a response to a question about Costco:

"We actually negotiated to buy more. I made the most common mistake that I make....We started buying it, and the price went up, and instead of following it up and continuing to buy more...If Costco had stayed at $15 a share or so, where we were buying it, we would've bought a lot more. But instead it went to $15 and 1/8th and who could pay 15 and 1/8th when they'd been paying $15 - it wasn't quite that bad. But I have made that mistake a lot of times, and it's very irritating."


I'm presently reading the book 'Damn Right!: Behind the scenes with Charlie Munger' and thought others on this board would enjoy this quote since I have heard many warn about chasing a stock.


-Adam