SGZH news..US China Mining Group Announces Year End Revenue and Net Income Guidance.Last update: 12/1/2010 5:06:00 PMCITY OF INDUSTRY, Calif., Dec. 1, 2010 /PRNewswire via COMTEX/ -- US China Mining Group, Inc., (SGZH) a Chinese leader in coal production and exploration in the People's Republic of China, today announced revenue and net income guidance for its fiscal year ending December 31, 2010.
Management expects the Company to generate revenue of approximately $66.5 million with net income of approximately $14.1 million for the 2010 Fiscal year ending December 31, 2010. This represents a revenue increase of approximately 2.3% and decrease in net income of approximately 44%, from 2009 levels. The decrease in net income is primarily attributed to a decrease in production at the Xing An mine due to maintenance and retrofit projects that began in the fourth quarter of 2009.
As previously reported, the Company began programs to increase production efficiencies and safety at the Xing An mine in December of 2009. Upon completion of these programs and modifications, the Xing An mine will be able to maintain coal processing operations year-round and will increase coal production from 600,000 metric tons per year to 900,000 metric tons per year pending approval from local Government in 2012. The Company expects to be at the full production of 600,000 tons when all upgrades have been completed, in May of 2011. Mr. Hongwen Li, President of US China Mining Group, commented, "We have worked very hard over the past twelve months to upgrade our mine equipment and operations. We expect to begin seeing the benefits of this effort in the fourth quarter of 2010 and throughout 2011." Li continued, "We are also expanding our efforts to pursue other mining properties and short term production opportunities which could be revenue contributors for us in the 2011 fiscal year." About US China Mining Group: US China Mining Group is a company engaged in coal production and sales by exploring, assembling, assessing, permitting, developing and mining coal properties in the People's Republic of China ("PRC").
After obtaining permits from the Heilongjiang Province National Land and Resources Administration Bureau and the Heilongjiang Economic and Trade Commission, we extract coal from properties to which we have the right to mine capped amounts of coal, and then sell most of the coal on a per metric ton ("ton") basis in cash on delivery, primarily to power plants, cement factories, wholesalers and individuals for home heating. We do not own the coal mines, but have mining rights to extract a capped amount of coal from a mine as determined by government authorized mining engineers and approved by the Heilongjiang Department of Land and Resources. Our business consists of the operations of Tong Gong coal mine in northern PRC, located approximately 175 km southwest of the city of Heihe in the Heilongjiang Province and the Hong Yuan and Sheng Yu coal mines located in the city of Mohe in Heilongjiang Province.
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