SHENZHEN, China, Nov. 30, 2011 /PRNewswire-Asia-FirstCall/ -- New
Energy Systems Group (NYSE Amex: NEWN) ("New Energy" or the
"Company"), an original design manufacturer and distributor of
consumer branded backup power systems and solar panels, today
announced its Board of Directors and Management team have finalized
the sale of its E'Jenie and NewPower battery and battery components
business to a group of employees in each business unit for
approximately $13.4 million. After
suspending guidance in August 2011,
the Company has also provided a detail to its revised guidance for
the full year of 2011.
"As discussed on our third quarter conference call, we have
continued to witness a decline in our E'Jenie and NewPower business
units in an increasingly competitive marketplace in China," began Chairman and CEO, Weihe "Jack"
Yu. "A recent product return of approximately $1.7 million of NewPower batteries from a
customer and large impairment charges we reported in the third
quarter related to those two respective business units further
confirmed our decision to exit these declining businesses. We are
confident this move will enable us to focus on our more promising
Anytone® and Kim Fai solar
businesses in the coming year and improve our overall financial
results."
As detailed in the Company's 8-K filed on November 30, 2011, the Company sold the E'Jenie
and NewPower business units for approximately RMB$85,533,893
(USD$13,445,322) to two long-term
employees at each facility. New Energy's board of directors and
management team decided to divest these businesses after
forecasting weaker demand and rising competition in China, which have significantly reduced
margins. Beginning in December of this year, New Energy Systems
Group's management team will focus all of its efforts on regaining
market share of Anytone®-branded products and growing Kim Fai sales of solar panels and related solar
application products in China and
South East Asia.
FY2011 GUIDANCE
As a result of the sale of E'Jenie and NewPower, the Company has
been able to more accurately forecast its sales for the balance of
the year and provide investors with updated guidance below.
Revenue:
|
$75 to $77 million
|
|
Adjusted Net Income:
|
$6 to $7 million
|
|
Adjusted EPS:
|
$0.41 to $0.48
|
|
|
|
Adjusted net income and adjusted EPS exclude
estimated $0.8
million of non-cash stock-based compensation expenses,
estimated $2.8 million of
amortization expenses and a $13.6
million impairment of goodwill in
2011.
"We are still working our way through the impact from piracy of
and increased competition in the marketplace by 'Feimaotue' (Hong
Kong Exchange listed company) and 'Singwongda' (China's A-share market company), whom have
recently entered the mobile power marketplace in China with their own product lines," continued
Weihe "Jack" Yu. "Our new products launched at MacWorld in
Beijing and the Hong Kong
Electronics Fair are designed to elevate our position in the market
and differentiate our product lines with consumers. To support our
new product launches and to educate consumers, we will spend
approximately $1.8 million over the
next three months on consumer marketing and expanding distribution.
We are confident the decision to focus our resources on growing
Anytone and Kim Fai will provide us
more sustainable returns in the years ahead."
About New Energy Systems Group
New Energy Systems Group is a vertically integrated original
design manufacturer and distributor of lithium ion batteries and
backup power systems for leading manufacturers of mobile phones,
laptops, digital cameras, MP3s and a variety of other portable
electronics. The Company's end-user consumer products are sold
under the Anytone® brand in China
while it's commercial and OEM batteries and battery components are
sold under New Power and E'Jenie. The fast pace of new mobile
device introductions in China
combined with a growing middle class make it fertile ground for New
Energy's end-user consumer products, as well as its high powered,
light weight lithium ion batteries. In addition to historically
strong organic growth, New Energy is expected to benefit from
economies of scale, broader distribution and higher profit margins
in 2011. Additional information about the company is available at:
www.newenergysystemsgroup.com.
Forward Looking Statements
This release contains certain "forward-looking statements"
relating to the business of the Company and its subsidiary and
affiliated companies. These forward looking statements are often
identified by the use of forward-looking terminology such as
"believes," "expects" or similar expressions. Such forward looking
statements involve known and unknown risks and uncertainties that
may cause actual results to be materially different from those
described herein as anticipated, believed, estimated or expected.
Investors should not place undue reliance on these forward-looking
statements, which speak only as of the date of this press release.
The Company's actual results could differ materially from those
anticipated in these forward-looking statements as a result of a
variety of factors, including those discussed in the Company's
periodic reports that are filed with the Securities and Exchange
Commission and available on its website (www.sec.gov). All
forward-looking statements attributable to the Company or to
persons acting on its behalf are expressly qualified in their
entirety by these factors other than as required under the
securities laws. The Company does not assume a duty to update these
forward-looking statements.
For more information, please contact:
COMPANY
New Energy Systems Group
Ken Lin, VP of Investor
Relations
Tel: +1-917-573-0302
Email: ken@newenergysystemsgroup.com
www.newenergysystemsgroup.com
INVESTOR RELATIONS
MZ
John Mattio, SVP
Tel: US +1-212-301-7130
Email: john.mattio@hcinternational.net
www.mz-ir.com
SOURCE New Energy Systems Group