JINJIANG, China, Nov. 8, 2010 /PRNewswire-Asia-FirstCall/ -- China
Ceramics Co., Ltd. (Nasdaq Capital Market: CCCL, CCCLW, CCCLU)
("China Ceramics" or the "Company"), a leading Chinese manufacturer
of ceramic tiles used for exterior siding and for interior flooring
and design in residential and commercial buildings, today announced
financial results for the third quarter ended September 30, 2010.
Third Quarter 2010 Highlights
- Revenue was RMB 294.1 million
(US$ 43.3 million), up 8.0% from the
second quarter of 2010 and up 24.7% from the third quarter of
2009;
- Gross profit was RMB 93.4 million
(US$ 13.8 million), up 10.1% from the
second quarter of 2010 and up 24.2% from the third quarter of
2009;
- Gross profit margin was 31.7%, compared to 31.2% in the second
quarter of 2010 and 31.9% in the third quarter of 2009;
- Net profit was RMB 63.3 million
(US$ 9.3 million), up 12.0% from the
second quarter of 2010 and up 20.0% from the third quarter of
2009;
- Earnings per fully diluted share were RMB 5.69 (US$
0.84).
Nine Months 2010 Highlights
- Revenue was RMB 795.5 million
(US$ 116.7 million), up 29.1% from
the same period of 2009;
- Gross profit was RMB 247.5
million (US$ 36.3 million), up
36.4% from the same period of 2009;
- Gross profit margin was 31.1%, compared to 29.5% in the same
period of 2009;
- Net profit was RMB 165.0 million
(US$ 24.2 million), up 29.9% from the
same period of 2009;
- Earnings per fully diluted share were RMB 15.73 (US$
2.31).
Third quarter 2010 Results
Revenue for the third quarter ended September 30, 2010 increased by 8.0% to
RMB 294.1 million (US$ 43.3 million) compared to the second quarter
ended June 30, 2010, and increased by
24.7% compared to the third quarter ended September 30, 2009. The sequential increase in
revenue from the second quarter of 2010 was mainly driven by higher
sales volume in peak season. The year-over-year increase in revenue
was primarily driven by a 21.3% increase in volume from 9.4 million
square meters to 11.4 million square meters in the third quarter of
2010 compared with the same period in 2009, as well as higher
average selling prices driven by improved product mix. The growth
in volume was primarily due to increased production capacity at the
Hengdali plant that we acquired in January
2010. Hengdali contributed 23.2% of total revenue in the
quarter ended September 30, 2010.
Revenue contributed by Hengda totaled RMB
225.8 million, down 4.2% from RMB
235.8 million in the same period of 2009. Approximately 2
million square meters or 17.7% of products sold in the quarter were
produced by the Company's outsourced manufacturing vendors.
Gross profit was RMB 93.4
million (US$ 13.8 million), up
10.1% from RMB 84.8 million in the
second quarter ended June 30, 2010,
and up 24.2% from RMB 75.2 million
for the quarter ended September 30,
2009. The sequential and year-over-year increase in gross
profit was driven by higher sales volume. Gross margin was 31.7%
compared to 31.2% in the second quarter of 2010 and 31.9% for the
same period last year.
Administrative expenses were RMB
7.3 million (US$ 1.1 million),
up 21.7% from RMB 6.0 million in the
second quarter of 2010, and up 180.8% from RMB 2.6 million in the third quarter of 2009. The
sequential increase in administrative expenses was driven by the
higher legal consulting and other expenses, which related to China
Ceramics' status as a public company. The year-over-year increase
in administrative expenses resulted mainly from depreciation and
amortization incurred at the newly acquired Hengdali as well as
from legal consulting and other expenses related to China Ceramics'
status as a public company.
Selling and distribution expenses were RMB 1.7 million (US$ 0.2
million), or 0.6% of sales, compared to RMB 1.5 million, or 0.6% of sales, in the second
quarter of 2010, and down 5.6% from RMB 1.8
million in the same period of 2009. The year-over-year
decline in selling expenses was due to reduced shipping costs as
customers now collect their goods directly from the Company's
warehouse.
Finance costs were RMB 1.7
million (US$ 0.2 million),
compared to RMB 1.5 million in the
second quarter of 2010, and up 240.0% from RMB 0.5 million in the third quarter of 2009. The
year-over-year increase in finance costs resulted from loans
assumed in connection with the acquisition of Hengdali.
Profit from operations for the third quarter ended
September 30, 2010 was RMB 87.0 million (US$ 12.8
million), up 12.1% from RMB 77.6
million in the second quarter of 2010, and up 22.7% from
RMB 70.9 million in the third quarter
of 2009. The sequential increase in operating profit resulted from
higher gross profit. The year-over-year increase in profit from
operations was the result of higher revenue, partially offset by
higher operating costs.
Other income for the third quarter ended September 30, 2010 was RMB
2.6 million (US$ 0.4 million),
up 766.7% from RMB 0.3 million in the
second quarter of 2010, and up 1200% from RMB 0.2 million in the same period of 2009. Other
income mainly consisted of sale of waste parts such as exhausted
metals, gears and transportation belts from equipment and moldings.
Waste parts sales amounted to RMB 1.7
million in third quarter ended September 30, 2010.
Net profit for the third quarter ended September 30, 2010 was RMB
63.3 million (US$ 9.3
million), up 20.0% from the comparable period in 2009. The
year-over-year increase in net profit was mainly driven by strong
growth in revenue. Net profit for the third quarter ended
September 30, 2010 was up 12.0%
compared to the second quarter of 2010. The sequential increase in
net profit was mainly driven by higher revenue and improved gross
margin.
Earnings per fully diluted share were RMB 5.69 (US$ 0.84)
for the third quarter of 2010, up 2.5% from RMB 5.55 (US$ 0.81)
in the second quarter of 2010, and down 38.0% from RMB 9.18 (US$ 1.34)
in the same period in 2009. The year-over-year decrease in earnings
per share was mainly due to the increase in the number of shares.
On September 1, 2010, 11,779,649
warrants were exchanged for 2,944,904 of the Company's common
shares.
Nine Months 2010 Results
Revenue for the nine months ended September 30, 2010 increased by 29.1% to
RMB 795.5 million (US$ 116.7 million) compared to the nine months
ended September 30, 2009. Gross
profit was RMB 247.5 million
(US$ 36.3 million), up 36.4% from
RMB 181.5 million in the nine months
ended September 30, 2009. Gross
margin was 31.1% compared to 29.5% in the same period of 2009.
Selling expenses were RMB 4.7 million
(US$ 0.7 million), compared to
RMB 5.0 million in the same period of
2009. Administrative expenses were RMB 19.0
million (US$ 2.8 million),
compared to RMB 7.4 million for the
same period of 2009. Net profit for the nine months ended
September 30, 2010 was RMB 165.0 million (US$
24.2 million), up 29.9% from the comparable period in 2009.
Earnings per fully diluted share were RMB
15.73 (US$ 2.31) for the nine
months 2010, down from RMB 22.10 in
the comparable period of 2009.
Third Quarter 2010 Statements of Financial
Position Items
- Cash and bank balances were RMB 41.5
million (US$ 6.2 million) as
of September 30, 2010, compared with
RMB 68.0 million (US$ 10.0 million) as of June 30, 2010 and RMB
150.1 million (US$ 22.0
million) as of December 31,
2009. In the third quarter of 2010, the Company
purchased new kilns and production lines to replace older
manufacturing equipment in Hengda. In addition, Hengdali completed
its phase I construction, and continued to make progress on phase
II construction. The capital expenditures incurred were
approximately RMB 88.6 million
(US$ 13.2 million) in the quarter
ended September 30, 2010, and these
capital expenditures resulted in the decrease in cash and bank
balances;
- Inventory turnover was 66 days as of September 30, 2010 compared with 70 as of
June 30, 2010 and 77 as of
December 31, 2009. The decrease in
the inventory turnover was due to an increased delivery rate to
customers during the peak season.
- Trade receivables turnover was 109 days as of September 30, 2010 compared with 109 days as of
June 30, 2010 and 102 days as of
December 31, 2009. The Company's
trade receivables include a 17% value-added-tax ("VAT"), whereas
its reported revenue is net of VAT. Trade receivables turnover
excluding VAT amounts from both the numerator and denominator was
93 days as of September 30, 2010
compared with 93 as of June 30, 2010
and 87 days as of December 31,
2009.
- Trade payables turnover was 71 days as of September 30, 2010 compared with 77 days as of
June 30, 2010 and 69 days as of
December 31, 2009. The decrease in
the trade payables turnover compared to the second quarter of 2010
resulted from the shortened payment cycle from the construction
materials and machinery suppliers for Hengdali's phase II
construction and the upgrades to Hengda's facilities.
- Bank borrowings (including both short-term borrowings and
long-term borrowings) was RMB 99.7
million (US$ 14.9 million) as
of September 30, 2010 compared to
RMB 104.7 million (US$15.4 million) as of June 30, 2010 and RMB 26.5
million (US$ 3.9 million) as
of December 31, 2009.
- Capital expenditures for Hengda are expected to be
approximately RMB 117.0 million
(US$17.5 million) in 2010. In the
third quarter ended September 30,
2010, the Company invested RMB 41.2
million (US$ 6.1 million) to
replace and improve older manufacturing equipment at Hengda. The
enhancement of production lines is expected to increase annual
production capacity at Hengda to 32.2 million square meters of
ceramic tiles by the end of 2010 from 28 million square meters at
the end of 2009. In the third quarter ended September 30, 2010, the Company invested
RMB 47.4 million (US$ 7.1 million) into Phase II of Hengdali for
capacity expansion. The capital expenditure for phase II of the
Hengdali is expected to be approximately RMB
136.4 million (US$ 20.4
million) in 2010. The completion of phase II construction at
Hengdali is expected to increase annual production capacity of
ceramic tiles to 24 million square meters by the end of 2010 from
10 million square meters when we purchased the facility. As a
result, China Ceramics expects to have total production capacity of
approximately 56.2 million square meters by the end of 2010 and to
incur total capital expenditure of approximately US$41.6 million in 2010, of which US$ 13.2 million has been spent in the third
quarter of 2010 (an aggregate of $ 28.8
million for the nine months ended September 30, 2010).
Recent Developments
On November 3, 2010 the Company
commenced trading on NASDAQ Capital Market with new ticker symbols
"CCCL" for Company's common shares, "CCCLW" for Company's warrants
and "CCCLU" for Company's units.
On October 4, 2010 the Company announced that its brands
"Hengda" and "HD" were included in Asia's 500 Most Influential Brands of the Year
2010.
During the third quarter of 2010, China Ceramics started to sell
products under a new brand "TOERTO". The new brand is being used to
differentiate products manufactured at Hengdali and are targeted at
the medium to high end market of the large-size rustic ceramics
tile industry. The new TOERTO brand represented 1.2% of the total
sales in the third quarter of 2010.
Business Outlook
The Company's backlog of orders for delivery in the fourth
quarter is at approximately RMB 279.9
million (US$ 41.8 million),
representing a year-over-year growth rate of 20.9% compared to the
revenue in the fourth quarter of 2009. The expected sales
volume in the fourth quarter of 2010 is approximately 10.2 million
square meters, representing a 19.3% increase from 8.6 million
square meters sold in the fourth quarter of 2009.
Conference Call Information
The Company will host a conference call at 9:00 am EST on Monday,
November 8, 2010. Listeners may access the call by dialing
+1 (866) 672-3985 five to ten minutes prior to the scheduled
conference call time. International callers should dial +1 (706)
902-4207. The conference participant pass code is 22519883.
A replay of the conference call will be available for 14 days
starting from 11:00 am ET on
Tuesday, November 9, 2010. To
access the replay, dial +1 (800) 642-1687. International
callers should dial +1 (706) 645-9291. The pass code is
22519883.
The Company will not have a Q&A session at the end of the
call.
About China Ceramics Co., Ltd
China Ceramics Co., Ltd., formerly China Holdings Acquisition
Corp., is a leading manufacturer of ceramic tiles in China. The Company's ceramic tiles are
used for exterior siding, interior flooring, and design in
residential and commercial buildings. China Ceramics' products,
sold under the "Hengda" or "HD", "Hengdali" or "HDL" and "TOERTO"
brands, are available in over 2000 styles, colors and sizes
combinations and are distributed through a network of exclusive
distributors or directly to large property developers. For more
information, please visit http://www.cceramics.com
Currency Convenience Translation
The Company's financial information is stated in
Renminbi("RMB"). The translation of RMB amounts into
United States dollars in the
earning release is included solely for the convenience of readers.
For statements of financial position data, translation of RMB into
U.S. dollars has been made using historic spot exchange rates
published by www.oanda.com. For statements of comprehensive income
data, translation of RMB into U.S. dollars has been made using the
average of historical daily exchange rates. Such translations
should not be construed as representations that RMB amounts could
be converted into U.S. dollars at that rate or any other rate, or
to be the amounts that would have been reported under IFRS.
Safe Harbor Statement
Certain of the statements made in this press release are
"forward-looking statements" within the meaning and protections of
Section 27A of the Securities Act of 1933, as amended,
and Section 21E of the Securities Exchange Act of 1934, as
amended, or the Exchange Act. Forward-looking statements include
statements with respect to our beliefs, plans, objectives, goals,
expectations, anticipations, assumptions, estimates, intentions,
and future performance, and involve known and unknown risks,
uncertainties and other factors, which may be beyond our control,
and which may cause the actual results, performance, capital,
ownership or achievements of the Company to be materially different
from future results, performance or achievements expressed or
implied by such forward-looking statements. All statements other
than statements of historical fact are statements that could be
forward-looking statements. You can identify these forward-looking
statements through our use of words such as "may," "will,"
"anticipate," "assume," "should," "indicate," "would," "believe,"
"contemplate," "expect," "estimate," "continue," "plan," "point
to," "project," "could," "intend," "target" and other similar words
and expressions of the future.
All written or oral forward-looking statements attributable
to us are expressly qualified in their entirety by this cautionary
notice, including, without limitation, those risks and
uncertainties described in our annual report on Form 20-F for the
year ended December 31,
2009 and otherwise in our SEC reports and filings,
including the final prospectus for our offering. Such reports
are available upon request from the Company, or from the Securities
and Exchange Commission, including through the SEC's Internet
website at http://www.sec.gov. We have no obligation and do not
undertake to update, revise or correct any of the forward-looking
statements after the date hereof, or after the respective dates on
which any such statements otherwise are made.
FINANCIAL TABLES FOLLOW
|
|
CHINA
CERAMICS CO., LTD. AND ITS SUBSIDIARIES
|
|
CONDENSED
CONSOLIDATED STATEMENTS OF FINANCIAL POSITION
|
|
(RMB in
thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
As at
September
30, 2010
|
|
As
at
December 31,
2009
|
|
|
(UNAUDITED)
|
|
|
|
ASSETS AND
LIABILITIES
|
|
|
|
|
|
|
|
|
|
Non-current
assets
|
|
|
|
|
Property, plant and
equipment
|
442,055
|
|
64,184
|
|
Land use rights
|
32,103
|
|
165
|
|
Goodwill
|
3,735
|
|
-
|
|
|
477,893
|
|
64,349
|
|
|
|
|
|
|
Current assets
|
|
|
|
|
Inventories
|
150,223
|
|
114,658
|
|
Trade receivables
|
365,116
|
|
270,840
|
|
Prepayments and other
receivables
|
838
|
|
149,268
|
|
Cash and bank
balances
|
41,478
|
|
150,121
|
|
|
557,655
|
|
684,887
|
|
|
|
|
|
|
Current
liabilities
|
|
|
|
|
Trade payables
|
157,799
|
|
126,251
|
|
Accrued liabilities and other
payables
|
89,680
|
|
74,749
|
|
Interest-bearing bank
borrowings
|
74,700
|
|
26,500
|
|
Income tax payable
|
24,032
|
|
16,639
|
|
|
346,211
|
|
244,139
|
|
Non-current
liabilities
|
|
|
|
|
Long term borrowings
|
25,000
|
|
-
|
|
Deferred tax
liabilities
|
1,130
|
|
-
|
|
|
26,130
|
|
-
|
|
|
|
|
|
|
Net current
assets
|
211,444
|
|
440,748
|
|
|
|
|
|
|
Net assets
|
663,207
|
|
505,097
|
|
|
|
|
|
|
EQUITY
|
|
|
|
|
Total shareholders'
equity
|
663,207
|
|
505,097
|
|
|
|
|
|
|
|
|
|
CHINA
CERAMICS CO., LTD. AND ITS SUBSIDIARIES
|
|
UNAUDITED
CONDENSED
CONSOLIDATED
STATEMENTS
OF COMPREHENSIVE
INCOME
|
|
(RMB in
thousands, except EPS and
share data)
|
|
|
|
|
Three months
ended
|
Nine months
ended
|
|
|
September
30
|
June 30
|
September
30
|
September
30
|
September
30
|
|
|
2010
|
2010
|
2009
|
2010
|
2009
|
|
|
|
|
|
|
|
|
Revenue
|
294,088
|
272,304
|
235,784
|
795,501
|
616,031
|
|
Cost of
Sales
|
(200,724)
|
(187,474)
|
(160,587)
|
(548,023)
|
(434,487)
|
|
Gross profit
|
93,364
|
84,830
|
75,197
|
247,478
|
181,544
|
|
Selling and distribution
expenses
|
(1,738)
|
(1,513)
|
(1,849)
|
(4,732)
|
(5,023)
|
|
Administrative
expenses
|
(7,268)
|
(5,976)
|
(2,577)
|
(19,026)
|
(7,409)
|
|
Finance costs
|
(1,652)
|
(1,478)
|
(528)
|
(4,626)
|
(945)
|
|
Other income
|
2,649
|
257
|
157
|
2,921
|
1,428
|
|
Profit before
taxation
|
85,355
|
76,120
|
70,400
|
222,015
|
169,595
|
|
Income tax expense
|
(22,099)
|
(19,659)
|
(17,668)
|
(57,048)
|
(42,648)
|
|
Net Profit for
the period
|
63,256
|
56,461
|
52,732
|
164,967
|
126,947
|
|
Attributable to:
Shareholders
of the
Company
|
|
|
|
|
|
|
EPS-Basic
|
5.69
|
5.55
|
9.18
|
15.73
|
22.10
|
|
EPS-Diluted
|
5.69
|
5.55
|
9.18
|
15.73
|
22.10
|
|
Shares used in calculating basic
EPS
|
|
|
|
|
|
|
Basic
|
11,124,593
|
10,164,298
|
5,743,320
|
10,487,914
|
5,743,320
|
|
Diluted
|
11,124,593
|
10,164,298
|
5,743,320
|
10.487.914
|
5,743,320
|
|
|
|
|
|
|
|
|
|
|
|
|
CHINA
CERAMICS CO., LTD. AND ITS SUBSIDIARIES
|
|
SALES VOLUME
AND AVERAGE SELLING PRICE
|
|
|
Three months
ended
|
Nine months
ended
|
|
|
September
30
|
June
30
|
September
30
|
September
30
|
September
30
|
|
|
2010
|
2010
|
2009
|
2010
|
2009
|
|
|
|
|
|
|
|
|
Sales volume (square
meters)
|
11,359,920
|
10,631,009
|
9,369,226
|
30,789,236
|
25,027,824
|
|
Average Selling Price (in
RMB/square meter)
|
25.9
|
25.6
|
25.2
|
25.8
|
24.6
|
|
Average Selling Price
(in USD/square
meter)
|
3.8
|
3.7
|
3.7
|
3.8
|
3.6
|
|
|
|
|
|
|
|
|
|
|
|
CHINA
CERAMICS CO., LTD. AND ITS SUBSIDIARIES
|
|
UNAUDITED
CONDENSED CONSOLIDATED STATEMENT
OF FINANCIAL POSITION
|
|
(USD in
thousands)
|
|
|
As
at
September
30, 2010
|
|
ASSETS AND
LIABILITIES
|
|
|
|
|
|
Non-current
assets
|
|
|
Property, plant and
equipment
|
65,997
|
|
Land use rights
|
4,793
|
|
Goodwill
|
558
|
|
|
71,348
|
|
|
|
|
Current assets
|
|
|
Inventories
|
22,428
|
|
Trade receivables
|
54,510
|
|
Prepayments and other
receivables
|
125
|
|
Cash and bank
balances
|
6,193
|
|
|
83,256
|
|
|
|
|
Current
liabilities
|
|
|
Trade payables
|
23,559
|
|
Accrued liabilities and other
payables
|
13,389
|
|
Interest-bearing bank
borrowings
|
11,152
|
|
Income tax payable
|
3,588
|
|
|
51,688
|
|
Non-current
liabilities
|
|
|
Long term borrowings
|
3,732
|
|
Deferred tax
liabilities
|
169
|
|
|
3,901
|
|
|
|
|
Net current
assets
|
31,568
|
|
|
|
|
Net assets
|
99,015
|
|
|
|
|
EQUITY
|
|
|
Total shareholders'
equity
|
99,015
|
|
|
|
|
|
|
|
CHINA
CERAMICS CO., LTD. AND ITS SUBSIDIARIES
|
|
UNAUDITED
CONDENSED
CONSOLIDATED
STATEMENT OF COMPREHENSIVE
INCOME
|
|
(USD in
thousands, except EPS and
share data)
|
|
|
|
|
Three months
ended
|
|
|
September
30, 2010
|
|
|
|
|
|
|
|
Revenue
|
43,342
|
|
Cost of Sales
|
(29,584)
|
|
Gross profit
|
13,758
|
|
Selling and distribution
expenses
|
(256)
|
|
Administrative
expenses
|
(1,071)
|
|
Finance costs
|
(244)
|
|
Other income
|
389
|
|
Profit before
taxation
|
12,576
|
|
Income tax expense
|
(3,256)
|
|
Net Profit for
the period
|
9,320
|
|
Attributable to:
Shareholders of the
Company
|
|
|
EPS-Basic
|
0.84
|
|
EPS-Diluted
|
0.84
|
|
Shares used in calculating basic
EPS
|
|
|
EPS-Basic
|
11,124,593
|
|
EPS-Diluted
|
11,124,593
|
|
|
|
|
|
|
Contact
Information:
|
|
|
China Ceramics Co.,
Ltd.
|
CCG Investor Relations
Inc.
|
|
Edmund Hen, Chief
Financial Officer
|
Mr. Ed Job, CFA - Account
Manager
|
|
Email: info@cceramics.com
|
Email:
ed.job@ccgir.com
|
|
|
Mr. Bryan Blake, Sr. MI
Executive
|
|
|
Phone:
+1-646-833-3416
|
|
|
Email:
bryan.blake@ccgir.com
|
|
|
|
SOURCE China Ceramics Co., Ltd.