Tri-Tech Holding Q1 2010 Revenue Up 48.7% to $4.2M; Net Income Up 36.2% to $817,614 EPS $0.15 |
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By: Tri-Tech Holding Inc. Posted: 2010-05-13 07:55:56 |
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Tri-Tech Holding Inc. (Nasdaq: TRIT), a leading Chinese company that engineers, manages and monitors China's municipal sewer systems, natural waterways and resources, announced today that revenue for the first fiscal quarter ended March 31, 2010 increased 48.7% to $4.2 million from $2.9 million in Q1 2009. Net income for the quarter was $817,614 or $0.15 per diluted share compared with net income of $600,252 or $0.17 diluted EPS in Q1 2009.
Additional First Quarter 2010 Highlights -- Revenue from Wastewater/Tail Gas operations increased 65.8% to $2.6million. -- Revenue from Water Resource Management increased 23.8% to $1.6 million. -- Revenue from Industrial Pollution Control was $60,643. Industrial Pollution Control is a new reportable segment for 2010. -- Gross profit (exclusive of depreciation and amortization) increased 65.3% to $1.8 million from $1.1 million in Q1 2009. -- Gross margin improved to 41.7% vs. 37.5% for Q1 2009. -- Income from operations increased 24.6% to $827,732 from $664,145 in Q12009. -- Weighted average number of diluted shares outstanding was 5.56 million as of March 31, 2010, compared to 3.56 million as of March 31, 2009. Subsequent Event On April 20, 2010, the company completed a secondary public offering of 2,142,750 ordinary shares at an offering price of $14.00 per share. The company received aggregated gross proceeds of approximately $30 million before underwriter commissions and discounts and other expenses, On May 4, 2010, the underwriters of the secondary public offering of common stock partially exercised their over-allotment option, which resulted in the issuance of an additional 224,083 ordinary shares. This over-allotment exercise brought the gross proceeds from the secondary offering to $33.1 million. The company expects to use the net proceeds of the offering for working capital and potential targeted acquisitions as well as new product development and sales and marketing. As of May 11, 2010, the company had 7,791,833 ordinary shares issued and out-standing. First Quarter 2010 Financial Performance Revenue Total revenue was $4.2 million in the quarter ended March 31, 2010, an increase of $1.4 million or 48.7%, compared to revenue of $2.9 million in the same period of 2009. The increase was primarily driven by an increase in larger contracts, several of which exceeded $1.1 million. Revenue attributable to Wastewater and Tail Gas Treatment was $2.6 million, an increase of 65.8% compared to Q1 2009. Water Resource Management revenue was up 23.8% to $1.6 million and Industrial Pollution Control revenue was $60,643. Net Income Net income attributable to shareholders was $817,614, an increase of $0.2 million, or 36.2%, compared to $600,252 in the same period of 2009. Diluted earnings per share attributable to shareholders for the quarter were $0.15 based on net income of $817,614. This compared with net income of $600,252 or $0.17 diluted EPS in Q1 2009. Gross profit (exclusive of depreciation and amortization) Gross profit (exclusive of depreciation and amortization) increased 65.3% to $1.8 million for the quarter from $1.1 million in the Q1 2009. This increase reflected significant Chinese government infrastructure spending along with tight construction timelines and strong market demand. These factors result in high market value for construction projects, and such projects are driving our revenue growth. We also emphasized tight cost containment, which was aided by continued sourcing of more locally made, lower priced equipment. Gross margin (exclusive of depreciation and amortization) for the quarter was 41.7%, compared to 37.5% for the same period. Operating income Operating income increased 24.6% to $827,732 from $664,145 in Q1 2009. Operating margin decreased from 23.3% in Q1 2009 to 19.5%. This decrease was mainly due to rapid growth of general and administrative expenses and selling expenses, which largely reflected an increased number of sales personnel, increased travel expenses in pursuit of new contracts and professional service fees associated with being a publicly traded company since September 2009. Liquidity and Capital Resources As of March 31, 2010, cash and cash equivalents were $7.2 million including a U.S. dollar deposit of $1.6 million and an equivalent RMB deposit of $5.6 million. Working capital was $18.7 million, including cash and cash equivalents of $7.2 million. Management Comment Chief Executive Officer, Warren Zhao said, "2010 is off to an excellent start with good performance from our Wastewater/Tail Gas Treatment and Water Resources Management segments and our rapidly emerging Industrial Pollution Control segment, which we believe also has significant potential for growth. "We continue to pursue smaller river basin flood monitoring and forecasting systems and groundwater monitoring systems across China. In the fiscal quarter ended March 31, 2010, we received awards for two projects for smaller river basin flood and forecasting systems in Zunyi and Anshun in Guizhou Province. "In 2010, we are closely tracking post-disaster reconstruction projects led by the Water Authority of Sichuan Province, Guangdong drought control projects, Henan drought control protects and Guangxi international river monitoring projects. "Our Wastewater and Tail Gas Treatment business segment focuses on Tianjin City and Hebei Province. Services include pump stations, treatment plants, odor control systems and controls and instruments. In the fiscal quarter ended March 31, 2010, we won contracts for the Beitang Wastewater Treatment Plant and the Hejian Wastewater Treatment Plant in Hebei Province. "We are making excellent progress in penetrating adjacent industry vertical opportunities in the industrial wastewater and process tail gas treatment markets in the petrochemical industry. We are also pursuing opportunities in the power generation industry and the oil and gas industry. In the fiscal quarter ended March 31, 2010, we won an industrial wastewater treatment contract in Jinxi City of Liaoning Province from Jinxi Petrochemical Co., a subsidiary of PetroChina. We are increasing our efforts to obtain these types of contracts. "In a similar manner, we are further developing our water resource management services from partial management solutions to full management solutions for large scale river basin projects. We believe the Chinese government's decision to initiate new programs and allocate significant investment for their implementation offers our company significant business opportunities. In addition, the severe drought in Southwest China will accelerate investment in water conservancy. "In our municipal wastewater business, we plan to expand beyond our existing base of operations. In our current business footprint, local governments are building 80 new wastewater treatment plants. This growth represents development activities in only two provinces. We believe significant opportunities exist in the other 32 provinces, municipalities and autonomous regions in China." Conference Call Tri-Tech CEO Warren Zhao, President Phil Fan and CFO Peter Dong will host a conference call at 10:00 AM EDT tomorrow, Friday, May 14, (10:00 PM Beijing/Hong Kong Time on May 14) to review the company's financial results and respond to questions and comments. To participate, call U.S. Toll Free Number 1-877-941-8416 approximately 10 minutes before the call. International callers, please dial 1-480-629-9812. The conference ID number is 4299302. A live webcast of the call will be available at http://viavid.net/dce.aspx?sid=0000753F . Both an MP3 file one hour after the call and a transcript 48 hours after the call will be available. These will be archived for 90 days via http://www.tri-tech.cn and http://www.hawkassociates.com . About Tri-Tech Holding Inc. Tri-Tech designs customized sewage treatment and odor control systems for China's municipalities and its larger cities. These systems combine software, information management systems, resource planning and local and distant networking hardware that includes sensors, control systems, programmable logic controllers, supervisory control and data acquisition systems. The company also designs systems that track natural waterway levels for drought control, monitor groundwater quality and assist the government in managing its water resources. The company is also moving into the industrial pollution control market. Tri-Tech owns seven software copyrights and two technological patents and employs 140 people. Please visit http://www.Tri-Tech.cn for more information. An online investor kit including a company profile, press releases, current price quotes, stock charts and other valuable information for investors is available at http://www.hawkassociates.com/profile/trit.cfm . To subscribe to future releases via e-mail alert, visit http://www.hawkassociates.com/about/alert/ . This press release contains forward-looking statements. These statements are made under the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements include statements concerning plans, objectives, goals, strategies, future events or performance, and underlying assumptions and other statements that are other than statements of historical facts. Among other things, expectations about expansion into adjacent industry verticals, growth of our Industrial Pollution Control Services, and the potential development of the company's other existing service lines contain forward-looking statements. These statements are subject to uncertainties and risks including, but not limited to, product and service demand and acceptance, changes in technology, economic conditions, the impact of competition and pricing, government regulation, and other risks contained in reports filed by the company with the Securities and Exchange Commission. All such forward-looking statements, whether written or oral, and whether made by or on behalf of the company, are expressly qualified by the cautionary statements and any other cautionary statements which may accompany the forward-looking statements. In addition, the company disclaims any obligation to update any forward-looking statements to reflect events or circumstances after the date hereof. For more information, please contact: Investor Contact: Hawk Associates Frank Hawkins Amy Lin Phone: +1-305-451-1888 |
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