China Industrial Waste Management Inc., a Chinese environmental services and solutions provider has announced financial results for the fiscal year, revealing a 106% rise in revenue.
Revenues increased 106.2% to $21.8 million from $10.6 million in 2009. According to the company, this increase is largely down to an increase in the Company's solid waste treatment business as production volumes from its industrial customers continued to recover from the lows of 2009.
Further to this, the addition of new customers in 2010, as well as additional revenue generated by the company's subsidiary, Dongtai Organic, from municipal sludge treatment, as well as sales of biogas, and revenues generated by waste disposal operations in connection with the June 2010 oil spill in Dalian also helped boost revenues.
Revenues from service fees increased 114.6% to $14.9 million, or 68.3% of total revenues, while sales of recycled commodities increased 90.1% to $6.9 million, or 31.7% of revenues. The increase in sales of recycled commodities is attributed to higher sale prices and increased volume for these products.
For example, the average price of cupric sulfate was approximately $1723 per tonne in 2010 as compared to $1285 per tonne in 2009, a 34% increase in average unit price. In addition, in 2010, revenues from the sale of methane gas generated $1.3 million whereas there were no sales of methane gas in 2009.
Gross profit increased 97.7% to $12.6 million from $6.4 million in 2009. Gross margin was 57.9% compared to 60.4% in 2009. The company attributes the decline in gross margin primarily to the additional overhead imposed by Dongtai Organic's sludge treatment operations, a business added in 2010 which has not yet reached full operating capacity.
Revenues up 106.2% to $21.8 million Gross profit up 97.7% to $12.6 million Operating income up 447.6% to $6.8 million Operating margin up to 31.3% from 11.8% Net income attributable to the company up 129.8% to $4.5 million Diluted earnings per shares up 142.9% to $0.29 per diluted share Operating cash flow up 130.9% to $4.7 million Working capital up 306.9% to $6.7 million "We are very pleased with our 2010 financial performance as we achieved strong growth in sales, profitability, EPS, and operating cash flow," said Jason Dong, Chairman and CEO. "Our business rebounded significantly in 2010 from the lows of 2009, a year where we were impacted by the global recession and slowdown in world trade."
"Importantly, we grew our bottom line and operating cash flow even faster than our top line at both the net income and EPS lines. Our increased profitability was the result of our strong sales rebound combined with the operating leverage of our business. Overall, we are proud of our accomplishments in 2010 and believe we are on sound footing to continue our strong financial performance in 2011," added Dong.
The company says that its 'Expansion Project' in Dalian will be one of the most advanced one-stop service centres for industrial solid waste treatment in China. Construction is now 90% complete and operations expected to commence in the third quarter of 2011.
Once fully operational, this new facility will increase our industrial solid waste treatment capacity to 114,000 tons per year, which is double our current treatment capacity.
For the first half of 2011, the company expects revenues of between $10 million and $12 million and net income attributable to the Company of between $2.0 million and $2.5 million.
The solid waste treatment business in China is still in the start-up stage and China Industrial says that it is well positioned to take advantage of very strong growth opportunities in 2011 and beyond. In addition the company expects a surge in demand for sludge and other degradable waste treatment services as a result of a shortage in sludge treatment facilities.
"We are excited about our future opportunities and believe that we are poised to benefit from the rising demand for waste treatment in China. Supported by our state-of-the-art technology, we strive to become the leading industry player in Northern China. We expect the Expansion Project and other initiatives to contribute to our financial performance in fiscal 2011," concluded Dong.