In the news release, "RINO Announces Second Quarter 2010 Financial
Results," issued
RINO Announces Second Quarter 2010 Financial Results 60.6% year-over-year total revenue increase 80.5% year-over-year operating profit increase
Second Quarter Highlights -- Total revenues in the second quarter of 2010 were $65.4 million, a 60.6% increase from the corresponding period in 2009. -- Operating profit in the second quarter of 2010 was $18.1 million, a 80.5% increase from the corresponding period in 2009. -- Net income in the second quarter of 2010 was $20.4 million, a 107.4% increase from the corresponding period in 2009. Net income excluding change in fair value of warrant (non-GAAP) was $15.5 million, a 33.0% increase from the corresponding period in 2009. -- Diluted earnings per share ("EPS") for the second quarter of 2010 was $0.71. Diluted EPS excluding change in fair value of warrant (non-GAAP) was $0.54, a 16.6% increase from $0.47 for the corresponding period in 2009.
"We are pleased to announce strong results for the second quarter 2010,"
said Mr.
"
Mr.
2010 Second Quarter Results
RINO reported total revenues of
Cost of sales for the second quarter of 2010 was
Total operating expenses for the second quarter of 2010 were
Share-based compensation expenses, which were allocated to the related
operating costs and expenses line items, increased in aggregate to
Income tax expense provision was
Net income for the second quarter of 2010 was
Balance Sheet and Cash Flow Discussion
Cash and cash equivalents as of
Accounts receivable stood at
For the first six months of 2010, cash used in operations totaled
Backlog as of
Backlog, defined as projects for which contracts have been signed but
which have not been completed or started, as of
Product Segment Amount ($ millions) 1. Desulphurization Systems 70.8 2. Wastewater Treatment 14.6 3. Anti-oxidation Systems 0.4 4. Municipal Sludge Treatment 18.9 Total 104.7 Recent Business Updates
Approval for new bank loan
In
Outlook for Fiscal Year 2010
RINO continues to expect to generate total revenues in an amount ranging
from
Conference Call Information
RINO's management will host an earnings conference call at
Dial-in details for the earnings conference call are as follows: International: +1-857-350-1602 US: +1-866-783-2143 UK: +44-207-365-8426 Hong Kong: +852-3002-1672 Passcode: 90238159
A replay of the conference call may be accessed by phone at the following
number until
International: +1-617-801-6888 US: +1-888-286-8010 Passcode: 52332473
Additionally, a live and archived webcast of this conference call will be available at http://ir.stockpr.com/rinointernational/ .
About RINO International Corporation
RINO International Corporation is a leading provider of clean technology
solutions to
Cautionary Statement Regarding Forward-Looking Information
Certain statement in this press release may contain forward-looking information about the Company. Forward-looking statements are statements that are not historical facts. These statements can be identified by the use of forward-looking terminology such as "believe," "expect," "may," "will," "should," "project," "plan," "seek," "intend," or "anticipate" or the negative thereof or comparable terminology, and statements which may include discussions of strategy, and statements about industry trends future performance, operations and products of each of the entities referred to above. Actual performance results may vary significantly from expectations and projections as a result of various factors, including without limitation and the risks set forth "Risk Factors" contained in the Company's Annual Reports on Form 10-K, and Quarterly Reports on Form 10-Q.
About Non-GAAP Financial Measures
The management of RINO International Corporation (herein "RINO") uses non-GAAP adjusted net earnings to measure the performance of the Company's business internally by excluding non-recurring items as well as special non-cash charges. The Company's management believes that these non-GAAP adjusted financial measures allow the management to focus on managing business operating performance because these measures reflect the essential operating activities of RINO and provide a consistent method of comparison to historical periods. The Company believes that providing the non-GAAP measures that management uses internally to its investors is useful to investors for a number of reasons. The non-GAAP measures provide a consistent basis for investors to understand RINO's financial performance in comparison to historical periods without variations caused by non-recurring items and non-operating related charges. In addition, it allows investors to evaluate the Company's performance using the same methodology and information as that used by the management. Non-GAAP measures are subject to inherent limitations because they do not include all of the expenses included under GAAP and because they involve the exercise of judgment of which charges are excluded from GAAP financial measure. However, the management of RINO compensates for these limitations by providing the relevant disclosure of the items excluded.
The following table provides the non-GAAP financial measures and the related GAAP measures and provides a reconciliation of the non-GAAP measure to the equivalent GAAP measure.
Q2 2010 Q2 2009 GAAP Net Income $ 20,436,248 $ 9,855,284 Change in fair value of warrants $ 4,889,118 $ (1,833,745) Adjusted Net Income $15,547,130 $ 11,689,029 Adjusted EPS (Diluted) $ 0.54 $ 0.47 For more information, please contact: In China: Mr. Ben Wang Chief Financial Officer RINO International Corporation Tel: +86-411-8766-1828 Email: benwang@rinogroup.com Ms. Cynthia He Brunswick Group LLP Tel: +86-10-6566-2256 Email: rino@brunswickgroup.com In the U.S.: Ms. Cindy Zheng Brunswick Group LLP Tel: +1-212-333-3810 Email: rino@brunswickgroup.com RINO INTERNATIONAL CORPORATION AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS AS OF JUNE 30, 2010 AND DECEMBER 31, 2009 2010 2009 A S S E T S CURRENT ASSETS Cash and cash equivalents $88,036,608 $134,487,611 Restricted cash 3,388,392 -- Notes receivable 469,960 440,100 Due from shareholders -- 3,005,386 Accounts receivable, trade, net of allowance for doubtful accounts of $562,822 and $273,446 as of June 30, 2010 and December 31, 2009, respectively 68,389,279 57,811,171 Costs and estimated earnings in excess of billings on uncompleted contracts 38,902,971 3,258,806 Inventories 4,401,228 5,405,866 Advances for inventory purchases 64,425,996 34,056,231 Other current assets and prepaid expenses 879,076 629,506 Total current assets 268,893,510 239,094,677 PLANT AND EQUIPMENT, NET 13,020,836 12,265,389 OTHER ASSETS Investment in unconsolidated affiliate 441,900 -- Advances for non current assets 9,492,531 6,570,378 Intangible assets, net 9,026,114 1,144,796 Total other assets 18,960,545 7,715,174 Total assets $300,874,891 $259,075,240 L I A B I L I T I E S A N D S H A R E H O L D E R S' E Q U I T Y CURRENT LIABILITIES Accounts payable $7,202,192 $4,281,353 Short term bank loans 3,682,500 1,467,000 Notes payable 3,388,392 -- Billings in excess of costs and estimated earnings on uncompleted contracts 3,385,163 -- Customer deposits 351,630 4,984,801 Deferred revenue 1,333,127 -- Liquidated damages payable 20,147 20,147 Due to shareholders 535,895 -- Taxes payable 3,261,799 4,003,709 Other payables and accrued liabilities 508,564 496,411 Total current liabilities 23,669,409 15,253,421 Long-term loan 8,101,500 -- Warrant Liabilities 97,798 15,172,712 REDEEMABLE COMMON STOCK ($0.0001 par value, 5,464,357 shares issued with conditions for redemption outside the control of the company) 24,480,319 24,480,319 COMMITMENTS AND CONTINGENCIES SHAREHOLDERS' EQUITY Preferred Stock ($0.0001 par value, 50,000,000 shares authorized, none issued and outstanding) -- -- Common Stock ($0.0001 par value, 100,000,000 shares authorized, 28,605,321 and 28,603,321 shares issued and outstanding as of June 30, 2010 and December 31, 2009) 2,860 2,860 Additional paid-in capital 107,201,125 107,135,593 Retained earnings 115,517,443 78,983,794 Statutory reserves 14,314,417 11,755,312 Accumulated other comprehensive income 7,490,020 6,291,229 Total shareholders' equity 244,525,865 204,168,788 Total liabilities and shareholders' equity $300,874,891 $259,075,240 RINO INTERNATIONAL CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF INCOME AND OTHER COMPREHENSIVE INCOME (LOSS) FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2010 AND 2009 (UNAUDITED) Three Months Ended June 30, Six Months Ended June 30, 2010 2009 2010 2009 REVENUES Contracts $64,496,123 $40,469,182 $112,263,690 $75,835,318 Services 887,545 253,068 979,225 495,051 65,383,668 40,722,250 113,242,915 76,330,369 COST OF SALES Contracts 41,638,121 26,123,509 72,613,173 45,249,005 Services 494,649 268,912 494,649 592,830 Depreciation 170,767 162,260 355,442 370,327 42,303,537 26,554,681 73,463,264 46,212,162 GROSS PROFIT 23,080,131 14,167,569 39,779,651 30,118,207 OPERATING EXPENSES Selling, general and administrative expenses 4,958,664 4,146,294 11,771,338 7,517,018 Stock compensation expense 46,036 9,263 65,532 9,263 TOTAL OPERATING EXPENSES 5,004,700 4,155,557 11,836,870 7,526,281 INCOME FROM OPERATIONS 18,075,431 10,012,012 27,942,781 22,591,926 OTHER INCOME (EXPENSES), NET Other expense, net -110,664 3,871 -113,879 -5,779 Change in fair value of warrants 4,889,118 -1,833,745 15,074,914 -1,810,134 Interest income (expense), net 70,162 -72,974 140,444 -191,933 Gain on liquidated damage settlement -- 1,746,120 -- 1,746,120 TOTAL OTHER INCOME (EXPENSES), NET 4,848,616 -156,728 15,101,479 -261,726 INCOME BEFORE PROVISION FOR INCOME TAXES 22,924,047 9,855,284 43,044,260 22,330,200 PROVISION FOR INCOME TAXES 2,487,799 -- 3,951,506 -- NET INCOME 20,436,248 9,855,284 39,092,754 22,330,200 OTHER COMPREHENSIVE INCOME (LOSS): Foreign currency translation adjustment 1,065,043 -10,019 1,198,791 -137,639 COMPREHENSIVE INCOME $21,501,291 $9,845,265 $40,291,545 $22,192,561 WEIGHTED AVERAGE NUMBER OF SHARES: Basic 28,603,517 25,070,356 28,603,431 25,055,668 Diluted 28,609,452 25,070,940 28,610,245 25,055,668 EARNINGS PER SHARE: Basic $0.71 $0.39 $1.37 $0.89 Diluted $0.71 $0.39 $1.37 $0.89 RINO INTERNATIONAL CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENT OF SHAREHOLDERS' EQUITY Common Stock Par Value $0.0001 Retained Additional Earnings Number Common Paid-in Unrestricted of shares stock capital earnings BALANCE, January 31, 2009 $25,040,000 $2,504 $25,924,007 $28,570,948 Cumulative effect of reclassification of warrants -- -- -1,058,702 -420,070 Shares issued to settle liquidated damage payable 48,438 5 216,999 -- Stock issued for service 2,000 -- 8,960 -- Imputed interest on advances from a shareholder -- -- 13,557 -- Net income -- -- -- 22,330,200 Allocation to statutory reserve -- -- -- -2,477,427 Foreign currency translation gain -- -- -- -- BALANCE, June 30, 2009 (Unaudited) $25,090,438 $2,509 $25,104,821 $48,003,651 Stock compensation expense -- -- 38,425 -- Non cash exercise of warrant at $5.38 260,851 26 5,881,081 -- Stock issuance for cash for $30.75 3,252,032 325 76,111,266 -- Net income -- -- -- 34,061,550 Allocation to statutory reserve -- -- -- -3,081,407 Foreign currency translation gain -- -- -- -- BALANCE, December 31, 2009 $28,603,321 $2,860 $107,135,593 $78,983,794 Stock compensation expense 2,000 -- 65,532 -- Net income -- -- -- 39,092,754 Allocation to statutory reserve -- -- -- -2,559,105 Foreign currency translation gain -- -- -- -- BALANCE, June 30, 2010 (Unaudited) 28,605,321 2,860 107,201,125 115,517,443 Accumulated other Statutory comprehensive reserve income Totals BALANCE, January 31, 2009 $6,196,478 $6,221,943 $66,915,880 Cumulative effect of reclassification of warrants -- -- -1,478,772 Shares issued to settle liquidated damage payable -- -- 217,004 Stock issued for service -- -- 8,960 Imputed interest on advances from a shareholder -- -- 13,557 Net income -- -- 22,330,200 Allocation to statutory reserve 2,477,427 -- -- Foreign currency translation gain -- -137,639 -137,639 BALANCE, June 30, 2009 (Unaudited) $8,673,905 $6,084,304 $87,869,190 Stock compensation expense -- -- 38,425 Non cash exercise of warrant at $5.38 -- -- 5,881,107 Stock issuance for cash for $30.75 -- -- 76,111,591 Net income -- -- 34,061,550 Allocation to statutory reserve 3,081,407 -- -- Foreign currency translation gain -- 206,925 206,925 BALANCE, December 31, 2009 $11,755,312 $6,291,229 $204,168,788 Stock compensation expense -- -- 65,532 Net income -- -- 39,092,754 Allocation to statutory reserve 2,559,105 -- -- Foreign currency translation gain -- 1,198,791 1,198,791 BALANCE, June 30, 2010 (Unaudited) 14,314,417 7,490,020 244,525,865 RINO INTERNATIONAL CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS FOR THE SIX MONTHS ENDED JUNE 30, 2010 AND 2009 2010 2009 CASH FLOWS FROM OPERATING ACTIVITIES Net income $39,092,754 $22,330,200 Adjustments to reconcile net income to cash (used in) provided by operating activities: Depreciation 466,837 478,251 Amortization 86,273 33,377 Allowance for bad debt 287,064 205,687 Imputed interest on advances from shareholders -- 13,556 Amortization of long term prepaid expenses 39,166 7,329 Stock issued for services -- 9,263 Stock compensation expense and shares placed in escrow 65,532 -- Gain (expense) on Liquidated damage settlement -- -1,746,120 Change in fair value of warrants -15,074,914 1,810,134 Changes in operating assets and liabilities: Notes receivable -27,944 806,516 Accounts receivable -10,585,899 -21,802,792 Costs and estimated earnings in excess of billings on uncompleted contracts -35,483,281 -- Inventories 1,022,495 81,194 Advances for inventory purchases -30,105,286 6,308,955 Other current assets and prepaid expenses -246,017 -131,544 Accounts payable 2,891,305 -823,508 Customer deposits -4,634,288 -3,549,925 Billings in excess of costs and estimated earnings on uncompleted contracts 3,371,144 -- Other payables and accrued liabilities 10,077 -329,915 Deferred revenue 1,327,607 -- Taxes Payable -755,144 6,038,867 Net cash (used in) provided by operating activities -48,252,519 9,739,525 CASH FLOWS FROM INVESTING ACTIVITIES Payment for investment in unconsolidated affiliate -440,070 -- Purchase of equipment -1,169,547 -28,051 Advances for non current assets -2,922,462 -- Purchase of intangible assets -7,930,290 -- Net cash used in investing activities -12,462,369 -28,051 CASH FLOWS FROM FINANCING ACTIVITIES Change in restricted cash -3,374,360 1,030,317 Proceeds from notes payable - banks 3,374,360 88,382 Proceeds from short term bank loans 3,667,250 21,985,500 Payments on short term bank loans -1,466,900 -- Payments on liquidated damage settlement -- -615,018 Payment on due to shareholder -321,810 -824,808 Proceeds from shareholder 3,862,842 668,449 Proceeds from long term bank loans 8,067,950 -- Net cash provided by financing activities 13,809,332 22,332,822 EFFECT OF EXCHANGE RATE ON CASH 454,553 -42,094 (DECREASE) INCREASE IN CASH AND CASH EQUIVALENTS -46,451,003 32,002,202 CASH AND CASH EQUIVALENTS, beginning 134,487,611 19,741,982 CASH AND CASH EQUIVALENTS, ending $88,036,608 $51,744,184 SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION Cash paid for Interest expense $206,830 $369,146 Cash paid for income taxes $2,388,504 $229,848
SOURCE RINO International Corporation