Nevada
|
001-34591
|
90-0648920
|
||
(State or other jurisdiction of
incorporation or organization)
|
(Commission File No.)
|
(IRS Employee Identification No.)
|
99.1
|
Press release issued on November 13, 2013 relating to its second quarter financial results.
|
|
99.2
|
Press release issued on November 11, 2013 relating to the conference call.
|
Date: November 13, 2013
|
Cleantech Solutions International, Inc. | |
|
By: |
/s/ Adam Wasserman
|
Adam Wasserman
|
||
Chief Financial Officer
|
|
·
|
Revenue from the dyeing and finishing equipment segment increased 26.2% to $9.5 million, compared to $7.5 million for the third quarter of 2012.
|
|
·
|
Revenue from the sale of forged rolled rings to other industries decreased 24.4% to $5.0 million, compared with $6.6 million for the comparable period of the prior year.
|
|
·
|
Revenue from the sale of forged rolled rings for the wind power industry rose 16.0% to $3.7 million, compared to $3.2 million for the comparable period last year.
|
For the Three Months Ended
|
For the Nine Months Ended
|
|||||||||||||||
September 30,
|
September 30,
|
|||||||||||||||
2013
|
2012
|
2013
|
2012
|
|||||||||||||
REVENUES
|
$
|
18,213,508
|
$
|
17,343,723
|
$
|
49,312,341
|
$
|
39,585,815
|
||||||||
COST OF REVENUES
|
13,576,808
|
13,024,265
|
37,572,531
|
30,689,436
|
||||||||||||
GROSS PROFIT
|
4,636,700
|
4,319,458
|
11,739,810
|
8,896,379
|
||||||||||||
OPERATING EXPENSES:
|
||||||||||||||||
Depreciation
|
109,652
|
373,896
|
461,539
|
1,122,432
|
||||||||||||
Selling, general and administrative
|
1,316,925
|
739,386
|
2,675,076
|
2,157,053
|
||||||||||||
Total Operating Expenses
|
1,426,577
|
1,113,282
|
3,136,615
|
3,279,485
|
||||||||||||
INCOME FROM OPERATIONS
|
3,210,123
|
3,206,176
|
8,603,195
|
5,616,894
|
||||||||||||
OTHER INCOME (EXPENSE):
|
||||||||||||||||
Interest income
|
14,840
|
5,069
|
16,009
|
10,919
|
||||||||||||
Interest expense
|
(74,638
|
)
|
(84,289
|
)
|
(244,291
|
)
|
(244,685
|
)
|
||||||||
Foreign currency (loss) gain
|
(9,821
|
)
|
1,251
|
(15,800
|
)
|
6,642
|
||||||||||
Warrant modification expense
|
-
|
-
|
-
|
(235,133
|
)
|
|||||||||||
Other income
|
5,933
|
51,523
|
43,015
|
64,803
|
||||||||||||
Total Other Income (Expense), net
|
(63,686
|
)
|
(26,446
|
)
|
(201,067
|
)
|
(397,454
|
)
|
||||||||
INCOME BEFORE INCOME TAXES
|
3,146,437
|
3,179,730
|
8,402,128
|
5,219,440
|
||||||||||||
INCOME TAXES
|
1,015,701
|
824,628
|
2,326,239
|
1,490,173
|
||||||||||||
NET INCOME
|
$
|
2,130,736
|
$
|
2,355,102
|
$
|
6,075,889
|
$
|
3,729,267
|
||||||||
COMPREHENSIVE INCOME:
|
||||||||||||||||
NET INCOME
|
$
|
2,130,736
|
$
|
2,355,102
|
$
|
6,075,889
|
$
|
3,729,267
|
||||||||
OTHER COMPREHENSIVE INCOME:
|
||||||||||||||||
Unrealized foreign currency translation gain (loss)
|
516,244
|
(169,625
|
)
|
2,161,711
|
342,015
|
|||||||||||
COMPREHENSIVE INCOME
|
$
|
2,646,980
|
$
|
2,185,477
|
$
|
8,237,600
|
$
|
4,071,282
|
||||||||
NET INCOME PER COMMON SHARE:
|
||||||||||||||||
Basic
|
$
|
0.61
|
$
|
0.88
|
$
|
1.95
|
$
|
1.51
|
||||||||
Diluted
|
$
|
0.61
|
$
|
0.88
|
$
|
1.95
|
$
|
1.42
|
||||||||
WEIGHTED AVERAGE COMMON SHARES OUTSTANDING:
|
||||||||||||||||
Basic
|
3,479,646
|
2,667,017
|
3,112,148
|
2,469,818
|
||||||||||||
Diluted
|
3,479,646
|
2,667,017
|
3,112,148
|
2,617,798
|
September 30,
2013
|
December 31,
2012
|
|||||||
(Unaudited)
|
||||||||
ASSETS
|
||||||||
CURRENT ASSETS:
|
||||||||
Cash and cash equivalents
|
$
|
2,223,017
|
$
|
1,445,728
|
||||
Restricted cash
|
796,567
|
-
|
||||||
Notes receivable
|
485,793
|
88,029
|
||||||
Accounts receivable, net of allowance for doubtful accounts
|
11,545,834
|
10,078,623
|
||||||
Inventories, net of reserve for obsolete inventory
|
6,216,215
|
5,897,555
|
||||||
Advances to suppliers
|
1,303,911
|
593,104
|
||||||
Prepaid VAT on purchases
|
830,361
|
542,032
|
||||||
Prepaid expenses and other
|
227,651
|
428,326
|
||||||
Total Current Assets
|
23,629,349
|
19,073,397
|
||||||
PROPERTY AND EQUIPMENT - net
|
66,699,091
|
59,436,100
|
||||||
OTHER ASSETS:
|
||||||||
Deferred tax assets
|
566,666
|
551,890
|
||||||
Equipment held for sale
|
7,309,150
|
7,118,555
|
||||||
Land use rights, net
|
3,784,841
|
3,756,342
|
||||||
Total Assets
|
$
|
101,989,097
|
$
|
89,936,284
|
||||
LIABILITIES AND STOCKHOLDERS' EQUITY
|
||||||||
CURRENT LIABILITIES:
|
||||||||
Short-term bank loans
|
$
|
3,088,728
|
$
|
2,216,558
|
||||
Bank acceptance notes payable
|
796,567
|
-
|
||||||
Accounts payable
|
5,494,461
|
5,474,479
|
||||||
Accrued expenses
|
552,758
|
986,824
|
||||||
Capital lease obligation - current portion
|
-
|
251,413
|
||||||
Advances from customers
|
2,210,102
|
1,851,987
|
||||||
VAT and service taxes payable
|
-
|
206,527
|
||||||
Income taxes payable
|
1,069,434
|
822,082
|
||||||
Total Current Liabilities
|
13,212,050
|
11,809,870
|
||||||
OTHER LIABILITIES:
|
||||||||
Capital lease obligation - net of current portion
|
-
|
132,756
|
||||||
Total Liabilities
|
13,212,050
|
11,942,626
|
||||||
STOCKHOLDERS' EQUITY:
|
||||||||
Preferred stock ($0.001 par value; 10,000,000 shares authorized; 0 share issued and outstanding at September 30, 2013 and December 31, 2012, respectively)
|
-
|
-
|
||||||
Common stock ($0.001 par value; 50,000,000 shares authorized; 3,503,502 and 2,894,586 shares issued and outstanding at September 30, 2013 and December 31, 2012, respectively)
|
3,503
|
2,894
|
||||||
Additional paid-in capital
|
31,532,308
|
28,987,128
|
||||||
Retained earnings
|
44,200,317
|
38,401,734
|
||||||
Statutory reserve
|
2,757,044
|
2,479,738
|
||||||
Accumulated other comprehensive gain - foreign currency translation adjustment
|
10,283,875
|
8,122,164
|
||||||
Total Stockholders' Equity
|
88,777,047
|
77,993,658
|
||||||
Total Liabilities and Stockholders' Equity
|
$
|
101,989,097
|
$
|
89,936,284
|
For the Nine Months Ended
|
||||||||
September 30,
|
||||||||
2013
|
2012
|
|||||||
CASH FLOWS FROM OPERATING ACTIVITIES:
|
||||||||
Net income
|
$
|
6,075,889
|
$
|
3,729,267
|
||||
Adjustments to reconcile net income from operations to net cash provided by operating activities:
|
||||||||
Depreciation
|
4,882,899
|
4,719,769
|
||||||
Amortization of land use rights
|
71,261
|
70,068
|
||||||
Increase (decrease) in allowance for doubtful accounts
|
76,784
|
(46,616
|
)
|
|||||
Warrant modification expense
|
-
|
235,133
|
||||||
Stock-based compensation expense
|
278,034
|
129,030
|
||||||
Changes in operating assets and liabilities:
|
||||||||
Notes receivable
|
(390,950
|
)
|
(112,209
|
)
|
||||
Accounts receivable
|
(1,260,651
|
)
|
(3,368,092
|
)
|
||||
Inventories
|
(158,944
|
)
|
(1,925,810
|
)
|
||||
Prepaid value-added taxes on purchases
|
(270,730
|
)
|
844,969
|
|||||
Prepaid and other current assets
|
82,378
|
(41,315
|
)
|
|||||
Advances to suppliers
|
(687,094
|
)
|
(627,455
|
)
|
||||
Accounts payable
|
(672,461
|
)
|
1,310,123
|
|||||
Accrued expenses
|
(451,672
|
)
|
(49,578
|
)
|
||||
VAT and service taxes payable
|
(209,667
|
)
|
-
|
|||||
Income taxes payable
|
222,801
|
289,230
|
||||||
Advances from customers
|
305,052
|
668,446
|
||||||
NET CASH PROVIDED BY OPERATING ACTIVITIES
|
7,892,929
|
5,824,960
|
||||||
|
||||||||
CASH FLOWS FROM INVESTING ACTIVITIES:
|
||||||||
Purchase of property and equipment
|
(9,943,309
|
)
|
(6,334,776
|
)
|
||||
NET CASH USED IN INVESTING ACTIVITIES
|
(9,943,309
|
)
|
(6,334,776
|
)
|
||||
CASH FLOWS FROM FINANCING ACTIVITIES:
|
||||||||
Principal payments on capital lease
|
(390,009
|
)
|
(205,509
|
)
|
||||
Proceeds from bank loans
|
4,821,973
|
2,686,706
|
||||||
Repayments of bank loans
|
(4,018,311
|
)
|
(2,370,623
|
)
|
||||
(Increase) decrease in restricted cash
|
(787,589
|
)
|
316,083
|
|||||
Increase (decrease) in bank acceptance notes payable
|
787,589
|
(316,083
|
)
|
|||||
Net proceeds from sale of common stock
|
2,388,589
|
-
|
||||||
Proceeds from exercise of warrants
|
-
|
198,142
|
||||||
NET CASH PROVIDED BY FINANCING ACTIVITIES
|
2,802,242
|
308,716
|
||||||
EFFECT OF EXCHANGE RATE ON CASH AND CASH EQUIVALENTS
|
25,427
|
3,898
|
||||||
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS
|
777,289
|
(197,202
|
)
|
|||||
CASH AND CASH EQUIVALENTS - beginning of period
|
1,445,728
|
1,152,607
|
||||||
CASH AND CASH EQUIVALENTS - end of period
|
$
|
2,223,017
|
$
|
955,405
|
||||
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
|
||||||||
Cash paid for:
|
||||||||
Interest
|
$
|
244,291
|
$
|
244,685
|
||||
Income taxes
|
$
|
2,103,438
|
$
|
1,200,944
|
||||
NON-CASH INVESTING AND FINANCING ACTIVITIES:
|
||||||||
Property and equipment acquired on credit as payable
|
$
|
547,294
|
$
|
-
|
||||
Series A preferred converted to common shares
|
$
|
-
|
$
|
13,198
|
||||
Common stock issued for future service
|
$
|
78,600
|
$
|
27,440
|
|
For the Three Months Ended September 30,
|
For the Nine Months Ended September 30,
|
||||||||||||||
|
2013
|
2012
|
2013
|
2012
|
||||||||||||
Net income
|
$ | 2,130,736 | $ | 2,355,102 | $ | 6,075,889 | $ | 3,729,267 | ||||||||
Add: income tax
|
1,015,701 | 824,628 | 2,326,239 | 1,490,173 | ||||||||||||
Add: interest expense
|
74,638 | 84,289 | 244,291 | 244,685 | ||||||||||||
Add: warrant modification expense
|
- | - | - | 235,133 | ||||||||||||
Add: depreciation and amortization
|
1,685,694 | 1,650,599 | 4,954,160 | 4,789,837 | ||||||||||||
Adjusted EBITDA
|
$ | 4,906,769 | $ | 4,914,618 | $ | 13,600,579 | $ | 10,489,095 |
|
For the Three Months Ended September 30,
|
For the Nine Months Ended September 30,
|
||||||||||||||
|
2013
|
2012
|
2013
|
2012
|
||||||||||||
|
||||||||||||||||
Net income
|
$ | 2,130,736 | $ | 2,355,102 | $ | 6,075,889 | $ | 3,729,267 | ||||||||
Add: warrant modification expense
|
- | - | - | 235,133 | ||||||||||||
Adjusted net income
|
$ | 2,130,736 | $ | 2,355,102 | $ | 6,075,889 | $ | 3,964,400 | ||||||||
|
||||||||||||||||
Weighted average shares - diluted
|
3,479,646 | 2,667,017 | 3,112,148 | 2,617,798 | ||||||||||||
Adjusted diluted EPS
|
$ | 0.61 | $ | 0.88 | $ | 1.95 | $ | 1.51 |