Conference Call
China Information Technology will host a corresponding conference call and live webcast at 8:00 am Eastern Standard Time (EST) (9:00 pm, Beijing time).
The dial-in details for the live conference call are as follows:
- U.S. Toll Free Number: | +1-866-519-4004 | |
- International Dial-in Number: | +65-6723-9381 | |
- Mainland China Toll Free Number: | 10-800-819-0121 | |
- Hong Kong Toll Free Number: | 80 093 0346 | |
Conference ID: 22786180 |
| |
A live and archived webcast of the call will be available on the Investor Relations section of China Information Technology's website at http://www.chinacnit.com.
A telephone replay of the call will be available from November 08, 2010 through November 16, 2010.
The dial-in details for the replay are as follows:
- U.S. Toll Free Number | +1-866-214-5335 | |
- International Dial-in Number | +61-2-8235-5000 | |
Conference ID: 22786180 |
| |
About China Information Technology, Inc.
China Information Technology, Inc., through its subsidiaries and other consolidated entities, specializes in geographic information systems (GIS), digital public security technology (DPST) and digital hospital information systems, with the goal of being the largest GIS software provider in China. Headquartered in Shenzhen, China, the Company's total solutions include specialized software, hardware, systems integration, and related services organized into three business segments - Geographic Information Systems (GIS), Digital Public Security Technology (DPST), and Digital Hospital Information Systems (DHIS). To learn more about the Company, please visit its corporate website at http://www.chinacnit.com.
Safe Harbor Statement
This press release may contain certain "forward-looking statements" relating to the business of China Information Technology, Inc., and its subsidiary companies. All statements, other than statements of historical fact included herein are "forward-looking statements" including statements regarding: the significance of the Company's new contract wins during the quarter; the ability of the Company to continue to strengthen its position in the industry by winning and successfully performing under national contracts; the ability of the Company to secure future opportunities in the market by leveraging its R&D capabilities and reputation; the continued support of the Chinese government for domestic GIS products; the general ability of the Company to achieve its commercial objectives, including the Company's plan to sustain the growth while creating shareholder value; the business strategy, plans and objectives of the Company and its subsidiaries; and any other statements of non-historical information. These forward-looking statements are often identified by the use of forward-looking terminology such as "believes," "expects" or similar expressions, involve known and unknown risks and uncertainties. Although the Company believes that the expectations reflected in these forward-looking statements are reasonable, they do involve assumptions, risks and uncertainties, and these expectations may prove to be incorrect. Investors should not place undue reliance on these forward-looking statements, which speak only as of the date of this press release. The Company's actual results could differ materially from those anticipated in these forward-looking statements as a result of a variety of factors, including those discussed in the Company's periodic reports that are filed with the Securities and Exchange Commission and available on its website ( http://www.sec.gov). All forward-looking statements attributable to the Company or persons acting on its behalf are expressly qualified in their entirety by these factors. Other than as required under the securities laws, the Company does not assume a duty to update these forward-looking statements.
For further information, please contact:
China Information Technology, Inc.
Iris Yan
Tel: +86-755-8370-4767
Email: Email Contact
Christensen
Kathy Li
Tel: +1-480-614-3036
Email: Email Contact
Teal Willingham
Tel: +86-010-5971-2001
Email: Email Contact
CHINA INFORMATION TECHNOLOGY, INC. CONDENSED CONSOLIDATED BALANCE SHEETS AS OF SEPTEMBER 30, 2010 AND DECEMBER 31, 2009 Expressed in U.S. dollars (Except for share and per share amounts) | |||||||||
|
|
|
|
| September 30 |
|
| December 31 |
| |
|
|
|
|
| 2010 |
|
| 2009 |
| |
| ASSETS |
|
|
| (Unaudited) |
|
|
|
| |
|
|
|
|
|
|
|
|
|
| |
| CURRENT ASSETS |
|
|
|
|
|
|
|
| |
| Cash and cash equivalents |
|
| $ | 18,001,834 |
| $ | 13,478,633 |
| |
| Restricted cash |
|
|
| 7,843,653 |
|
| 5,859,910 |
| |
| Accounts receivable: |
|
|
|
|
|
|
|
| |
| Billed, net of allowance for doubtful accounts of $ 3,136,000 and $3,123,000, respectively |
|
|
| 19,777,808 |
|
| 23,907,035 |
| |
| Unbilled |
|
|
| 72,060,307 |
|
| 47,851,638 |
| |
| Bills receivable |
|
|
| 568,860 |
|
| - |
| |
| Advances to suppliers |
|
|
| 8,840,865 |
|
| 6,924,035 |
| |
| Amount due from related parties, net of allowance for doubtful accounts of $0 and $73,000, respectively |
|
|
| 264,840 |
|
| 129,937 |
| |
| Inventories, net of provision of $ 320,000 and $184,000,respectively |
|
|
| 23,498,795 |
|
| 10,936,004 |
| |
| Other receivables and prepaid expenses |
|
|
| 6,772,698 |
|
| 15,405,089 |
| |
| Deferred tax assets |
|
|
| 1,530,931 |
|
| 1,719,327 |
| |
| TOTAL CURRENT ASSETS |
|
|
| 159,160,591 |
|
| 126,211,608 |
| |
|
|
|
|
|
|
|
|
|
| |
| Deposit for software purchase |
|
|
| 5,050,878 |
|
| 1,426,452 |
| |
| Deposit for purchase of land use rights |
|
|
| 18,175,883 |
|
| - |
| |
| Long-term investments |
|
|
| 2,055,195 |
|
| 2,862,016 |
| |
| Property, plant and equipment, net |
|
|
| 75,218,112 |
|
| 53,586,514 |
| |
| Land use rights, net |
|
|
| 1,914,475 |
|
| 1,907,611 |
| |
| Intangible assets, net |
|
|
| 13,407,005 |
|
| 13,556,141 |
| |
| Goodwill |
|
|
| 50,067,871 |
|
| 50,609,866 |
| |
| Deferred tax assets |
|
|
| 554,747 |
|
| 668,730 |
| |
| TOTAL ASSETS |
|
| $ | 325,604,757 |
| $ | 250,828,938 |
| |
|
|
|
|
|
|
|
|
|
| |
| LIABILITIES AND EQUITY |
|
|
|
|
|
|
|
| |
|
|
|
|
|
|
|
|
|
| |
| CURRENT LIABILITIES |
|
|
|
|
|
|
|
| |
| Short-term bank loans |
|
| $ | 27,390,533 |
| $ | 15,927,780 |
| |
| Accounts payable |
|
|
| 18,033,514 |
|
| 20,159,317 |
| |
| Bills payable |
|
|
| 26,795,017 |
|
| 12,658,029 |
| |
| Advances from customers |
|
|
| 6,163,440 |
|
| 3,950,744 |
| |
| Amount due to related parties, current portion |
|
|
| 678,008 |
|
| 583,736 |
| |
| Accrued payroll and benefits |
|
|
| 1,935,712 |
|
| 3,142,240 |
| |
| Other payables and accrued expenses |
|
|
| 7,931,283 |
|
| 14,252,918 |
| |
| Contingent consideration, current portion |
|
|
| 1,468,901 |
|
| 1,857,994 |
| |
| Income tax payable |
|
|
| 5,648,596 |
|
| 3,290,245 |
| |
| TOTAL CURRENT LIABILITIES |
|
|
| 96,045,004 |
|
| 75,823,003 |
| |
|
|
|
|
|
|
|
|
|
| |
| Long-term bank loans |
|
|
| 8,592,780 |
|
| 1,907,100 |
| |
| Amount due to related parties, long-term portion |
|
|
| 5,009,478 |
|
| - |
| |
| Contingent consideration, net of current portion |
|
|
| 2,083,503 |
|
| 2,635,397 |
| |
| Deferred tax liabilities |
|
|
| 1,863,638 |
|
| 2,564,604 |
| |
| TOTAL LIABILITIES |
|
|
| 113,594,403 |
|
| 82,930,104 |
| |
|
|
|
|
|
|
|
|
|
| |
| COMMITMENTS AND CONTINGENCIES |
|
|
| - |
|
| - |
| |
|
| |||||||||
| CHINA INFORMATION TECHNOLOGY, INC. CONDENSED CONSOLIDATED BALANCE SHEETS AS OF SEPTEMBER 30 , 20 10 AND DECEMBER 31, 20 0 9 (CONTINUED) Expressed in U.S. dollars (Except for share and per share amounts) | |||||||||
| EQUITY |
|
|
|
|
|
|
|
| |
| Common stock, par $0.01; authorized capital 200,000,000 shares; shares issued and outstanding 20 10: 52,061,787 : 200 9 : 49,905,141shares |
|
| $ | 255,115 |
| $ | 233,548 |
| |
| Treasury stock, 6,000 shares, at cost |
|
|
| (11,468) |
|
| (11,468) |
| |
| Additional paid-in capital |
|
|
| 90,381,445 |
|
| 78,495,062 |
| |
| Reserve |
|
|
| 8,345,371 |
|
| 8,345,371 |
| |
| Retained earnings |
|
|
| 86,705,220 |
|
| 60,462,275 |
| |
| Accumulated other comprehensive income |
|
|
| 8,929,721 |
|
| 5,016,575 |
| |
| Total equity of the Company |
|
|
| 194,605,404 |
|
| 152,541,363 |
| |
| Non-controlling interest |
|
|
| 17,404,950 |
|
| 15,357,471 |
| |
| Total equity |
|
|
| 212,010,354 |
|
| 167,898,834 |
| |
|
|
|
|
|
|
|
|
|
| |
| TOTAL LIABILITIES AND EQUITY |
|
|
| 325,604,757 |
|
| 250,828,938 |
| |
|
| |||||||||
| CHINA INFORMATION TECHNOLOGY, INC. CONDENSED CONSOLIDATED STATEMENTS OF INCOME FOR THE THREE AND NINE MONTHS EN DED SEPTEMBER 30 , 2010 AND 200 9 (Unaudited) Expressed in U.S. dollars (Except for share and per share amounts) | |||||||||||||
|
|
| Three Months Ended |
|
| Nine Months Ended |
| |||||||
|
|
| September 30, |
|
| September 30, |
| |||||||
|
|
| 2010 |
|
| 20 09 |
|
| 2010 |
|
| 20 09 |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
| Revenue - Products | $ | 12,643,172 |
| $ | 2,444,969 |
| $ | 26,462,653 |
| $ | 9,055,386 |
| |
| Revenue - Software |
| 29,474,263 |
|
| 20,178,136 |
|
| 67,059,131 |
|
| 45,111,089 |
| |
| Revenue - System integration |
| 1,347,984 |
|
| 5,927,117 |
|
| 7,617,390 |
|
| 14,454,193 |
| |
| Revenue - Others |
| 340,712 |
|
| 130,459 |
|
| 1,488,952 |
|
| 828,116 |
| |
| TOTAL REVENUE |
| 43,806,131 |
|
| 28,680,681 |
|
| 102,628,126 |
|
| 69,448,784 |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
| Cost - Products sold |
| 10,725,203 |
|
| 1,765,042 |
|
| 21,779,326 |
|
| 7,385,682 |
| |
| Cost - Software sold |
| 11,314,585 |
|
| 7,365,142 |
|
| 27,973,686 |
|
| 16,059,719 |
| |
| Cost - System integration |
| 621,310 |
|
| 4,402,388 |
|
| 3,667,840 |
|
| 10,943,151 |
| |
| Cost - Others |
| 59,440 |
|
| 28,112 |
|
| 205,922 |
|
| 190,220 |
| |
| TOTAL COST |
| 22,720,538 |
|
| 13,560,684 |
|
| 53,626,774 |
|
| 34,578,772 |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
| GROSS PROFIT |
| 21,085,593 |
|
| 15,119,997 |
|
| 49,001,352 |
|
| 34,870,012 |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
| Administrative expenses |
| (5,449,209) |
|
| (2,462,872) |
|
| (10,840,741) |
|
| (6,983,595) |
| |
| Research and development expenses |
| (937,774) |
|
| (687,580) |
|
| (2,067,854) |
|
| (1,911,844) |
| |
| Selling expenses |
| (1,697,564) |
|
| (715,951) |
|
| (4,401,337) |
|
| (1,954,016) |
| |
| INCOME FROM OPERATIONS |
| 13,001,046 |
|
| 11,253,594 |
|
| 31,691,420 |
|
| 24,020,557 |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
| Subsidy income |
| 6,521 |
|
| 158,520 |
|
| 438,201 |
|
| 674,379 |
| |
| Other income, net |
| 350,874 |
|
| 2,654 |
|
| 992,973 |
|
| 167,174 |
| |
| Interest income |
| 22,024 |
|
| 40,948 |
|
| 51,318 |
|
| 238,492 |
| |
| Interest expense |
| (548,184) |
|
| (109,204) |
|
| (960,832) |
|
| (225,858) |
| |
| INCOME BEFORE INCOME TAXES |
| 12,832,281 |
|
| 11,346,512 |
|
| 32,213,080 |
|
| 24,874,744 |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
| Income tax expense |
| (2,361,593) |
|
| (1,797,945) |
|
| (5,696,285) |
|
| (3,478,141) |
| |
| NET INCOME |
| 10,470,688 |
|
| 9,548,567 |
|
| 26,516,795 |
|
| 21,396,603 |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
| Add/( Less ) : Net income attributable to the non-controlling interest |
| 139,080 |
|
| 177,476 |
|
| ( 273,850 ) |
|
| (115,742) |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
| NET INCOME ATTRIBUTABLE TO THE COMPANY | $ | 10,609,768 |
| $ | 9,726,043 |
| $ | 2 6,242,945 |
| $ | 21,280,861 |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
| Weighted average number of shares |
|
|
|
|
|
|
|
|
|
|
|
| |
| Basic |
| 51,466,927 |
|
| 47,536,883 |
|
| 51,377,933 |
|
| 47,531,327 |
| |
| Diluted |
| 51,466,927 |
|
| 47,536,883 |
|
| 51,377,933 |
|
| 47,531,327 |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
| Earnings per share - Basic and Diluted |
|
|
|
|
|
|
|
|
|
|
|
| |
| Basic - Net income attributable to the Company's common stockholders | $ | 0. 21 |
| $ | 0.20 |
| $ | 0. 51 |
| $ | 0.45 |
| |
| Diluted - Net income attributable to the Company's common stockholders | $ | 0. 21 |
| $ | 0.20 |
| $ | 0 51 |
| $ | 0.45 |
| |
|
| |||||||||||||
| CHINA INFORMATION TECHNOLOGY, INC. CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME FOR THE THREE AND NINE MONTHS ENDED SEPTEMBER 30 , 2010 AND 200 9 (Unaudited) Expressed in U.S. dollars (Except for share and per share amounts) | |||||||||||||
|
|
| Three Months Ended |
|
| Nine Months Ended |
| |||||||
|
|
| September 30, |
|
| September 30, |
| |||||||
|
|
| 2010 |
|
| 20 09 |
|
| 2010 |
|
| 2009 |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
| Net income | $ | 10,470,688 |
| $ | 9,548,567 |
| $ | 26,516,795 |
| $ | 21,396,603 |
| |
| Other comprehensive income: |
|
|
|
|
|
|
|
|
|
|
|
| |
| Foreign currency translation gain |
| 2,948,257 |
|
| 208,129 |
|
| 3,972,752 |
|
| 643,508 |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
| Comprehensive income |
| 13,418,945 |
|
| 9,756,696 |
|
| 30,489,547 |
|
| 22,040,111 |
| |
| Comprehensive income attributable to the non-controlling interest |
| 99,972 |
|
| 174,004 |
|
| (333,456) |
|
| (119,301) |
| |
| Comprehensive income attributable to the Company | $ | 13,518,917 |
| $ | 9,930,700 |
| $ | 30,156,091 |
| $ | 21,920,810 |
| |
|
| |||||||||||||
| CHINA INFORMATION TECHNOLOGY, INC. CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS FOR THE NINE MONTHS ENDED SEPTEMBER 30 , 2010 AND 2009 (Unaudited) Expressed in U.S. dollars (Except for share and per share amounts) | |||||||
|
|
| Nine Months Ended |
| ||||
|
|
| September 30, |
| ||||
|
|
| 20 10 |
|
| 2009 |
| |
| OPERATING ACTIVITIES |
|
|
|
|
|
| |
| Net income | $ | 26,516,795 |
| $ | 21,396,603 |
| |
| Adjustments to reconcile net income to net cash provided by operating activities: |
|
|
|
|
|
| |
| Depreciation |
| 5,415,554 |
|
| 2,825,201 |
| |
| Amortization of intangible assets |
| 1,349,745 |
|
| 1,305,550 |
| |
| Stock-based compensation |
| 1,130,000 |
|
| 183,600 |
| |
| L oss on disposal of property and equipment |
| 321,854 |
|
| 33,966 |
| |
| Loss on write-off of land use rights |
| 231,615 |
|
|
|
| |
| Impairment of long-term investment |
| 850,320 |
|
| 184,397 |
| |
| Loss on doubtful accounts receivable |
| 1,060,348 |
|
| 576,832 |
| |
| Provision for obsolete inventories |
| 130,328 |
|
| - |
| |
| Change in d eferred income tax |
| 162,900 |
|
| (117,583) |
| |
| Deemed interests in relat ion to shareholder's loan |
| 125,000 |
|
| - |
| |
| Change in fair value of contingent consideration |
| (940,986) |
|
| - |
| |
| Changes in operating assets and liabilities, net of effects of business acquisitions: |
|
|
|
|
|
| |
| In crease in restricted cash |
| (658,872) |
|
| - |
| |
| Increase in accounts receivable |
| (19,772,920) |
|
| (17,231,581) |
| |
| I ncrease in advances to suppliers |
| (2,394,325) |
|
| (6,177,155) |
| |
| Decrease / (increase) in other receivables and prepaid expenses |
| 8,134,566 |
|
| (1,315,827) |
| |
| Increase in inventories |
| (12,431,677) |
|
| (620,005) |
| |
| I ncrease in accounts payable and bills payable |
| 11,143,415 |
|
| 5,944,128 |
| |
| I ncrease in advances from customers |
| 2,100,476 |
|
| 439,436 |
| |
| Increase in amount due to related parties |
| 75,244 |
|
| 67,081 |
| |
| D ecrease in other payables and accrued expenses |
| (5,931,994) |
|
| (507,220) |
| |
| In crease in income tax payable |
| 2,253,344 |
|
| 1,338,726 |
| |
| Net cash provided by operating activities |
| 18,870,730 |
|
| 8,326,149 |
| |
|
|
|
|
|
|
|
| |
| INVESTING ACTIVITIES |
|
|
|
|
|
| |
| Increase in restricted cash in relation to credit facilities |
| (1,172,663) |
|
| - |
| |
| Proceeds from sales of property and equipment |
| 55,925 |
|
| 100,299 |
| |
| Purchase of land use rights |
| (231,615) |
|
|
|
| |
| Proceeds from sale of short-term investments |
| - |
|
| 5,863,600 |
| |
| Refund of investment in former Joint Venture |
| - |
|
| 4,397,700 |
| |
| Purchases of property and equipment |
| (24,332,630) |
|
| (3,682,753) |
| |
| Capitalized and purchased software development costs |
| (899,204) |
|
| (435,494) |
| |
| Deposit for software purchase |
| (4,963,154) |
|
| (6,822,826) |
| |
| Deposit for business acquisition |
| - |
|
| (8,000,000) |
| |
| Deposit for purchase of land use rights |
| (17,266,658) |
|
| - |
| |
| Net cash used in investing activities |
| (48,809,999) |
|
| (8,579,474) |
| |
|
|
|
|
|
|
|
| |
|
| |||||||
| CHINA INFORMATION TECHNOLOGY, INC. CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS FOR THE NINE MONTHS ENDED SEPTEMBER 30 , 2010 AND 2009 (CONTINUED ) (Unaudited) Expressed in U.S. dollars (Except for share and per share amounts) | |||||||
|
|
| Nine Months Ended |
| ||||
|
|
| September 30, |
| ||||
|
|
| 20 10 |
|
| 2009 |
| |
|
|
|
|
|
|
|
| |
| FINANCING ACTIVITIES |
|
|
|
|
|
| |
| Borrowing of short-term loans |
| 37,198,374 |
|
| 6,296,041 |
| |
| Borrowing of share - holder ' s loan |
| 6,029,700 |
|
| - |
| |
| Borrowing of long-term loans |
| 8,443,540 |
|
| - |
| |
| Repayment of short-term loans |
| (26,150,419) |
|
| (1,172,720) |
| |
| Repayment of shareholder ' s loan |
| (1,029,700) |
|
| - |
| |
| Repayment of long-term loans |
| (1,912,300) |
|
| - |
| |
| Issued common stock |
| 9,383,440 |
|
| - |
| |
| Repurchase of common stock |
| - |
|
| (11,468) |
| |
| Capital injection to Geo by minority share-holders |
| 1,734,309 |
|
| - |
| |
| Net cash provided by financing activities |
| 33,696,944 |
|
| 5,111,853 |
| |
|
| |||||||
|
| |||||||
| Effect of exchange rate changes on cash and cash equivalent s |
| 765,526 |
|
| 40,325 |
| |
|
| |||||||
|
| |||||||
| NET IN CREASE IN CASH AND CASH EQUIVALENTS |
| 4,523,201 |
|
| 4,898,853 |
| |
| CASH AND CASH EQUIVALENTS, BEGINNING |
| 13,478,633 |
|
| 9,565,252 |
| |
| CASH AND CASH EQUIVALENTS, ENDING | $ | 18,001,834 |
| $ | 14,464,105 |
| |
| Supplemental disclosure of cash flow information: |
|
|
|
|
|
| ||||||||
|
|
| Nine Months Ended |
| |||||||||||
|
|
| September 30, |
| |||||||||||
|
|
| 20 10 |
|
| 2009 |
| ||||||||
| Cash paid during the period |
|
|
|
|
|
| ||||||||
| Income taxes | $ | 3,288,052 |
| $ | 2,256,998 |
| ||||||||
| Interest paid | $ | 834,857 |
| $ | 209,639 |
| ||||||||
|
|
|
|
|
|
|
| ||||||||
| Supplemental disclosure of significant non-cash transactions : |
|
|
|
|
|
| ||||||||
|
| ||||||||||||||
