SOURCE: China Infrastructure Investment Corporation

September 30, 2008 08:30 ET

China Infrastructure Investment Corporation Announces Its Audited Financial Results for the Fiscal Year Ended June 30, 2008

BEIJING--(Marketwire - September 30, 2008) - China Infrastructure Investment Corporation (NASDAQ: CIIC) (the "Company"), an emerging infrastructure development company operating in the People's Republic of China, announces today its audited financial results for the fiscal year ended June 30, 2008. The Company's revenues increased approximately US$18.0 million, or 46.8%, from approximately US$38.4 million for the fiscal year ended June 30. The Net income increased approximately US$5.0 million, or 67.8%, from approximately US$7.5 million for the fiscal year ended June 30, 2007.

CIIC, incorporated in Nevada, USA and headquartered in Henan Province, China, focuses on investing, constructing, operating and managing infrastructure development projects in China. The Company currently operates the Pinglin Expressway, a 106-kilometer (66 miles) dual carriageway four-lane toll road in the central province of Henan. The Expressway is an important passage from the northwest region to the southeast coastal region of China.

The Company's revenues are derived from the operation of the Pinglin Expressway. The revenue increase of approximately US$18.0 million, or 46.8% from fiscal year 2007, was mainly attributable to the increase in traffic volumes.

The Gross profit increased approximately US$11.8 million, or 37.9%, from approximately US$31.3 million for the fiscal year ended June 30. This increase reflected higher net sales and operating efficiencies generally across the expressway business.

General and administrative expenses increased approximately US$1.1 million, or 49.3%, from US$2.2 million for the fiscal year ended June 30, 2007. The increase in administration expenses was mainly attributable to the increase in payroll and benefits, increase in local taxes, professional services and travel expenses in association with the public listing.

The Company's net income increased approximately US$5.0 million, or 67.8%, from approximately US$7.5 million for the fiscal year ended June 30, 2007. This increase is primarily attributable to the growth of the toll revenues and well managed expenses.

Net cash provided by operating activities is approximately US$14.5 million for the fiscal year ended June 30, 2008, as compared to US$11.5 million for the fiscal year ended June 30, 2007. The increase is mainly due to the combined result of increased toll receipts, offset in part by operational costs and expenses.

The decrease in current portion of long-term loans primarily represented the maturity of the long-term loans of approximately US$134 million which have been renewed and extended through May 2022.

As of June 30, 2008, the Company's total cash and time deposit balance was US$5.77 million, compared to US$5.83 million as of June 30, 2007.

The Company made capital expenditures approximately of US$6.7 million and US$24.7 million for the years ended June 30, 2008 and 2007, respectively. The capital expenditures principally consisted of toll road infrastructures, toll stations and ancillary facilities, communication and monitoring equipments and other equipments related to toll operations.

Mr. Li Xipeng, Chairman and Chief Executive Officer of the Company, stated, "CIIC has achieved tremendous growth in fiscal year 2008. The economic expansion in China and specifically in Henan Province provided solid foundation and support for Company's growth. The management team was able to manage the costs along with high revenue growth to achieve outstanding performance." Mr. Li continued, "We also have successfully managed the Company's debt structure and cash flow. The Company is fully self-sustained by the cash flow from our existing operations and is able to meet our current financing obligations despite the turmoil in the world financial markets. With the listing on NASDAQ, CIIC is well positioned to grow its business through new project development and through merger and acquisition."

"Safe Harbor" statement under the Private Securities Litigation Reform Act of 1995:

This news release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are based on current expectations or beliefs, including, but not limited to, statements concerning the Company's operations, financial performance and condition. For this purpose, statements that are not statements of historical fact may be deemed to be forward-looking statements. The Company cautions that these statements by their nature involve risks and uncertainties, and actual results may differ materially depending on a variety of important factors, including, but not limited to, the impact of competitive conditions and effectiveness of marketing; changes in laws and regulations; fluctuations in costs of construction, financing costs and other factors as those discussed in the Company's reports filed with the Securities and Exchange Commission from time to time. In addition, the Company disclaims any obligation to update any forward-looking statements to reflect events or circumstances after the date hereof.

No securities regulatory authority has either approved or disapproved the contents of this news release.

     CHINA INFRASTRUCTURE INVESTMENT CORPORATION AND SUBSIDIARIES
                     CONSOLIDATED BALANCE SHEETS


                                ASSETS


                                                June 30, 2008 June 30, 2007
                                                ------------- -------------

CURRENT ASSETS
Cash and cash equivalents                       $   5,769,344 $   5,830,962
Restricted cash                                        29,104     2,631,475
Note receivable                                       776,936       656,556
Accounts receivable                                 2,006,848     2,721,057
Other receivables                                     419,642     1,389,579
Notes receivable from related parties, current     10,197,016   126,098,139
Advance to a related party                         21,733,471    29,998,648
Other current assets                                  991,768       138,742
                                                ------------- -------------
  Total current assets                             41,924,129   169,465,158
                                                ------------- -------------

Toll road infrastructures, net                    443,672,007   398,701,246
Plant and equipment, net                           15,943,451    14,754,523
Land use rights, net                               49,066,392    46,068,301
Long-term investment                                1,455,223     1,313,111
Notes receivable from related parties,
 long-term                                        139,872,158             -
Deferred taxes                                      6,059,721     6,170,156
                                                ------------- -------------
  Total long-term assets                          656,068,952   467,007,337
                                                ------------- -------------

TOTAL ASSETS                                    $ 697,993,081 $ 636,472,495
                                                ============= =============





        CHINA INFRASTRUCTURE INVESTMENT CORPORATION AND SUBSIDIARIES
                      CONSOLIDATED BALANCE SHEETS


                   LIABILITIES AND SHAREHOLDERS' EQUITY


                                              June 30, 2008  June 30, 2007
                                              -------------- -------------

CURRENT LIABILITIES
Other payables and accrued liabilities        $    4,840,299 $   2,932,841
Short-term bank loans                                      -    10,504,891
Current portion of long-term loans                10,678,425   134,047,666
Note payable                                               -     5,262,951
Payable to contractors                            24,224,039    26,411,885
Deferred taxes                                     8,556,534     4,604,522
Other current liabilities                            225,915       157,426
                                              -------------- -------------
  Total current liabilities                       48,525,212   183,922,182
                                              -------------- -------------

LONG-TERM LIABILITIES
Long-term bank loans                             466,512,413   299,279,102
Deferred revenue                                   6,627,828     6,041,304
                                              -------------- -------------
  Total long-term liabilities                    473,140,241   305,320,406
                                              -------------- -------------

TOTAL LIABILITIES                                521,665,453   489,242,588
                                              -------------- -------------

CONTINGENCIES

SHAREHOLDERS' EQUITY
Common stock, $.001 par value, 150,000,000
 shares  authorized, 80,000,000 shares and
 54,400,000 shares issued and outstanding
 as of June 30, 2008 and 2007, respectively           80,000        54,400
Additional paid-in capital                       140,573,673   140,662,392
Accumulated other comprehensive income            26,818,531    10,192,480
Retained earnings (deficit)                        8,855,424    (3,679,365)
                                              -------------- -------------
  Total Shareholders' Equity                     176,327,628   147,229,907
                                              -------------- -------------

TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY    $  697,993,081 $ 636,472,495
                                              ============== =============








      CHINA INFRASTRUCTURE INVESTMENT CORPORATION AND SUBSIDIARIES
            STATEMENTS OF INCOME AND COMPREHENSIVE INCOME



                                                   YEARS ENDED JUNE 30,
                                                --------------------------
                                                    2008          2007
                                                ------------  ------------

REVENUES                                        $ 56,424,236  $ 38,449,103

OPERATING COSTS                                    6,814,079     1,353,310

DEPRECIATION AND AMORTIZATION                      6,483,911     5,811,456
                                                ------------  ------------

GROSS PROFIT                                      43,126,246    31,284,337

General and administrative expenses                3,268,346     2,189,499
                                                ------------  ------------

INCOME FROM OPERATIONS                            39,857,900    29,094,838

OTHER INCOME (EXPENSES)

  Interest expense, net                          (23,941,036)  (19,326,104)

  Other income, net                                  905,832       188,577
                                                ------------  ------------

Income FROM OPERATIONS Before Income Taxes        16,822,696     9,957,311

Income Tax EXPENSE                                (4,287,907)   (2,489,328)
                                                ------------  ------------

NET INCOME                                        12,534,789     7,467,983
                                                ------------  ------------

Other comprehensive income

Foreign currency translation gain                 16,626,051     6,730,246
                                                ------------  ------------

Other comprehensive income, NET                   16,626,051     6,730,246
                                                ------------  ------------

COMPREHENSIVE INCOME                            $ 29,160,840  $ 14,198,229
                                                ============  ============

WEIGHTED AVERAGE SHARES OUTSTANDING, BASIC AND
 DILUTED                                          64,472,131    54,400,000
                                                ============  ============

NET INCOME PER COMMON SHARE, BASIC AND DILUTED  $       0.19  $       0.14
                                                ============  ============








      CHINA INFRASTRUCTURE INVESTMENT CORPORATION AND SUBSIDIARIES
                 CONSOLIDATED STATEMENTS OF CASH FLOWS


                                                   YEARS ENDED JUNE 30,
                                                --------------------------
                                                    2008          2007
                                                ------------  ------------
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income                                      $ 12,534,789  $  7,467,983
Adjustments to reconcile net income to net cash
 provided by operating activities:
Depreciation and amortization                      7,039,349     6,112,186
Deferred taxes                                     4,062,447     2,355,730
Deferred revenue                                    (571,640)     (530,782)
Interest income                                   (9,700,215)            -
Imputed interest                                     507,834       475,925
Gain from disposal of plant and equipment            103,343             -
Changes in operating assets and liabilities:
(Increase) Decrease In:
Accounts receivable                                  714,209    (1,972,723)
Other receivables                                    969,937       187,926
Other current assets                                (853,027)      602,295
Increase (Decrease) In:
Payable to contractors                            (2,187,846)            -
Other payables and accrued liabilities             1,844,339    (3,317,031)
Other current liabilities                             68,489       127,576
                                                ------------  ------------
   Net cash provided by operating activities      14,532,008    11,509,085
                                                ============  ============

CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of construction in progress             (6,114,070)  (23,241,194)
Purchases of plant and equipment                    (545,399)     (336,999)
Purchases of land use rights                               -    (1,129,893)
Refund of deposit for long-term investment                 -     1,281,140
Note receivable                                            -      (656,556)
Proceeds from disposition of plant and
 equipment                                            61,177             -
Advance to a related party                        10,914,798             -
Notes receivable from related parties               (120,470)    3,427,154
                                                ------------  ------------
   Net cash provided by (used in) investing
    activities                                     4,196,036   (20,656,348)
                                                ============  ============

CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from long-term bank loans               170,899,229    25,874,237
Repayments of long-term bank loans              (173,774,644)  (25,353,751)
Proceeds from short-term bank loans                        -    10,249,118
Repayments of short-term bank loans              (11,038,061)   (5,002,752)
Proceeds from notes payable                                -     7,607,437
Repayments of notes payable                       (5,530,068)   (2,344,486)
Restricted cash                                    2,602,371    (2,631,475)
Capital contributions                                      -     3,843,419
                                                ------------  ------------
   Net cash (used in) provided by financing
    activities                                   (16,841,173)   12,241,747
                                                ============  ============

NET INCREASE IN CASH AND CASH EQUIVALENTS          1,886,871     3,094,484
  Effect of exchange rate changes on cash         (1,948,489)   (2,788,362)
  Cash and cash equivalents at beginning of year   5,830,962     5,524,840
                                                ------------  ------------


Contact Information

  • Contact:
    Mr. Wang Feng
    Corporate Secretary
    Pinglin Expressway Headquarters
    New District, Pingdingshan
    Henan Province, P.R. China 467000
    Tel:86-371-68261551
    Fax:86-371-68261839
    www.ciicusa.com
    wangfeng@ciicusa.com