SOURCE: China America Holdings, Inc.

August 13, 2009 08:00 ET

China America Holdings Reports Financial Results for the Second Quarter and First Six Months of 2009

2nd Quarter 2009 Revenue of $8.2 Million, an Increase of 31.4% Compared to 1st Quarter of 2009; 2nd Quarter Income From Operations of $183,995 Improving From $9,370 in First Quarter of 2009

SHANGHAI, CHINA--(Marketwire - August 13, 2009) - China America Holdings, Inc. (OTCBB: CAAH), a holding company operating in China, announced today the Company's financial results for the Second Quarter of 2009.

Financial Highlights:

Revenue for the second quarter of 2009 was $8.2 million, up 31.4% from the $6.2 million recorded in the first quarter of 2009. Revenue for the first six months of 2009 was $14.4 million as compared to $16.9 million in the first six months of 2008. Income from operations in the second quarter of 2009 was $183,995, up from the $9,370 recorded in the first quarter of 2009. Income from operations for the first 6 months of 2009 was $174,625 compared to $747,830 for the first six months of 2008. After including a loss of ($81,000) for its discontinued Biometric segment and deducting income attributable to its non-controlling interest, the Company recorded a net loss the first six months of 2009 of ($219,947) or $0.00 per basic share, as compared to a net loss of ($99,568) or $0.00 per basic share for the comparable period in 2008.

At June 30, 2009 total assets were $14.5 million compared to total assets of $13.7 million at December 31, 2008. At June 30, 2009, current assets were $9.5 million compared to current assets of $9.3 million at December 31, 2008. Cash and cash equivalents were $1.8 million at June 30, 2009 compared to $2.2 million at December 31, 2008. Shareholder equity at June 30, 2009 was $3.7 million with 141.3 million shares outstanding.

Mr. Shaoyin Wang, CEO of China America Holdings, stated, "We are pleased to have improved performance significantly from the first quarter of 2009. While the business environment in the first half of 2009 has been extremely challenging, we are seeing signs of improvement and believe these positive trends will continue in the second half of the year. We believe the performance of our Aohong subsidiary demonstrates our ability to quickly react to a changing environment and we intend to work diligently to increase our overall profitability in the coming quarters. We continue to have a strong current ratio of almost 2 to 1 with negligible long term debt. We look forward to further improvement and growth in the second half of 2009 for our Aohong subsidiary and remain committed to our business strategy in China."

About China America Holdings, Inc.

China America Holdings, Inc. (OTCBB: CAAH) is a holding company which owns a 56% stake in Shanghai Aohong Chemical Co., Ltd. based in Shanghai, China. Shanghai Aohong Chemical Co., Ltd. is a distributor of assorted liquid coolants which are utilized in a variety of applications, primarily as refrigerants in air conditioning systems for automobiles, residential and commercial air conditioning systems, and a manufacturer of steel non-refillable cylinders. For more information, please visit http://www.caah.us.

              CHINA AMERICA HOLDINGS, INC. AND SUBSIDIARIES
                        CONSOLIDATED BALANCE SHEETS

                                                  June 30,    December 31,
                                                ------------  ------------
                                                    2009          2008
                                                ------------  ------------
                                                 (Unaudited)
                     ASSETS
    CURRENT ASSETS:
    Cash                                        $  1,837,542  $  2,228,455
    Accounts receivable, net                       4,518,545     3,778,096
    Notes receivable                                 312,050     1,104,343
    Inventories                                    2,242,495     1,719,796
    Prepaid expense and other current assets         569,716       453,860
                                                ------------  ------------
       Total current assets                        9,480,348     9,284,550
                                                ------------  ------------
    LONG-TERM ASSETS:
    Restricted cash                                  701,262       175,075
    Property and equipment, net                    3,440,415     3,394,157
    Prepaid land use rights, net                     832,011        84,746
    Deposit on land use rights                             0       744,303
    Other assets                                      29,219        31,221
                                                ------------  ------------
       Total other assets                          5,002,907     4,429,502
                                                ------------  ------------
       Total assets                             $ 14,483,255  $ 13,714,052
                                                ============  ============
    LIABILITIES AND SHAREHOLDERS' EQUITY

    CURRENT LIABILITIES:
    Notes payable                               $  2,286,571  $  2,602,982
    Notes payable - related party                    400,000       400,000
    Accounts payable and accrued expenses          1,755,049       957,190
    Advances from customers                          588,129       424,320
    Taxes payable                                    517,637       487,223
    Due to related parties                           209,481       208,568
                                                ------------  ------------
       Total current liabilities                   5,756,867     5,080,283
    CHINA AMERICA HOLDINGS, INC. SHAREHOLDERS'
     EQUITY:
    Common stock, ($.001 par value, 500,000,000
     shares authorized; 146,810,792 shares
     issued and outstanding at June 30, 2009)        146,811       135,811
    Additional paid-in capital                    19,859,352    19,661,352
    Statutory reserves                               704,200       687,717
    Accumulated deficit                          (17,416,613)  (17,180,183)
    Other comprehensive income                       421,359       415,630
                                                ------------  ------------
       Total China America Holdings, Inc.
        shareholders' equity                       3,715,109     3,720,327
       Non-controlling Interest                    5,011,279     4,913,442
                                                ------------  ------------
       Total shareholders' equity                  8,726,388     8,633,769
                                                ------------  ------------
       Total liabilities and shareholders'
        equity                                  $ 14,483,255  $ 13,714,052
                                                ============  ============

         See notes to unaudited consolidated financial statements.








               CHINA AMERICA HOLDINGS, INC. AND SUBSIDIARIES
                  CONSOLIDATED STATEMENTS OF OPERATIONS
                                (Unaudited)

                    For the Three Months Ended   For the Six Months Ended
                             June 30,                    June 30,
                    --------------------------  --------------------------
                        2009          2008          2009          2008
                    ------------  ------------  ------------  ------------
Net revenues        $  8,185,254  $ 10,433,724  $ 14,414,446  $ 16,925,854
Cost of sales          7,320,478     9,456,641    13,062,568    15,143,276
                    ------------  ------------  ------------  ------------
Gross profit             864,776       977,083     1,351,878     1,782,578
                    ------------  ------------  ------------  ------------
Operating expenses:
  Selling expenses       314,058       150,319       535,408       420,335
  Consulting and
   investor
   relations
   expense                     -        19,201             -       255,375
  Consulting
   expense-related
   party                 109,000             -       209,000             -
  Compensation and
   related taxes         160,856        68,089       213,946       135,316
  General and
   administrative         96,867       (11,977)      218,899       223,722
                    ------------  ------------  ------------  ------------
    Total operating
     expenses            680,781       225,632     1,177,253     1,034,748
                    ------------  ------------  ------------  ------------
Income from
 operations              183,995       751,451       174,625       747,830
                    ------------  ------------  ------------  ------------
Other income
 (expenses):
  Interest income          1,654         1,776         2,851        10,018
  Interest expense        (9,711)      (15,321)      (32,001)      (20,350)
  Loss on
   disposition of
   property and
   equipment                   -             -       (61,958)            -
  Realized loss on
   sale of
   marketable
   equity
   securities                  -       (52,239)            -       (47,343)
  Gains from
   investments             2,338             -         2,338             -
  Foreign currency
   transaction gain
   (loss)                   (463)        5,649        (3,943)        5,649
                    ------------  ------------  ------------  ------------
    Total other
     expenses             (6,182)      (60,135)      (92,713)      (52,026)
                    ------------  ------------  ------------  ------------
Income before
 discontinued
 operations and
 income taxes            177,813       691,316        81,912       695,804
                    ------------  ------------  ------------  ------------
Discontinued
 operations:
  Gain from
   disposal of
   discontinued
   operations                  -        45,912             -        45,912
  Loss from
   discontinued
   operations                  -       (40,002)      (81,250)     (130,836)
                    ------------  ------------  ------------  ------------
    Total loss from
     discontinued
     operations                -         5,910       (81,250)      (84,924)
                    ------------  ------------  ------------  ------------
Income before
 income taxes and
 noncontrolling
 interest                177,813       697,226           662       610,880
Provision for
 income taxes           (102,699)     (186,637)     (129,499)     (320,763)
                    ------------  ------------  ------------  ------------
Net income (loss)         75,114       510,589      (128,837)      290,117
Less: Net income
 attributable to
 noncontrolling
 interest                (87,805)     (277,028)      (91,110)     (389,685)
                    ------------  ------------  ------------  ------------
Net (loss) income
 attributable to
 China America
 Holdings, Inc.     $    (12,691) $    233,561  $   (219,947) $    (99,568)
                    ============  ============  ============  ============

Comprehensive
 (loss) income:
      Unrealized
       foreign
       currency
       translation
       gain                  463       217,984         5,729       316,199
                    ------------  ------------  ------------  ------------
    Comprehensive
     (loss)
     income         $    (12,228) $    451,545  $   (214,218) $    216,631
                    ============  ============  ============  ============
Basic and diluted
 loss per common
 share:
  Net loss from
   continuing
   operations       $      (0.00) $       0.00  $      (0.00) $       0.00
  Net loss from
   discontinued
   operations               0.00          0.00         (0.00)        (0.00)
                    ------------  ------------  ------------  ------------
  Net loss per
   common share     $      (0.00) $       0.00  $      (0.00) $       0.00
                    ============  ============  ============  ============
Weighted average
 number of shares
 outstanding:
  Basic and diluted  141,272,331   135,810,792   138,556,649   135,792,990
                    ============  ============  ============  ============

         See notes to unaudited consolidated financial statements.










              CHINA AMERICA HOLDINGS, INC. AND SUBSIDIARIES
                  CONSOLIDATED STATEMENTS OF CASH FLOWS
                                (Unaudited)

                                                  For the Six Months Ended
                                                          June 30,
                                                  ------------------------
                                                      2009         2008
                                                  -----------  -----------
Cash flows from operating activities:
  Loss from continued operations attributable to
   China America Holdings, Inc.                   $  (138,697) $   (14,644)
  Adjustments to reconcile loss from continuing
   operations to net cash provided by (used in)
   continuing operations:
      Depreciation and amortization                   170,197      124,146
      Allowance for doubtful accounts                       -     (187,087)
      Realized and unrealized loss on marketable
       equity securities                                    -       47,343
      Loss on disposition of property and
       equipment                                       61,958            -
      Common stock, warrants and options issued
       for services                                   209,000       10,400
      Contributed services                                  -      110,000
      Minority interest                                91,110      389,685
      Gain on sale of discontinued operations               -      (45,912)
  Changes in assets and liabilities:
    Accounts receivable                              (735,429)    (354,786)
    Decrease in notes receivable                      793,991      278,089
    Inventory                                        (520,457)  (2,178,556)
    Prepaid expenses and other current assets        (115,266)    (595,459)
    Other assets                                        2,042      237,960
    Accounts payable and accrued expenses             796,908      216,792
    Taxes payable                                      29,751      243,312
    Advances from customers                           163,264      143,590
    Deferred revenue                                        -       18,874
                                                  -----------  -----------
        Net cash provided by (used in) continuing
         operations                                   808,372   (1,556,253)
                                                  -----------  -----------
  Loss from discontinued operations                   (81,250)     (84,924)
                                                  -----------  -----------
        Net cash used in discontinued operations      (81,250)     (84,924)
                                                  -----------  -----------
Net cash provided by (used in) operating
 activities                                           727,122   (1,641,177)
                                                  -----------  -----------
Cash flows from investing activities:
  Proceeds from sale of marketable equity
   securities                                               -       26,919
  Purchase of property and equipment                 (270,269)  (1,398,175)
  Land use rights                                    (750,776)           -
  Deposit on land use rights                          745,496            -
                                                  -----------  -----------
Net cash flows used in investing activities          (275,549)  (1,371,256)
                                                  -----------  -----------
Cash flows from financing activities:
  (Repayments of) Proceeds from notes payable        (300,024)   1,381,381
  Proceeds from related party advances                (19,399)     589,947
  Increase in restricted cash                        (526,067)    (226,224)
                                                  -----------  -----------
Net cash flows (used in) provided by financing
 activities                                          (845,490)   1,745,104
                                                  -----------  -----------
Effect of exchange rate on cash                         3,004       26,565
                                                  -----------  -----------
Net decrease in cash                                 (390,913)  (1,240,764)
Cash - beginning of year                            2,228,455    2,012,480
                                                  -----------  -----------
Cash - end of period                              $ 1,837,542  $   771,716
                                                  ===========  ===========
Supplemental disclosure of cash flow information:
  Cash paid for:
      Interest                                    $    24,037  $    21,950
                                                  ===========  ===========
      Income taxes                                $       180  $         -
                                                  ===========  ===========

         See notes to unaudited consolidated financial statements.

Safe Harbor Statement

In connection with the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, China America Holdings, Inc., is hereby providing cautionary statements identifying important factors that could cause our actual results to differ materially from those projected in forward-looking statements (as defined in such act). Any statements that are not historical facts and that express, or involve discussions as to, expectations, beliefs, plans, objectives, assumptions or future events or performance (often, but not always, indicated through the use of words or phrases such as "will likely result," "are expected to," "will continue," "is anticipated," "estimated," "intends," "plans," "believes" and "projects") may be forward-looking and may involve estimates and uncertainties which could cause actual results to differ materially from those expressed in the forward-looking statements. These statements include, but are not limited to, our belief about trends, our performance and profitability.

We caution that the factors described herein could cause actual results to differ materially from those expressed in any forward-looking statements we make and that investors should not place undue reliance on any such forward-looking statements. Further, any forward-looking statement speaks only as of the date on which such statement is made, and we undertake no obligation to update any forward-looking statement to reflect events or circumstances after the date on which such statement is made or to reflect the occurrence of anticipated or unanticipated events or circumstances. New factors emerge from time to time, and it is not possible for us to predict all of such factors. Further, we cannot assess the impact of each such factor on our results of operations or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements. This press release is qualified in its entirety by the cautionary statements and risk factor disclosure contained in our Securities and Exchange Commission filings, including our Annual Report on Form 10-K for the year ended December 31, 2008.

Contact Information

  • Contact:
    China America Holdings, Inc.
    Gary Liu
    U.S. Representative
    954-363-7333 ext. 318