China Keli Electric Company Ltd.
TSX VENTURE : ZKL

December 23, 2010 18:07 ET

China Keli Electric Co., Ltd. Announces the Financial and Operating Results for the Six Months Ended October 31, 2010

VANCOUVER, BRITISH COLUMBIA--(Marketwire - Dec. 23, 2010) - China Keli Electric Co. Ltd. (TSX VENTURE:ZKL) ("Keli" or the "Company") today announced the financial and operating results for the three and six months ended October 31, 2010. The Company completed its qualifying transaction with Creative Grace Limited ("Creative Grace") resulting in a merger of the two companies on May 5, 2010. The financial and operating results for the six months ended October 31, 2010 include the results of operations of the Company and Creative Grace. The financial and operating results for the six months ended October 31, 2009 include the results of operations of Creative Grace only. The functional currency of the Company and its subsidiaries is Chinese Yuan (also known as "Renminbi" or "RMB"). The financial and operating results of the relevant periods have been translated into Canadian dollars. Depending on the magnitude of changes in foreign currency exchange rates, the impact on the financial and operating results may or may not be material.

For the six months ended October 31, 2010, reported total revenue was $7,106,658, an increase of 4.8% over the same period in 2009 ($6,780,315), with gross profit $3,204,302, an increase of 13.9% ($2,812,198 for the same period in 2010); excluding the negative impact of foreign exchange, increases in both revenues and gross profit would have been greater. The Company incurred operating expenses for the six months ended October 31, 2010 of $2,708,875 ($1,303,648 for the same period in 2009). Among the operating expenses, there was a one-time charge of $359,723 for stock-based compensation expense (nil for the same period in 2009), and some expenses related to the improvement of the quality of management and listing related expenses. Net income for the six months ended October 31, 2010 was $260,022 ($1,248,961 for the same period in 2009) and the basic and diluted earnings per share were $0.004 and $0.003 respectively ($0.020 for the same period in 2009). Reduced net income and EPS were due primarily to one-time charges and the negative effect of foreign exchange rates. After accounting for an unrealized foreign exchange translation gain of $312,478, the Company ended the first half of FY2011 with a total comprehensive income of $572,500, compared with a total comprehensive income of $397,370 for the first half of FY2010. The Company's unrealized foreign exchange gains (losses) on translation of the Group's functional currency to reporting currency are subject to fluctuations in the exchange rate between the RMB and the Canadian dollar in each reporting period.

As of October 31, 2010, the Company had total cash and cash equivalents of $2,076,323 compared with $678,682 as of April 30, 2010. Accounts receivable were $6,275,316 as at October 31, 2010, an increase of $1,777,207 compared with $4,498,109 as at April 30, 2010. The Company's working capital was $9,282,263 as at October 31, 2010, increased from $4,640,028 as at April 30, 2010.

Full financial results of the Company for the six months ended October 31, 2010 are available on SEDAR at www.sedar.com.

About China Keli Eletric Company Ltd.

China Keli Electric Company Ltd. specializes in the manufacturing of electrical components and equipments, including pre-assembled mini substations, electrical controllers, pressurized and vacuumed switchgears and circuit breakers in the manufacturing.

CHINA KELI ELECTRIC COMPANY LTD.

For further company information please access our website: www.zkl.cc

This press release contains forward-looking statements based on current expectations. These forward-looking statements entail various risks and uncertainties that could cause actual results to differ materially from those reflected in these forward-looking statements. Risks and uncertainties about Keli's business are more fully discussed in the Company's disclosure materials filed with the securities regulatory authorities in Canada. All amounts are stated in Canadian dollars unless noted otherwise.

Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this press release.

Contact Information

  • China Keli Electric Company Ltd.
    George Dorin
    Independent Director
    (604) 831-2114
    www.zkl.cc