China Keli Electric Company, Ltd.
TSX VENTURE : ZKL

September 29, 2010 17:20 ET

China Keli Electric Co., Ltd. Announces the Financial and Operational Results for the Three Months Ended July 31, 2010

VANCOUVER, BRITISH COLUMBIA--(Marketwire - Sept. 29, 2010) - China Keli Electric Co., Ltd. (TSX VENTURE:ZKL) ("Keli" or the "Company") today announced the financial and operating results for the three months ended July 31, 2010 ("FY2011 Q1"). 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 FY2011 Q1 include the results of operations of the Company and Creative Grace. The financial and operating results for the three months ended July 31, 2009 ("FY2010 Q1") 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 of foreign currency exchange rates the impact on the financial and operating results may or may not be material.

For FY2011 Q1, reported total revenue of $3,646,698, an increase of 0.5% over FY2010 Q1 ($3,630,317), with gross profit $1,645,102, an increase of 8.1% ($1,521,161 for FY2010 Q1); excluding the negative impact of foreign exchange, increases in both revenues and gross profit would have been greater. The Company incurred operating expenses for FY2011 Q1 of $1,445,923 ($685,472 for FY2010 Q1). Among the operating expenses, there was a one-time charge of $359,723 for stock-based compensation expense (nil for FY2010 Q1), and some expenses related to the merger and listing transaction. Net income for FY2011 Q1 was $61,641 ($696,266 for FY2010 Q1) and the basic and diluted earnings per share for FY2011 Q1 were $0.001 ($0.011 for FY2010 Q1). 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 $243,908, the Company ended the quarter with a total comprehensive income of $305,549, compared with a total comprehensive loss of $143,444 for FY2010 Q1. The Company's unrealized foreign exchange gains (losses) on translation of 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 July 30, 2010, the Company had total cash and cash equivalents of $2,667,362 compared with $678,682 as of April 30, 2010. Accounts receivable were $5,578,877 as at July 31, 2010, an increase of $1,080,768 compared with $4,498,109 as at April 30, 2010. The Company's working capitcal was $9,045,674 as at July 31, 2010, increased from $4,640,028 as at April 30, 2010.

Full financial results of the Company for the three months ended July 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.

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