SOURCE: Guanwei Recycling Corp.

March 09, 2010 08:00 ET

Guanwei Recycling Reports Significant Year Over Year Growth in Suppliers and Customers

Plastic Scrap Suppliers Have Nearly Doubled and Customers Have Increased Approximately 50% From a Year Earlier

FUQING CITY, CHINA--(Marketwire - March 9, 2010) -  Guanwei Recycling Corp. (OTCBB: GURC), a leader in environmentally sound plastic recycling and China's largest manufacturer of recycled low density polyethylene (LDPE), today announced it has entered 2010 with a near doubling of suppliers, and an approximately 50% increase in customers, which the Company believes creates a solid underpinning for a year of strong growth in 2010. 

The Company, which will report 2009 results at the end of the month, noted that the expansion of its customer base occurred in the second half of 2009 as China's economy picked up new momentum after suffering from the effects of the world financial crisis in the first half of 2009. Guanwei started 2009 with a base of 210 customers and, by year-end, had increased this base to approximately 300 customers in 10 different industries. According to the Company, the biggest increase came from new customers in the building and infrastructure industries.

New Long Term Raw Material Suppliers in Spain and Holland

The Company believes the growth it experienced in the number of raw material suppliers to be even more significant than the increase in its customer base. "With demand for recycled plastic as strong as it is, the key enabling element in our industry for accelerating growth is raw material procurement," stated Mr. Chen Min, Chairman and CEO of the Company. He reported that starting in the second half of 2009, Guanwei was able to add to its long term supplier network several of the biggest scrap suppliers in Europe, increasing the number of its long term suppliers to 10, including suppliers in Spain and The Netherlands.

"Historically, our strong bottom line growth," Mr. Chen said, "is largely attributable to our ability to import high quality raw material directly from European suppliers as one of the few authorized recyclers in China that also is certified by the German Environment Auditing Association. This provides us a significant cost advantage as well as the ability to produce a higher percentage of high quality product that commands a higher price."

Reaping the Benefits of Strong Relationships

Mr. Chen added, "Clearly, we are reaping the benefits of the strong relationships we maintained with suppliers, in particular, in the first half of 2009. While most were affected by the decline in raw material prices, we maintained timely payments and originally negotiated prices. As a consequence, we have also been able to obtain commitments for increased supplies as the year progresses with some of our original suppliers." 

"In an improving economy," Mr. Chen said, "the significant gap between plastic production and consumption in China will continue to be filled by recycled plastic and will generate new customers and uses for our low cost, high quality recycled LPDE. By also broadening and enlarging our long term supplier base, we have secured our raw material requirement and are in a very strong position for continuing success."

Description of Guanwei Recycling Corp. (OTCBB: GURC)

Guanwei Recycling Corp. is China's largest manufacturer of recycled low density polyethylene (LDPE). Adhering to the highest "green" standards, it has generated rapid growth producing LDPE from plastic waste procured mostly in Europe for sales to customers in more than ten different industries in China. Guanwei is one of the few plastic recyclers authorized in China that also has obtained the certificate issued by the German Environment Auditing Association. This permits the Company to procure high quality plastic waste directly from Germany and other European countries, with no middlemen, which permits highly economic production of the highest grades of LDPE. Guanwei is a fully reporting publicly traded Company in the U.S. on the OTC Bulletin Board. Additional information on the Company is available at www.guanweirecycling.com.

Information Regarding Forward-Looking Statements
Except for historical information contained herein, the statements in this press release are forward-looking statements that are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements involve known and unknown risks and uncertainties, which may cause our actual results in future periods to differ materially from forecasted results. These risks and uncertainties include, among other things, product demand, market competition, and risks inherent in our operations. These and other risks are described in our filings with the U.S. Securities and Exchange Commission.

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