China Sun Group High-Tech Co.
China Sun Group High-Tech Co., through its wholly-owned subsidiary Dalian Xinyang High-Tech Development Co. Ltd., has the second largest cobalt series production capacity in China. Through its research and development division, DLX owns a proprietary series of nanometer technologies that supply state-of-the-art components for advanced lithium ion batteries. Leveraging its state-of-the-art technology, high-quality product line and scalable production capacity, the Company plans to create a fully integrated supply chain from the primary manufacturing of cobalt ore to finished products, including lithium ion batteries.
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China Sun Group sees 14% rise in Q4 sales, as company expands product offering
China Sun Group High-Tech (OTCBB: CSGH), a supplier of raw materials for rechargeable Lithium-ion (Li-ion) batteries in China, reported a 14% increase in sales in the fourth quarter of fiscal 2010, driven by higher demand and the introduction of a new product.
Revenues for the three months ending May 31 2010 were $11.0 million, compared to $9.6 million a year earlier. The company sold 108 tons of its new product, lithium iron phosphate (LIP).
Profits for quarter were virtually unchanged from the previous year, at $2.3 million, or $0.04 per diluted share.
Expansion is on the horizon for China Sun, however. The company has said it will continue to develop its lithium iron phosphate business, as during fiscal year 2010, it sent LIP samples to 24 potential customers and gave out a further nine samples in the first quarter of 2011.
A number of these clients are nearing the end of their testing processes, and new orders could result in fiscal 2011, which would require expansion of the company's production facilities.
China Sun is also investing research funds into the development of its own power Li-ion batteries, of which the first phase is slated to begin in October this year. The investment will allow the company entry into the downstream industry, where there is opprtunity to increase margins, it said.
"With China Sun's high quality production control and strong R&D team, we will be looking to expand our share of what we believe will a growing market as China develops new clean energy businesses and provides government and municipal support," said current CEO Mr. Bin Wang.
At May 31, 2010, the company had $18 million in cash reserves and it is currently exploring financing options for further growth.
For fiscal year 2011, China Sun expects to produce 1,200 tons of cobaltosic oxide and lithium cobalt oxide and 600 tons of lithium iron phosphate.
Based on these production levels and the company's expectations for raw materials prices, full year revenue in 2011 is expected to be in the range of $56.0 million and $58.0 million, with net income between $10.0 million and $ 11.0 million, and earnings per diluted share in the range of $0.18 to $0.20.
Separately, the company announced that Guosheng Fu was appointed CEO of China Sun on Monday. Wang will continue as the company's chairman.
China Sun was up almost 9% in the first hour of trading on Wednesday, trading at $0.72 as of 9:45am ET.
