HEBEI, China, May 9 /PRNewswire-FirstCall/ -- American Metal & Technology,
Inc. (OTC Bulletin Board: AMGY) ("American Metal," the "Company"), a leading
manufacturer in the People's Republic of China engaged in the development,
manufacture and sale of high-precision metal casting and metal fabrication
products to European and U.S. markets and microprocessor-controlled electronic
circuit boards in China, today announced its financial results for the first
quarter ended March 31, 2008.
First Quarter 2008 Highlights
-- Net sales increased 133.3% year-over-year to $4.9 million
-- Gross profit increased 121.6% year-over-year to $1.5 million
-- Net income increased 161.3% year-over-year to $1.0 million, or
$0.11 per diluted share
-- Increased production capacity through the addition of nine high-
precision lathe machines
First Quarter 2008 Results
In the first quarter of 2008, net sales increased 133.3% to $4.9 million
from $2.1 million a year ago. The increase resulted from increased capacity
during the quarter via the addition of nine new precision lathe machines,
which allowed the Company to fill additional orders. Six of the machines were
operational at the beginning of the quarter, while the remaining three
machines entered service in March.
"We are extremely pleased with our progress during the quarter, in which
we achieved an optimal combination of high efficiency, excellent gross margin
and a favorable mix of orders for metal casting and machining," said Mr. Chen
Gao, Chairman and Chief Executive Officer of American Metal. "We continued to
expand capacity during the quarter, which allowed us to fulfill additional
orders from our existing customers."
Gross profit during the quarter was $1.5 million, up 121.6% from gross
profit of $0.7 million a year ago because of the increased production levels.
Customers continued to increase their orders for cast parts, requiring the
Company to purchase metals for casting before machining the parts. Parts that
are both machined and cast by the Company typically yield a higher dollar
margin but a lower percentage. The mix of cast parts and machining-only orders
varies from quarter to quarter, resulting in variations in gross margin but
overall increases in gross profit.
Operating expenses for the quarter declined as a percentage of sales, to
$0.5 million, or 10.2% of net sales, from $0.3 million, or 13.0% of net sales,
in the first quarter of 2007. Operating expenses included several one-time
expenses related to the ongoing second phase of the Company's capacity
expansion, as it continued to upgrade equipment at its manufacturing facility
in Hebei, China, and added employees to operate the new machines.
Operating income increased 146.5% to $1.0 million, or 19.7% of sales, from
$0.4 million, or 18.9% of sales, during the same quarter the prior year.
Net income for the first quarter of 2008 increased 161.3% to $1.0 million,
or $0.11 per diluted share, from net income of $0.4 million, or $0.05 per
diluted share, for the first quarter of 2007. Earnings per share for the first
quarter of 2007 have been adjusted for a 1-for-150 reverse stock split,
effective December 3, 2007.
Financial Condition
As of March 31, 2008, American Metal had cash and cash equivalents of
$6.8 million, working capital of $9.2 million, no long-term debt and
shareholders' equity of $13.2 million. During the first quarter of 2008, the
Company generated $0.6 million in cash from operations, compared to $0.1
million in the same quarter the prior year.
Recent Events
In February 2008, the Company announced plans to invest $3 million to
build additional facilities at its Langfang manufacturing center. The new
facilities mark the second phase of a four-phase plan to transform the
Company's capacity and capabilities for the foreseeable future. This second
phase of American Metal's four-phase expansion plan will add two buildings
totaling 10,900 square meters, increasing annual capacity for casting products
by 50%. Construction is due to be completed in December 2008, with full
production beginning in January 2009.
During the first quarter ended March 31, 2008, the Company acquired and
put into operation nine new high-precision lathe machines, bringing the total
number of machines in use to 59. Another late machine was delivered and became
operable in April 2008, bringing the current number of high-precision machines
to 60, compared to 40 lathe machines a year ago.
Business Outlook
For the 2008 fiscal year, the Company expects global industrial demand for
its products to remain strong. The Company expects to meet an increasing
amount of that demand as its additional capacity comes online. Given the
favorable results in the first quarter, and the successful installation and
operation of additional capacity during the quarter, the Company is increasing
its expectation for full-year 2008 net income to a range of $3.2 million to
$3.4 million, or earnings per share of $0.29 to $0.32, from net income of
$2.9 million to $3.1 million, or $0.27 to $0.29 per diluted share. Full-year
guidance assumes a limited contribution from the effective launch of the
second phase of the capacity expansion, which the Company expects to complete
during December 2008, a mix of multiple products at varying price points and
increased efficiencies as the Company gains additional experience with its
growing customer base.
"The first quarter of 2008 was extremely favorable for American Metal, as
we experienced very strong increases in revenues and net income because of
greatly expanded production capacity," Mr. Gao said. "However, there are
several potential factors that could temper our results in the remaining three
quarters, including appreciation of the Renminbi, the potential lifting of the
export tax holiday and rapidly rising raw materials costs. Even so, we remain
optimistic about our opportunities for the remainder of 2008, and we look
forward to further capacity expansion coming online in January 2009."
About American Metal & Technology, Inc.
American Metal & Technology, through its wholly-owned subsidiary American
Metal Technology Group ("AMTG"), a Nevada Corporation, and through AMTG's
subsidiaries, Beijing Tong Yuan Heng Feng Technology Co., Ltd. and American
Metal Technology (Lang Fang) Co., Ltd., is a leading manufacturer of
high-precision casting and machined products in the People's Republic of
China. The subsidiaries operate in a 53,819-square-foot manufacturing plant.
In 2006, AMTG expanded into the design and manufacture of electric circuit
boards for home appliances and motion controllers. The Company recently
announced facility expansion plans to increase casting product capacity by 50%
and enhance the development and manufacturing of its circuit board solutions
at its Langfang manufacturing center. To learn more about American Metal &
Technology, Inc., please visit the Company's Web site at:
http://www.ammyusa.com.
Safe Harbor Statement Under the Private Securities Litigation Reform Act
of 1995: Certain of the statements made in this press release constitute
forward-looking statements within the meaning of the Private Securities
Litigation Reform Act of 1995. Such forward-looking statements involve known
and unknown risks, uncertainties and other unknown factors that could cause
the Company's actual results to be materially different from the historical
results or from any future results expressed or implied by such forward-
looking statements. In addition to statements that explicitly describe such
risks and uncertainties, readers are urged to consider statements labeled with
the terms "believes," "belief," "intends," "anticipates" or "plans" to be
uncertain and forward-looking. The forward-looking statements contained herein
are also subject generally to other risks and uncertainties that are described
from time to time in the Company's reports filed with the Securities and
Exchange Commission.
Contact:
CCG Elite Investor Relations
Mark Collinson, Partner
Phone: (310) 231-8600 ext. 117
E-mail: mark.collinson@ccgir.com
- FINANCIAL TABLES FOLLOW -
AMERICAN METAL & TECHNOLOGY, INC. AND SUBSIDIARIES
(FORMERLY MURRY UNITED DEVELOPMENT CORPORATION)
CONSOLIDATED STATEMENTS OF INCOME AND OTHER COMPREHENSIVE INCOME
(Amounts expressed in U.S. dollars)
Three months ended Three months ended
March 31, 2008 March 31, 2007
Net sales $4,896,515 $2,108,963
Cost of goods sold 3,437,120 1,450,261
Gross profit 1,459,395 658,703
Operating expenses
Selling expenses 16,258 6,835
Operating and administrative expenses 480,946 261,571
Total operating expenses 497,204 268,406
Income from operations 962,191 390,297
Other income (expense)
Interest income 5,728 2,054
Gain on disposal of marketable securities 35,651
Other income (expense) 1,041 (2,698)
Total other income 42,420 (644)
Income before income taxes 1,004,612 389,653
Provision for income taxes - -
Income before minority interests 1,004,612 389,653
Minority interests 12,585 (155)
Net income 1,017,196 389,498
Unrealized loss from available securities (66,190)
Foreign currency translation adjustment 547,366 79,716
Comprehensive income $1,498,372 $469,214
Basic weighted average shares
outstanding 8,988,568 7,649,959
Basic net earnings per share $0.11 $0.05
Diluted weighted average shares
outstanding 8,988,568 7,649,959
Diluted net earnings per share $0.11 $0.05
AMERICAN METAL & TECHNOLOGY, INC. AND SUBSIDIARIES
(FORMERLY MURRY UNITED DEVELOPMENT CORPORATION)
CONSOLIDATED BALANCE SHEET
AS OF MARCH 31, 2008 and DECEMBER 31, 2007
ASSETS
Current Assets March 31, 2008 December 31, 2007
Cash and cash equivalents $6,781,705 $6,037,193
Accounts receivable - net 1,628,323 1,332,664
Investment in marketable securities 107,581 93,196
Other receivables 156,641 134,275
Advances to suppliers 1,753,998 974,799
Inventories 606,372 547,579
Total Current Assets 11,034,619 9,119,706
Property, Plant and Equipment, net 3,071,313 3,020,972
Construction in Progress 462,305 377,240
Intangible Assets, net 707,035 692,167
Total Assets $15,275,272 $13,210,084
LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities
Accounts payable $1,067,565 $743,070
Accrued liabilities and other payables 166,450 75,765
Amount due to related parties 413,375 333,670
Unearned revenue 93,036 12,938
Total Current Liabilities 1,740,425 1,165,443
Minority Interests 324,706 337,291
Shareholders' Equity
Common stocks; $0.0001 par value,
30,000,000 shares authorized,
10,402,687 shares issued and outstanding 1,040 1,040
Additional paid in capital 5,140,013 5,039,217
Statutory reserve 1,040,205 912,019
Accumulated other comprehensive income 1,475,267 994,092
Retained earnings 5,649,993 4,760,982
Total Stockholders' Equity 13,210,140 11,707,350
Total Liabilities and Shareholders' Equity $15,275,272 $13,210,084
AMERICAN METAL & TECHNOLOGY, INC. AND SUBSIDIARIES
(FORMERLY MURRY UNITED DEVELOPMENT CORPORATION)
CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE THREE MONTHS ENDED MARCH 31, 2008 AND 2007
(UNAUDITED)
2008 2007
Cash flows from operating activities:
Net income $1,017,196 $389,498
Adjustments to reconcile net income to
net cash provided by operating activities:
Minority interest (12,585) 155
Issuance of warrants for services 4,418 -
Depreciation and amortization 87,088 63,490
Gain on disposal of marketable securities (35,651) -
Bad debt expenses 33,317 -
(Increase)/decrease in assets:
Accounts receivable, net (270,300) (735,048)
Note receivable 29,334 606
Other receivables 81,202 (92,151)
Inventory (35,971) (127,851)
Advance to suppliers (724,723) 271,121
Prepaid expenses-LT - 138,596
Increase/(decrease) in liabilities:
Accounts payable 288,502 251,089
Other payable and accrued expenses 65,421 (43,389)
Unearned revenue 77,943 21,807
Net Cash Provided By Operating Activities 605,193 137,922
Cash flows from investing activities:
Additions to construction in progress (68,427) -
Increase in long-term investment - (129,750)
Disposal (Purchase) of equipment and
leasehold improvements (4,383) 114,889
Net Cash Used in Investing Activities (72,810) (14,861)
Cash flows from financing activities:
Purchase of marketable securities (40,620) -
Proceed from loans - 116,070
Net Cash Provided By (Used in) Financing Activities (40,620) 116,070
Effects of Exchange Rate Change in Cash 252,750 8,934
Net Increase in Cash and Cash Equivalents 744,513 248,065
Cash and Cash Equivalents-Beginning Balance 6,037,193 787,444
Cash and Cash Equivalents-Ending Balance 6,781,705 1,035,509
Supplement disclosure of cash flow information:
Income taxes paid $ - $ -
Interest expenses paid $ - $ 627
SOURCE American Metal & Technology, Inc.
Mark Collinson, Partner of CCG Elite Investor Relations, +1-310-231-8600, ext.
117, mark.collinson@ccgir.com, for American Metal & Technology, Inc.
