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SmartHeat Inc. Announces Record 3rd Quarter Financial Results- Earnings Per Share (EPS) of $0.18, Increased 1700%, Energy Saving Equipment Sales Continue to Benefit from Rapid Growth Momentum
- Net Income increased 1865% to $4.3 million for the quarter ended September 30, 2008 compared to $0.22 million for the same period in 2007.
- Net Income for the first nine months in 2008 reached $5.53 million, an increase of 1335% over the $0.39 million reported for the comparable 2007 period.
- Earnings per Share were $0.18 and $0.26, respectively, for the three and nine months ended September 30, 2008, increases of approximately 1700% and 1200% as compared to $0.01 and $0.02 for the same periods in 2007.
- Revenues for the three and nine months ended September 30, 2008 were $20.7 million and $29.3 million, respective increases of 587% and 436% period to period.

Monday November 17, 2008, 6:55 am EST

NEW YORK, Nov. 17 /Xinhua-PRNewswire/ -- SmartHeat Inc. (Website: http://www.smartheatinc.com/) (OTC Bulletin Board: SMHT - News), a market leader in China's "green" technology, environmentally friendly energy savings industry, today announced record financial results for the quarter ended September 30, 2008.

SmartHeat generated revenue of $20.7 million in the quarter compared to $3.01 million in the same period in 2007, an increase of approximately 587%. This increase was primarily due to increased customer recognition and acceptance of SmartHeat brand quality products, deeper market penetration and strong customer demand as China mandates that businesses and municipalities adopt energy saving programs. SmartHeat expects this momentum to continue in 2008 and 2009.

Net income for the quarter was $4.3 million compared to $0.22 million for the corresponding 2007 period. The year to year increase in SmartHeat's earnings was attributable in large part to larger economies of scale, combined with the growth in revenues and significantly improved operating efficiency.

James Jun Wang, SmartHeat's CEO, commented: "We are pleased with our 3rd quarter financial results which demonstrate continued rapid growth in our business and the industry in general that we anticipated in early 2008. Our strong financial performance reflects execution of our growth strategies in a favorable market environment as China embraces more energy efficient products and mandates the use of environmentally friendly energy saving equipment. As a market leader, SmartHeat stands to benefit greatly from China's "green" movement towards a clean environment. Our products reduce heat consumption and lower heating bills by as much as 50%. We are committed to delivering quality products to customers while creating greater value for our shareholders."

About SmartHeat Inc.

SmartHeat, Inc. is a US company with its primary operations in China. SmartHeat is a market leader in China's "green" technology heat energy saving industry. SmartHeat manufactures plate heat exchangers and compact plate heat exchanger units -- the technology that helps to capture and recycle waste heat thus reducing fossil fuel related costs and pollution. SmartHeat's products and technology have broad residential and industrial applications. China's heat transfer market is currently estimated at approximately $2.4 billion with double digit annual growth according to China Heating Association.

Safe Harbor Statement

All statements in this press release that are not historical are forward-looking statements made pursuant to the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995. There can be no assurance that actual results will not differ from the company's expectations. SmartHeat's actual results may differ from its projections. Further, preliminary results are subject to normal year-end adjustments. You are cautioned not to place undue reliance on any forward-looking statements in this press release as they reflect SmartHeat's current expectations with respect to future events and are subject to risks and uncertainties that may cause actual results to differ materially from those contemplated. Potential risks and uncertainties include, but are not limited to, the risks described in SmartHeat's filings with the Securities and Exchange Commission.

    Corporate Contact:
    James Jun Wang
    Chairman & CEO
    SmartHeat Inc.
    Tel: 011-86-13701368262
    Email: info@smartheatinc.com



      SMARTHEAT, INC. AND SUBSIDIARY
      CONSOLIDATED STATEMENTS OF INCOME AND OTHER COMPREHENSIVE INCOME
           (Unaudited)

                             FOR THE NINE MONTHS     FOR THE THREE MONTHS
                                    ENDED                   ENDED
                                 SEPTEMBER 30,           SEPTEMBER 30,
                               2008         2007        2008         2007

      Net sales             $29,345,571  $5,473,573  $20,708,288  $3,015,606

      Cost of goods sold     19,502,070   3,679,507   13,273,914   2,080,718

      Gross profit            9,843,501   1,794,066    7,434,374     934,888

      Operating expenses
           Selling expenses   1,664,882     805,099    1,056,854     320,206
           General and
            administrative
            expenses          1,470,577     528,215    1,024,107     229,373

           Total operating
            expenses          3,135,459   1,333,314    2,080,961     549,579

      Income from
       operations             6,708,042     460,752    5,353,413     385,309

      Non-operating income
       (expenses)
           Interest income      318,070     142,583       57,387           -
           Interest expense    (257,116)   (170,985)     (94,076)   (104,857)
           Investment
            expense              (1,628)          -       (1,628)          -
           Non-operating
            income                9,744      22,110        9,744      22,110
           Non-operating
            expense              (2,990)     (6,285)     (11,280)    (18,285)
           Exchange loss         (9,058)    (11,855)      (9,058)    (11,855)
           Subsidy income        16,141      52,193        7,000         363

           Total non-operating
            income (expenses)    73,163      27,761      (41,911)   (112,524)

      Income before income
       tax                    6,781,205     488,513    5,311,502     272,785

      Income tax expense      1,246,935     105,256      980,907      52,770

      Income after income
       tax                    5,534,270     383,257    4,330,595     220,015

      Less: minority interest     5,934      (1,859)       5,934         (13)

      Net income              5,528,336     385,116    4,324,661     220,028

      Other comprehensive
       item
           Foreign currency
            translation         578,670     147,335      167,774      70,081

      Comprehensive Income   $6,107,006    $532,451   $4,492,435    $290,109


      Basic weighted
       average shares
       outstanding           21,503,588  18,500,000   24,055,878  18,500,000

      Diluted weighted
       average shares
       outstanding           21,503,647  18,500,000   24,056,054  18,500,000

      Basic earnings per
       share                      $0.26       $0.02        $0.18       $0.01

      Diluted earnings per
       share                      $0.26       $0.02        $0.18       $0.01



                          SMARTHEAT, INC. AND SUBSIDIARY
                            CONSOLIDATED BALANCE SHEETS

                                         AS OF SEPTEMBER 30, AS OF DECEMBER 31,
                                                  2008            2007
                                              (Unaudited)
       ASSETS

       CURRENT ASSETS
            Cash & cash equivalents             $1,702,938          $393,147
            Restricted cash                        678,642           537,098
            Accounts receivable, net            11,797,010         4,762,822
            Retentions receivable                  271,173           191,319
            Prepaid expenses                         8,316                 -
            Advances to suppliers                  154,290           158,750
            Other receivables                    3,351,498           766,231
            Inventories                          8,454,000         7,928,408
            Due from related party                 251,547           118,560
            Notes receivable                       203,696                 -

               Total current assets             26,873,110        14,856,335

       NON-CURRENT ASSETS
            Accounts receivable, net                     -           949,998
            Retentions receivable                        -           169,309
            Intangible assets, net               1,176,351           534,208
            Property and equipment, net          2,349,147         2,040,809
            Construction in progress                85,036                 -

               Total noncurrent assets           3,610,534         3,694,324

       TOTAL ASSETS                            $30,483,644       $18,550,659


       LIABILITIES AND STOCKHOLDERS' EQUITY

       CURRENT LIABILITIES
            Accounts payable                    $4,635,664        $3,128,585
            Unearned revenue                     2,282,353         3,125,406
            Taxes payable                        1,423,528           503,010
            Accrued liabilities and other
             payables                            1,398,402           807,700
            Due to related party                         -           445,990
            Due to minority shareholder              5,274                 -
            Loans payable                        3,548,746         4,619,856

               Total current liabilities        13,293,967        12,630,547

       DEFERRED TAX LIABILITY                       39,112               -

       COMMITMENTS AND CONTINGENCIES

       MINORITY INTEREST                               -                 -

       STOCKHOLDERS' EQUITY
            Common stock, $0.001 par
             value; 75,000,000 shares
             authorized, 24,179,900 and
             18,500,000 shares issued and
             outstanding at September 30, 2008
             and December 31, 2007,
             respectively                           24,180            18,500
            Paid in capital                      8,219,898         3,102,132
            Statutory reserve                    1,064,768           506,532
            Accumulated other
             comprehensive income                1,052,529           473,859
            Retained earnings                    6,789,190         1,819,089

                Total stockholders' equity      17,150,565         5,920,112

       TOTAL LIABILITIES AND
        STOCKHOLDERS' EQUITY                   $30,483,644       $18,550,659


___________________________________
Source: SmartHeat, Inc.

 

 
Copyright © SmartHeat, Inc. 2008
 
 
 
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