Business News
China Bottles Inc. Announces First Quarter 2008 Results
Wednesday 21. May 2008 - China Bottles Inc. ("The Company") (BULLETIN BOARD: CBTT) , a leading plastic packaging solution company and plastic bottle production equipment company in the People's Republic of China ("PRC"), today announced financial results for the first quarter ended March 31, 2008.
First Quarter 2008 Highlights
— Revenue reached $ 13.7 million
— Gross profit was $4.1 million or 29.6% of revenue
— Operating income was $2.6 million
— Net income was $2.8 million with a fully diluted EPS of $0.07
— On April 3, 2008, the Company changed its name from Hutton Holdings,
Inc. to China Bottles Inc.
“Our strong first quarter performance for 2008 underscores the intensifying national and international demand for our products as polyethylene terephthalate packaging (PET) continues to grow as the preferred packaging material worldwide. We remain focused on building brand awareness and expanding our market share in domestic and international markets. Our strong R&D staff continues to improve our operational efficiency and develop innovative new products, such as packaging materials for the pharmaceutical industry,” noted Chong-Hui Zhao, CEO of China Bottles.
First Quarter 2008 Results
Revenue of $13.7 million for the first quarter ended March 31, 2008, was primarily attributable to the expanding demand in the blown molding equipment and the molds divisions. China Bottles delivers cost competitive equipment and machinery as beverage companies continue the in-house bottle production trend driven by increasing crude oil prices.
Gross profit was $4.1 million for the three months ended March 31, 2008. Gross profit as a percentage of net revenue was 29.6% in the first quarter of 2008.
Sales and marketing expenses, including distribution expense was $0.7 million for the three months ended March 31, 2008. This expense was primarily attributable to an increased participation in tradeshow exhibitions and higher traveling expenses for marketing and sales personnel.
General and administrative expenses (G&A) were $0.7 million for the three months ended March 31, 2008. The largest components were staff and travel-related expenses, which accounted for 40.8% of total G&A expenses during the quarter.
Operating income was $2.6 million for the three months ended March 31, 2008, or 18.9% of revenue.
Net income for the three months ended March 31, 2008 was $2.8 million, or $0.07 per fully diluted share. The Company’s net margin for the first quarter ended of 2008 was 20.7%.
Financial Condition
As of March 31, 2008, cash and cash equivalents totaled $1.9 million, accounts receivable of $5.9 million, inventory of $10.0 million and working capital of $5.9 million. Total liabilities totaled $17.3 million and the Company had no long-term debt. Stockholders’ equity stood at $10 million. The Company used $1.9 million in cash flow from operating activities, primarily due to the increased in accounts receivable and inventory.
Business Outlook
“China Bottles has a strong presence in China’s southern and northern markets for molds and bottle blowing equipment and we are making good progress in the production of pharmaceutical products by adding polypropylene packaging materials to our product line. Through our aggressive sales and marketing programs, we intend to increase export sales volume from 20% of total revenue in 2007 to 30% in 2008,” said Mr. Chong-Hui Zhao, CEO of China Bottles. “In order to meet expected demand, we also intend to increase our production capacity to participate in the expanding market.”