Tallahasee, FL 3/30/12 (StreetBeat) -- Longhai Steel Inc. ("Longhai") (OTCBB: LGHS), a producer of high-quality steel wire products in the People's Republic of China, today announced financial results for the year ended December 31, 2011.Financial highlights for 2011 include:
• 2011 steel wire sales revenue of $608 million compared with revenues of $475 million for 2010, an increase of $133 million, or 28%
• 2011 gross profit of $18.7 million compared to gross profit of $18.6 million for 2010, an increase of $100,000
• 2011 net income of $11.2 million, or $1.12 per fully diluted share, compared with net income of $11.3 million for 2010, a decrease of $100,000
• At December 31, 2011, shareholder's equity of $57.5 million, or $5.72 per fully diluted share
• At December 31, 2011, no long term debt
Financial highlights for Fourth Quarter 2011 include:
• Fourth Quarter 2011 steel wire sales revenue of $197.3 million compared with revenues of $144.5 for the same period of 2010, an increase of 36.5%
• Fourth Quarter 2011 net income of $6.3 million compared with net income of $4.6 million for the same period of 2010, an increase of 36.4%
Mr. Steven Ross, Executive Vice President of Longhai, said, "We are pleased to report record sales for 2011, largely driven by the opening of our new production facility in the fourth quarter of 2011. As the newly-opened steel wire facility continues to ramp output, we expect to see continued year-over-year improvements in operating results throughout 2012. During the first quarter of 2012 we also reconstituted our Board of Directors and transitioned to a new auditing firm, Marcum Bernstein & Pinchuk, LLP, both significant steps toward our goal of moving to a senior exchange.
Once fully ramped, the new facility will increase our overall capacity by approximately 60%, and have the capability to produce such high margin products as alloy steel, cold forging steel and welding rods. Over the next two quarters we expect to begin utilizing higher quality steel billets, which will enable us to produce higher quality and higher margin products for additional markets beyond construction and infrastructure."
About Longhai Steel Inc.
Longhai Steel Inc. is a leading producer of high quality steel wire. Downstream manufacturers process Longhai's wire into screws, nails, and wire mesh used to reinforce concrete and for fencing. Longhai's newly-opened second production facility also produces higher quality steel wire for specialized applications such as steel wire rope, steel strand, steel belted radial tires, and steel welding rod. All of its sales are delivered in China. Longhai competes using advanced production equipment and process technology, high product quality, fast order fill, and competitive prices. Its rolling and drawing facilities are among the most advanced in the world.
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