SHENZHEN, China , Aug. 13 /Xinhua-PRNewswire/ -- China Security & Surveillance Technology, Inc. (" China Security" or the "Company") (OTC: CSCT), a leading provider of digital surveillance technology in China , today reported its financial results for the second quarter ending June 30, 2007 .
The Company reported GAAP earnings per diluted share of
Revenue increased 551.3% to
Mr. Guo Shen Tu , Chief Executive Officer of China Security, commented, "We are pleased with our financial performance in the second quarter. During the second quarter, we secured fifty-nine new contracts across a wide array of private businesses as well as local and city governments. We are seeing significant demand from government Safe-City contracts, and importantly, several of our customers are bypassing the pilot phase and moving straight to longer-term, higher revenue-generating projects."
Second quarter gross profit increased 397% to
Income from operations increased 300% to
The Company recognized interest expense of
Net income in the second quarter of 2007 increased 72% to
The Company's cash position in the second quarter of 2007 increased to
Total debt at the end of the second quarter of 2007 was
For the third quarter of 2007, the Company expects to achieve revenues
The Company estimates that the non-cash interest expenses associated with
the redemption amount payable on convertible notes, the accrual of
performance-based employee compensation and the amortization of intangible
expense related to the company's recent acquisitions for the remaining two
quarters will be approximately
Mr. Tu concluded, "We have put in place the foundation to grow our security and surveillance company and expect to continue to be a market leader in the manufacturing, systems integration and operating services markets. The overall market for security and surveillance projects continues to expand in China and our market share is growing. Our acquisition strategy -- combined with our strong organic growth -- serves to strengthen our overall competitive position, so that our brand will become synonymous with premiere security solutions and our customers will receive one solid solution for all their security needs. This model has worked well for our organization and we expect benefits will become even more apparent over time. Our highly incentivized management team remains focused on shareholder value and we plan to proceed with our strategic plan with our shareholders foremost in mind."
Explanation of Redemption Accrual
The Company raised
As of June 30th , the Company accrued
The Company will hold a conference call to discuss the financial results at 5:00 p.m. ET today. The Company invites you to join the call by dialing 913-981-4911. A live webcast of the conference call will be available at www.viavid.net. A replay of the call will be available from August 13, 2007 to August 20, 2007 . Listeners may access the replay by dialing 719-457-0820, passcode: 5643215.
About China Security & Surveillance Technology, Inc.
Based in Shenzhen, China , China Security manufactures, distributes, installs and maintains security and surveillance systems throughout China. China Security has manufacturing facilities in China and a R&D facility which maintains an exclusive collaboration agreement with Beijing University. China Security has built a diversified customer base through its extensive sales and service network throughout China . To learn more about the Company visit http://www.csst.com.
About Non-GAAP Financial Measures
This press release contains non-GAAP financial measures for earnings that exclude the accrual for the redemption amount payable under certain outstanding convertible notes issued by the Company and certain other non-cash charges. China Security believes that these non-GAAP financial measures are useful to investors because they exclude non-cash charges that China Security's management excludes when it internally evaluates the performance of China Security's business and makes operating decisions, including internal budgeting, and performance measurement, because these measures provide a consistent method of comparison to historical periods. Moreover, management believes these non-GAAP measures reflect the essential operating activities of China Security. Accordingly, management excludes the expense arising from the accrual of redemption amounts payable under its outstanding convertible notes and certain other non-cash charges when making operational decisions. China Security believes that providing the non-GAAP measures that management uses to its investors is useful to investors for a number of reasons. The non-GAAP measures provide a consistent basis for investors to understand China Security's financial performance in comparison to historical periods. In addition, it allows investors to evaluate China Security's performance using the same methodology and information as that used by China Security's management. Non-GAAP measures are subject to inherent limitations because they do not include all of the expenses included under GAAP and because they involve the exercise of judgment of which charges are excluded from the non- GAAP financial measure. However, China Security's management compensates for these limitations by providing the relevant disclosure of the items excluded.
The following table provides the non-GAAP financial measure and the related GAAP measure and provides a reconciliation of the non-GAAP measure to the equivalent GAAP measure.
Safe Harbor Statement
This press release includes certain statements that are not descriptions of historical facts, but are forward-looking statements. Such statements include, among others, those concerning our expected financial performance and strategic and operational plans, our future operating results, our expectations regarding the market for security and surveillance products, our expectations regarding the continued growth of the security and surveillance market, as well as all assumptions, expectations, predictions, intentions or beliefs about future events. You are cautioned that any such forward-looking statements are not guarantees of future performance and that a number of risks and uncertainties could cause our actual results to differ materially from those anticipated, expressed or implied in the forward-looking statements. These risks and uncertainties include, but not limited to, the factors mentioned in the "Risk Factors" section of our Annual Report on Form 10-K for the year ended December 31, 2006 , and other risks mentioned in our other reports filed with the Securities Exchange Commission, or SEC. Copies of filings made with the SEC are available through the SEC's electronic data gathering analysis retrieval system (EDGAR) at www.sec.gov. The words "believe," "expect," "anticipate," "project," "targets," "optimistic," "intend," "aim," "will" or similar expressions are intended to identify forward-looking statements. All statements other than statements of historical fact are statements that could be deemed forward-looking statements. The Company assumes no obligation and does not intend to update any forward- looking statements, except as required by law.
SOURCE China Security & Surveillance Technology, Inc.