China Gerui Advanced Materials Group Limited Announces Record Fourth Quarter and Fiscal Year 2011 Results

 China Gerui Advanced Materials Group Limited Announces Record Fourth Quarter
                         and Fiscal Year 2011 Results

PR Newswire

ZHENGZHOU, China, April 17, 2012

ZHENGZHOU, China, April 17, 2012 /PRNewswire-Asia-FirstCall/ -- China Gerui
Advanced Materials Group Limited (NASDAQ: CHOP) ("China Gerui," or the
"Company"), a leading high precision, cold-rolled strip steel producer in
China, today announced unaudited financial results for the fourth quarter and
fiscal year ended December 31, 2011.

Full Year 2011 Highlights (Unaudited)

  oRevenue increased 34.6% to $341.8 million
  oGross profit increased 33.7% to $101.6 million
  oGross margin was 29.7%
  oOperating income increased 24.8% to $83.5 million
  oNet income increased 22.4% to $57.6 million, or $1.02 per diluted share
  oUnrestricted cash increased 106.4% to $246.6 million
  oOperating cash flow increased 54.2% to $56.2 million
  oWorking capital increased 113.6% to $142.5 million

Fourth Quarter 2011 Highlights (Unaudited)

  oRevenue increased 39.0% to $91.9 million
  oGross profit increased 42.5% to $28.0 million
  oGross margin was 30.4%
  oOperating income increased 42.1% to $24.0 million
  oNet income was $18.2 million, or $0.31 per diluted

"We are very pleased to report a record year in terms of revenues and profits
as our expanded cold-rolled steel production capacity drove record levels of
sales volume in 2011. Our specialized steel precision product offerings were
further enhanced with the year's increase in chromium plating capability to
250,000 tons per year which is applicable to both our wide- and narrow-strip
steel products," said Mr. Mingwang Lu, Chairman and Chief Executive Officer.
"The construction and equipment installation of 100,000 tons of annual
cold-rolled steel capacity has been completed as of the first quarter of 2012
and is undergoing testing and fine-tuning of its production processes. This
added capacity now aggregates to a total of 500,000 metric tons of both wide-
and narrow-strip cold-rolled steel production per year."

"We believe that the new capacity will enable us to better service our
existing customers as well as to secure new business as we are better
positioned than ever to offer one-stop shopping in the specialized high-end
cold-rolled steel sector. Our objective in 2012 is to continue building upon
our strong capabilities so as to further penetrate our specialized steel
sector and build market share. Our in-house production processes have
contributed to China Gerui's excellent reputation as a high-quality steel
producer in China as we continue to experience strong demand for our end-use
products across a variety of industries," Mr. Lu continued. "Although our
fourth quarter results were lower than we expected primarily due to
macroeconomic issues, following the ramp-up of our new production lines, we
believe that our cost-plus pricing strategy and business model of specialized
customization of our products will continue to contribute towards positive
results in the years ahead."

Full Year 2011 Results (Unaudited)

Revenue increased 34.6% to $341.8 million for the fiscal year ended December
31, 2011, from $253.9 million for fiscal year 2010. The increase in revenue
was primarily due to both a 16.5% increase in the Company's average selling
price to $987  per ton for fiscal year 2011 as compared to $847 per ton for
fiscal year 2010, and a 15.5% increase in sales volume to approximately
346,200 metric tons for fiscal year 2011 as compared to approximately 299,800 
metric  tons for fiscal year 2010.

Gross profit increased 33.7% to $101.6 million in the fiscal year ended
December 31, 2011 from $76.0 million for fiscal year 2010. Gross margin was
29.7% for fiscal year 2011, reflecting a slight decline as compared to 29.9%
in fiscal year 2010.

Operating income increased 24.8% to $83.6 million for fiscal year 2011 from
$66.9 million in fiscal year 2010. Operating margin was 24.5% for fiscal year
2011 compared to 26.4% for 2010. The modest decrease in operating margin was
due to a one-time warrant exercise expense of $5.7 million. Non-GAAP operating
income, which excludes the aforementioned one-time warrant exercise expense,
increased 33.3% to $89.2 million, or 26.1% of revenue, as compared to $66.9
million, or 26.4% of revenue.*

Interest expenses increased 22.4% for fiscal year 2011 to $6.5 million
compared to $5.3 million in fiscal year 2010. The increase in interest
expenses was due to an increase in the use of bank debt facilities in fiscal
year 2011.

Net income increased 22.4% to $57.6 million for the fiscal year ended December
31, 2011 from $47.1 million for fiscal year 2010. Net income per diluted
share for fiscal year 2011 increased to $1.02 from $1.01 per diluted share for
fiscal year 2010, taking into account the 20.7% increase in the number of
fully diluted shares outstanding in fiscal year 2011 from fiscal year 2010
resulting primarily from warrant exercises through the end of the fiscal
quarter ended March 31, 2011 prior to their expiration during that quarter.

Non-GAAP adjusted EBITDA increased 39.0% to $98.2 million for 2011, or 28.7%
of revenue, from $70.6 million, or 27.8% of revenue, in fiscal year 2010.
Non-GAAP adjusted EBITDA is defined as earnings before interest, taxes,
depreciation, amortization and one-time warrant exercise expenses incurred in
the first quarter of fiscal year 2011.*

* Please see the section below entitled "Use of Non-GAAP Adjusted Financial
Measures" and the reconciliation table at the end of this press release for an
explanation and quantitative comparison of the non-GAAP measures used in this
press release to their GAAP equivalents.

Fourth Quarter 2011 Results (Unaudited)

Revenue increased 39.0% to $91.9 million in the fourth quarter of fiscal year
2011 from $66.1 million in the fourth quarter of fiscal year 2010. The
increase in revenue was primarily due to both a 10.1% increase in the
Company's average selling price to $949  per ton for the fourth quarter of
fiscal year 2011 as compared to $862 per ton for the same period of fiscal
year 2010, and a 26.4% increase in sales volume to approximately 95,400 tons
for the fourth quarter of fiscal year 2011 as compared to approximately 75,500
tons for the same period of fiscal year 2010.

Gross profit increased 42.5% to $28.0 million in the fourth quarter of fiscal
year 2011 from $19.6 million in the same period of fiscal year 2010. Gross
margin was 30.4% in the fourth quarter of fiscal year 2011 compared to 29.7%
in the same period of fiscal year 2010. The increase in gross margin was due
to the increased utilization of both the new 150,000-ton wide-strip production
line and the 200,000 tons in new chromium-plating capacity that were both
added earlier in fiscal year 2011.

Operating income increased 42.1% to $24.0 million in the fourth quarter of
fiscal year 2011, or 26.0% of revenue, from $16.8 million, or 25.5% of revenue
in the same period of fiscal year 2010. The level of operating margin was
relatively unchanged year-to-year primarily due to the gradual utilization of
new production line capacities.

Interest expenses decreased 42.9% to $1.0 million compared to $1.8 million in
the prior year period. The decrease in interest expenses was due to
management's continued efforts to reduce leverage to strengthen its balance
sheet.

Net income increased 60.4% to $18.2 million in the fourth quarter of fiscal
year 2011 from $11.3 million in the same period of fiscal year 2010. Net
income per diluted share in the fourth quarter of fiscal year 2011 increased
to $0.31 from $0.23 per diluted share in the same period of fiscal year 2010,
which factors in the significant increase of number of shares outstanding from
warrant exercises through March 21, 2011 prior to their expiration during that
quarter.

Non-GAAP adjusted EBITDA increased 54.7% to $27.5 million, or 29.9% of
revenue, from $17.8 million, or 26.9% of revenue, in the same period of 2010.*

* Please see the section below entitled "Use of Non-GAAP Adjusted Financial
Measures" and the reconciliation table at the end of this press release for an
explanation and quantitative comparison of the non-GAAP measures used in this
press release to their GAAP equivalents.

Financial Condition (Unaudited)

As of December 31, 2011, the Company had $246.6 million in unrestricted cash
and an additional $118.1 million in restricted cash, as compared to $119.5
million and $66.5 million, respectively, as of December 31, 2010. Working
capital was $142.5 million as of December 31, 2011, compared to $66.7 million
at the end of 2010. The Company's short-term debt consisted of notes payable
and term loans that totaled $249.1 million as of December 31, 2011, compared
to $130.3 million at the end of 2010. The Company has no long-term debt.
Shareholders' equity was $298.4 million, as compared to $167.8 million at the
end of 2010. The net cash provided by operating activities for 2011 was $56.2
million compared to net cash provided by operating activities of $36.5 million
for 2010.

Recent Developments

Management acknowledges the recent challenging sentiment toward U.S. listed
companies based in China. In order to foster investor confidence in China
Gerui and enhance transparency, in April 2011, the Company announced that its
Board of Directors approved the repurchase of up to an aggregate of $10
million of its ordinary shares. As of April 16, 2012 the Company had
repurchased 1,176,898 ordinary shares at an average price of $3.84 per share
for a total repurchase price of approximately $4.52 million. 

Business Outlook

The Company executed a substantial capacity expansion plan in fiscal year 2011
and the first quarter of fiscal year 2012. The plan was implemented in two
phases: Phase I involved the construction of two new cold-rolled, wide-strip
steel production lines with 150,000 tons of total annual capacity and a new
chromium plating production line capable of processing an additional 200,000
tons of cold-rolled steel per year. These lines began normal operations as of
July 2011 and are currently running at an approximate 65% utilization rate,
reflecting a gradual increase in utilization consistent with the Company's
quality control standards. Phase II of the expansion plan involved the
addition of 100,000 tons of cold-rolled steel production capacity per year
which occurred during the first quarter of 2012, which resulted in a total of
250,000 tons of total additional annual capacity.

The completion of the Company's capacity expansion plan has increased the
Company's total annual production capacity to a total of 500,000 tons of
specialized steel of both wide- and narrow-strip cold-rolled steel production.
The Company's chromium plating production lines are fully operational and can
accommodate a total of 250,000 tons of either wide- or narrow-strip
specialized steel.

In the fourth quarter of fiscal year 2011, the Company experienced a
contraction in both its average selling prices and sales volume as compared to
the third quarter of fiscal year 2011, primarily due to two factors. First, a
general slowdown in the Chinese economy due to macroeconomic factors led to a
decrease in domestic spending and infrastructure investment. This directly
impacted some of the end-use applications that the Company and its products
serve. Second, the slowdown in the domestic economy and a slowdown in exports
of steel also led to a somewhat depressed steel market in China which has
forced large state-owned steel mills to rely on the domestic market to absorb
their otherwise export-oriented output; this has resulted in an increase in
supply and induced some short-term price cuts throughout the domestic steel
sector.

However, the Company's strategic focus on high-end specialized steel products
is expected to mitigate competition with commodity steel producers. Moreover,
the Company significantly increased its production capacity in fiscal year
2011 and testing is underway to refine its production processes to reach the
designed thickness from its state-of-the-art manufacturing lines. The Company
believes that as its new production capacity meets those specifications for
which it has been designed, the average selling prices for the Company's steel
products from its new production lines will increase.

In addition, while adhering to its long-term strategy to operate as a high-end
higher-margin precision steel producer, China Gerui is currently offering
selective incentives in order to develop business from customers. Further,
the Company plans upon increasing the utilization of its chromium plating with
its new wide-strip output so as to further mobilize sales. The Company is
also pursuing other advanced materials applications such as the development
and processing of various alloys to optimize the utilization of its extensive
value-added in-house production technology.

To continue in its efforts to diversify its products and generate high margin
income streams, the Company is also pursuing additional growth opportunities
as dictated by new developments in hardware and software technology as well as
those offered by potential acquisition opportunities. However, as the Company
continues to implement its long-term strategy, it may experience further
contraction in its average selling prices which could translate into pressure
on its gross margin in the year ahead if an overall improvement in
macroeconomic conditions does not occur in the short-term.

For fiscal year 2012, China Gerui expects revenue of between $395 million and
$410 million, and diluted earnings per share of between $1.32 and $1.37. The
Company may adjust this guidance as changing macroeconomic issues and
operational and competitive challenges dictate.

Mr. Lu concluded, "We believe that China Gerui will maintain its leadership
position as a high-end specialized steel producer in China. The year ahead is
exciting given the new levels of capacity available to the Company. The
execution of the Company's expansion in production is well-timed as we are now
very well-prepared to meet expected strong market demand with an enhanced
product portfolio as well as to further diversify our customer base in the
year ahead. We expect to experience increased volume from our additional
capacity through 2012 as our value-added capabilities enable us to meet
specialized customer service needs in an increasing number of industries."

Scheduled Form 20-F Filing

The Company expects to file its audited financial results for the year of 2011
on Form 20-F before or on April 30, 2012. As a foreign private issuer, China
Gerui is exempt from the rules under the Securities Exchange Act of 1934
prescribing the filing and content of quarterly reports on Form 10-Q, among
other reporting requirements, and has until April 30 to file its Form 20-F.

Conference Call Information

The Company will also host a conference call at 10:00 am ET on Tuesday, April
17, 2012.^

Listeners may access the call by dialing +1 (866) 759-2078 five to ten minutes
prior to the scheduled conference call time. International callers should dial
+1 (706) 643-0585. The conference participant pass code is 65653713.

A replay of the conference call will be available for 14 days starting from
12:00 pm ET on Tuesday, April 17, 2012. To access the replay, dial +1 (855)
859-2056. International callers should dial +1 (404) 537-3406. The passcode is
65653713.

A live and archived webcast of the call will be available on the Company's
website at http://www.geruigroup.com/Investors.html. To listen to the live
webcast, please go to the Company's website at least fifteen minutes prior to
the start of the call to register, download and install any necessary audio
software.

Use of Non-GAAP Adjusted Financial Measures

This earnings release includes the use of non-GAAP operating income, non-GAAP
net income, non-GAAP adjusted diluted earnings per share, and non-GAAP
adjusted EBITDA, which are financial measures that are not defined by U.S.
generally accepted accounting principles, or U.S. GAAP. For purposes of
Regulation G, a non-GAAP financial measure is a numerical measure of a
registrant's historical or future financial performance, financial position or
cash flows that excludes amounts, or is subject to adjustments that have the
effect of excluding amounts, that are included in the most directly comparable
measure calculated and presented in accordance with U.S. GAAP in the statement
of income, balance sheet, or statement of cash flows (or equivalent
statements) of the issuer; or includes amounts, or is subject to adjustments
that have the effect of including amounts, that are excluded from the most
directly comparable measure so calculated and presented. In this regard, U.S.
GAAP refers to generally accepted accounting principles in the United States.
Pursuant to the requirements of Regulation G, the Company has included with
this press release a table which includes a reconciliation of non-GAAP
operating income, non-GAAP net income, non-GAAP adjusted diluted earnings per
share, and non–GAAP adjusted EBITDA to the most directly comparable respective
U.S. GAAP financial measures. Non-GAAP adjusted EBITDA is defined as earnings
before interest, taxes, depreciation, amortization and one-time warrant
exercise expenses of $5.7 million incurred in the first quarter of 2011.
Non-GAAP operating income, non-GAAP net income and non-GAAP adjusted diluted
earnings per share were calculated by excluding one-time warrant exercise
expenses of $5.7 million from operating income, net income, and net income per
diluted share, respectively. The Company's management believes that the
presentation of these non-GAAP financial measures provides useful information
regarding the Company's results of operations because it assists in analyzing
and benchmarking the performance and value of the Company's business. The
Company's calculation of non-GAAP adjusted EBITDA, non-GAAP operating income,
non-GAAP net income, and non-GAAP adjusted diluted earnings per share may not
be consistent with similarly titled measures of other companies.

About China Gerui Advanced Materials Group Limited

China Gerui Advanced Materials Group Limited is a leading niche and high
value-added steel processing company in China. The Company produces high-end,
high-precision, ultra-thin, high- strength, cold-rolled steel products that
are characterized by stringent performance and specification requirements that
mandate a high degree of manufacturing and engineering expertise. China
Gerui's products are not standardized commodity products. Instead, they are
tailored to customers' requirements and subsequently incorporated into
products manufactured for various applications. The Company sells its products
to domestic Chinese customers in a diverse range of industries, including the
food packaging, telecommunication, electrical appliance, and construction
materials industries. For more information, please visit
http://www.geruigroup.com.

Safe Harbor Statement

Certain of the statements made in this press release are "forward-looking
statements" within the meaning and protections of Section 27A of the
Securities Act of 1933, as amended and Section 21E of the Securities Exchange
Act of 1934, as amended, or the Exchange Act. Forward-looking statements
include statements with respect to our beliefs, plans, objectives, goals,
expectations, anticipations, assumptions, estimates, intentions, and future
performance, and involve known and unknown risks, uncertainties and other
factors, which may be beyond our control, and which may cause the actual
results, performance, capital, ownership or achievements of the Company to be
materially different from future results, performance or achievements
expressed or implied by such forward-looking statements. All statements other
than statements of historical fact are statements that could be
forward-looking statements. You can identify these forward-looking statements
through our use of words such as "may," "will," "anticipate," "assume,"
"should," "indicate," "would," "believe," "contemplate," "expect," "estimate,"
"continue," "plan," "point to," "project," "could," "intend," "target" and
other similar words and expressions of the future.

All written or oral forward-looking statements attributable to us are
expressly qualified in their entirety by this cautionary notice, including,
without limitation, those risks and uncertainties to be described in our
annual report on Form 20-F for the year ended December 31, 2011 and otherwise
in our SEC reports and filings, including the final prospectus for our
offering. Such reports are available upon request from the Company, or from
the Securities and Exchange Commission, including through the SEC's Internet
website at http://www.sec.gov. We have no obligation and do not undertake to
update, revise or correct any of the forward-looking statements after the date
hereof, or after the respective dates on which any such statements otherwise
are made.

Company Contact:         Investor Relations Contact:
Email:                   CCG Investor Relations
investors@geruigroup.com
Website:                 David Rudnick
www.geruigroup.com
                         Phone:
                         1-646-626-4172
                         Email: david.rudnick@ccgir.com

Financial tables to follow

CHINA GERUI ADVANCED MATERIALS GROUP LIMITED
CONSOLIDATED STATEMENTS OF INCOME
(IN US DOLLARS)
                                For the Three Months      For the Year Ended
                                 Ended December 31,       December 31,
                                2011          2010          2011           2010
                                (Unaudited)   (Unaudited)   (Unaudited)
Revenue                       $          $          $           $   
                                91,937,463   66,141,972   341,778,295    253,866,337
Cost of revenue               (63,951,432)  (46,500,979)  (240,199,678)  (177,869,648)
Gross Profit                  27,986,031    19,640,993    101,578,617    75,996,689
Operating expenses:
 General                    (3,564,323)   (2,422,447)   (10,707,418)   (7,795,722)
andadministrativeexpenses
 Selling and marketing      (472,370)     (370,384)     (1,634,232)    (1,251,091)
expenses
 Warrant compensation       -             -             (5,700,000)    -
expenses
Total operating expenses      (4,036,693)   (2,792,831)   (18,041,650)   (9,046,813)
Operating income              23,949,338    16,848,162    83,536,967     66,949,876
Other income and
(expense):
 Interest income            541,538       433,251       1,913,091      1,087,178
 Interest expenses          (1,039,575)   (1,821,717)   (6,470,126)    (5,286,727)
 Sundry income              159,311       1,514         602,247        270,240
Income before income taxes      23,610,612    15,461,210    79,582,179     63,020,567
Income tax expense              (5,419,015)   (4,119,761)   (21,961,627)   (15,937,143)
Net income                     18,191,597    11,341,449    57,620,552     47,083,424
Earnings per share
 - Basic                     0.31          0.25          1.02           1.07
 - Diluted                   0.31          0.23          1.02           1.01
Weighted average common
shares outstanding
 - Basic                     58,299,223    45,625,015    56,297,652     43,891,670
 - Diluted                   58,299,223    48,389,066    56,297,652     46,655,721



CHINA GERUI ADVANCED MATERIALS GROUP LIMITED
CONSOLIDATED BALANCE SHEETS
(IN US DOLLARS)
                                          December 31, 2011  December 31, 2010
                                          (Unaudited)
Assets
Current assets
 Cash                                  $             $     
                                          246,600,917        119,477,298
 Restricted cash                       118,130,253        66,530,303
 Accounts receivable, net              6,382,630          4,087,086
 Notes receivable                      568,328            -
 Inventories                           24,463,142         7,002,277
 Prepaid purchases                     45,805,423         27,772,852
 Prepaid expenses and other deposits   385,131            976,828
 Other receivables                     2,850,601          2,068,082
Total current assets                      445,186,425        227,914,726
Non-current assets
 Property, plant and equipment, net    122,695,246        85,489,849
 Land use right, net                   13,807,056         13,455,218
 Deposit on acquisition of future land 12,710,719         2,143,939
use right
 Other receivable                      3,499,083          -
 Certificates of deposit               3,177,679          -
Total non-current assets                  155,889,783        101,089,006
Total assets                              $             $     
                                          601,076,208        329,003,732
Liabilities and stockholders' equity
Current Liabilities
 Accounts payable                      $           $       
                                          8,074,432          2,650,689
 Notes payable                         204,880,916        86,227,272
 Term loans                            44,169,751         44,090,909
 Land use right payable                1,404,926          10,203,404
 Income tax payable                    5,458,482          4,151,665
 Customers deposits                    23,383,849         9,686,444
 Accrued liabilities and other         15,276,016         4,181,347
payables
Total current liabilities                 302,648,372        161,191,730
Total liabilities                         302,648,372        161,191,730
Stockholders' equity
Common stock,
 Common stock, 100,000,000 shares
authorized with no par value;
 59,428,578 and 46,139,053
shares issued,
 58,251,680 and 46,139,053 shares
outstanding as of
 December 31, 2011 and December   140,418,118        73,944,243
31, 2010, respectively
 Additional paid-in capital            6,930,944          6,930,944
 Treasury stock, at cost, 1,176,898
shares, as of December 31, 2011,
 none as of December 31, 2010      (4,516,744)        -
 Retained earnings                     137,142,958        79,522,406
 Accumulated comprehensive income      18,452,560         7,414,409
Total stockholders' equity                298,427,836        167,812,002
Total liabilities and stockholders'       $             $     
equity                                    601,076,208        329,003,732



CHINA GERUI ADVANCED MATERIALS GROUP LIMITED
CONSOLIDATED STATEMENTS OF CASH FLOWS
(IN US DOLLARS)
                            For the year ended December 31
                            2011              2010             2009
                            (Unaudited)
Cash flows from operating
activities:
Net income                  $           $          $      
                            57,620,552        47,083,424       43,448,278
Adjustments to reconcile
net income to net
 cash provided by
operating activities:
Depreciation of property,   7,994,638         3,149,314        2,792,547
plant and equipment
Loss on disposal of
property, plant and         12,726            -                -
equipment
Warrant compensation        5,700,000         -                -
expenses
Amortization of land use    322,638           259,438          30,827
right
Changes in assets and
liabilities:
Accounts receivable, net    (2,046,819)       721,098          5,496,540
Notes receivable, net       (554,789)         -                -
Inventories                 (16,712,453)      (1,043,397)      (2,404,567)
Prepaid expenses and other  621,611           (914,841)        (37,772)
deposits
Prepaid purchases           (16,284,440)      (11,361,129)     (5,514,883)
Other receivables           (697,676)         224,051          (1,026,036)
Accounts payable            5,168,689         (4,967,264)      2,278,603
Income tax payable          1,078,582         334,361          1,628,627
Customers deposit           12,911,217        1,539,833        (9,338,097)
Accrued liabilities and     1,113,651         1,452,762        (3,565,821)
other payables
Net cash provided by        56,248,127        36,477,650       33,788,246
operating activities
Cash flows from investing
activities:
Cash paid for property,     (29,816,858)      (65,063,864)     (5,213,329)
plant and equipment
Proceeds from disposal of
property, plant and         9,655             -                -
equipment
Payment of purchases of     (9,073,284)       (1,903,656)      (14,648)
land use right
Payment of acquisition of   (10,213,261)      (2,093,071)      -
future land use right
Cash deposit - potential
business initiative program (5,000,000)       -                -
- related party
Cash deposit refunded -     5,000,000         -                -
related party
Advance to unrelated third  (3,415,724)       -                -
party
Investment in certificates  (3,101,978)       -                -
of deposit
Changes in restricted       (47,212,098)      (29,032,134)     (12,785,820)
cash
Changes in prepaid          -                 13,973,966       (13,336,084)
machinery deposits
Net cash used in investing  (102,823,548)     (84,118,759)     (31,349,881)
activities
Cash flows from financing
activities:
Repayment of term loans     (45,831,718)      (45,984,848)     (37,269,379)
Proceeds from term loans   43,815,432        56,093,042       40,574,191
Proceeds from notes         111,733,230       45,213,650       14,102,666
payable, net
Proceeds received from
common stock issued and
 warrant conversion,     -                 28,682,613       26,736,329
net
Proceeds received from      66,473,875        -                -
exercise of warrants
Warrant compensation        (5,700,000)       -                -
expense
Purchase of treasury        (4,516,744)       -                -
stock
Repayment of subscription   -                 -                4,310,087
receivable
Land use right payable      -                 -                (28,521)
Due to former minority      -                 -                (4,310,087)
shareholders
Dividends paid              -                 -                (9,601,549)
Net cash provided by        165,974,075       84,004,457       34,513,737
financing activities
Net increase in cash        119,398,654       36,363,348       36,952,102
Effect on change of         7,724,965         3,506,581        32,863
exchange rates
Cash as of January 1        119,477,298       79,607,369       42,622,404
Cash as of December 31      $            $           $      
                            246,600,917       119,477,298      79,607,369
Supplemental disclosures of
cash flow information:
Cash paid during the year
for:
         Interest paid      $          $         $       
                            6,254,304         3,927,906        3,237,757
         Income tax paid    $           $          $      
                            20,883,046        15,738,892       13,122,287
Non-cash paid during the
year for:
         Dividend paid      $          $         $      
                                   -          -  18,525,000



CHINA GERUI ADVANCED MATERIALS
GROUP LIMITED
RECONCILIATION OF NON-GAAP
FINANCIAL DATA
(IN US DOLLARS)
(UNAUDITED)
                       Non GAAP Operating Income
                       Three Months Ended Dec. 31  Full Year Ended Dec. 31
                       2011            2010          2011          2010
Operating Income, GAAP amount per
consolidated
statement of income   23,949,338      16,848,162    83,536,967    66,949,876
One-time warrant      -               -             5,700,000     -
exercise expenses
Non GAAP Adjusted     23,949,338      16,848,162    89,236,967    66,949,876
Operating Income
                       Non GAAP Net Income
                       Three Months Ended Dec. 31  Full Year Ended Dec. 31
                       2011            2010          2011          2010
Net Income, GAAP
amount per
consolidated
statement of income   18,191,597      11,341,449    57,620,552    47,083,424
One-time warrant      -               -             5,700,000     -
exercise expenses
Adjusted Amount      18,191,597      11,341,449    63,320,552    47,083,424
Weighted average      58,299,223      48,389,066    56,297,652    46,655,721
shares - diluted
GAAP diluted          0.31            0.23          1.02          1.01
earnings per share
Non GAAP Adjusted
diluted earnings per   0.31            0.23          1.12          1.01
share
                       Non GAAP Adjusted EBITDA
                       Three Months Ended Dec. 31  Full Year Ended Dec. 31
                       2011            2010          2011          2010
Net Income, GAAP
amount per
consolidated
 statement of         18,191,597      11,341,449    57,620,552    47,083,424
income
One-time warrant      -               -             5,700,000     -
exercise expenses
Interest income      (541,538)       (433,251)     (1,913,091)   (1,087,178)
Interest expenses    1,039,575       1,821,717     6,470,126     5,286,727
Income tax expense   5,419,015       4,119,761     21,961,627    15,937,143
Depreciation of
property, plant and    3,305,560       849,013       7,994,638     3,149,314
equipment
Amortization of land  81,977          77,288        322,638       259,438
use right
Non GAAP Adjusted     27,496,186      17,775,977    98,156,490    70,628,868
EBITDA



SOURCE China Gerui Advanced Materials Group Limited
 
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