Guanwei Recycling Corp. Reports 2012 Revenues Grew 24.28% Over Prior Year

Guanwei Recycling Corp. Reports 2012 Revenues Grew 24.28% Over Prior Year 
Profits Declined Slightly as Full Year Manufacturing Costs Outpaced
Steady Gains in Selling Prices; 2012 Year End Investor Conference
Call to Be Held Monday, April 1st at 8:00am ET 
FUQING CITY, CHINA -- (Marketwire) -- 03/28/13 --  Guanwei Recycling
Corp. (NASDAQ: GPRC), a leading clean tech manufacturer in China of
recycled low density polyethylene (LDPE), today reported revenues
advanced 24.28% year over year to a record $79,043,356 in the year
ended December 31, 2012. Operating in a relatively weaker economy in
China, growth was fueled by continued domestic demand for the
Company's competitively priced, high quality recycled plastic.
Despite a moderation in some key costs in the second half of 2012,
especially for raw materials, year over year increases in
manufacturing costs slightly outpaced steady gains in sales prices.
This resulted in slightly lower full year net income compared with
the prior year.  
2012 Highlights 


 
--  Net revenues grew to a record $79,043,356, up 24.28% from revenues of
    $63,600,678 in 2011.
--  Net income declined 7.49 % from $12,793,448, or $1.28 per share in
    2011, to $11,835,295, or $1.15 per share, as gross profit margins
    declined from 30.6
4% in 2011 to 23.54% in 2012. The earnings per share
    data retroactively reflects the reverse stock split which took place
    in December, 2012.
--  At year end, the Company had no bank debt, cash and cash equivalents
    of $12,083,358, and working capital of $35,505,028, up 49.16% from the
    prior year.
--  The Company maintained its competitive advantage of being licensed by
    Chinese and German authorities to import lower cost, higher quality
    plastic waste from Germany and other European raw material suppliers
    by continuing to meet exacting green standards.

  
Volume and Sales Price Increases 
The Company's sales of manufactured recycled LDPE in 2012 were a
record $67,331,679, up 8.77% from 2011. This increase reflected year
over year growth in tonnage sales from 52,666 tons in 2011 to 55,448
tons in 2012, a 5.28% increase. Average selling prices for
manufactured recycled LDPE in 2012 were approximately $1,214 per ton,
a 3.32% increase from approximately $1,175 per ton a year earlier.  
Sales of sorted non-LDPE materials increased 12.57% to $1,913,859
reflecting a 5.41% increase in tonnage sales to 6,135 tons as average
sales prices increased 6.85% to approximately $312 per ton.  
During the year, the Company also recorded $9,797,818 in low margin
sales of raw materials. It had no such sales in 2011. The sales in
2012 resulted from a Company decision to increase bulk buying of raw
materials to reduce costs which required sales of unused raw
materials to increase storage space. 
Capital Expenditures 
During the year the Company incurred capital expenditures of
approximately $2.69 million, primarily related to building
improvements and other factory equipment purchases aimed mainly at
improving its production process and efficiencies. Production
capacity at year end was 80,000 tons. 
Import Quota 
The Company received governmental approval for an import quota in
2013 of 100,000 tons of imported plastic waste, up from 80,000 tons
in 2012. At the same time, the Company's ability to utilize the
import quota of Fuqing Huan Li Plastics Company was reduced from
35,000 tons in 2012, to 15,000 tons in 2013. The combined imported
plastic waste tonnage allowed in 2012 was 115,000 tons which is the
same combined tonnage allowed in 2013. 
Outlook 
Mr. Min Chen, Chairman and CEO of the Company, commented, "We believe
our financial strength and the continuing growth in sales we achieved
in 2012 -- despite China's relatively slower economic environment --
bode well for the future, as we provide key products required in a
wide variety of end uses to a broad range of customers. A primary
goal this year is to improve profit margins as sales continue to
expand, with a particular focus on managing key manufacturing costs
to the extent possible."  
He added, "We also remain committed to our U.S. listing and believe
it is only a matter of time before investors recognize the
outstanding growth still ahead in China, and companies such as ours
that are well positioned to benefit from that growth." 
Conference Call Invitation 
The Company will discuss 2012 year end results during a live
conference call and webcast on Monday, April 1st, at 8:00am ET.  
To participate in the call, interested participants should call
1-877-941-4774 when calling within the United States or
1-480-629-9760 when calling internationally. Please ask for the
Guanwei Recycling Corp. 2012 Year End Conference Call, Conference ID:
4609603. There will be a playback available until 04/08/13. To listen
to the playback, please call 1-877-870-5176 when calling within the
United States or 1-858-384-5517 when calling internationally. Use the
Replay Pin Number: 4609603. 
This call is being webcast by ViaVid Broadcasting and can be accessed
by clicking on this link http://public.viavid.com/index.php?id=103983
or 
at ViaVid's website at http://viavid.com. 
SEE ATTACHED TABLES 
Description of Guanwei Recycling Corp. 
Adhering to the highest "green" standards, Guanwei Recycling Corp.
(the "Company") has generated rapid growth producing recycled low
density polyethylene (LDPE) from plastic waste procured mostly in
Europe for sales to more than 300 customers (including over 150
active recurring customers) in more than ten different industries in
China. The Company is licensed by Chinese authorities and also has
been issued a Compliance Certificate by Umweltagentur Erftstadt,
which issues certificates of approval for certain plastics
manufacturers that meet Germany's strict environmental standards.
This enables the Company to procure high quality plastic waste
directly from Germany and other European countries (Spain and
Holland) with no middlemen, and permits highly economic production of
the highest grades of LDPE. Additional information regarding Guanwei
Recycling Corp. is available at www.guanweirecycling.com.  
Information Regarding Forward-Looking Statements 
Except for historical information contained herein, the statements in
this press release are forward-looking statements that are made
pursuant to the safe harbor provisions of the Private Securities
Litigation Reform Act of 1995. Forward-looking statements involve
known and unknown risks and uncertainties, which may cause our actual
results in future periods to differ materially from forecasted
results. These risks and uncertainties include, among other things,
product demand, market competition, and risks inherent in our
operations. These and other risks are described in our filings with
the U.S. Securities and Exchange Commission. 


 
                                                                            
                                                                            
                          GUANWEI RECYCLING CORP.                           
         CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME         
                                                                            
                                                   Year Ended December 31,  
                                                 -------------------------- 
                                                     2012          2011     
                                                 ------------  ------------ 
                                                                            
Net revenue                                      $ 79,043,356  $ 63,600,678 
Cost of revenue                                    60,440,237    44,111,700 
                                                 ------------  ------------ 
    Gross profit                                   18,603,119    19,488,978 
                                                 ------------  ------------ 
                                                                            
Operating expenses:                                                         
  Selling and marketing                               417,597       398,513 
  General and administrative                        2,297,782     1,994,873 
                                                 ------------  ------------ 
    Total operating expenses                        2,715,379     2,393,386 
                                                 ------------  ------------ 
                                                                            
Income from operations                             15,887,740    17,095,592 
                                                 ------------  ------------ 
                                                                            
Other income (expenses)                                                     
  Interest income                                      55,781        88,249 
  Interest expenses                                         -       (29,083)
  Net foreign exchange gain                            62,806       156,602 
  Loss on disposal of property and equipment          (33,452)      (72,174)
  Miscellaneous                                         6,372         7,383 
                                                 ------------  ------------ 
    Total other income                                 91,507       150,977 
                                                 ------------  ------------ 
                                                                            
Income before income taxes                         15,979,247    17,246,569 
                                                                            
Income taxes                                        4,143,952     4,453,121 
                                                 ------------  ------------ 
   
                                                                         
Net income                                         11,835,295    12,793,448 
                                                                            
Other comprehensive income - foreign currency                               
 translation adjustments                              284,318     1,067,008 
                                                 ------------  ------------ 
                                                                            
Comprehensive income                             $ 12,119,613  $ 13,860,456 
                                                 ============  ============ 
                                                                            
                                                                            
Earnings per share - basic and diluted           $       1.15  $       1.28 
                                                 ============  ============ 
                                                                            
Weighted average number of common shares                                    
 outstanding                                                                
  - basic and diluted                              10,293,872    10,000,015 
                                                 ============  ============ 
                                                                            
                                                                            

 
                                                                            
                                                                            
                           GUANWEI RECYCLING CORP.                          
                         CONSOLIDATED BALANCE SHEETS                        
                                                                            
                                                          December 31,      
                                                       2012         2011    
                                                   ------------ ------------
ASSETS                                                                      
Current assets                                                              
  Cash and cash equivalents                        $ 12,083,358 $ 12,432,803
  Accounts receivable                                 9,305,104    4,475,386
  Inventories                                        18,696,648   16,858,801
  Advances to suppliers                               1,827,480            -
  Value added tax refundable                                  -    1,221,531
  Prepaid expenses and other current assets             131,564      882,818
                                                   ------------ ------------
    Total current assets                             42,044,154   35,871,339
                                                                            
Property, plant and equipment, net                   10,223,874    8,151,012
Construction in progress                                      -      174,295
Land use right, net                                     663,800      673,762
Other assets                                            202,346      205,437
                                                   ------------ ------------
    Total Assets                                   $ 53,134,174 $ 45,075,845
                                                   ============ ============
                                                                            
LIABILITIES AND SHAREHOLDERS' EQUITY                                        
Current liabilities                                                         
  Accounts payable                                 $  4,082,982 $  8,741,822
  Accrued expenses and other payables                   796,705      714,072
  Value added taxes payable                             110,484            -
  Amount due to shareholder                             517,863    1,468,167
  Income tax payable                                  1,031,092    1,144,516
                                                   ------------ ------------
    Total current liabilities                         6,539,126   12,068,577
                                                   ------------ ------------
Commitments and contingencies                                               
Shareholders' Equity                                                        
  Common stock, $0.001 par value, 500,000,000                               
   shares authorized, 10,407,839 and 10,000,015                             
   shares issued and outstanding, as of December                            
   31, 2012 and December 31, 2011                        10,408       10,000
  Additional paid-in capital                          2,767,787    1,300,028
  PRC statutory reserves                                805,483      805,483
  Accumulated other comprehensive income              2,546,999    2,262,681
  Retained earnings                                  40,464,371   28,629,076
                                                   ------------ ------------
    Total shareholders' equity                       46,595,048   33,007,268
                                                   ------------ ------------
                                                                            
    Total liabilities and shareholders' equity     $ 53,134,174 $ 45,075,845
                                                   ============ ============

  
Contacts: 
Richard Sun
guanweirecycling@gmail.com 
Ken Donenfeld
DGI Investor Relations 
kdonenfeld@dgiir.com
Tel: 212-425-5700 
Fax: 646-381-9727 
 
 
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