THT Heat Transfer Technology, Inc. Announces Fourth Quarter and Fiscal Year 2012 Results

 THT Heat Transfer Technology, Inc. Announces Fourth Quarter and Fiscal Year
                                 2012 Results

Sales revenue rose 43.9% year-over-year in fourth quarter 2012, exceeding
guidance

PR Newswire

SIPING, China, April 1, 2013

SIPING, China, April 1, 2013 /PRNewswire/ -- THT Heat Transfer Technology,
Inc. (Nasdaq: THTI) ("THT" or the "Company"), a leading provider of heat
exchangers and heat exchange solutions in China'sclean technology industry,
today announced its financial results for the fourth quarter and fiscal year
ended December 31, 2012.

Fourth Quarter 2012 (Unaudited) Financial Highlights

  oSales revenue increased by 43.9% year-over-year to US$27.6 million,
    exceeding the Company's previously stated guidance of US$11 million to
    US$13 million.
  oGross profit decreased by 18.1% year-over-year to US$7.0 million.
  oGross margin for the fourth quarter 2012 was 25.5%, compared to 44.8% for
    the fourth quarter 2011.
  oOperating income decreased by 35.1% year-over-year to US$1.8 million.
  oNet income attributable to common stockholders decreased by 63.4%
    year-over-year to US$0.7 million.

Fiscal Year 2012  (Audited) Financial Highlights

  oSales revenue increased by 8.7% year-over-year to US$62.8 million.
  oGross profit decreased by 14.2% year-over-year to US$21.7 million.
  oOperating income decreased by 43.1% year-over-year to US$5.3 million.
  oNet income attributable to common stockholders decreased by 60.0%
    year-over-year to US$3.2 million.
  oBasic and fully diluted net income per share was US$0.15 for 2012,
    compared with net income per share of US$0.39 for 2011.

Chairman and Chief Executive Officer Guohong Zhao commented, "We are pleased
to report significant revenue growth in the fourth quarter 2012 exceeding our
guidance, mainly driven by the delivery of a backlog of orders from previous
quarters. In addition, sales revenue from heat exchange units increased over
182% as a result of China's rapid urbanization. Despite the increase in the
fourth quarter sales, we continued to face a challenging operating environment
in the face of macroeconomic headwinds and competitive pressure, which coupled
with increased labor and raw materials costs, resulted in a decline in our
gross margin for the fourth quarter.

"Looking to the year ahead, we expect to face continuing macroeconomic and
industry specific headwinds, namely increasing competition and further margin
pressure as labor and raw materials costs are forecasted to remain high.
Nevertheless, we expect that sales from heat exchange units will continue to
benefit from ongoing development and urbanization in China, providing
stability and growth prospects in certain end markets. In order to maximize
our growth prospects in the year ahead, we will complement our sales efforts
in key end markets with an increased focus on expanding sales of replacement
parts and repair services. Having completed over 3,000 installation projects
in recent years, we are now in a phase that many of these installations are
gradually approaching the end of their product lifecycles, requiring
replacement parts and repair services which we believe will create new revenue
streams for the Company. In addition, we will continue to invest in research
and development to improve and further diversify our product portfolios and
support the long-term growth prospects for the Company."

Fiscal Year 2012 Audited Financial Results

Revenue

Sales revenue for the fiscal year 2012 was US$62.8 million, an 8.7% increase
from US$57.7 million in 2011, primarily attributable to increased demand of
heat exchange units in response to rapid urbanization in China. Sales volume
of heat exchange products amounted to 3,726 units, a decrease of 407 units
from 4,133 units in 2011. Such decrease was mainly due to decreased sales from
plate heat exchangers (PHEs) and air-cooled heat exchangers.

For the fiscal year 2012, sales revenue from heat exchange units increased
US$12.2 million, or 98.7% year-over-year, to US$24.6 million. Sales revenue
from PHEs decreased 18.9% year-over-year to US$24.2 million from US$29.9
million in 2011. Sales revenue from air-cooled heat exchangers decreased 50.1%
year-over-year to US$1.7 million from US$3.5 million in 2011. The decreased
revenue from PHEs and air-cooled heat exchangers was mainly due to decreased
demand from the petrochemical and shipbuilding industries as a result of the
overall economic slowdown in China in 2012.

Cost of Sales

Cost of sales for the fiscal year 2012 increased by 26.5% year-over-year to
US$41.1 million from US$32.5 million in 2011, mainly attributable to increased
total labor costs in factory and raw material costs in 2012.

Gross Profit and Gross Margin

Gross profit for 2012 was US$21.7 million, representing a 14.2% decrease from
US$25.2 million in 2011, mainly attributable to decreased sales from PHEs and
air-cooled heat exchangers.

Gross margin decreased to 34.5% in 2012 compared to 43.7% in 2011, mainly due
to an increase in labor costs in factory and raw material costs in 2012.

Operating Expenses

Administrative expenses increased 5.2% year-over-year to US$5.9 million in
2012, compared to US$5.6 million in 2011. The rise was driven primarily by
higher allowance for doubtful accounts. The overall increase in administrative
expenses was partially offset by a decrease in our office expenses which
decreased by $0.60 million to $1.29 million in 2012 compared with $0.69
million in 2011. The decrease was mainly due to a reduction in the office
purchase in 2012.

Research and development (R&D) expenses rose by 27.1% to US$2.2 million in
2012 from US$1.8 million in 2011, primarily due to the Company's increasing
emphasis on R&D and expanded investment in the development of new products
such as HBLB welded plate heat exchangers and large-scale nuclear class plate
heat exchangers in 2012.

Selling expenses totalled US$8.2 million in 2012, representing a decrease of
4.0% over 2011, mainly due to a decrease in salaries of the Company's sales
personnel.

Accordingly, total operating expenses increased by 2.7% to US$16.3 million in
2012 compared to US$15.9 million in 2011.

Income Before Income Taxes

Income before income taxes for the fiscal year 2012 decreased by 57.2% to
US$3.9 million from US$9.1 million in 2011. The decrease was mainly
attributable to the decreased gross profit and increased total expenses.

Income Tax

Income tax expenses decreased to US$0.7 million in 2012 from US$1.6 million in
2011 as a result of a decrease in taxable income.

Net Income

Net income attributable to common stockholders was US$3.2 million in 2012, a
decrease of 60.0% compared to US$7.9 million in 2011.

Basic and fully diluted net income per share was US$0.15 in 2012, compared
with US$0.39 in 2011.

Liquidity

As of December 31, 2012, the Company had cash and cash equivalents of US$10.7
million and restricted cash of US$1.8 million. During the year, there was a
net cash inflow of US$3.4 million, compared with a net cash outflow of US$11.1
million in 2011.

Net cash provided by operating activities was US$4.2 million for 2012,
compared with net cash used in operating activities of US$13.1 million for
2011. The increase in net cash provided by operating activities was mainly
because the inventories increased US$18.0 million in 2011 but decreased US$0.9
million in 2012.

Net cash used in investing activities was US$1.4 million for 2012, compared
with US$6.2 million for 2011.

Net cash provided by financing activities was US$0.5 million for 2012,
compared with US$7.8 million for 2011.

First Quarter Fiscal 2013 Guidance

THT expects to generate net revenues in the range of US$7 million to US$9
million during the first quarter 2013, compared with US$11.4 million in the
same period of 2012. This represents the Company's current and preliminary
view, and is subject to change.

About THT Heat Transfer Technology, Inc.

Through its Chinese operating subsidiaries, THT Heat Transfer Technology, Inc.
designs, manufactures and sells plate heat exchangers, shell-and-tube heat
exchangers, heat exchanger units and other heat exchanger products with total
heat exchange solutions. Heat exchangersplayan integral part in
helpingcustomers improve energy efficiency.Used in a number of industries,
THT's products focus on energy conservation, emission reduction and other
environmentally friendly applications.Its six major product categories are
plate heat exchangers, shell-and-tube heat exchangers, air-cooled heat
exchangers, weld plate heat exchangers, heat exchanger units and
plate-and-shell heat exchangers. The Company also offers comprehensive heat
exchange solutions.

THT's in-house R&D capabilities enable it to deliver tailored products that
better meet the changing demands of its customers. The Company has a strong
record of delivering high-quality products and services to leading domestic
and international customers. THT has completed over 3,000 projects and has
provided heat exchange solutions to several Fortune 500 companies. The Company
is headquartered in Siping City, Jilin Province, China. For more information,
please visit the Company's website at www.tht.cn.

Safe Harbor Statement

This press release contains certain statements that may include "forward
looking statements". All statements other than statements of historical fact
included herein are "forward-looking statements". These forward-looking
statements are often identified by the use of forward-looking terminology such
as "believes," "expects" or similar expressions, and involve known and unknown
risks and uncertainties. Although the Company believes that the expectations
reflected in these forward-looking statements are reasonable, they do involve
assumptions, risks and uncertainties, and these expectations may prove to be
incorrect. You should not place undue reliance on these forward-looking
statements, which speak only as of the date of this press release. The
Company's actual results could differ materially from those anticipated in
these forward-looking statements as a result of a variety of factors,
including those discussed in the risk factor sections of the Company's
periodic reports that are filed with the Securities and Exchange Commission
and are available on its website (http://www.sec.gov). All forward-looking
statements attributable to the Company or persons acting on its behalf are
expressly qualified in their entirety by these factors. Other than as required
under the securities laws, the Company does not assume a duty to update these
forward-looking statements.

Contact:

The Company:

Mr. Jack Xiao
Investor Relations Manager
THT Heat Transfer Technology, Inc.
Tel: +86 (434) 3266779
Email: IR@tht.cn

Investor Relations (Beijing):

Xiaoyan Su
Taylor Rafferty
Tel: +852 3196 3712
Email: tht@taylor-rafferty.com

Investor Relations (US):

Mahmoud Siddig
Taylor Rafferty
Tel: +1 (212) 889 4350
Email: tht@taylor-rafferty.com

.

THT Heat Transfer Technology, Inc.
Audited Consolidated Balance Sheets
As of December 31, 2012 and 2011
(Stated in thousands of US Dollars)
                              December 31, 2012 December 31, 2011
Assets
Current assets
Cash and cash equivalents     10,703            7,340
Restricted cash               1,838             1,726
Accounts receivable, net      37,683            33,573
Inventories, net              31,892            32,531
Other current assets          14,049            9,763
Total current assets          96,165            84,933
Long-term accounts receivable 1,237             1,184
Other non-current assets      14,067            13,693
Total assets                  111,469           99,810
Liabilities
Current liabilities
Short-term bank loans         18,705            16,183
Other current liabilities     33,080            25,748
Total current liabilities     51,785            41,931
Long-term loan                951               2,828
Total liabilities             52,736            44,759
Total shareholders' equity    59,311            55,616
Noncontrolling interests      (578)             (565)
Total liabilities and equity  111,469           99,810



THT Heat Transfer Technology, Inc.
Audited Consolidated Statements of Income
For Fiscal Year Ended December 31, 2012 and 2011
(Stated in thousands of US Dollars, except number of shares and per share
data)
                                                       Year ended December 31,
                                                       2012        2011
Sales revenue                                          62,771      57,741
Cost of sales                                          (41,119)    (32,501)
Gross profit                                           21,652      25,240
Operating expenses
 Administrative expenses                              5,910       5,616
 Research and development expenses                    2,231       1,755
 Selling expenses                                     8,195       8,532
Total operating expenses                               16,336      15,903
Operating income                                       5,316       9,337
Interest income                                        28          56
Other income                                           524         797
Financial costs                                        (1,814)     (1,121)
Other expense                                          (175)       -
Income before income taxes                             3,879       9,069
Income taxes expenses                                  (700)       (1,620)
Net income before noncontrolling interests             3,179       7,449
Net (income) loss attributable to noncontrolling       (16)        454
interest
Net income attributable to the equity stockholders     3,163       7,903
Earnings per share attributable to THT Heat Transfer
 Technology Inc. common stockholders                  0.15        0.39
Weighted average number of shares outstanding
- Basic and diluted                                    20,453,500  20,453,500

.

THT Heat Transfer Technology, Inc.
Audited Consolidated Statements of Cash Flows
For Fiscal Year Ended December 31, 2012 and 2011
(Stated in thousands of US Dollars)
                                                Fiscal Year Ended December 31,
                                                2012         2011
Net cash provided by (used in) operating        4,219        (13,050)
activities
Net cash used in investing activities           (1,409)      (6,239)
Net cash provided by financing activities       475          7,786
Effect of exchange rate changes on cash and     78           405
cash equivalents
Net (decrease) / increase in cash and cash      3,363        (11,098)
equivalents
Cash and cash equivalents at beginning of the   7,340        18,438
period
Cash and cash equivalents at end of the period  10,703       7,340

SOURCE THT Heat Transfer Technology, Inc.

Website: http://www.tht.cn
 
Press spacebar to pause and continue. Press esc to stop.