Wowjoint Holdings Limited Reports Fourth Quarter & Fiscal Year 2012 Financial Results

Wowjoint Holdings Limited Reports Fourth Quarter & Fiscal Year 2012 Financial

- FY 2012 revenue of $10.1 million

- Q4 2012 revenue of $6.0 million

- EPS for FY 2012 was a negative of $0.46 from a positive of $0.15 for FY 2011

- Gross margins increased by 137 basis points from 27.72% in FY 2011 to 29.09%
in FY 2012

PR Newswire

BEIJING, June 19, 2013

BEIJING, June 19, 2013 /PRNewswire/ -- Wowjoint Holdings Limited ("Wowjoint,"
or the "Company") (OTC: BWOWF), China's innovative infrastructure solutions
provider of customized heavy duty lifting and carrying machinery, reported
today financial results for the fourth quarter and full year of 2012.

Full Year Ended December 31, 2012

  oRevenues for the full year ended December 31, 2012 were $10.1 million,
    compared to $24.4 million reported for 2011.
  oTechnical service sales were $0.3 million in FY 2012, a decrease from $1.3
    million in FY 2011. Lease income for FY 2012, represented $6.2 million, or
    61% of total revenues, a 75% increase from $3.5 million in 2011. The
    company began generating revenue from its leasing business in 2010 and it
    is traditionally a higher margin segment.
  oInternational based revenues accounted for approximately 26% of total
    sales in 2012.
  oGross profit for 2012 was $2.9 million, compared to gross profit of $6.8
    million in the full year 2011. Gross margin increased to 29.09%, from
    27.72% in the same period 2011. The 137 basis points gross margin increase
    was due to higher lease income and a higher margin product mix.
  oNet loss was $3.9 million, or a negative $0.46 per share based on 8.34
    million weighted average shares outstanding for 2012, compared to net
    income of $1.2 million, or $0.15 per share based on 7.97 million weighted
    average shares outstanding as of the end 2011.

Operating expenses for 2012 were approximately $7.2 million, compared to $4.7
million in the same period of 2011. Selling expenses were $2.2 million in
2012, compared to $1.2 million in the same period of 2011. General and
administrative expenses were $5.1 million and $3.5 million for the 2012 and
2011 periods, respectively. The increase in operating expenses were primarily
due to the set-up of a new sales office in Italy, increased sales efforts in
international markets, as well as generated corporate expenses.

Fourth-quarter Ended December 31, 2012

  oRevenues for the Company's fourth quarter ended December 31, 2012 were
    $6.0 million, a 51% increase from $4.0 million in the fourth quarter of
  oTechnical service sales $0.3 million in 2012, compared to $0.1 million in
    the fourth quarter of 2011.
  oLease income increased to $4.5 million for the fourth quarter 2012, from
    $2.7 million in the same period of 2011. This is a higher margin line of
    business for Wowjoint.
  oGross profit was $1.64 million compared to $1.59 million for the same
    period in 2011. Gross margin were 27.1%, a decrease from 39.7% for the
    same period in 2011.
  oNet loss for the fourth quarter 2012 was $1.6 million, compared to net
    loss of $0.1 million in same period 2011.

Cost of sales for the three months ended December 31, 2012 was approximately
$4.4 million as compared to $2.4 million for the three months ended December
31, 2011. Operating expenses for the three months ended December 31, 2012 were
approximately $3.2 million, compared to $1.7 in the same period in 2011.
Selling expenses for the three months ended December 31, 2012 totaled $1.3
million compared to $0.3 million in the same period of 2011.

"During 2012, we continued to pursue International expansion and successfully
entered new markets in Malaysia and Peru. We also conducted sales trips and
attended conferences in the US, South America, India, Asia and others, which
enabled us to introduce Wowjoint to various contractors and designers that
could become our customers in the future," commented Mr. Yabin Liu, Chairman
and Chief Executive Officer of Wowjoint. "Gross margin has improved for the
year due to the increase in our leasing business. Providing leasing and
technical services creates a more stable income flow and helps us better serve
our customers."

Balance Sheet as of December 31, 2012

  oCash and cash equivalents totaled $1.7 million as of December 31, 2012,
    compared to $4.6 million as of December 31, 2011.
  oAccounts receivable were $8.1 million as of December 31, 2012 as compared
    to $12.3 million as of December 31, 2011.
  oInventories amounted to $3.57 million and working capital was a negative
    $1.52 million as of December 31, 2012.
  oThe Company had total stockholders' equity of $18.7 million, with total
    assets of $41.3 million versus total liabilities of $22.7 million as of
    December 31, 2012. Leverage was low, with bank debt/equity of only 19.5%.

"We're pleased that during 2012 we added new products, entered new vertical
markets and new international locations. We also continued to grow our sales
force internationally and in China. We remain encouraged by the traction that
we are achieving in these new markets and believe we will see the results over
the next few years," stated Mr. Yabin Liu, Chairman and CEO of Wowjoint.

Business Updates

Wowjoint continued to diversify its customer base in 2012 by entering new
markets and pursuing additional vertical markets. The Company entered into an
agreement to provide two Movable Scaffolding Systems ("MSS") for a highway
bridge construction project with BBE Solutions Sdn Bhd in Malaysia in March
2012. This is a new type of equipment for Wowjoint. The Company further
expanded its product range in construction machinery from providing not only
machines for the precast arena, but now also non-prefabricated girder/beam
bridge construction. The MSS is equipment has initially been marketed in the
Southeast Asian markets and the Company anticipates the demand for the
equipment to be significant once the initial machine is deployed. In addition,
in May 2012, the Company announced a contract with Titan Peru, S.A.C., for a
50-ton Rubber Tire Gantry to be used in Peru. This was a new market for
Wowjoint that is expected to increase sales.

The Company commenced construction of a new R&D and new manufacturing
facilities in Zhenjiang City, which is located in Eastern China, northwest of
Shanghai, in mid-2012. The new manufacturing facility will cover 2 million
square feet of land, including 140,000 square feet of production workshop,
70,000 square feet of office space, shipping field and testing ground. Phase
one has been completed and was put into use in early May 2013. The new
manufacturing facility will be focused on producing large equipment and
providing maintenance services for Wowjoint's launching gantries, lifting
equipment, railway transportation equipment and railway testing equipment. The
new R&D center will work with the new manufacturing facility to supply
enhanced equipment and services to Wowjoint's customers and will focus on
customers located around the Eastern China Yangtze River Delta area, Southern
China and international market customers. Going forward the Company believes
the new R&D and manufacturing facilities will be one of its drivers for future

Wowjoint's focus in 2013 is to develop additional international markets,
vertical markets and new products to enhance its sales reach and potential in
a broader scope. The Company will continue to provide quality products and
engage in strategic partnerships that widen its customer interaction.

Backlog as of the December 31, 2012 was just over $14 million (10 contracts),
of which approximately 66% is expected to be recognized in 2013 and the
remainder in 2014, although there can be no assurance that this level will be
achieved. Wowjoint's management views backlog as one of many indicators of the
performance of its business. Because many variables can cause changes in
backlog, and these changes may or may not be of any significance, the Company
consequently views backlog as an important, but not necessarily determinative,
indicator of future results.

About Wowjoint Holdings Limited

Wowjoint is a leading provider of customized heavy duty lifting and carrying
machinery used in such large scale infrastructure projects such as railway,
highway and bridge construction. Wowjoint's main product lines include
launching gantries, tyre trolleys, special carriers and marine hoists. The
company's innovative design capabilities have resulted in patent grants and
proprietary products. Wowjoint is well positioned to benefit directly from
China's rapid infrastructure development by leveraging its extensive
operational experience and long-term relationships with established blue chip
customers. Information on Wowjoint's products and other relevant information
are available on its website at

Forward Looking Statements

This press release includes "forward-looking statements" within the meaning of
the safe harbor provisions of the United States Private Securities Litigation
Reform Act of 1995. Words such as "expect," "estimate," "project," "budget,"
"forecast," "anticipate," "intend," "plan," "may," "will," "could," "should,"
"believes," "predicts," "potential," "continue," and similar expressions are
intended to identify such forward-looking statements. Forward-looking
statements in this press release include matters that involve known and
unknown risks, uncertainties and other factors that may cause actual results,
levels of activity, performance or achievements to differ materially from
results expressed or implied by this press release. Wowjoint undertakes no
obligation and does not intend to update these forward-looking statements to
reflect events or circumstances occurring after the date of this
communication. You are cautioned not to place undue reliance on these
forward-looking statements, which speak only as of the date of this
communication. All forward-looking statements are qualified in their entirety
by this cautionary statement. All subsequent written and oral forward-looking
statements concerning Wowjoint or other matters and attributable to Wowjoint
or any person acting on their behalf are expressly qualified in their entirety
by the cautionary statements above.

For additional information contact:

Wowjoint Holdings:
Aubrye Foote, Vice President, Investor Relations
Tel: +1-530-475-2793

                      WOWJOINT HOLDINGS LTD
                      Consolidated Statements of Income
                      (US dollars in thousands, except for EPS and share data)
                      Three Months Ended            Fiscal Year Ended
                      December 31,  December 31,    December 31,  December 31,
                      2012          2011            2012          2011
                      (Unaudited)                   (Audited)
Machinery Sales       1,268         1,111           3,639         19,599
Technical Service     302           151             301           1,275
Lease Income          4,470         2,749           6,158         3,524
Total Sales           6,040         4,011           10,098        24,398
Cost of Sales         4,405         2,420           7,160         17,636
Gross Profit          1,635         1,591           2,938         6,762
Operating Expenses:
Selling Expenses      1,280         331             2,180         1,160
General and
Administrative        1,939         1,360           5,067         3,544
Total Operating       3,219         1,691           7,246         4,704
Operating Income      (1,584)       (100)           (4,308)       2,058
Other Income
Other Income          117           58              1,006         69
Other Expenses        (21)          (317)           (25)          (264)
Bank Expenses         0             (3)             0             (45)
Interest Income       1             3               3             14
Interest Expense      (56)          (77)            (311)         (299)
Government Income     0             0               4             0
Total Other Income    41            (336)           677           (525)
(Loss) & Expense
Earnings Before Tax   (1,543)       (436)           (3,632)       1,533
Income taxes          227           60              226           346
/Deferred Tax Benefit
Net Income (Loss)     (1,770)       (376)           (3,858)       1,188
Foreign Currency      226           60              21            917
Translation Gain
Comprehensive Income  (1,544)       (316)           (3,837)       2,105
Earnings per share
Basis                (0.20)        (0.05)          (0.46)        0.15
Diluted             (0.20)        (0.05)          (0.46)        0.15
Weighted average number of shares used in computing earnings per share
Basis                8,337,320     7,971,465       8,337,320     7,971,465
Diluted             8,337,320     7,971,465       8,337,320     7,971,465

                                                   WOWJOINT HOLDINGS LTD
                                                   Consolidated Balance Sheets
                                                   (US dollars in thousands)
                                                   December 31,  December 31,
                                                   2012          2011
Current Assets:
Cash and Cash Equivalents                          1,714         4,627
Restricted Cash                                    973           578
Accounts Receivable, net                           8,083         12,308
Other Receivable, net                              133           1,656
Note Receivable, net                               48            0
Advance to Suppliers                               3,567         8,956
Inventories                                        3,739         3,979
Costs and Estimated Earnings in Excess of Billings 2,250         4,413
Prepaid Expenses - Short Term                      0             0
Due from Related Parties                           0             76
Total Current Assets                               20,506        36,592
Property, Plant and Equipment, net                 12,396        9,016
Construction in Progress                           5,301         5,573
Intangible Assets, net                             3,141         1,067
Other Long Term Asset - Deposit                    2             -
Total Assets                                       41,347        52,249
Current Liabilities:
Short Term Loans                                   2,539         3,492
Accounts Payable and Accrued Expenses              8,683         14,203
Advances from Customers                            3,414         5,314
Taxes Payable                                      4,602         4,591
Other Payables                                     1,992         481
Due to Related Parties                             316           54
Bank Loan - Short Term                             476           476
Total Current Liabilities                          22,022        28,610
Bank Loan - Long Term                              635           1,111
Total Liabilities                                  22,657        29,721
Stockholders' Equity:
Common stock                                      8             8
Additional Paid in Capital                         4,755         4,755
Warrants                                           5,581         5,581
Statutory Surplus Reserve                          3,025         3,025
Retained Earnings                                  3,291         7,149
Accumulated Other Comprehensive Income             2,031         2,010
Total Stockholders' Equity                         18,690        22,527
Total Liabilities and Stockholders' Equity         41,347        52,249

Statements of Cash Flows
(US dollars in thousands)
                                                     Year Ended
                                                     December 31, December 31,
                                                     2012        2011
Net Income (Loss)                                    (3,858)      1,188
Adjustments to reconcile net income to net
cashprovided by operating activities:
Depreciation and Amortization                        996          725
Issuance of Share Based Compensation                 0            0
Loss/(Gain) on Disposal of Property, Plant and       (11)         0
Bad Debt Expenses                                    371          110
Issuance of Common Shares for Services               0            36
Decrease / (Increase) in Accounts Receivable         3,854        5,486
Decrease / (Increase) in Other Receivable            1,523        (932)
Decrease / (Increase) in Note Receivable             (48)         0
Decrease / (Increase) in Advance to Suppliers        5,389        (5,432)
Decrease / (Increase) in Inventories                 240          1,245
Decrease / (Increase) in Cost and Estimated Earnings 2,163        (1,723)
in Excess of Billings
Decrease / (Increase) in Prepaid Expenses - Short    (0)          0
Increase / (Decrease) in Accounts Payable and        (5,520)      6,700
Accrued Expenses
Increase / (Decrease) in Advances from Customer      (1,899)      4,141
Increase / (Decrease) in Unearned Lease Income       0            (748)
Increase / (Decrease) in Taxes Payable               10           (459)
Increase / (Decrease) in Other Payable               1,511        158
Increase / (Decrease) in Billings in Excess of Costs 0            (897)
and Estimated Earnings
Increase/ (Decrease) in Deposit                      (2)          0
Net cash provided by / (used in) operating           4,720        9,597
Purchase of Property, Plant and Equipment            (4,314)      (8,045)
(Increase) / Decrease in Construction in Progress    272          (4,061)
Purchases of Intangible Asset- Land                  (2,125)      0
Prepaid Expense - Long Term Loan                     0            101
Net cash provided by / (used in) investing           (6,167)      (12,004)
Repayment of Short Term Loans                        (952)        (1,510)
Due from Related Parties                             76           6
Due to Related Parties                               262          54
Restricted Cash                                      (395)        344
Proceeds of Short Term Debt                          0            3,492
Proceeds of Long Term Debt                           (476)        1,587
Net cash provided by /(used in) financing           (1,486)      3,973
NET INCREASE (DECREASE) IN CASH                      (2,934)      1,565
EFFECT OF CURRENCY TRANSLATION                       21           893
CASH, BEGINNING OF PERIOD                            4,626        2,168
CASH, END OF PERIOD                                  1,713        4,626
Interest Received                                    3            -
Interest paid                                        311          220
Income tax paid                                      707          427

SOURCE Wowjoint Holdings Limited
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