NEW YORK and HARBIN, China, May 18, 2010 (GLOBE NEWSWIRE) -- China Digital Animation Development, Inc. (OTCBB:CHDA) today provided a business update and announced financial results for its fiscal third quarter ended March 31, 2010.
Mr. Fu Qiang, Chairman and Chief Executive Officer, commented, "We are pleased to report a 74% increase in revenue for the third quarter of 2010 versus the same period last year. This is even more impressive given the fact that our results exclude contributions from our Trans World Financial website operations, which we gradually phased out this year. As we head into the fourth quarter, our new business pipeline is robust. Demand for high-end special effects continues to grow both domestically in China and internationally, and we are extremely well positioned due to our highly skilled team of animation experts, our ability to internally develop talent, and our highly competitive pricing."
China Digital's strategic plan includes expansion into creating original content and entering the movie production arena. To that end, the company is nearing completion of its acquisition of Chongqing Dinv Ares Filming Production Co., Ltd., which has expertise in film production and 2-D animation. On March 15, 2010, China Digital Animation modified the original acquisition agreement whereby it will initially acquire only one of Dinv Ares' subsidiaries, Chongqing Dinv Ares Television Media, Ltd., in exchange for 500,000 shares of common stock rather than 1,000,000 shares as originally agreed to for both subsidiaries.
Revenue for the third quarter of fiscal 2010 totaled $1.7 million versus $966 thousand in the third quarter of fiscal 2009. Approximately $1.2 million in revenue was derived from animation design and development during the period and $469 thousand in revenue came from the company's participation in the Harbin International Ice and Snow Sculpture Festival during the period. The Trans World Financial website ceased operations prior to the start of the third quarter. Gross profit in the third quarter was $1.2 million versus $824 thousand in the same period last year. Net income was approximately $691 thousand, or $0.03 per share, versus $463 thousand, or $0.02 per share, in the third quarter of last year.
As of March 31, 2010, the company had cash and cash equivalents of $2.2 million, working capital of $6.4 million, no long-term debt, and shareholders' equity of $15.5 million.
About China Digital Animation Development, Inc.
China Digital Animation Development, Inc. is a premier China-based digital animation development company, operating in Harbin (one of the largest animation development centers in China) as well as Beijing in The People's Republic of China. The Company also has an administrative office in New York City. The Company is engaged in animation post-stage processing, animation outsourcing, and information transmission services. The Company also operates an animation development skills training center located in Harbin, China, which provides its students with different types of animation skill training programs such as motion graphics, product modeling, character animation, and more. The Company's technical team has extensive experience in animation production and outsourcing.
Safe Harbor Statement
In addition to historical information, this press release contains forward-looking statements, which are generally identifiable by use of the words "believes," "expects," "intends," "anticipates," "plans to," "estimates," "projects," or similar expressions. These forward-looking statements represent Management's belief as to the future of China Digital Animation Development, Inc. Whether those beliefs become reality will depend on many factors that are not under Management's control. Many risks and uncertainties exist that could cause actual results to differ materially from those reflected in these forward-looking statements. Factors that might cause such a difference include, but are not limited to, those discussed in Section 1A: "Risk Factors" In the Company's Annual Report on Form 10-K for the year ended June 30, 2009. Readers are cautioned not to place undue reliance on these forward-looking statements. We undertake no obligation to revise or publicly release the results of any revision to these forward-looking statements.
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CHINA ANIMATION DEVELOPMENT, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (Unaudited) |
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Three Months Ended March 31, |
Nine Months Ended March 31, |
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| 2010 | 2009 | 2010 | 2009 | |
| Revenues | $ 1,679,143 | $ 966,163 | $ 4,057,433 | $ 3,471,131 |
| Cost of Goods Sold | 437,675 | 142,025 | 1,356,440 | 455,160 |
| Gross Profit | 1,241,467 | 824,138 | 2,700,993 | 3,015,971 |
| Operating Expenses: | ||||
| Sales Expenses | 68,357 | 54,588 | 202,731 | 209,301 |
| General and Administrative Expenses | 317,647 | 178,842 | 683,626 | 464,500 |
| Total Operating Expenses | 386,004 | 233,431 | 886,357 | 673,801 |
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Income from Operations before Other Income and (expenses) – Continued |
855,463 | 590,708 | 1,814,636 | 2,342,170 |
| Other Income and (Expense): | ||||
| Interest income | 82,491 | 1,211 | 251,039 | 14,256 |
| Gains from Disposal of Fixed Assets | -- | -- | (26) | -- |
| Other expense | -- | 290 | -- | 240 |
| Total Other Income and (Expense) | 82,491 | 1,501 | 251,013 | 14,496 |
| Income Before Income Taxes | 937,954 | 592,208 | 2,065,649 | 2,356,665 |
| Provision For Income Taxes | 246,718 | 154,458 | 546,250 | 612,364 |
| Income After Provision for Income Taxes | 691,236 | 437,750 | 1,519,399 | 1,744,301 |
| Discontinued Operations | ||||
| Profit from Operations of Discontinued Component | -- | 25,625 | -- | 58,441 |
| Income from Discontinued Operations | 25,625 | 58,441 | ||
| Net Income | 691,236 | 463,375 | 1,519,399 | 1,802,742 |
| Other Comprehensive Income | ||||
| Foreign Currency Translation Adjustment | 253 | 135,767 | 52,717 | 179,730 |
| Net Comprehensive Income | 691,489 | 599,142 | 1,572,116 | 1,982,472 |
| Basic and diluted income per share | 0.03 | 0.02 | 0.07 | 0.09 |
| Weighted average common shares outstanding | 20,510,000 | 20,000,000 | 20,510,000 | 20,000,000 |
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CHINA ANIMATION DEVELOPMENT, INC. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS |
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| ASSETS | March 31, 2010 | June 30, 2009 | |
| (Unaudited) | |||
| Current Assets: | |||
| Cash and cash equivalents | $ 2,181,877 | $ 2,282,786 | |
| Accounts Receivable, net | 1,122,989 | 1,388,599 | |
| Employee advances | 3,689 | 2,234 | |
| Advanced to suppliers | -- | 1,443,440 | |
| Down payment for acquisition of company | 1,250,000 | -- | |
| Interest Receivable | 137,531 | 54,786 | |
| Prepaid Expenses | 16,667 | 84,202 | |
| Short Term Investment | 2,200,500 | 2,191,457 | |
| Total Current Assets | 6,913,253 | 5,256,047 | |
| Non-current Assets | |||
| Property, Plant & Equipment, net | 5,735,095 | 3,929,257 | |
| Land use right and other intangible assets, net | 2,865,140 | 1,106,870 | |
| Total Non-current Assets | 8,600,235 | 5,036,127 | |
| Total Assets | $ 15,513,487 | $ 10,292,174 | |
| LIABILITIES AND STOCKHOLDERS' EQUITY | |||
| March 31, 2010 | June 30, 2009 | ||
| (Unaudited) | |||
| Current Liabilities: | |||
| Accounts Payable | $ 57,491 | $ 29,219 | |
| Payroll payable | 1,823 | -- | |
| Tax Payable | 254,026 | 214,471 | |
| Loan Payable-Related Party | 106,000 | 5,000 | |
| Accrued expenses and other payable | 82,054 | 64,964 | |
| Total Current Liabilities | 501,394 | 313,654 | |
| Total Liabilities | 501,394 | 313,654 | |
| Stockholders' Equity: | |||
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Common Stock, par value $0.001, 500,000,000 authorized 20,510,000 shares and 20,000,000 shares issued, and outstanding, respectively |
20,510 | 20,000 | |
| Additional Paid in Capital | 7,493,207 | 6,223,717 | |
| Accumulated other comprehensive income | 1,814,695 | 1,761,978 | |
| Reserved Fund | 705,738 | 341,524 | |
| Retained Earnings | 4,977,943 | 3,822,758 | |
| Total Stockholders' Equity | 15,012,093 | 12,169,977 | |
| Total Liabilities and Stockholders' Equity | $ 15,513,487 | $ 12,483,631 | |