BIRCH BRANCH INC

CIK:0000857872|SEC Filings

Consolidated Statements of Operations (USD $)	3 Months Ended		9 Months Ended
Consolidated Statements of Operations (USD $)	Sep. 30, 2012	Sep. 30, 2011	Sep. 30, 2012	Sep. 30, 2011
Revenues	$ 92,334,315	$ 114,953,099	$ 293,001,141	$ 302,885,541
Cost of revenues	93,753,039	112,925,723	297,697,818	285,496,778
Gross profit	(1,418,724)	2,027,376	(4,696,677)	17,388,763
Operating expenses:
Sales and marketing	4,080,425	1,925,134	10,237,497	6,725,671
General and administrative	1,353,066	1,666,839	8,662,381	6,308,226
Total operating expenses	5,433,491	3,591,973	18,899,878	13,033,897
Income (loss) from operations	(6,852,215)	(1,564,597)	(23,596,555)	4,354,866
Other income (expenses):
Interest income	(306,628)	857,196	1,789,753	1,634,093
Interest expense	(3,900,142)	(4,835,012)	(17,737,433)	(12,755,153)
Other income	145,180	534,332	871,323	1,081,728
Other expenses	(49,589)	(27,109)	(75,618)	(176,693)
Gain on investment		1,248		193,721
Total other income (expenses)	(4,111,179)	(3,469,345)	(15,151,975)	(10,022,304)
Income (loss) before provision for income taxes	(10,963,394)	(5,033,942)	(38,748,530)	(5,667,438)
Provision for (benefit from) income taxes
Net income (loss)	(10,963,394)	(5,033,942)	(38,748,530)	(5,667,438)
Net income attributable to:
- Common stockholders	(10,964,187)	(5,076,521)	(38,743,998)	(5,624,108)
- Non-controlling interest	793	(42,578)	(4,532)	(43,330)
Other Comprehensive Income/(Loss)
Foreign currency translation adjustments	17,980	416,161	1,895,645	1,381,656
Total Comprehensive Income/(Loss)	$ (10,945,414)	$ (4,617,781)	$ (36,852,885)	$ (4,285,782)
Earnings per share
- Basic	$ (0.34)	$ (0.16)	$ (1.21)	$ (0.18)
- Diluted	$ (0.34)	$ (0.16)	$ (1.21)	$ (0.18)
Weighted average shares outstanding
- Basic	32,047,222	32,047,222	32,047,222	32,047,222
- Diluted	32,047,222	32,047,222	32,047,222	32,047,222

Consolidated Statements of Cash Flows (USD $)	9 Months Ended		12 Months Ended
Consolidated Statements of Cash Flows (USD $)	Sep. 30, 2012	Sep. 30, 2011	Dec. 31, 2011
Cash flows from operating activities:
Net Income/(loss)	$ (38,748,530)	$ (5,667,438)	$ (32,117,864)
Adjustments to reconcile net loss to net cash provided by (used in) operating activities:
Depreciation and amortization	10,966,436	6,197,844
Change in assets and liabilities:
Increase in Trade receivables	(3,636,425)	4,995,879
Decrease/(Increase) in Inventories	19,122,316	(3,477,481)
Increase in Prepayments and other receivables	(39,090,244)	(22,256,982)
Decrease/(Increase) in Related party receivables	447,251	(127,510)
Increase in Accounts payable	42,009,551	28,014,703
Decrease in Other payables and current liabilities	25,502,744	(24,936,768)
Net cash provided by (used in) operating activities	16,573,099	(17,257,753)
Cash flows from investing activities:
Increase in restricted cash	1,164,548	(46,731,621)
Long-term investment in equities	(2,820,997)	(4,343,954)
Acquisitions of property, plant and equipment	(12,253,481)	(6,669,816)
Decrease/(Increase) in construction in progress	(2,817,639)	(26,101,295)
Decrease/(Increase) in Bank notes receivable	(2,800,885)	3,893,186
Collection/(Advance) loans to individuals and companies	(250,658)
Collection/(Advance) to related parties	(6,269,902)
Net cash provided by (used in) investing activities	(26,049,014)	(79,953,500)
Cash flows from financing activities:
Proceeds from borrowings from bank and others	75,697,839	12,034,860
Repayment of bank borrowings and others	(60,526,731)
Increase/(Decrease) in bank notes payable	3,390,633	63,501,656
Proceeds/(Repayment) of capital lease obligation	(2,398,125)	11,292,944
Proceeds from deposit for capital lease obligation	339,064	1,817,694
Proceeds from forgivable loans	3,460,021
Payment to related parties	(7,646,205)
Net cash provided by (used in)financing activities	12,316,496	88,647,154
Net increase in cash	5,837,476	(6,861,231)
Effect of exchange rate changes	2,996,895	1,702,868
Cash at beginning of the period	2,704,987	9,213,760	9,213,760
Cash at end of the period	8,542,463	2,352,529	2,704,987
Supplemental disclosure of cash flow information:
Interest received	984,381	1,634,093
Interest paid	9,961,669	(12,470,954)
Income taxes paid		10,845,094
Non-Cash Investing and Financing Activities:
Addition of PPE transferred from CIP	68,741,410
Accounts Payable for constructions	$ 5,428,154

Consolidated Balance Sheets (USD $)	Sep. 30, 2012	Dec. 31, 2011
Current assets:
Cash	$ 8,542,463	$ 2,704,987
Restricted cash	141,534,877	142,168,060
Bank notes receivable	2,946,590	145,162
Trade receivables, net	19,517,860	15,822,298
Other receivables	13,089,168	7,514,142
Related party receivables	9,336,450	3,500,715
Inventories	31,107,545	50,042,822
Advances to suppliers and prepayments	100,493,266	66,450,939
Deposits	2,974,767	3,301,491
Total current assets	329,542,986	291,650,616
Non-current assets:
Property, plant and equipment, net	139,330,794	68,927,116
Construction in Progress	22,528,287	83,621,292
Intangible assets, net	798,063	870,903
Long-term investments	27,264,476	24,352,460
Total non-current assets	189,921,620	177,771,771
Total assets	519,464,606	469,422,387
Current liabilities:
Bank notes payable	190,979,341	186,890,191
Short term bank loans	82,431,793	66,538,879
Accounts payable	116,536,309	68,841,304
Accrued liabilities	3,258,630	660,695
Taxes payable	16,752,464	12,199,742
Other payable	8,277,202	9,179,612
Long-term bank loans, current portion	5,835,042	3,142,331
Capital lease obligation, current portion	4,384,483	4,087,562
Customer deposits	27,569,639	8,202,109
Total current liabilities	456,024,903	359,742,425
Non-current liabilities:
Notes payable to related party	62,806,908	70,190,769
Forgivable loans	9,719,287	6,235,959
Long-term bank loans		3,142,332
Capital lease obligation, non-current portion	9,164,852	11,509,361
Total non-current liabilities	81,691,047	91,078,421
Total liabilities	537,715,950	450,820,846
Stockholders' Equity
Preferred stock, 50,000,000 shares authorized, $0 par value, 0 shares issued and outstanding
Common stock, 500,000,000 shares authorized, $0 par value, 32,047,222 and 32,047,222 shares issued and outstanding as of September 30, 2012 and December 31, 2011	6,963,403	6,963,403
Statutory reserve	234,683	234,683
Retained earnings	(32,374,640)	6,369,358
Accumulated other comprehensive income	6,490,204	4,594,559
Non-controlling interest	435,006	439,538
Total stockholders' equity	(18,251,344)	18,601,541
Total liabilities and equity	$ 519,464,606	$ 469,422,387