China Environmental Protection Inc.

CIK:0001418475|SEC Filings

CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS (USD $)	3 Months Ended		9 Months Ended
CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS (USD $)	Jun. 30, 2011	Jun. 30, 2010	Jun. 30, 2011	Jun. 30, 2010
Revenues
Total revenues	$ 366,001	$ 9,591,388	$ 25,930,756	$ 27,785,938
Costs of Revenues
Total costs of revenues	292,563	6,796,445	18,045,284	19,259,041
Gross profit	73,438	2,794,943	7,885,472	8,526,897
Selling Expenses
Payroll and Commission	0	187	0	1,122,516
Fright out	14,296	0	16,242	3,706
Office expenses	0	49	0	73,637
Total selling expenses	14,296	236	16,242	1,199,859
General and administrative expenses
Payroll	68,202	63,195	181,498	188,821
Employee benefit and pension	5,571	3,624	15,215	11,527
Depreciation and amortization expenses	21,529	22,458	64,118	65,165
Professional fees and consultancy fees	155	50,299	25,452	63,661
Taxes	2,000	19,012	19,682	36,824
Office expenses	17,410	43,945	63,718	127,977
Bad debt expenses	1,092,479	1,419,233	9,120,585	1,487,396
Travel and entertainment	48,974	17,321	85,807	58,147
Total General and Administrative Expenses	1,256,320	1,639,087	9,576,075	2,039,518
Total operating expenses	1,270,616	1,639,323	9,592,317	3,239,377
Income from operations	(1,197,178)	1,155,620	(1,706,845)	5,287,520
Non-operating income (expenses):
Interest income	49	93	265	193
Interest expenses	(13,144)	(10,957)	(33,304)	(27,165)
Gain on bargain purchase			0	52,016
Governmental subsidy	0	0	4,554	0
Other income (expenses)	34	0	1,123	0
Total non-operating income (expenses)	(13,061)	(10,864)	(27,362)	25,044
Income before income taxes	(1,210,239)	1,144,756	(1,734,207)	5,312,564
Provision for income taxes
Current income tax expense	(13,235)	305,141	224,354	1,345,955
Deferred income tax expense (benefit)	610	(18,498)	100,157	(30,240)
Total provision for income taxes	(12,625)	286,643	324,511	1,315,715
Net income before extraordinary item	(1,197,614)	858,113	(2,058,718)	3,996,849
Extraordinary item (Note 12)	0	0	(4,525,822)	0
Net income (loss)	(1,197,614)	858,113	(6,584,540)	3,996,849
Less: Net income attributable to noncontrolling interest	0	0	0	(222)
Net Loss attributable to China Environmental Protection, Inc.	(1,197,614)	858,113	(6,584,540)	3,996,627
Basic and diluted earnings per share (in dollars per share)	$ (0.07)	$ 0.05	$ (0.12)	$ 0.24
Weighted average number of shares (in shares)	17,170,015	16,374,180	17,170,015	16,581,250
Installation Projects [Member]
Revenues
Total revenues	304,172	9,398,525	25,154,435	26,543,896
Costs of Revenues
Total costs of revenues	245,052	6,663,803	17,474,738	18,407,405
Equipment [Member]
Revenues
Total revenues	61,829	192,863	776,321	1,242,042
Costs of Revenues
Total costs of revenues	$ 47,511	$ 132,642	$ 570,546	$ 851,636

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (USD $)	9 Months Ended
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (USD $)	Jun. 30, 2011	Jun. 30, 2010
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income	$ (6,584,540)	$ 3,996,849
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization	118,472	117,303
Bad debt expense	9,120,585	1,487,396
Impairment of fixed assets	16,978	7,459
Gain on bargain purchase	0	(52,016)
Deferred tax expense	100,157	(30,241)
Decrease (increase) in assets:
Restricted cash	5,941,479	(5,916,211)
Accounts receivable	(12,907,089)	(1,986,419)
Other receivable	9,297	(3,017)
Advances to suppliers	1,620,804	(1,238,627)
Inventory	7,337,075	(8,046,513)
Prepaid expense	15,681	28,425
Refundable security deposit	442,869	(1,175,944)
Increase (decrease) in liabilities:
Accounts payables	2,005,324	2,381,971
Salaries and welfare payable	(231,559)	40,057
Other payables	(83,483)	(20,509)
Taxes payable	172,428	1,380,536
Advance from customers	(6,985,207)	9,384,251
Net cash provided by operating activities	109,271	354,750
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchase of property and equipment	(161,724)	(102,062)
Purcahse of minority shares by Dragon Path	0	(280,000)
Net cash used in investing activities	(161,724)	(382,062)
CASH FLOWS FROM FINANCING ACTIVITIES:
Shareholder capital contribution	0	295,000
Proceeds from bank loans	758,929	732,463
Repayments of bank loans	(758,929)	(292,985)
Proceeds from the CEO	1,039,085	1,043,291
Repayments to the CEO	0	(10,254)
Net cash provided by financing activities	1,039,085	1,767,515
EFFECT OF EXCHANGE RATE CHANGE ON CASH AND CASH EQUIVALENTS	19,309	7,573
NET CHANGES IN CASH AND CASH EQUIVALENTS	1,005,941	1,747,776
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD	1,268,674	538,767
CASH AND CASH EQUIVALENTS, END OF PERIOD	2,274,615	2,286,543
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION
Income taxes paid	1,589	7,963
Interest paid	$ 33,304	$ 27,165

CONDENSED CONSOLIDATED BALANCE SHEETS (USD $)	Jun. 30, 2011	Sep. 30, 2010
ASSETS
Cash and cash equivalents	$ 2,274,615	$ 1,268,674
Restricted cash	0	5,844,020
Accounts receivable, net (Note 4)	4,704,378	815,566
Others receivables	87,214	93,310
Inventory (Note 5)	1,894,893	9,045,390
Advance to suppliers	12,228	1,606,018
Prepaid expenses	0	15,424
Deferred tax assets	0	98,514
Total current assets	8,973,328	18,786,916
Property, Plant and Equipment, net (Note 6)	1,654,567	1,536,358
Other Assets
Intangible asset-Land use right, net (Note 7)	1,131,579	1,109,867
Refundable security deposit	2,140,228	2,501,031
Total other assets	3,271,807	3,610,898
Total Assets	13,899,702	23,934,172
LIABILITIES AND SHAREHOLDERS' EQUITY
Bank loans (Note 8)	773,515	746,480
Accounts payable	6,420,047	4,223,235
Salary and welfare payables	460,118	671,797
Others payable	977	83,056
Taxes payable (Note 9)	2,008,285	1,768,495
Advance from customers	599,856	7,449,518
Due to the CEO	1,986,172	894,714
Total Current Liabilities	12,248,970	15,837,295
COMMITMENTS AND CONTINGENCIES (Note 14)
STOCKHOLDERS' EQUITY
Preferred stock, $0.01 par value. 10,000,000 shares authorized; Authorized 10,000,000 shares; none issued as of June 30, 2011 and September 30, 2010, respectively	0	0
Common stock, $0.01 par value; authorized 34,639,823 shares; Issued and outstanding- 17,170,015 shares as of June 30, 2011 and September 30, 2010, respectively	171,700	171,700
Additional paid-in capital	2,960,904	2,960,904
Retained earnings	(1,694,551)	4,889,989
Accumulated other comprehensive income (loss)	212,679	74,284
Total Shareholders' Equity	1,650,732	8,096,877
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY	$ 13,899,702	$ 23,934,172