China Chemical Corp.

CIK:0001445941|SEC Filings

CONDENSED CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME (UNAUDITED) (USD $)	3 Months Ended		9 Months Ended
	Sep. 30, 2011	Sep. 30, 2010	Sep. 30, 2011	Sep. 30, 2010
REVENUES:
Phthalic anhydride production line	$ 6,565,670	$ 9,644,787	$ 22,453,415	$ 26,169,640
Aleic anhydride production line	23,147,074	8,038,603	53,870,692	21,022,576
Sales of steam to a related party	744,215	1,382,511	2,276,467	4,539,200
TOTAL REVENUES	30,456,959	19,065,901	78,600,574	51,731,416
COST OF GOODS SOLD	23,722,927	14,938,547	63,296,542	41,188,906
GROSS PROFIT	6,734,032	4,127,354	15,304,032	10,542,510
General and administrative expenses	614,698	348,420	1,704,818	966,770
Selling and distribution expenses	3,274	2,980	24,973	8,286
INCOME FROM OPERATIONS	6,116,060	3,775,954	13,574,241	9,567,454
OTHER INCOME (EXPENSES)
Lease income from a related party, net		713,564		2,136,161
Lease income, net	825,643		2,444,481
Interest expense, net	(758,258)	(689,710)	(2,704,368)	(1,481,236)
Other income, net	113,785	6,236	402,016	1,106
INCOME BEFORE INCOME TAXES	6,297,230	3,806,044	13,716,370	10,223,485
INCOME TAX EXPENSE	(928,010)	(403,445)	(1,958,263)	(1,184,237)
NET INCOME	5,369,220	3,402,599	11,758,107	9,039,248
OTHER COMPREHENSIVE INCOME
Foreign currency translation gain	7,507,308	938,679	2,878,869	1,220,932
COMPREHENSIVE INCOME	$ 12,876,528	$ 4,341,278	$ 14,636,976	$ 10,260,180
WEIGHTED AVERAGE SHARES OUTSTANDING BASIC AND DILUTED (In shares)	30,015,000	19,867,000	30,015,000	19,867,000
NET INCOME PER SHARE BASIC AND DILUTED (in dollars per share)	$ 0.18	$ 0.17	$ 0.39	$ 0.45

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) (USD $)	9 Months Ended
	Sep. 30, 2011	Sep. 30, 2010
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income	$ 11,758,107	$ 9,039,248
Adjustments to reconcile net income to net cash provided by (used in) operating activities:
Depreciation and amortization	6,472,857	4,588,875
Deferred taxes	(234,814)	(217,549)
Amortization of initial cost of financial obligation, sales-leaseback	161,827
Amortization of financial obligations, sale-leaseback	1,457,499	108,627
(Increase) Decrease In:
Accounts receivable	(6,696,265)	(350,212)
Inventories	(6,495,256)	(1,616,906)
Prepayments for goods	1,643,872	(15,878,333)
Prepaid expenses and other receivables	(261,395)	301,146
Lease income receivable	(4,347,656)
Due from a related party	(2,784,385)	(3,412,947)
Increase (Decrease) In:
Accounts payable	9,269,542	3,793,898
Other payables and accrued liabilities	(1,342,053)	1,997,760
Customer deposits	1,276,180	(171,816)
Income tax payable	267,014	861,573
Payable to contractors	29,263	(1,353,017)
Due to related parties	204,924	59,776
Net cash provided by (used in) operating activities	10,379,261	(2,249,877)
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of plant and equipment	(234,372)	(341,668)
Purchases of construction in progress	(29,850,979)	(13,787,367)
Issuance of notes receivable		(1,111,826)
Repayments of notes receivable	2,775,960	1,185,816
Due from a related party	5,548,363	2,276,521
Net cash used in investing activities	(21,761,028)	(11,778,524)
CASH FLOWS FROM FINANCING ACTIVITIES:
Restricted cash	(35,822,766)	(36,115,604)
Due to a related party	10,171,999
Due from an employee		(4,531,047)
Proceeds from short-term bank loans	53,800,106	55,811,564
Repayments of short-term bank loans	(55,594,318)	(41,387,568)
Proceeds from notes payable	197,928,759	193,911,870
Repayments of notes payable	(152,953,210)	(153,048,288)
Repayments of long-term bank loans	(3,236,545)	(295,959)
Net proceeds from financial obligation, sale-leaseback		1,492,960
Repayments of financial obligations, sale-leaseback	(6,544,210)	(271,719)
Net cash provided by financing activities	7,749,815	15,566,209
NET (DECREASE) INCREASE IN CASH AND CASH EQUIVALENTS	(3,631,952)	1,537,808
Effect of exchange rate changes on cash	3,623,238	1,304,496
Cash and cash equivalents at beginning of period	3,260,299	828,921
CASH AND CASH EQUIVALENTS AT END OF PERIOD	3,251,585	3,671,225
SUPPLEMENTARY CASH FLOW INFORMATION:
Income taxes paid	2,026,413	574,512
Interest paid	2,588,360	1,693,508
SUPPLEMENTAL NON-CASH DISCLOSURES:
Transferred from construction in progress to plant and equipment	$ 2,032,667

CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED) (USD $)	Sep. 30, 2011	Dec. 31, 2010
CURRENT ASSETS
Cash and cash equivalents	$ 3,251,585	$ 3,260,299
Restricted cash	93,541,765	57,718,999
Accounts receivable	26,599,702	19,903,437
Inventories	16,801,285	10,306,029
Notes receivable		2,727,968
Prepayments for goods, net of allowance of $177,785 and $159,538 at September 30, 2011 and December 31, 2010, respectively	14,138,751	15,782,623
Prepaid expenses and other receivables	445,893	184,498
Lease income receivable	4,347,656
Due from a related party	6,584,676	19,640,240
Deferred taxes		105,476
Total current assets	165,711,313	129,629,569
LONG-TERM ASSETS
Plant and equipment, net	72,859,503	74,428,715
Construction in progress	61,465,310	32,151,137
Land use rights, net	3,140,835	3,224,995
Due from related parties	29,178,040	17,679,267
Initial cost for financial obligation, sale-leaseback, net	456,550	600,778
Deferred taxes	821,426	416,656
Total long-term assets	167,921,664	128,501,548
TOTAL ASSETS	333,632,977	258,131,117
CURRENT LIABILITIES
Accounts payable	14,242,514	4,972,972
Other payables and accrued liabilities	2,021,945	3,363,998
Short-term bank loans	47,365,534	47,593,169
Customer deposits	1,339,125	62,945
Notes payable	123,756,649	75,546,569
Income tax payable	3,184,264	2,917,250
Payable to contractors	662,785	633,522
Due to related parties	10,922,781	545,858
Deferred taxes	60,808
Current portion of financial obligations, sale-leaseback	5,986,529	5,892,988
Current portion of long-term bank loans	10,957,189	5,831,080
Total current liabilities	220,500,123	147,360,351
LONG-TERM LIABILITIES
Long-term portion of financial obligations, sale-leaseback	5,677,673	10,391,835
Long-term bank loans	12,052,908	19,613,634
Total long-term liabilities	17,730,581	30,005,469
TOTAL LIABILITIES	238,230,704	177,365,820
COMMITMENTS AND CONTINGENCIES
SHAREHOLDERS' EQUITY
Common stock, $0.0001 par value, 80,000,000 shares authorized, 30,015,000 shares issued and outstanding at September 30, 2011 and December 31, 2010	3,002	3,002
Additional paid-in capital	12,184,672	12,184,672
Retained earnings (restricted portion is $1,857,451 at September 30, 2011 and December 31, 2010)	72,828,422	61,070,315
Accumulated other comprehensive income	10,386,177	7,507,308
TOTAL SHAREHOLDERS' EQUITY	95,402,273	80,765,297
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY	$ 333,632,977	$ 258,131,117