China Tracker - Details for China Integrated Energy (CBEH)


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 China Integrated Energy
 Business Outlook

Recent Chain of Events:
2012-09-24 -- Last SEC Filing
2012-09-18 -- CFO Change
2011-07-21 -- Auditor Engagement
2011-06-15 -- Delisting from NASDAQ
2011-05-19 -- CFO Appointment
2011-04-28 -- CFO Resignation
2011-04-26 -- Auditor Resignation
2011-04-20 -- Trading halted by NASDAQ
2011-03-16 -- Last Quarterly/Annual Report: FY2010 ended December 31, 2010

(Source: Trading China, 2012-09-30)

For financial year 2011, the Company's sales are currently expected to be $497 million and net income is expected to be $41 million. At the beginning of 2011, the Company provided guidance for sales of $588 million and net income of $72 million. We have revised guidance downward for the financial year 2011 due to several factors. In the first half of 2011, our biodiesel production facilities in Tongchuan were not producing at planned capacity due to government restrictions on chemical and oil production during the International Horticultural Exposition in Xi'an, which began in April 2011 and is currently still underway. We were successful, however in our efforts to maintain limited hours of production each day as the local government authorities acknowledged that our production of biodiesel is safer and less pollutive than traditional oil refining. Normal production schedules will resume after the end of the Expo in November 2011.

In addition, the newly acquired equipment for the Tongchuan Phase 2 plant is still undergoing testing. Production is scheduled to commence in the third quarter of 2011. Additionally, one of the production lines in the Chongqing plant was upgraded in the second quarter of 2011, which temporarily reduced our biodiesel production during that period. As previously announced, four gas station leases were cancelled by Shaanxi Highway Services Co., Ltd. as part of the government's effort to reduce the number of gas stations leased to third party operators. As a result, we have received a refund of about $3.9 million for the advance lease payment that was made at the time we began operating those gas stations.

On July 8, 2011 and July 11, 2011, we received termination notices from Shaanxi Fangwei Road Gas Station and Lantian Gas Station for the gas stations leased by Xi'an Baorun at those locations. The termination of the operating lease for Lantian Gas Station is due to the expected demolition of this gas station in order to widen the road, a project undertaken by the local government. The termination of the Fangwei Road Gas Station lease results from the owner's decision to sell the gas station. According to the Gas Station Leasing and Operation Agreement dated May 28, 2009 entered into with the Shaanxi Fangwei Road Gas Station, we were given priority to acquire the gas station in the event of a sale by its owner. However, the price demanded by the owner was in the opinion of the Company unreasonably high and was outside the internal guidelines and policies we have in place with respect to acquisitions. The Company expects to receive a refund for the advance lease payments made amounting to approximately $10.9 million. As a result of the termination of these leases, our retail gas station segment sales have been reduced.

To date, we have not received the corporate income tax waiver for financial year 2011 from the Xi'an local tax bureau for our Xi'an Baorun subsidiary and, hence, we expect that Xi'an Baorun will be subject to corporate income tax at the rate of 15% since it has been certified as a High & New Technology Enterprise. Our expenses are also expected to increase due to the cost of the ongoing independent investigation.

(Source: PR Newswire, 2011-07-27)

Unless the Company requests an appeal of Nasdaq's determination to delist by May 23, 2011, trading of the Company's shares of common stock will be suspended at the opening of business on May 25, 2011, and a Form 25NSE will be filed with the Securities and Exchange Commission, which will result in the Company's securities being removed from listing and registration on Nasdaq. The Company intends to appeal Nasdaq's determination.

(Source: 8-K Filing, 2011-05-19)

On April 21, 2011, the Audit Committee of the Company received a notification from Pillsbury Winthrop Shaw Pittman LLP that effective immediately, it resigned as special counsel to the Audit Committee. In addition, Pillsbury notified the Audit Committee that it has been authorized by Deloitte Financial Advisory Services LLP and King & Wood to advise Audit Committee that effective immediately, each firm has resigned from its engagement.

(Source: 8-K Filing, 2011-04-28)

China Integrated Energy today announced that four gas station leases entered into in 2008 have been terminated by Shaanxi Highway Service Co., reducing the total number of the Company's gas stations from thirteen to nine. Shaanxi Highway has recalled all of the 32 gas stations that are currently being leased by Shaanxi Highway to third parties, including the four gas stations leased by the Company.

On May 20, 2008, the Company leased four gas stations for operation from Shaanxi Highway. The annual lease payment for each gas station was approximately $437,000 (RMB 3,000,000). The Company was required to make the lease payments for all four gas stations in advance in five-year increments. The first five-year aggregate lease payment of $8,747,631 (RMB 60,000,000) has been paid by the Company to Shaanxi Highway. Each gas station will be inspected by Shaanxi Highway, and upon its approval, the Company will receive the pro-rated portion of the prepaid lease payment by April 30, 2011. The Company expects the aggregate returned amount to be approximately $3,970,496 (RMB 26,000,000).

"Since early 2010, the cost of acquiring or leasing retail gas stations has escalated significantly in China, primarily as a result of increased competition to buy gas stations from state-owned petroleum companies working in cooperation with foreign entities. Given the fierce competition that exists now in the retail gas station market in China, we will continue to evaluate organic and acquisition opportunities in all three of our business segments - biodiesel production, wholesale distribution and retail gas stations - to prudently deploy available resources to achieve the greatest investment return."

(Source: PR Newswire, 2011-04-20)

The NASDAQ Stock Market announced that trading was halted today in China Integrated Energy for "additional information requested" from the company at a last price of $1.84. Trading will remain halted until China Integrated Energy, Inc. has fully satisfied NASDAQ's request for additional information.

(Source: Globe Newswire, 2011-04-20)

China Integrated Energy is a complete hoax, according to a detailed investigation by the International Financial Research & Analysis Group (IFRA) commissioned by one of its hedge fund clients.

(Source: Scribd.com, 2011-03-28)

China Integrated Energy today denied the allegations published in the article written by an author calling himself "Alfred Little." The Company has previously denied and addressed similar and overlapping allegations raised by an individual using the pseudonym "Sinclair Upton". In order to provide the highest level of transparency to its shareholders, the Audit Committee of the Board of Directors had previously authorized the conduct of an independent investigation into the issues raised by Sinclair Upton. The Committee will ask the investigators also to consider the Alfred Little allegations. The Company intends to pursue all of its rights against the authors of these reports.

(Source: PR Newswire, 2011-03-28)

We are now pleased to have KPMG, an experienced and very qualified firm, complete the audit of the company's fourth quarter and full year 2010 financial results and internal controls. We will provide a detailed explanation to address the negative research report issued earlier today through a letter to our shareholders. We are committed to sound corporate governance and internal controls as we continuously strive to maintain our financial integrity.

(Source: PR Newswire, 2011-03-16)

Based on the strong results recorded for the full year of 2010, management expects to report sales of $588.1 million and net income of $72.2 million for the year ended December 31, 2011.

China Integrated Energy, Inc.'s management plans to focus on growing each of its three businesses; biodiesel production, wholesale distribution, and retail gas stations with a focused expansion on biodiesel production. On the wholesale distribution and retail side, the company benefits from its strategic location, well-established supplier relationships as well as an extensive distribution network that has valuable railway access to reach remote parts of China that other distribution companies cannot currently reach. China Integrated Energy is the only non-state-owned integrated biodiesel producer with a distribution license in China. The company operates 13 gas stations surrounding Xi'an city and expects to increase that number during 2011.

The company successfully doubled its biodiesel production capacity from 100,000 tons to 200,000 tons with the newly-constructed 50,000-ton biodiesel production facility in Tongchuan City, Shaanxi Province coming online. The facility began testing in the first quarter of 2011 and is expected to be operating at 25% - 30% capacity in the second quarter of 2011 and 70% capacity in the third quarter, ramping to a 100% utilization rate by the fourth quarter. For the full-year 2011, the new facility is expected to contribute approximately $21.6 million in revenue and $5.4 million in net income. At full production, this facility is expected to generate at least $9.0 million in net income at current prices.

On January 3, 2011, the company announced plans to expand its biodiesel production capacity by acquiring assets, including but not limited to infrastructure, land use rights to 15 acres of land, and storage tanks with 15,000 cubic meters of storage capacity in Lin Gao County, Hainan province, for approximately $9.0 million in cash. The company is performing due diligence, and expects to complete the acquisition by the end of the first quarter of 2011. The company announced plans to build a 300,000-ton biodiesel plant at this facility and has revised its phase one expansion plan to construct a 200,000-ton production facility, from the previously announced 100,000-ton facility. The estimated construction cost of phase one is approximately $37 million and is expected to take eighteen months to complete, which would be in the third quarter of 2012.

The company continues to invest in developing new biodiesel production technology to further increase the flexibility in feedstock application which it expects to reduce raw materials costs and improve margins. Throughout 2010, we witnessed broad-based growth in each of our three business segments, while bringing on new biodiesel capacity online. We are well positioned to capture further market share across our business segments during 2011. With our strong balance sheet and cash flow, we intend to augment organic growth with opportunistic acquisitions, such as the Tianrun biodiesel plant and the Hainan Lin Gao Chemical Co. With our products now being sold in 16 provinces and municipalities, we believe we will continue to gain market share by adding new customers and increasing volume to existing ones. With an insatiable appetite for energy to meet China's domestic growth needs, we are well positioned to support our revenue, net income and working capital targets moving forward." Although additional working capital is required to support the growth of all three business segments, the company believes that it has adequate capital to support its current growth strategies.

(Source: PR Newswire, 2011-03-10)

As of September 30, 2010, the Company had cash and cash equivalents of approximately $79.7 million. Together with strong operating cash flow and net proceeds of approximately $37.4 million from two recent capital raises, the Company believes that it has adequate funds to support its growth plans. In the fourth quarter of 2010, the Company spent a total of $25.7 million for two separate acquisitions that will generate a combined $44.3 million in revenues in 2011.

Additionally, the Company is expected to complete the construction of its new 50,000-ton biodiesel production facility adjacent to its existing 100,000-ton biodiesel production facility in Tongchuan City, Shaanxi Province, by the end of this month. The total construction cost of the new 50,000-ton biodiesel production facility is now approximately $19.3 million, of which $18.3 million has been spent by the Company to date. The remaining $1 million will be paid in the first quarter of 2011. The Company expects to generate approximately $21 million in annual revenues from this new facility in 2011.

For 2011, the Company estimates a $45.0 million to $50.0 million of working capital requirements for the growth of all three business segments, which includes an increase of approximately 25% to 30% in wholesale distribution volume in 2011 from 2010, and the two capital projects of Hainan Lin Gao Chemical Co. and Chongqing FengDou Keyu Trade Co. The Company believes that it has adequate capital to support its current growth plans.

(Source: PR Newswire, 2011-01-27)

We are committed to sound corporate governance, and our SOX 404 compliance program is an important element in strengthening our internal controls. For our upcoming fourth quarter and full year 2010 financial results, we look forward to working with KPMG as our new auditor, as well as our other financial and legal advisors, as we continuously strive to maintain our financial integrity.

(Source: PR Newswire, 2011-01-10)

China Integrated Energy today announced that it has signed a non-binding letter of intent to acquire all of the assets of Hainan Lin Gao Chemical Co. The Company plans to build a 300,000-ton biodiesel plant at this facility in Lin Gao County, Hainan Province. The Company is performing due diligence, and expects to complete the acquisition by the end of the first quarter 2011. Phase one, which includes a production facility with 100,000-ton capacity, is expected to commence production approximately twelve months after the closing of the acquisition. The Company will acquire all of the assets of Hainan Lin Gao Chemical for a total cash consideration of approximately $9 million. This includes a land use right to approximately 15 acres of land, an oil storage facility with 15,000 cubic meters of storage capacity, and built-in infrastructure including power, water, and waste treatment. In addition, this facility is located near a seaport, which is convenient for feedstock and biodiesel transport.

China Integrated Energy Inc. also continues with the construction of its new 50,000-ton biodiesel production facility, adjacent to the Company's existing 100,000-ton biodiesel production facility in Tongchuan City, Shaanxi Province. The completion of the newly constructed 50,000-ton biodiesel production facility had been slightly delayed, due to a holdup on the clearance through customs of the equipment shipped from Japan. However, the last shipment of equipment has already cleared customs and is expected to arrive in early January. The Company expects to commence testing and ramp-up of the newly constructed biodiesel production facility in January 2011.

(Source: PR Newswire, 2011-01-03)

The Company reaffirms the newly updated 2010 guidance with revenue of $435 million and net income of $53.5 million representing an increase of 50.2% and 41.2%, respectively, from 2009.

(Source: PR Newswire, 2010-12-03)

Based on the strong results recorded in the first nine months of 2010, Management expects to report sales of $435 million and net income of $53.5 million for the full year ended December 31, 2010. Guidance includes two months of contribution from the newly-acquired 50,000-ton biodiesel production capacity and Shenmu retail gas station, offset by lower-than-expected contribution from the newly-constructed 50,000-ton biodiesel plant due to the delay in the expected completion date.

China Integrated Energy, Inc.'s management plans to focus on growing each of its three businesses - biodiesel production, wholesale distribution, and retail gas stations with a focused expansion on biodiesel segment. On the wholesale distribution and retail side, the Company benefits from its advantageous location, well-established supplier relationships as well as an extensive distribution network that has valuable railway access to reach remote parts of China that other distribution companies cannot currently reach. China Integrated Energy is the only non-state-owned integrated biodiesel producer with a distribution license in China. Including the Shenmu retail gas station acquired on October 19, 2010, the Company operates 13 gas stations surrounding Xi'an city.

The Company is also doubling its current biodiesel production capacity of 100,000 tons to 200,000 tons once the newly-constructed 50,000-ton biodiesel production facility in Tongchuan City, Shaanxi Province commences testing and ramp-up of production in December 2010. The Company anticipates spending approximately $15 million in capital expenditures to accomplish this goal. The Company has secured enough raw materials to supply 150,000 tons of capacity in Tongchuan City, but will also continue to work towards securing more long-term sources of raw materials and new technology in the bio-energy field. On October 22, 2010, the Company executed a definitive agreement to acquire Chongqing Tianrun Energy Development Co., Ltd., a biodiesel production facility with 50,000 tons of biodiesel production capacity. The Company believes that profit margins of the acquired company are similar to its current biodiesel production. The acquisition costs approximately $16.5 million. The Company continues pursuing strategic acquisitions that will quickly provide financial benefits to us. Furthermore, the Company continues to invest in developing new biodiesel production technology to further increase the flexibility in feedstock for its plants and to reduce raw materials costs.

(Source: PR Newswire, 2010-11-04)

The Company is paying approximately $16.5 million in cash for the Chongqing Tianrun biodiesel production facility. Management expects the acquisition to add approximately $32 million in revenue and $8 million in pretax income in 2011. The Chongqing Tianrun biodiesel plant is subject to 15% corporate income tax rate. The Company will fund the acquisition with cash on hand, which was approximately $58.7 million as of June 30, 2010.

The completion of the newly-constructed 50,000-ton biodiesel production facility has been slightly delayed, due to recent inclement weather and a holdup on equipment clearance by customs. However, the Company expects to commence testing and ramp-up of the newly constructed biodiesel production facility in December 2010. The new production facility is adjacent to the Company's existing 100,000-ton biodiesel production facility in Tongchuan City, Shaanxi Province, China. The company reaffirms its 2010 financial guidance of revenue of $425 million to $430 million, and net income of $52 million to $52.5 million.

(Source: PR Newswire, 2010-10-26)

China Integrated Energy today announced that it has acquired a retail gas station located in Shenmu County, Yulin City, Shaanxi Province for a total cash consideration of approximately $9.2 million. The gas station distributes both gasoline and diesel, which may include blended biodiesel in the future. During the past twelve months, the acquired gas station sold approximately 8,000 tons of fuel and generated revenue of approximately $8.2 million. For the fiscal year of 2011, the Company estimates the Shenmu gas station will sell approximately 12,000 tons of fuel and generate approximately $12.3 million in revenue.

"We will continue to evaluate organic and acquisition opportunities in all three of our businesses - biodiesel production, wholesale distribution and retail gas stations – to drive further growth in revenue and profits."

(Source: PR Newswire, 2010-10-25)

Management has demonstrated a high level of confidence in the Company's long term fundamentals and strong cash position with increases in sales volume from both wholesale distribution of finished oil and heavy oil products segment and retail gas station segment, and a goal of doubling biodiesel production capacity from 100,000 tons to 200,000 tons in 2010 through both internal expansion and an acquisition. The Company reaffirms the newly updated 2010 guidance with revenue of $425 million and net income of $52 million representing an increase of 46.8% and 37.2%, respectively, from 2009.

"We hope that this statement puts any concerns to rest. We consider the reputation and integrity of China Integrated Energy to be of utmost importance to our future success, both from an operational and a public Company perspective. The Company intends to continue to demonstrate tremendous growth opportunities in all three business segments supported by China economic stimulation and favorable alternative energy policies, and provides a measurable investment return to our shareholders."

(Source: PR Newswire, 2010-09-13)

For the full year ending December 31, 2010, management now expects revenues of $425 million to $430 million, and net income of $52.0 million to $52.5 million, representing an increase of 46.8% to 48.5% and 37.2% to 38.5% respectively from 2009. Guidance includes an additional 50,000 tons of annual biodiesel manufacturing capacity expected to come online during the fourth quarter of 2010 and the lease of three additional retail gas stations.

The Company plans to expand its current biodiesel production capacity of 100,000 tons to 200,000 tons by bringing a new 50,000 ton biodiesel production facility in Tongchuan City online by the end of third quarter and completing an acquisition for 50,000 tons of biodiesel production capacity, which is anticipated to close before or on September 30, 2010. The Company anticipates spending approximately $31.5 million in capital expenditures to accomplish this goal. China Integrated Energy has secured adequate raw materials to accommodate this new capacity, including new feedstocks, and will continue to work towards securing more long-term sources of raw materials.

"We are currently operating at full capacity with our current 100,000-ton biodiesel production plant and expect to drive incremental growth by adding 100,000 tons of capacity for this high margin, high return business. We will leverage our proprietary biodiesel manufacturing process and new technologies to further improve operating efficiencies and drive margins higher. Our retail gas stations, which historically have benefited from higher retail gas prices set by the NDRC, will maintain a structural cost advantage to our competitors, regardless of where prices are in the future. In conclusion, we are very confident in our ability to successfully execute our growth plan in the short and long term."

(Source: PR Newswire, 2010-08-05)

The new production facility is being constructed adjacent to the Company's existing 100,000 ton biodiesel production facility and will expand the Company's production capacity to 150,000 metric tons. Installation of the equipment at the new biodiesel facility is expected to be completed by the third quarter of 2010, with production commencing in the fourth quarter. The facility is expected to be operating at 60-70% of capacity in the first quarter of 2011, and ramping up to 80-90% utilization rate in the second quarter of 2011. For full-year 2011, the new facility is expected to contribute at least $27 million and $9 million in revenue and net income, respectively.

(Source: PR Newswire, 2010-05-17)

For the full year ending December 31, 2010, management now expects revenues of $387 million from $382 million and net income of $49.5 million from $48 million, representing an increase of 33.7% and 30.7% compared to 2009 revenue and net income, respectively. Guidance includes an additional 50,000 tons of annual biodiesel manufacturing capacity expected to come online during the third quarter of 2010 and the lease of three additional retail gas stations.

(Source: PR Newswire, 2010-05-11)

Management expects fiscal year 2010 revenues of $382 million and net income of $48 million, representing an increase of 32.8% and 26.3% compared to 2009 revenue and net income, respectively. Guidance includes an additional 50,000 tons of annual biodiesel manufacturing capacity expected to come online during the third quarter of 2010 and the lease of 3 additional retail gas stations. The company is focused on growing all of its business segments, both organically and through complementary acquisitions, while further diversifying its supplier base for finished oil and heavy oil products.

(Source: PR Newswire, 2010-03-12)
CBEH
Oil & Gas
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Current Price:  n/a
F10k Day (2008-07-08): -100.00%$6.05
2009 Close: -100.00%$7.04
2010 Close: -100.00%$7.33
2011 Close: -100.00%$0.39
High (2012-02-02): -100.00%$0.96
Low (2012-09-27): -100.00%$0.31
Exchange:
Market Capitalization: n/a
Total Shares: 42.20 mill
Float: n/a
Avg Volume: 423.70 k
Short Interest: 1.93 mill
Short Ratio: n/a4.6 d
Last Quarter: 2010-12-31
Revenue (MRQ): 118.05 mill
Net Income (MRQ): 15.32 mill
Op. Cash Flow (MRQ): 22.59 mill
all financial data provided without warranty