KAIFENG, China, Sept. 1 /PRNewswire-Asia/ -- China Valves Technology, Inc. (OTC Bulletin Board: CVVZ) ("China Valves" or the "Company"), a leading metal valve manufacturer with operations in the People's Republic of China (the "PRC"), today announced that the Company's new production facility at its Henan Kaifeng High Pressure Valve Co., Ltd. ("Kaifeng Valve") subsidiary will begin formal production in mid September 2009.
The new production facility at Kaifeng Valve will mainly focus on the production of high-end large diameter metal valves used in thermal and nuclear power plants, as well as by the oil petrochemical and water supply and drainage industries. Additionally, the new facility will produce high-quality forged steel valves for use in supercritical thermal power generating units. The Company believes it is the only company in China capable of manufacturing this advanced product. The new facility will also produce conventional islands valves of nuclear power stations. The facility covers 13,000 square meters (approximately 140,000 square feet) and is equipped with state-of-the-art, fully automated machines supported by a new power transformer station. The construction was completed in the first quarter of 2009 and the facility began trial production in June 2009.
"Our new facility will focus on production of high-end valve products, and we plan to quickly ramp up production to reach 100% utilization by the end of 2009. Based on feedback from end valve users in the power generation and oil and petrochemical industries, demand for large diameter valves and forged steel valves will remain strong due to the shortage of production capacity for valve products used in more critical applications, such as supercritical thermal power generating units. This conscious and ongoing shift in our product portfolio towards technologically advanced valves should significantly improve our competitive position in the high-end valve market in China," said Mr. Siping Fang, Chairman and Chief Executive Officer of China Valves. "We expect the new facility to contribute $9.8 million in revenue and $3 million in net income in 2009. On a full year basis when at full capacity and accounting for seasonality we expect the new facility will contribute approximately $29.4 million in revenue and approximately $9 million in net income. These estimates assume that the facility's product mix remains in line with current backlog. However, annualized revenue and net margin may change as our product offerings evolve."
About China Valves Technology, Inc.
China Valves Technology, Inc., through its subsidiaries, Zhengzhou Zhengdie Valve Co, Ltd., Henan Kaifeng High Pressure Valve Co., Ltd., and Tai Zhou Tai De Valve Co., Ltd., is engaged in development, manufacture and sale of high-quality metal valves for the electricity, petroleum, chemical, water, gas and metallurgy industries. The Company has one of the best-known brand names in China's valve industry, and its history can be traced back to 1959 when it was formed as a state-owned enterprise. The Company develops valve products by extensive research and development and owns a number of patents. It enjoys significant domestic market shares and exports to Asia and Europe. For more information, visit http://www.cvalve.com .
Safe Harbor Statements
Any statements set forth above that are not historical facts are forward-looking statements that involve risks and uncertainties that could cause actual results to differ materially from those in the forward-looking statements. Such factors include, but are not limited to, the Company's ability to increase utilization at the new facility to targeted levels, develop and market new products, the ability to acquire other companies, changes from anticipated levels of sales, changes in national or regional economic and competitive conditions, changes in relationships with customers, changes in principal product profits and other factors detailed from time to time in the Company's filings with the United States Securities and Exchange Commission and other regulatory authorities. The Company undertakes no obligation to update or revise to the public any forward-looking statements, whether as a result of new information, future events or otherwise. This press release was developed by China Valves, and is intended solely for informational purposes and is not to be construed as an offer or solicitation of an offer to buy or sell the Company's stock. This press release is based upon information available to the public, as well as other information from sources which management believes to be reliable, but it is not guaranteed by China Valves to be accurate, nor does China Valves purport it to be complete. Opinions expressed herein are those of management as of the date of publication and are subject to change without notice.
For more information, please contact:
China Valves Technology, Inc.
Ray Chen, VP of Investor Relations
Tel: +1-650-281-8375
+86-139-2527-9478
Email: raychen@cvalve.net
Web: http://www.cvalve.com
CCG Investor Relations
Crocker Coulson, President
Tel: +1-646-213-1915
Email: crocker.coulson@ccgir.com
Web: http://www.ccgirasia.com
