News

CHNR released unaudited interim financial information for the three and six months ended June 30, 2011

EXHIBIT 99.1


 

CONTACT

Edward Wong, Chief Financial Officer

011-852-2810-7205 or cfo@chnr.net

FOR IMMEDIATE RELEASE

CHINA NATURAL RESOURCES RELEASES

INTERIM RESULTS OF OPERATIONS

HONG KONG, December 21, 2011 – CHINA NATURAL RESOURCES, INC. (NASDAQ: CHNR), a company based in the People’s Republic of China, today released unaudited interim financial information for the three and six months ended June 30, 201as follows:

CHINA NATURAL RESOURCES, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (UNAUDITED)

THREE AND SIX MONTHS ENDED JUNE 30, 2011 AND 2010

(Amounts in thousands, except share and per share data)


 

                       

 

Three Months Ended June 30,

 

Six Months Ended June 30,

 

2010

 

2011

 

2011

 

2010

 

2011

 

2011

 

CNY

 

CNY

 

US$

 

CNY

 

CNY

 

US$

 

 

 

 

 

 

 

 

 

 

 

 

NET SALES

24,850 

 

61,809 

 

9,562 

 

33,623 

 

70,133 

 

10,850 

COST OF SALES

(15,729)

 

(39,885)

 

(6,170)

 

(21,727)

 

(46,083)

 

(7,129)

GROSS PROFIT

9,121 

 

21,924 

 

3,392 

 

11,896 

 

24,050 

 

3,721 

 

 

 

 

 

 

 

 

 

 

 

 

SELLING, GENERAL AND

 

 

 

 

 

 

 

 

 

 

 

ADMINISTRATIVE EXPENSES,

 

 

 

 

 

 

 

 

 

 

 

including share-based compensation

 

 

 

 

 

 

 

 

 

 

 

expense of CNY13,008 (US$1,904) and  nil

 

 

 

 

 

 

 

 

 

 

 

for the six months ended June 30, 2010 and 2011, respectively, and CNY6,504 (US$952) and 
nil for the three months ended June 30, 2010 and 2011, respectively

(24,940)

 

(18,232)

 

(2,821)

 

(37,877)

 

(35,451)

 

(5,484)

OTHER OPERATING EXPENSES

(1,936)

 

— 

 

— 

 

(2,315)

 

— 

 

— 

OPERATING PROFIT (LOSS)

(17,755)

 

3,692 

 

571 

 

(28,296)

 

(11,401)

 

(1,763)

FINANCE COST

(436)

 

(6,561)

 

(1,015)

 

(436)

 

(11,831)

 

(1,830)

INTEREST INCOME

293 

 

246 

 

38 

 

774 

 

372 

 

58 

LOSS ATTRIBUTABLE TO INVESTMENTS IN UNCONSOLIDATED INVESTEES

(1,826)

 

— 

 

— 

 

(3,612)

 

— 

 

— 

GAIN ON DISPOSAL OF AN UNCONSOLIDATED INVESTEE

— 

 

— 

 

— 

 

7,269 

 

— 

 

— 

GAIN FROM BARGAIN PURCHASE OF A SUBSIDIARY

— 

 

— 

 

— 

 

624,148 

 

— 

 

— 

OTHER INCOME (EXPENSE), NET

(58)

 

19 

 

 

44 

 

(54)

 

(7)

PROFIT (LOSS) FROM BEFORE INCOME TAXES

(19,782)

 

(2,604)

 

(403)

 

599,891 

 

(22,914)

 

(3,542)

INCOME TAXES

(2,155)

 

(4,446)

 

(688)

 

(3,600)

 

(5,825)

 

(901)

NET INCOME (LOSS)

(21,937)

 

(7,050)

 

(1,091)

 

596,291

 

(28,739)

 

(4,443)

OTHER COMPREHENSIVE INCOME (LOSS)

 

 

 

 

 

 

 

 

 

 

 

Foreign currency translation adjustments

 

 

 

 

 

 

 

 

 

 

 

  Attributable to CHNR Shareholders

3,951 

 

5,394 

 

835 

 

3,844 

 

8,279 

 

1,281 

  Attributable to non-controlling interests

— 

 

— 

 

— 

 

— 

 

— 

 

— 

COMPREHENSIVE INCOME (LOSS)

(17,986)

 

(1,656)

 

(256)

 

600,135

 

(20,460)

 

(3,162)

 

 

 

 

 

 

 

 

 

 

 

 

COMPREHENSIVE INCOME (LOSS) ATTRIBUTABLE TO:

 

 

 

 

 

 

 

 

 

 

 

CHNR Shareholders

(17,616)

 

(1,445)

 

(223)

 

600,726 

 

(20,128)

 

(3,111)

Non-controlling interests

(370)

 

(211)

 

(33)

 

(591)

 

(332)

 

(51)

 

(17,986)

 

(1,656)

 

(256)

 

600,135

 

(20,460)

 

(3,162)

 

 

 

 

 

 

 

 

 

 

 

 

NET INCOME (LOSS) ATTRIBUTABLE TO:

 

 

 

 

 

 

 

 

 

 

 

CHNR Shareholders

(21,567)

 

(6,839)

 

(1,058)

 

596,882 

 

(28,407)

 

(4,392)

Non-controlling interests

(370)

 

(211)

 

(33)

 

(591)

 

(332)

 

(51)

 

(21,937)

 

(7,050)

 

(1,091)

 

596,291

 

(28,739)

 

(4,443)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

EARNINGS (LOSS) PER SHARE:

 

 

 

 

 

 

 

 

 

 

 

Basic

 

 

 

 

 

 

 

 

 

 

 

   Income (loss) per share

(0.96)

 

(0.30)

 

(0.05)

 

26.94

 

(1.25)

 

(0.19)

 

 

 

 

 

 

 

 

 

 

 

 

Diluted

 

 

 

 

 

 

 

 

 

 

 

   Income (loss) per share

(0.96)

 

(0.30)

 

(0.05)

 

26.61

 

(1.25)

 

(0.19)

 

 

 

 

 

 

 

 

 

 

 

 

WEIGHTED AVERAGE NUMBER

 

 

 

 

 

 

 

 

 

 

 

OF SHARES OUTSTANDING

 

 

 

 

 

 

 

 

 

 

 

Basic

22,468,471 

 

22,748,141 

 

22,748,141 

 

22,158,775 

 

22,748,141 

 

22,748,141 

 

 

 

 

 

 

 

 

 

 

 

 

Diluted

22,468,471 

 

22,748,141 

 

22,748,141 

 

22,430,086 

 

22,748,141 

 

22,748,141 

 

 

 

 

 

 

 

 

 

 

 

 


 


 


CONDENSED CONSOLIDATED BALANCE SHEETS

AS OF JUNE 30, 2011 AND DECEMBER 31, 2010

(Amounts in thousands, except share data)


 


 

                 

 

 

 

 

December 31,

 

June 30,

 

June 30,

 

 

 

 

2010

 

2011

 

2011

 

 

 

 

CNY

 

CNY

 

US$

 

 

 

 

 

 

(Unaudited)

 

(Unaudited)

 

 

 

 

 

 

 

 

 

CURRENT ASSETS

 

 

 

 

 

 

 

 

Cash

 

 

 

126,685 

 

105,099 

 

16,259 

Restricted cash

 

 

 

— 

 

21,000 

 

3,249 

Available-for-sale financial asset

 

 

 

— 

 

7,000 

 

1,083 

Trade receivables

 

 

 

13,807 

 

27,032 

 

4,182 

Bills receivable

 

 

 

2,200 

 

6,000 

 

928 

Prepayment

 

 

 

7,791 

 

26,334 

 

4,074 

Inventories

 

 

 

11,454 

 

13,042 

 

2,018 

Deferred tax assets

 

 

 

439 

 

140 

 

22 

Other receivables

 

 

 

14,538 

 

17,561 

 

2,717 

 

 

 

 

 

 

 

 

 

TOTAL CURRENT ASSETS

 

 

 

176,914 

 

223,208 

 

34,532 

 

 

 

 

 

 

 

 

 

DEFERRED TAX ASSETS

 

 

 

1,695 

 

1,667 

 

258 

 

 

 

 

 

 

 

 

 

REHABILITATION FUND

 

 

 

20,402 

 

28,023 

 

4,335 

 

 

 

 

 

 

 

 

 

PREPAYMENTS

 

 

 

15,825 

 

84,579 

 

13,085 

 

 

 

 

 

 

 

 

 

PROPERTY AND EQUIPMENT, NET

 

 

 

1,823,992 

 

1,915,642 

 

296,360 

 

 

 

 

 

 

 

 

 

TOTAL NON-CURRENT ASSETS

 

 

 

1,861,914 

 

2,029,911 

 

314,038 

 

 

 

 

 

 

 

 

 

TOTAL ASSETS

 

 

 

2,038,828 

 

2,253,119 

 

348,570 

 

 

 

 

 

 

 

 

 

CURRENT LIABILITIES

 

 

 

 

 

 

 

 

Mining rights payable – current

 

 

 

19,192 

 

25,104 

 

3,884 

Short-term bank loan

 

 

 

100,000 

 

120,000 

 

18,565 

Accounts payable

 

 

 

82,897 

 

60,673 

 

9,386 

Bills payable

 

 

 

— 

 

70,000 

 

10,829 

Advances from customers

 

 

 

1,306 

 

7,273 

 

1,125 

Accrued liabilities

 

 

 

7,117 

 

7,491 

 

1,159 

Income tax and other taxes payable

 

 

 

22,034 

 

23,188 

 

3,587 

Other payables

 

 

 

46,880 

 

51,395 

 

7,953 

Interest payable – current

 

 

 

4,253 

 

3,886 

 

601 

Payables to related parties

 

 

 

44,782 

 

95,836 

 

14,826 

 

 

 

 

 

 

 

 

 

TOTAL CURRENT LIABILITIES

 

 

 

328,461 

 

464,846 

 

71,915 

 

 

 

 

 

 

 

 

 

Long-term bank loans

 

 

 

318,742 

 

438,742 

 

67,876 

Mining rights payable – non-current

 

 

 

132,966 

 

112,578 

 

17,416 

Interest payable – non-current

 

 

 

13,205 

 

14,035 

 

2,171 

Long-term payable to the Shareholder

 

 

 

404,093 

 

375,255 

 

58,054 

Deferred tax liabilities

 

 

 

294,250 

 

296,255 

 

45,832 

Asset retirement obligations

 

 

 

9,036 

 

9,484 

 

1,467 

 

 

 

 

 

 

 

 

 

TOTAL NON-CURRENT LIABILITIES

 

 

 

1,172,292 

 

1,246,349 

 

192,816 

 

 

 

 

 

 

 

 

 

TOTAL LIABILITIES

 

 

 

1,500,753 

 

1,711,195 

 

264,731 

 

 

 

 

 

 

 

 

 

EQUITY

 

 

 

 

 

 

 

 

China Natural Resources, Inc. equity:

 

 

 

 

 

 

 

 

 Common shares, no par:

 

 

 

 

 

 

 

 

Authorized – 200,000,000 shares;

 

 

 

— 

 

— 

 

— 

Issued and outstanding – 22,723,416 shares and 23,098,416 at December 31, 2010 
and June 30, 2011, respectively

 

 

 

312,081 

 

312,081 

 

48,281 

Other equity

 

 

 

161,048 

 

156,950 

 

24,281 

Other comprehensive loss

 

 

 

(20,902)

 

(12,623)

 

(1,953)

 

 

 

 

 

 

 

 

 

TOTAL CHINA NATURAL RESOURCES, INC. EQUITY

 

 

 

452,227 

 

456,408 

 

70,609 

NON-CONTROLLING INTERESTS

 

 

 

85,848 

 

85,516 

 

13,230 

 

 

 

 

538,075 

 

541,924 

 

83,839 

 

 

 

 

 

 

 

 

 

TOTAL LIABILITIES AND EQUITY

 

 

 

2,038,828 

 

2,253,119 

 

348,570 


 


 


 

2


 


 


For the convenience of the reader, amounts in Renminbi, the Chinese currency (“CNY”), have been translated into United States dollars (“US$”) at the applicable rate of US$1.00 = CNY6.4639 as quoted by Bloomberg Finance L.P. as of June 30, 2011. No representation is made that the CNY amounts could have been, or could be, converted into US$ at that rate, or at all.

The condensed consolidated statements of operations and comprehensive income for the three and six months ended June 30, 2011 (unaudited) and the condensed consolidated balance sheet as of June 30, 2011 (unaudited) are derived from, and should be read in conjunction with, the Company’s unaudited condensed consolidated financial statements for the three and six months ended June 30, 2011 and 2010, which was filed with the Securities and Exchange Commission on December 14, 2011 under cover of Form 6-K. The results of operations for the six months ended June 30, 2011 are not necessarily indicative of the results of operations that may be expected for the year ending December 31, 2011.

Mr. Feilie Li, the Company's Chairman and CEO, commented on the 2011 interim results "In view of the continuing economic growth in the PRC, we believe that demand for coal will continue to be robust in the foreseeable future. We are positive about the prospects for the coal mining industry in the PRC and we will continue to pursue growth through acquisition and consolidation of small to medium sized coal mines.”

About China Natural Resources, Inc.:

China Natural Resources, Inc., a British Virgin Islands corporation, through its operating subsidiaries in the People's Republic of China, is currently engaged in (a) the acquisition and exploitation of mining rights, including the exploration, mineral extraction, processing and sale of iron, zinc and other nonferrous metals, extracted or produced at mine primarily located in Anhui Province in the PRC, and (b) the acquisition, exploration, development and production of coal resources in Guizhou Province in the PRC.

Forward-Looking Statements:

This press release includes forward-looking statements within the meaning of federal securities laws. These statements include, without limitation, statements regarding the intent, belief and current expectations of management with respect to the Company's policies regarding investments, dispositions, financings, conflicts of interest and other matters; and trends affecting the Company's financial condition or results of operations. Forward-looking statements are not a guarantee of future performance and involve risks and uncertainties, many of which are outside of our control, and actual results may differ materially from those in the forward-looking statement. Among the risks and uncertainties that could cause our actual results to differ from our forward-looking statements are: uncertainties relating to our business operations and operating results; uncertainties regarding the governmental, economic and political environment in the People’s Republic of China; uncertainties associated with metal and coal price volatility; uncertainties associated with the Company’s reliance on third-party contractors and other risks detailed from time to time in the Company’s filings with the Securities and Exchange Commission, including without limitation the information set forth in our Annual Report on Form 20-F under the heading "Risk Factors". While management believes that its assumptions forming the bases for forward looking statements are reasonable, assumed facts or bases generally vary from actual results, and there can be no assurance that the expectations or beliefs expressed in forward looking statements will be achieved or accomplished.


 

3