ZhongDe Waste Technology AG

Earnings Release • May 30, 2008

News Details

Corporate | 30 May 2008 08:23

ZhongDe Waste Technology AG reports strong growth in Q1 2008

ZhongDe Waste Technology AG / Quarter Results

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ZhongDe Waste Technology AG reports strong growth in Q1 2008

• Q1 revenues increased by 52% yoy to € 11.2 million

• Net profit climbed to € 7.0 million, an advance of 71% yoy

• Order intake increased by 365% yoy to € 44.0 million

• Earnings per share increased by 69% yoy to € 0.54 per share

• Continued strategic focus on municipal solid waste incinerators of
  larger scales

Hamburg, May 30, 2008 – ZhongDe Waste Technology AG (‘the Company’) today
announced its Q1 2008 results which continue to reflect the Company’s
strong growth profile.

The Company achieved revenues of € 11.2 million in Q1 2008, an increase of
52% compared to € 7.4 million in the same period of the previous year.
Growth was driven by a significant rise in municipal incinerator sales
which amounted to € 10.7 million in Q1 2008 compared to € 3.5 million in Q1
2007, an increase of 208%, which now amount to 96% of the Company’s total
sales, compared to 47% in Q1 2007. A total of four municipal solid waste
incinerators were sold in Q1 2008 compared to two in Q1 2007. Revenues in
the medical waste incinerator segment declined from € 3.9 million in Q1
2007 to k€ 462 in Q1 2008 due to the company focusing on the strongly
growing municipal solid waste incinerator segment.

Operating results in the first quarter of 2008 rose significantly, fuelled
by the upward trend in the municipal solid waste incinerator segment. As a
result gross profits increased from € 4.8 million in Q1 2007 to € 7.7
million in Q1 2008, an increase of 61%. EBITDA rose by 57% from € 4.1
million in Q1 2007 to € 6.5 million in Q1 2008, with an increase in the
EBITDA margin from 56% to 58% in the respective periods. The net profit
increased from € 4.1 million in Q1 2007 to € 7.0 million in Q1 2008, an
increase of 71%, with the underlying net profit margin increasing from 56%
in Q1 2007 to 63% in Q1 2008.

Orders continue to rise strongly in the municipal incinerator segment –
during the Q1 2008 period, the Company received orders for contracts worth
€ 44 million compared to € 9.5 million in the same period last year and
resulted in an order backlog of € 54.1 million in Q1 2008 compared to € 9.5
in Q1 2007.

Furthermore, the Company achieved a strong rise in EPS to € 0.54, compared
to € 0.32 in Q1 2007 resulting from the strong sales growth and continued
tight cost controls.

The Company’s net cash position as at March 31, 2008 was € 86.6 million
compared to € 83.8 million as at December 31, 2007.

In the period under review the Company has signed general contracts for the
Datong waste disposal and electricity generation project with the total
contract value amounting to approximately € 30 million. This is the
Company’s first major project to also include electricity generation on a
large scale.

In view of the strong growth already recorded in this financial year, the
Company has stepped up its recruitment by hiring some 12 skilled production
workers which will help to ensure the timely delivery of the Company’s
products to customers.

CEO Zefeng Chen comments: 'We are pleased that our strong growth profile is
reflected in these Q1 2008 financial results - the market continues to be
buoyant and we are successfully positioning ourselves as a major player in
the waste incineration market in China with a strategy that focuses on
larger scale incinerators. To this end, we are investing in R&D, have
stepped up our recruitment programme and are pleased that our second
production facility in Beijing is now in the construction stage. Together
these efforts enable the Company to take advantage of the enormous
potential and our outlook for the year remains strongly positive.'

Key Financial Highlights

Key figures in k€ Q1 2008 Q1 2007 Change
Order intake 43,992 9,465 +365%
Order backlog 54,142 9,465 +472%
Revenues 11,211 7,359 +52%
Gross profit 7,744 4,796 +61%
Gross profit margin 69% 65%
Cost of sales 3,467 2,563 +35%
EBITDA 6,482 4,131 +57%
EBITDA margin 58% 56%
EBIT 6,426 4,133 +56%
EBIT margin 57% 56%
Net profit 7,027 4,112 +71%
Net profit margin 63% 56%
Earnings per share 0,54 0,32 +69%

Amounts in k¤ Q1 2008 Q1 2007 Change %

About ZhongDe Group:

ZhongDe Group designs, manufactures and installs pyrolytic, grate and
rotary kiln waste incinerators for the disposal of solid medical, municipal
and industrial (including hazardous) waste. Since 1996, ZhongDe Group has
installed approximately 180 waste incinerators in about 13 provinces, and
more than 120 waste incinerators in the last three financial years alone.
Its waste incinerators are principally constructed for operators of medical
disposal centres in the hospital and healthcare industry, as well as for
small and midsized Chinese cities in developed areas of the People’s
Republic of China. ZhongDe Group is one of the leading suppliers of small
and midsized solid waste incinerators in China, supplying state-of-the-art
products.

This document constitutes neither an offer to sell nor a solicitation to
buy securities of ZhongDe Waste Technology AG. The securities have already
been sold.

This document is not an offer of securities for sale in the United States
of America. Securities may not be offered or sold in the United States of
America absent registration or an exemption from registration under the
U.S. Securities Act of 1933, as amended. The shares in ZhongDe Waste
Technology AG have not been and will not be registered under the U.S.
Securities Act of 1933, as amended, and are not being and will not be
offered or sold in the United States of America.

This document is directed at and/or for distribution in the U.K. only to
(i) persons who have professional experience in matters relating to
investments falling within article 19(5) of the Financial Services and
Markets Act 2000 (Financial Promotion) Order 2005 (the 'Order') or (ii)
high net worth entities falling within article 49(2)(a) to (d) of the Order
(all such persons being together referred to as 'relevant persons'). This
document is directed only at relevant persons. Any person who is not a
relevant person should not act or rely on this document or any of its
contents. Any investment or investment activity to which this document
relates is available only to relevant persons and will be engaged in only
with relevant persons.

Contact

Matthias Link
Director
Citigate Dewe Rogerson GmbH
Goethestraße 26-28
60313 Frankfurt am Main
Tel: 0049-69 90 500-150
Fax: 0049-69 90 500-102
E-Mail: matthias.link@citigatedr.de
Internet: www.citigatedr.de
30.05.2008 Financial News transmitted by DGAP

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Language: English
Issuer: ZhongDe Waste Technology AG
Stadthausbrücke 1-3
20355 Hamburg
Deutschland
Phone: +49 40 37644 745
Fax: +49 40 37644 500
E-mail: cornelia.dieker@zhongdetech.de
Internet: www.zhongdetech.de
ISIN: DE000ZDWT018
WKN: ZDWT01
Listed: Regulierter Markt in Frankfurt (Prime Standard); Freiverkehr
in Berlin, Düsseldorf, Hamburg, München, Stuttgart

End of News DGAP News-Service

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