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Sancon Resources Recovery Announces Record Second Quarter Results

Post Time:Aug 19,2008Classify:Company NewsView:335

SHANGHAI, China, Aug 18, 2008 (BUSINESS WIRE) -- SRRYE | Quote | Chart | News | PowerRating -- Sancon Resources Recovery, Inc. ((OTCBB:SRRY) or "Sancon"), a rapidly growing environmental services and waste recycling company, with operations in both China and Australia, today announced record second quarter results for the period ended June 30, 2008. 

The Company generated record 2008 second quarter revenue of $2.94 million, a 251% increase compared to $0.84 million in the 2007 second quarter. Revenue increased significantly due to strong growth in China, despite interruptions to the Company's business due to the closure of highways and road as a result of the earthquake. Gross profit increased to $1.36 million compared to $0.15 million in the year earlier period. Gross margin increased from 17.9% in the 2007 second quarter to 46.2% in the 2008 second quarter due to increased sales of higher margin services in China. 2008 second quarter net income was a record $0.24 million, or $0.01 per diluted share, compared to a loss of $(0.06) million, or a loss of $(0.00) per share in the year ago period. Profitability was impacted by the Company's decision to increase spending to develop ways to turn waste glass material into new usable products and materials, which it believes will allow it to generate additional sources of revenue and investments in additional infrastructure to support anticipated growth throughout the balance of 2008 and 2009. The 2008 second quarter was the Company's second consecutive quarter of profitability.

For the six months ended June 30, 2008, Sancon had revenue of $5.89 million, a 284% increase compared to $1.53 million in the first six months of 2007. Gross profit increased to $2.87 million in the 2008 six months compared to $0.31 million in the year-earlier period. Gross margin increased from 20.3% in the 2007 six months period to 48.7% in the 2008 six months period. 2008 net income for the first six months was $1.03 million, or $0.05 per diluted share, compared to a loss of $(0.22) million, or a loss of $(0.01) per share in the year ago period.

"We are pleased that we have achieved another profitable quarter, while positioning the Company for growth throughout 2008 and 2009," said Jack Chen, Sancon's Chief Executive Officer. "The recent announcement that we have been selected by the largest personal computer manufacturer in China to collect and process waste materials reflects the growing recognition in China of the importance of recycling. Companies are increasingly embracing these initiatives, endorsed by the Chinese government, to become more environmentally responsible. We have been positioning Sancon to benefit from these trends by investing in technology and recycling plants and depots to support growth in new Chinese cities."

Business Outlook:

The Company expects to generate 2008 revenue of between $11 million and $12 million and net income between $2 million and $2.1 million and $0.09 to $0.1 per share.

Conference Call

The Company will hold a conference call today at 10:30 a.m. eastern time. Interested parties should dial (866) 675-4790 or (913) 312-9330 (internationally) and reference passcode 9524581. There will be a playback available as well. To listen to the playback, please call (888) 203-1112 or (719) 457-0820 (internationally) and use the same passcode.

The conference call will also be webcast and will be available at

About Sancon Resources Recovery Inc

Sancon Resources Recovery, Inc. is an environmental service and waste management company that operates recycling facilities in China and Australia. Sancon specializes in the collection and recovery of industrial and commercial solid wastes such as plastic, paper, cardboard, and glass. The recycled materials are re-used by Sancon's manufacturing customers in China to make a wide variety of new products including outdoor furniture, construction materials, building materials, road surface, and various new products. Sancon's China operation is licensed by the Chinese government for waste management services, and is certified with ISO9001 and ISO14001 standards. For more information please visit:

Forward-looking statements:

The statements made in this press release, which are not historical facts, may contain certain forward-looking statements concerning potential developments affecting the business, prospects, financial condition and other aspects of the company to which this release pertains. The actual results of the specific items described in this release, and the company's operations generally, may differ materially from what is projected in such forward-looking statements. Although such statements are based upon the best judgments of management of the company as of the date of this release, significant deviations in magnitude, timing and other factors may result from business risks and uncertainties including, without limitation, the company's dependence on third parties, general market and economic conditions, technical factors, the availability of outside capital, receipt of revenues and other factors, many of which are beyond the control of the company. The company disclaims any obligation to update information contained in any forward-looking statement.

Source: Sancon Resources Recovery, Inc. Author: admin

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