Gushan Environmental Energy Limited (GU)
Q1 2010 Earnings Call
May 18, 2010 8:30 am ET
Wilson Kwong – President
JinMing Liu – Ardour Capital
Good morning and thank you for participating in the first quarter 2010 earnings conference call of Gushan Environmental Energy. At this time, all participants are in a listen-only mode. After the call, we will conduct a question-and-answer session. Today’s conference is being recorded.
I would now like to turn the call over to Wilson Kwong, President of Gushan Environmental Energy. Please proceed.
Good morning ladies and gentlemen, and welcome to Gushan’s first quarter 2010 earnings call. Joining me on the call is Frank Chan, Principal Financial Officer of Gushan.
Please note that today’s discussion may contain forward-looking statements made under the Safe Harbor provisions of the US federal securities laws. Please see today’s press release under the section Safe Harbor statement for a discussion of risks and uncertainties that may affect our results.
Before opening the call to questions, I would like to briefly review our first quarter 2010 results. Like the previous quarter, Gushan’s results in the first quarter were significantly impacted by continued uncertainty over potential consumption tax liability and a challenging operating environment. Total revenues for the quarter dropped 73.5% year-to-year, but remains stable quarter-on-quarter at $10.6 million. The year-to-year drop in revenue for the first quarter was largely attributable to the drop in sales volume of our biodiesel and biodiesel by-products and to a drop in average selling prices of our biodiesel by-products.
The drop in sales volume largely reflects two factors, firstly, the suspension of production at our Fujian plant where production stopped at the beginning in April of ’09 because of road work and remained suspended because of a continued uncertainty over consumption tax liabilities. As a result, production at the Fujian plant is down 100% on a year-to-year basis.