WUHAN, China, Feb. 23, 2012 /PRNewswire-Asia/ -- Kingold Jewelry, Inc. (NASDAQ: KGJI), today announced an agreement with China CITIC Bank ( Wuhan) ("CITIC" or "the Bank") to design and manufacture 24-Karat gold investment-oriented products for resale throughout the Bank's local retail banking network. China CITIC Bank is one of the leading commercial banks in mainland China, with more than 600 retail footprints and has operations in nearly 130 countries and regions around the world.
The agreement with CITIC, which is initially for two years and renewable thereafter, calls for Kingold to design and manufacture 24-Karat gold investment-oriented products, including coins, bars and ornaments, on behalf of CITIC. It is initially a pilot project focused on Wuhan, which Kingold hopes will rapidly extend to CITIC's other locations throughout China. While Kingold expects to hire additional labor to assist in the production of these products for CITIC, it does not anticipate that it will incur incremental capital expenditures for either manufacturing equipment, or for facilities, in connection with the agreement. Kingold expects this new relationship to begin contributing meaningfully to its overall revenue commencing in 3Q 2012.
The agreement with CITIC further advances Kingold's diversification into China's rapidly growing market for investment-oriented products, catering to Chinese consumer demand for gold as a store of wealth. According to the China Gold Council, China's domestic gold jewelry consumption increased to 456.66 metric tons in 2011, a growth of 27.9% over 2010; while domestic investment-oriented gold consumption (gold bars and coins) increased 48% to 234.65 metric tons over the same period.
"We are delighted to announce this agreement with CITIC. It furthers our efforts to capture market share in China's rapidly growing investment-oriented gold market, extending our existing footprint through our ongoing relationships with Bank of Communications Co., Ltd. and China Merchants Bank, both of which began in 2011 and are growing rapidly," said Mr. Zhihong Jia, Chairman and CEO of Kingold. "Our goal is to provide the finest quality 24-Karat gold products to customers located throughout CITIC's network of 13 retail branches in Wuhan, and then roll out to other cities and provinces across their network. We will continue to pursue similar arrangements with other world class financial institutions in China, aiming to consolidate Kingold's leading positions both in 24K gold jewelry and gold investment markets."About Kingold Jewelry, Inc.: Kingold Jewelry, Inc. (NASDAQ: KGJI), centrally located in Wuhan City, China's fourth largest city, was founded in 2002 and today is one of China's leading designers and manufacturers of 24-karat gold jewelry, ornaments and investment-oriented products. The Company sells both directly to retailers as well as through major distributors across China. Kingold has received numerous industry awards and has been a member of the Shanghai Gold Exchange since 2003. Sales have grown from $29 million in FY 2006 to $523 million in FY 2010 with net income attributable to common stockholders growing from $1.3 million to $18.2 million over the same period. For more information, please visit www.kingoldjewelry.com. About China CITIC Bank China CITIC Bank (601998.SH; 0998.HK), founded in 1987, is one of the leading commercial banks in mainland China, with 78 branches and 622 sub-branches. In addition, the Bank has operations in nearly 130 countries and regions around the world. Among "Top 1,000 World Banks" released by The Banker magazine of the United Kingdom, China CITIC Bank ranked 67th in terms of Tier-1 capital and the 72nd in terms of total assets in 2010. Business Risks and Forward-Looking Statements This press release contains forward-looking statements that are subject to the safe harbors created under the Securities Act of 1933 and the Securities Exchange Act of 1934. Readers are cautioned that actual results could differ materially from those expressed in any forward-looking statements. In addition, please refer to the risk factors contained in Kingold's SEC filings available at www.sec.gov, including Kingold's most recent Annual Report on Form 10-K and Quarterly Reports on Form 10-Q. Readers are cautioned not to place undue reliance on any forward-looking statements, which speak only as of the date on which they are made. Kingold undertakes no obligation to update or revise any forward-looking statements for any reason. Company Contact: Kingold Jewelry, Inc Bin Liu, CFOPhone: +1-847-660-3498 (US) / +86-27-6569-4977 ( China)Email: email@example.com www.kingoldjewelry.com SOURCE Kingold Jewelry, Inc.