China Keli Electric Announces Over 500% Year-over-Year Growth in Net Profit and 11.2% Growth in Revenues for Q1 2012

VANCOUVER, Nov. 1, 2011 /CNW/ - China Keli Electric Co., Ltd. (TSX-V: ZKL) ("Keli" or the "Company") announced the financial and operating results for the three months ended July 31, 2011.

For the three months ended July 31, 2011 ("Q1 2012"), reported total revenue was $4,054,351, an increase of 11.2% over $3,646,698 for Q1 2011, with gross profit $1,644,802, consistent with $1,645,102 for Q1 2011. The Company incurred operating expenses for Q1 2012 of $1,170,220 ($1,360,627 for Q1 2011). The decrease was mainly caused by the decline in stock-based compensation expense. The Company recognized stock-based compensation expenses of $93,004 for Q1 2012 ($359,723 for Q1 2011). As a result, the Company recorded a net profit of $380,872 for Q1 2012, up 517.9% over Q1 2011 (net profit of $61,641 for Q1 2011) and the basic and diluted earnings per share ("EPS") were $0.004 ($0.001 for Q1 2011). Increased net profit and EPS were due primarily to the increase of revenue and the decrease of operating expenses. Excluding stock-based compensation expenses, the Company would record a net profit of $473,876 for Q1 2012. After accounting for an unrealized foreign exchange translation gain of $223,696, the Company ended Q1 2012 with a total comprehensive income of $604,568, compared with a total comprehensive income of $305,549 for Q1 2011. The Company's unrealized foreign exchange income on translation of the Group's functional currency to its reporting currency is subject to fluctuations in the exchange rate between the RMB and the Canadian dollar in each reporting period.

"We've had a very good start for fiscal year 2012", said Lou Meng Cheong, Keli's CEO, "We tightened our belt on the administrative side of the company and worked hard to deliver improved financial results for shareholders. In addition, our investment of time, money and energy in the prior year contributed to stronger financial and operating results for Q1 2012. We look forward to continuing this positive trend in our performance, and hope our investors will share our enthusiasm for our company and our progress".

As of July 31, 2011, the Company had total cash and cash equivalents of $1,114,637 compared with $1,717,377 as of April 30, 2011. Accounts receivable were $10,109,734 as at July 31, 2011, an increase of $1,460,963 compared with $8,648,771 as at April 30, 2011. The Company's working capital was $8,138,910 as at July 31, 2011, decreased from $8,537,972 as at April 30, 2011.

The functional currency of the Company and its subsidiaries is Chinese Yuan (also known as "Renminbi" or "RMB"). The financial and operating results of the relevant periods have been translated into Canadian dollars. Depending on the magnitude of changes in foreign currency exchange rates, the impact on the financial and operating results may or may not be material.

Full financial results of the Company for the three months ended July 31, 2011 are available on SEDAR at www.sedar.com.

About China Keli Electric Company Ltd.

China Keli Electric Company Ltd. specializes in the manufacturing of electrical components and equipment, including pre-assembled mini substations, electrical controllers, pressurized and vacuumed switchgears and circuit breakers.

Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this press release.

This press release contains forward-looking statements based on current expectations. These forward-looking statements entail various risks and uncertainties that could cause actual results to differ materially from those reflected in these forward-looking statements. Risks and uncertainties about Keli's business are more fully discussed in the Company's disclosure materials filed with the securities regulatory authorities in Canada. All amounts are stated in Canadian dollars unless noted otherwise.

SOURCE China Keli Electric Company Ltd.

For further information:

CHINA KELI ELECTRIC COMPANY LTD.

Michael Raymont, EVP Finance and Corporate Development
Tel. No.: (403) 389-3488
Email: mraymont@zkl.cc

Scott Koyich, President, Brisco Capital Partners
Tel. No.: (403) 262-9888
Email: skoyich@briscocapital.com 

For further company information please access our website: www.zkl.cc

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China Keli Electric Company Ltd.

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