Boyuan Reports Second Quarter FY2015 Financial Results

-  Initiated five new projects for a total value of $102.2 million -

TORONTO, Feb. 11, 2015 /CNW/ - Boyuan Construction Group, Inc., (TSX: BOY, BOY.DB.A) a growing construction company in China of commercial, residential and municipal infrastructure projects, today reported its financial results for the three-month and six-month periods ended December 31, 2014. All figures are in U.S. dollars unless otherwise stated.

Selected Fiscal Year Financial Highlights

In thousands except share and % data

Q2 2015

Q2 2014






Gross profit




Gross profit margin







Net income




Earnings per share - diluted




December 31, 2014

June 30, 2014

Total Assets




Cash, cash equivalents and restricted cash




"Our success in the second quarter of 2015 can be attributed to our focus and discipline to expand within our core markets. With our continued strength in operational and financial performance, we are committed to explore opportunities to further grow our Company." said Mr. Cailiang Shou, Chairman of Boyuan Construction Group.  

Q2 2015 Operational and Financial Highlights

  • Revenue of $76.3 million, up 23% from $62 million for Q2 FY2014
  • EBITDA of $9.1 million, up 17.8% from $7.8 million for Q2 FY2014
  • Net income of $4.7 million, or $0.16 per diluted share for Q2 FY2015, up from $3.6 million, or $0.13 per diluted share, for Q2 FY2014
  • Initiated two projects on Hainan Island. These projects include residential developments for a total value of $22.1 million.
  • Initiated three projects for a total value of $80.1 million which comprise two residential developments and one commercial development located in the Zhejiang province of mainland China.

Review of Financial Results
Revenue for the three-month period ended December 31, 2014 was $76.3 million, up 23% from the corresponding period in FY2014.  Revenue for the first six months of FY2015 was $144.1 million, up 30% from $111 million for the same period of FY2014.  Boyuan recognizes revenue on the percentage-of-completion method.

Cost of construction for Q2 FY2015 was $65.8 million, an increase of 24% from $52.9 million for Q2 FY2014. Expenses were higher as a result of increased project volume during the period which led to an increase in costs for Q2 FY2015 compared with Q2 FY2014. Cost of construction includes all direct material, labour, subcontract and other related costs, such as equipment repairs. The two major components of the cost of construction are direct material and labour costs. Direct material costs for Q2 FY2015 were $43.3 million and labour costs were $19.8 million, compared to direct material costs and labour costs of $37.8 million and $13.2 million for Q2 FY2014.

Gross profit for Q2 FY2015 was $10.5 million, which represented a margin of 13.8% on revenue, compared to gross profit for Q2 FY2014 of $9 million, which represented a margin of 14.6% on revenue. Boyuan has experienced a slight downward pressure on margins resulting from the market conditions in China. Developers are more price sensitive with longer development cycles, which results in some erosion of the Company's historical margins.

G&A expenses were $1.32 million for Q2 FY2015 in line with $1.39 million for Q2 FY2014. Interest expense was $1.84 million for the second quarter of FY2015, also in line with the interest expense of $1.80 for the same period last year.

After-tax net income for Q2 FY2015 was 4.7 million, or $0.16 per fully diluted share, compared to net income of $3.6 million, or $0.13 per fully diluted share, in Q2 FY2014.

The Company had working capital of $99.1 million, including cash, cash equivalents, and restricted cash totaling $10.3 million as at December 31, 2014. This compares to $87.9 million and $13.3 million respectively at June 30, 2014. The increase in working capital is mainly due to the increase in unbilled revenue in the period.


"As the real estate market in China has demonstrated signs of tepid improvement, we remained focus on the opportunities in our core markets of Yangtze River Delta, Shadong Province and Hainan Island. Boyuan's presence and core capabilities in construction services will remain to meet the demands as growth in the middle class continues. In the longer term, we look to further expand and strengthen our capabilities to secure higher margin specialty construction projects," added Mr. Shou.

Boyuan's consolidated statements for the three-month and six-month periods ended December 31, 2014 and related management's discussion and analysis (MD&A) will be filed with securities regulatory authorities within applicable timelines and will be available via SEDAR at

Conference Call Notice
The Company will hold a conference call to discuss its second quarter 2015 financial results on Thursday, February 12, 2015 at 9:30 a.m. ET. Mr. Paul Law, Boyuan's Chief Financial Officer, will host the call.

All interested parties can join the call by dialing 647-427-7450 or 1-888-231-8191. Please dial in 15 minutes prior to the call to secure a line.

The conference call will be archived for replay until Thursday, February 19, 2015 at midnight. To access the archived conference call, please dial 1-855-859-2056 or 416-849-0833 and enter the reservation number 80688508#.

About Boyuan Construction Group, Inc.
Based in Jiaxing City, China, Boyuan Construction Group, Inc. is in the business of commercial building and residential construction, municipal infrastructure and engineering projects. In its last three fiscal years ending June 30, 2014, Boyuan completed 45 projects for a number of private and public sector clients.  Boyuan's current project backlog includes residential, commercial, industrial and mixed-use developments.  From its operating bases in Zhejiang Province and in Hainan Province, Boyuan focuses on construction projects in China's fast-growing regions of the Yangtze River Delta, Hainan Province and Shandong Province. For more information visit

Caution Regarding Forward-Looking Information:
Certain information contained in this press release constitutes forward-looking information, which is information relating to future events or the Company's future performance and which is inherently uncertain.  Forward-looking information involves known and unknown risks, uncertainties and other factors that may cause actual results or events to differ materially from those anticipated in such forward-looking information.  The Company believes the expectations reflected in the forward-looking information are reasonable but no assurance can be given that these expectations will prove to be correct and readers are cautioned not to place undue reliance on forward-looking information contained in this press release.  Some of the risks and other factors which could cause results to differ materially from those expressed in the forward-looking information contained in this press release have been identified in the Company's AIF for the fiscal year ended June 30, 2014 and in the Company's other public disclosure documents filed with certain Canadian securities regulatory authorities and available at  The forward-looking information contained in this press release is made as of the date hereof and the Company undertakes no obligation to update publicly or revise any forward-looking information, whether as a result of new information, future events or otherwise, except as otherwise required by law.

1 EBITDA is defined as earnings before interest, income taxes, depreciation and amortization. EBITDA is not a defined performance measure under IFRS.

SOURCE Boyuan Construction Group, Inc.

For further information: Boyuan Construction Group, Inc.: Mr. Paul Law, CFO, +(852) 9329 5088,; TMX Equicom: Ms. Renee Lam, (416) 815-0700 ext. 258,

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