International Mining Machinery Holdings Limited Demonstrates Significant Growth in Profitability in 1H 2010

HONG KONG, Aug. 31 /PRNewswire-Asia/ -- International Mining Machinery Holdings Limited (1683.HK) announced its 2010 interim results. Compared to the first half of 2009, its adjusted net profit surged by 93.3% to RMB220.8 million, excluding non-recurring charges related to its recent Global Offering and non-recurring income from the waiver of taxes related to periods prior to the formation of the Company. Additionally, its revenue increased by 24.6% over the prior year to RMB926.2 million for the six months ended 30 June 2010. Gross profit surged by 41.7% to RMB395.8 million and its gross margin recorded an impressive growth of 5.1 points year-on-year to 42.7%.

The Company's results were a direct result of its successful expansion strategy, better product and pricing mix, continuous and vigorous cost control, enhanced efficiency and improved supply chain management. During the first six months of 2010 the demand for the Company's products remained strong. The sales of roadheaders increased 41.7% compared to the same period last year, accounting for 63.1% of the total revenue.

Looking ahead, it is evident that IMM will benefit tremendously from the Chinese government's initiatives for the industry -- which also drive our continued confidence in the long-term fundamentals of the coal and mining machinery industries. We believe that the current industry and regulatory environment requiring our customers to increase the output and percentage of mechanization in their mines will further drive the need for our machinery and services and significantly contribute to our growth. The consolidation of mainland China's coal mining industry will bode well for IMM, since most of our existing customers are likely to be the beneficiaries of the industry consolidation currently in progress.