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China Electronics Holdings, Inc. (CEHD.OB) Reports Excellent Financials

China Electronics, – one of central China’s biggest rural retailers of consumer electronics and household appliances, today reported outstanding financial results for the first six months of 2010.

Six-month (ending June 30 – comparisons based on the same interval from 2009):

• Earnings up 441% to $9.35M
• Revenues up 382% to $55.79M or an amazing 117% of revenues for all of 2009
• Stockholders’ Equity up 472% to $28.3M ($6M in 2009)
• Profits earned equal to 96% of all profits for 2009

Quarter 2

• Earnings of $5.1M or $0.34 per Share
• Revenue up 566% to $29.1M

For FY09 (ended Dec. 31) after-tax net income was $9.7M on $47.7M in revenues.

With a network of some 1,015 stores (600 franchise, 412 direct, and 3 company-owned) via its PRC subsidiary, Lu’an Guoying Electronic Sales Co., Ltd., CEHD has rapidly assumed a dominant role in the largely untapped rural markets of the PRC where rising income and demand are ideal.

Chairman and Founder of CEHD, Hailong Liu, explained that the addition of 217 new stores in Q2 compared with 2009, new products from SONY, LG and THTF going onto the shelves in 2010, and the improved economic climate in the PRC all contributed to the success.

Guoying has wholesale exclusivity in the Lu’an area for Sony, LG and Samsung, as well as Chigo, Huayang, Huangming and Shanghai Shangling brands, and is also the general sales agency for Sanyo air conditioners, microwave ovens, TVs and washing machines.

Guoying has even teamed up with Huangming and Huayang, China’s top 2 solar thermal manufacturers, to become their exclusive retailer in Anhui Province.

Refrigerators produced by CEHD under the Guoying brand are widely known and show a strong growth curve as the Company moved 30k units in 2007, 46k and 62k in the following years, and projects some 77k units being sold this year, increasing again to 100k in 2011.

All of this constitutes a very strong hand for CEHD in Anhui, Henan and Hubei Provinces with abundant growth potential due to underserved demand.

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