EXHIBIT 99.1
Orsus Xelent Technologies Reports Third Quarter 2006 Results
Conference call scheduled Thursday, November 16, 2006 at 9:30am EST
US caller dial-in number: 1-866-365-4409
International caller dial-in number: 1-303-248-9656
Caller access code: 3478399
NEW YORK, NY-- --November 15, 2006 -- Orsus Xelent Technologies, Inc. (OTC BB:
ORXT), an emerging designer and manufacturer of award-winning mobile phones for
the Asian market, reported today the Company's financial results for the quarter
ended September 30, 2006.
Revenues were $45.9 million for the nine months ended September 30, 2006,
representing a sharp increase of 176.45% as compared to the same period in 2005.
Revenues for the three months ended September 30, 2006 were $20.5 million,
representing a 55.92% increase over the same period in 2005. After experiencing
reform in the cellular phone market in the first half of 2005, the Company
adjusted its business model, market position and strategy, improved its
technology, and the quality of its products. The Company believes that because
of these efforts it is better prepared to take advantage of a rejuvenated
cellular phone market in the Public's Republic of China.
For the nine months ended September 30, 2006, gross profit was $8.2 million,
which represents an increase of $5.3 million or 158.39% as compared to the gross
profit of $3.3 million for the same period in 2005. The gross profit in the
third quarter of 2006 was $3.8 million representing 6.33% growth over the second
quarter of 2006 and a slight decline of 0.40%, as compared with the third
quarter of 2005.
Net income for the nine months ended September 30, 2006 was $4,647,000, or
10.12% of revenue, which represents a 223% increase compared to the same period
in 2005. Net income for the three months ended September 30, 2006 was
$2,366,000, which represents 51% of total net profit for the first nine months
of 2006. The net income for the third quarter 2006 represents an increase of
20.84%, compared to the same period in 2005. The substantial increase in net
profit is due to the Company's adjustment of its marketing strategy and
improvements in the cellular phones market in this quarter.
"This was a very robust quarter for us. Our CDMA product revenues were up
considerably and our new marketing strategy produced superb results. We continue
to be optimistic in our profit expectations for the third quarter," said Xavier
Xin Wang, President and CEO of Orsus Xelent.
The Company has scheduled a conference call for Thursday, November 16, 2006 at
9:30am Eastern Standard Time. Dial-in numbers are as follows:
U.S. callers: 1-866-365-4409
International callers: 303-248-9656
Pass code: 3478399
About Orsus Xelent Technologies
Incorporated in the state of Delaware and headquartered in Beijing, China, Orsus
Xelent Technologies, Inc. is an emerging designer and manufacturer of
award-winning mobile phones for the Asian market, primarily the People's
Republic of China (PRC). The company's business comprises the design of mobile
phones, related digital circuits, and software development, and is a recognized
pioneer in mobile phone integration technology. It introduced the region's first
wristwatch-style cellular phone, and it continues to break new ground with
state-of-the-art phones that include advanced features like finger print
recognition and touch-screen displays. Since the company's launch in 2004, it
has established "Orsus" as a popular brand and achieved a significant share of
the world's largest mobile phone market. It maintains more than 179 service call
centers across the PRC, with additional offices in New York, Shanghai, Hong
Kong, Shenzhen, and Tianjin. For more information, please visit:
www.orsus-xelent.com.
Information Regarding Forward-Looking Statements
Except for historical information contained herein, the statements in this Press
Release are forward-looking statements that are made pursuant to the safe harbor
provisions of the Private Securities Litigation Reform Act of 1995.
Forward-looking statements involve known and unknown risks and uncertainties,
which may cause our actual results in future periods to differ materially from
forecasted results. These risks and uncertainties include, among other things,
product demand, market competition, and risks inherent in our operations. These
and other risks are described in our filings with the Securities and Exchange
Commission.
Orsus Xelent Technologies, Inc.
Condensed Consolidated Statements of Operations
(Unaudited) (Unaudited)
Three months ended Nine months ended
September 30, September 30,
-------------------------- --------------------------
2006 2005 2006 2005
US$'000 US$'000 US$'000 US$'000
Operating revenues: 20,525 13,164 45,901 16,604
----------- ----------- ----------- -----------
Operating expenses:
Cost of sales 16,716 10,358 37,879 13,257
Sales and marketing 140 430 926 1,131
General and administrative 1,194 200 1,883 769
Research and development 40 195 187 337
Depreciation 24 89 149 164
----------- ----------- ----------- -----------
Total operating expenses 18,114 11,272 41,024 15,658
----------- ----------- ----------- -----------
Operating profit 2,411 1,892 4,877 946
Interest expense (41) -- (70) (25)
Other income, net (4) 89 1 541
----------- ----------- ----------- -----------
Income before income taxes 2,366 1,981 4,808 1,462
Income taxes -- (23) (160) (23)
----------- ----------- ----------- -----------
Net income 2,366 1,958 4,648 1,439
Other comprehensive income -- -- -- --
----------- ----------- ----------- -----------
2,366 1,958 4,648 1,439
=========== =========== =========== ===========
Earnings per share:
Basic 0.08 0.07 0.16 0.05
=========== =========== =========== ===========
Weighted average number of common stock
outstanding 29,756,000 29,756,000 29,756,000 29,756,000
=========== =========== =========== ===========
Orsus Xelent Technologies, Inc.
Condensed Consolidated Balance Sheet
As of As of
September 30, December 31,
2006 2005
US$'000 US$'000
(Unaudited)
ASSETS
Current assets
Cash and cash equivalents 88 2,974
Accounts receivable, net of allowance for doubtful accounts
of $555,000 ($149,000 in 2005) 31,527 12,034
Inventories 2,361 4,460
Trade deposits paid 3,112 10,580
Advance to third party 125 --
Other current assets 125 182
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Total current assets 37,338 30,230
Property, plant and equipment, net 782 781
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Total assets 38,120 31,011
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LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities
Short-term bank loan 2,477 --
Accounts payable - Trade 11,764 7,939
Accrued expenses and other accrued liabilities 3,474 2,238
Trade deposits received 260 5,432
Due to directors 320 320
Provision for warranty 57 122
Taxes payable 181 21
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Total current liabilities 18,533 16,072
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Commitments and contingencies
Stockholders' equity Preferred stock, US$0.001 par value:
Authorized: 100,000,000 shares, no shares issued
Common stock and paid-in capital, US$0.001 par value:
Authorized: 100,000,000 shares
Issued and outstanding: 29,756,000 shares as of September
30, 2006 and as of December 31, 2005 30 30
Additional paid-in capital 2,484 2,484
Dedicated reserves 1,042 1,042
Other comprehensive income 349 349
Retained earnings 15,682 11,034
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Total stockholders' equity 19,587 14,939
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Total liabilities and stockholders' equity 38,120 31,011
============= =============
For more information contact:
Orsus Xelent Technologies, Inc.
Xavier Xin Wang
President and CEO
US: Tel 212-719-7535
Fax 212-790-9594
PRC: Tel 010-85653777
Fax 010-85653666
RedChip Companies, Inc./Aurelius Consulting Group, Inc.
1-800-REDCHIP
(407) 644-4256
info@aurcg.com
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