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 Tracking 1239 U.S. listed China Stocks and Counting...
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 China Tmk Battery Systems (PINK:DFEL)

Wednesday, January 4, 2012
Investor Alert
SHENZHEN, China, Jan. 3, 2012 /PRNewswire-Asia-FirstCall/ -- China TMK Battery Systems Inc. (OTC Bulletin Board: DFEL) ("TMK" or "the Company") (formerly, Deerfield Resources, Ltd.), a Chinese manufacturer and distributor of customized rechargeable battery solutions to global consumer product companies, today announced that on December 30, 2011, it filed a Certification and Notice of Suspension of Duty to File Reports with the Securities and Exchange Commission (the "SEC") in order to reduce substantial legal and accounting expenses. The Company was eligible to deregister its common shares because it had fewer than 300 holders of record of its common shares at the beginning of its fiscal year. The Board of Directors is in the process of evaluating strategic alternatives for the Company including a sale, merger, privatization, or other business combination, however, the Company has not set a timetable for completion of this evaluation process and there can be no assurances that this review will result in any action. The Company does not expect to make any further comments unless the Board of Directors has approved a specific course of action or otherwise deems disclosure appropriate. "We believe our company has a bright future ahead," explained Mr. Henian Wu, Chairman and President of the Company. "Since we became a public company in February 2010, our revenues have increased from $48.6 million in 2009 to an estimated $84 million in 2011, significantly faster than the industry. Despite this strong performance and ongoing efforts to strengthen our competitive position, our stock continues to trade at a depressed valuation. We expect that the Company will have attractive options to consider. In the meantime, our Management team will continue to focus on executing our business plan and serving our customers." The Company's Form 15 filing on December 30, 2011 immediately suspended the Company's obligation to file certain reports with the SEC, including Forms 10-K, 10-Q and 8-K, however, the Company's common stock will continue to be quoted on the OTCQB and eligible shareholders may continue to avail themselves of legend removal under Rule 144 until the deregistration becomes effective. The Company expects that the deregistration of its common stock will become effective on or before March 31, 2012. Following deregistration, the Company's common shares will only be quoted on the OTC Pink Sheets and its shareholders may no longer avail themselves of Rule 144.

Tuesday, January 3, 2012
Going Private News

SHENZHEN, China, January 3, 2012 /PRNewswire-Asia-FirstCall/ -- China TMK Battery Systems Inc. (OTC Bulletin Board: DFEL) ("TMK" or "the Company") (formerly, Deerfield Resources, Ltd.), a Chinese manufacturer and distributor of customized rechargeable battery solutions to global consumer product companies, today announced that on December 30, 2011, it filed a Certification and Notice of Suspension of Duty to File Reports with the Securities and Exchange Commission (the "SEC") in order to reduce substantial legal and accounting expenses. The Company was eligible to deregister its common shares because it had fewer than 300 holders of record of its common shares at the beginning of its fiscal year.

The Board of Directors is in the process of evaluating strategic alternatives for the Company including a sale, merger, privatization, or other business combination, however, the Company has not set a timetable for completion of this evaluation process and there can be no assurances that this review will result in any action. The Company does not expect to make any further comments unless the Board of Directors has approved a specific course of action or otherwise deems disclosure appropriate.

"We believe our company has a bright future ahead," explained Mr. Henian Wu, Chairman and President of the Company. "Since we became a public company in February 2010, our revenues have increased from $48.6 million in 2009 to an estimated $84 million in 2011, significantly faster than the industry. Despite this strong performance and ongoing efforts to strengthen our competitive position, our stock continues to trade at a depressed valuation. We expect that the Company will have attractive options to consider. In the meantime, our Management team will continue to focus on executing our business plan and serving our customers."


Thursday, December 29, 2011
Financial Target Agreements

SHENZHEN, China, December 29, 2011 /PRNewswire-Asia-FirstCall/ -- China TMK Battery Systems Inc. (OTC Bulletin Board: DFEL) ("TMK" or "the Company") (formerly, Deerfield Resources, Ltd.), a Chinese manufacturer and distributor of customized rechargeable battery solutions to global consumer product companies, today announced it has delivered payment to all eligible investors for the make good provision as stipulated in its registration rights agreement ("the Agreement") dated February 10, 2010.

TMK has wired the penalty funds to Escrow and Agent Service Co., LLC and will be distributed by check to each Investor's address of record. TMK would like to inform all eligible investors that if they have not received their payment, they may contact Johnnie Zarecor by phone at 540-347-2212 or by email at


Monday, November 21, 2011
Comments & Business Outlook

Third Quarter 2011 Results

  • For the third quarter of 2011, revenues increased 54% to $24.4 million due primarily due to an increase of new customers, increased demand from existing customers, supported by increased production.
  • Income from operations was $4.1 million for the third quarter of 2011, up 35% from $3.0 million from the prior year's period and operating margins were 16.2% compared to 18.5% in 2010.
  • Net income for TMK in the third quarter of 2011 was approximately $3.7 million, up from $3.1 million in the same period last year. Adjusted net income for the quarter was $3.1 million, up 28% from $2.4 million in 2010. Excluding changes in the fair value of derivative liabilities, adjusted diluted earnings per share were $0.08 and $0.07 in the third quarter of 2011 and 2010, respectively, based on 36.9 million and 36.9 million weighted average shares outstanding.

"During our third quarter of 2011 we continued to see solid revenue growth across our battery product lines," said Henian Wu, Chairman and President of TMK. "The demand for batteries to power consumer electronics, household products, and power tools in both China and globally continues to escalate. Our recent capacity expansion enables us to meet this robust demand while continuing to increase market share. We are also working closely with government to get approval on our acquisition of lithium battery producer Dongfang Hualian, which will expand our product line and enter a multi-billion dollar, rapidly growing global market."

Guidance

For the full year ending December 31, 2011, management reaffirms revenue guidance of $84 million and net income of $11 million. Guidance does not include contribution from proposed acquisition of Dongfang Hualian.


Tuesday, August 16, 2011
Comments & Business Outlook

Second Quarter 2011 Results (USD) (unaudited)


 

Three months ended June 30

2011

2010

CHANGE


 

Sales

$25.1 million

$16.8 million

+50%


 

Gross Profit

$5.8 million

$3.4 million

+71%


 

Net Income

$3.7 million

$2.3 million

+62%


 

Adjusted Net Income(1)

$3.5 million

$1.2 million

+190%


 

EPS

$0.10

$0.06

+67%


 

Adjusted EPS(1)

$0.10

$0.03

+188%


 

(1) Please see non-GAAP reconciliation below.


 





 
         

Second Quarter ended June 30, 2011

"We delivered solid growth during our second quarter of 2011 which was driven by balanced demand across each of our product lines," stated Henian Wu, Chairman and President of TMK. "Increased production and sales of consumer electronics, household products, and power tools in China and globally is driving demand for rechargeable batteries. Our capacity expansion has enabled us to meet incremental customer demand and capture additional market share. The Hualian acquisition will enable us to capitalize on the rapid growth in the Lithium ion battery market, and additionally expand our diverse product line."

For the second quarter of 2011, revenues increased 50% to $25.1 million due primarily due to an increase of new customers, increased demand from existing customers, supported by increased production. Total cost of sales increased by 44% to $19.3 million for the second quarter of 2011, compared to the same period in 2010. Gross profit increased 71% to $5.8 million with gross margin of 23.1% in the second quarter, compared to $3.4 million and gross margin of 20.2% in 2010.

Operating expenses for the second quarter of 2011 were approximately $1.2 million in comparison to $1.7 million in the second quarter of 2010. Selling expenses decreased 8% to $0.5 million. The major reason was that the company had a one-time welfare paid to employees, excluding management level, as a consideration of their efforts to the Company's going public activity in second quarter of 2010.

Income from operations was $4.5 million for the second quarter of 2011, up 169% from $1.7 million from the prior year's period and operating margins were 18.1% compared to 10.1% in 2010.

Net income for TMK in the second quarter of 2011 was approximately $3.7 million, up from $2.5 million in the same period last year. Adjusted net income for the quarter was $3.5 million, up 190% from $1.2 million in 2010. Excluding changes in the fair value of derivative liabilities, adjusted diluted earnings per share were $0.10 and $0.03 in the second quarter of 2011 and 2010, respectively, based on 36.9 million and 36.6 million weighted average shares outstanding.

Six Months ended June 30, 2011

Six Months 2011 Results (USD) (unaudited)


 

Six months ended June 30

2011

2010

CHANGE


 

Sales

$45.4 million

$30.0 million

+51%


 

Gross Profit

$10.6 million

$6.5 million

+63%


 

Net Income

$7.1 million

$0.8 million

+779%


 

Adjusted Net Income(1)

$6.5 million

$3.0 million

+113%


 

EPS

$0.19

$0.02

+690%


 

Adjusted EPS(1)

$0.18

$0.09

+96%


 

(1) Please see non-GAAP reconciliation below.

Business Update

On August 16th, TMK announced it completed a share purchase agreement with Loyal Top Capital Investment Limited ("Loyal Top") on August 13 for the purchase of Shenzhen Dongfang Hualian Technology Co., Ltd. ("Dongfang Hualian"), a lithium battery producer which design, manufacture and sell lithium ion batteries. Under the terms of the purchase agreement, the Company will acquire 100% equity interest in Dongfang Hualian in exchange for a cash payment of approximately $11 million and 8.1 million shares of the Company's common stock. The audited financial statements reported that Dongfang Hualian generated approximately $41 million in revenue and approximately $5.5 million in net income during 2010. With a state-of-the-art production facility built in 2008 and 20 patents related to lithium ion battery technologies, Hualian provides TMK with an entry into a multi-billion dollar, rapidly growing global market opportunity.

Separately, On May 28, 2011 and June 20, 2011, the Company signed separate purchase agreements with China Development Industrial Bank and ZTE Energy Co., Ltd., respectively, for the two investors to purchase an aggregate of 8,000,000 shares of the Company's preferred stock convertible at $2 per share.

In the fourth quarter of 2011, TMK expects to commence road testing for its hybrid electric vehicle (HEV) battery pack which will center on both safety and functionality. It is estimated that growth in HEV batteries will be one of the major contributors to increased Ni-MH consumption and TMK is focused on participating in this opportunity.


Tuesday, May 17, 2011
Comments & Business Outlook

FirstQuarter 2011 Results (USD) (unaudited)

 

 

Three months ended December 31            

 

2011

 

2010

 

CHANGE

 

 

Sales

 

$20.3 million

 

$13.3 million

 

+53%

 

 

Gross Profit

 

$4.9 million

 

$3.2 million

 

+54%

 

 

Net Income

 

$3.4 million

 

($1.5) million

 

N/A

 

 

Adjusted Net Income(1)

 

$3.0 million

 

$1.8 million

 

+63%

 

 

EPS

 

$0.09

 

($0.05)

 

N/A

 

 

Adjusted EPS(1)

 

$0.08

 

$0.06

 

33%

 

Business Review

In January 4, 2010 the Company entered into a Memorandum of Understanding (MOU) with Shenzhen DongFang Hualian Technology Ltd. ("Hualian"). Hualian is a leading manufacturer of lithium ion batteries used in consumer electronics products such as PCs and mobile devices. The Company paid a $9.4 million deposit during 2010 and a $0.9 million deposit in the first quarter of 2011, which are fully refundable if Hualian does not meet the Company's financial and operating criteria. The Company has completed its due diligence of Hualian's operations, while an audit of the financials by a PCAOB certified firm were also completed. Management is working through the final contract and expects to complete the acquisition by the end of May 2011.

The Company shipped to US based Alexis Power Supply, Inc. its first order of rechargeable Ni-MH battery packs used in telecommunications infrastructure applications and expects to increase sales in the next few months. The market opportunity to replace existing battery technology for back-up power is significant as Alexis Power expands its sales and marketing efforts.

In the third quarter of 2010, TMK successfully developed a working prototype of a hybrid electric vehicle (HEV) battery pack and expects to commence road testing in the second half year of 2011, which will center on both safety and functionality. It is estimated that growth in HEV batteries will be one of the major contributors to increased Ni-MH consumption and TMK is focused on participating in this opportunity.

- Provides full year 2011 guidance: above $80 million revenues and over $10 million adjusted net income


Sunday, April 3, 2011
Liquidity Requirements
We believe that our cash on hand and cash flow from operations will meet part of our present cash needs and we will require additional cash resources, including loans, to meet our expected capital expenditure and working capital for the next 12 months.

Friday, April 1, 2011
Comments & Business Outlook

Fourth Quarter Results:

  • For the fourth quarter of 2010, revenues increased 38.8% to $19.9 million
  • Net income for the Company in the fourth quarter of 2010 was approximately $2.4 million, an increase of 1.6% from the previous year.
  • Diluted net income per share for the fourth quarter of 2010 was $0.07, based on 36.9 million weighted average shares outstanding, as compared to diluted net income per share of $0.09 for the fourth quarter of 2009

Full Year 2010 Results (USD) (unaudited)

 

 

12 months ended December 31

 

2010

 

2009

 

CHANGE

 

 

Sales

 

$66.4 million

 

$48.6 million

 

+36.6%

 

 

Gross Profit

 

$15.3 million

 

$12.1 million

 

+26.4%

 

 

GAAP Net Income

 

$6.3 million

 

$7.5 million

 

-15.6%

 

 

Adjusted Net Income

 

$9.9million(1)

 

$7.5 million

 

+29.7%

 

 

GAAP Net Income Per Share

 

$0.18

 

$0.30

 

-39.3%

 

 

Adjusted Net Income Per Share

 

$0.28(1)

 

$0.30

 

-8.3%

 

 

(1) Adjusted net income and adjusted net income per share for the 2010 fiscal year excludes approximately $1.8 million in one-time merger costs incurred in the first quarter of 2010, one-time bonus payments of $1.5 million, and a $0.4 million charge related to a registration right penalty.

"2010 was a fruitful year for TMK," remarked Henian Wu, the Company's Chairman and President. "We are becoming an emerging player in the $5 billion global Ni-MH battery market, which we believe is expanding due to strong demand for rechargeable consumer devices. With greater production capacity, an expanded R&D team focused on new product introductions and an enhanced sales and marketing staff, we are well positioned to benefit from both domestic and global demand."


Wednesday, February 23, 2011
Comments & Business Outlook

SHENZHEN, China, Feb. 23, 2011 /PRNewswire-Asia-FirstCall/ -- China TMK Battery Systems Inc. today announced it has received and delivered an initial order from a Fortune 500 multinational electronics and defense manufacturer based in the U.S. for 26,150 nickel metal hydride (NI-MH) battery packs to be used in water pump applications.

"We are pleased that our product has met this customer's rigorous testing standards, and that our batteries will be used in water system applications for products sold to multiple countries," stated Henian Wu, Chairman and President of the Company. "We believe that this sale represents a new market opportunity for TMK and as we strive to market our innovative battery solutions to a broader range of customers."


Wednesday, August 18, 2010
Comments & Business Outlook

Second Quarter ended June 30, 2010:

  • For the second quarter of 2010, revenues increased 47.3% to $16.8 million, from $11.4 million in the second quarter of 2009. The increase was primarily due to rising demand for TMK's products, from both existing and new customers resulting from the Company's expanded sales and marketing efforts. 
  • GAAP Net income for the Company in the second quarter of 2010 was approximately $2.3 million, an increase of $0.5 million, or 28.9%, from $1.8 million in the equivalent quarter last year.
  • GAAP diluted earnings per share for the second quarter of 2010 was $0.06 based on 36.5 million weighted average shares outstanding, as compared to diluted earnings per share of $.07 for the second quarter of 2009, based on 25.3 million weighted average shares outstanding.
  • Excluding non-cash items, adjusted net income for the second quarter of 2010 and 2009 was $2.5 million and $1.8 million, respectively, with corresponding adjusted earnings per share of $0.07 and $0.07 based on 36.6 million and 25.2 million diluted shares, respectively.

"We continued our strong growth in the second quarter, with increasing demand for consumer products which utilize environmentally friendly rechargeable batteries, and our push into new end markets," stated Henian Wu, Chairman and President of the Company. "The quarter marked a major milestone in our strategy to become a premier supplier of Nickel Metal Hydride (Ni-MH) based backup power systems by signing a 5-year exclusive distribution agreement with Nevada-based Alexis Power Supply, Inc. We have recently commenced the commercial production of proprietary, rechargeable Ni-MH 'intelligent battery' packs, which will be used as back-up power supply sources for multiple industrial applications including telecommunications, solar, railroad and traffic control systems. Our first shipment will land in October and Alexis will market and distribute our products in the US and internationally. We are currently doubling our production capacity to accommodate customer orders and to increase market share in 2010."


Thursday, May 27, 2010
Reverse Merger Activity

on On February 10, 2010 TMK Battery Systems became a public entity via a reverse merger transaction.

TMK also  completed a private placement transaction with a group of accredited investors. Pursuant to a subscription agreement with the investors we issued to the investors:

  • 5,486,000 shares of our common stock for an aggregate purchase price of $6,857,500, or $1.25 per share.
  • Warrants to purchase up to 2,743,000 shares of our common stock. The Warrants have a term of 5 years, bear an exercise price of $1.60 per share.  Assuming that the Warrants issued in the transaction are exercised, the securities issued represented approximately 21.90% of our issued and outstanding capital stock as of and immediately after closing date.

Company Snapshot:

Designs, develops, manufacture and sell environmentally-friendly nickel-metal hydride cell, or Ni-MH, rechargeable batteries

Industry Snapshot:

  • A battery is a portable electrochemical system that releases stored electrical energy. The battery industry has experienced significant growth in recent years as a result of increased global demand for portable electronic applications. The higher power requirements, small size, and high-rate discharge of these devices have also driven steady progress in battery technology.
  • The battery industry can be broadly divided into non-rechargeable (or primary) and rechargeable (or secondary) segments. Rechargeable batteries have increased their share of the overall battery market as they have become more cost and time efficient for use over sustained periods. They also help address environmental concerns over disposal of non-rechargeable batteries.
  • The four mainstream chemistries currently used in rechargeable batteries for portable electronics are nickel cadmium, nickel metal hydride, lithium-ion, and lithium polymer.
  • End-product applications which are driving the demand for Ni-MH rechargeable batteries include personal portable electronic devices, vacuum cleaners and other household electrical appliances, power tools, medical devices, electric bicycles and battery-operated toys. We also expect interest in electric vehicles and hybrid electric vehicles to increase demand for Ni-MH rechargeable batteries substantially.

Post Merger Share Calculation:

  • 32,600,000: Pre reverse merger outstanding shares
  • 272,250,000: Shares cancelled as part of the Share Exchange
  • 25,250,000: Newly issued shares of Common Stock
  • 5,486,000: Shares from convertible notes associated with private placement
  • 2,743,000: Shares from warrants associated with private placement

GeoTeam® best effort calculation of total post reverse merger shares assuming full conversions:  27,912,500

Financial Snapshot: See financial tab.