Shares of China Security and Surveillance Technology, Inc. (NYSE: CSR) were up almost 13 percent from Friday’s closing price in morning trading on Monday after the company posted strong second quarter earnings thanks in part to large scale government projects, increased demand, and improved margins.
The Shenzhen-based China Security and Surveillance Technology, Inc. reported second quarter net income of $17.81 million, or 23 cents per diluted share, marking a 174 percent increase in net income and a 76.9 percent increase in diluted earnings per share. Revenues for the quarter increased 18.6 percent to $168.35 million, over the prior year.
Analysts on average were expecting earnings of 23 cents a share on revenue of $177.8 million, according to Thomson Reuters I/B/E/S.
“Our results demonstrate the great strength of CSST’s assets and our ability to execute with focus and discipline,” said Guoshen Tu, Chairman and CEO of China Security and Surveillance Technology, Inc. in a statement. “Revenues and earnings growth continue to be solid, our margin improvement is encouraging, major growth and cost initiatives are on track, and we continue to execute on large-scale government projects from safe cities and e-cities in China.”
For fiscal 2010, the company reaffirmed its earnings forecast of $1.12 a share to $1.16 a share on revenue of $830 million to $850 million.
Analysts on average are expecting earnings of $1.10 a share, on revenue of $817 million.
“Underneath the terrific industry demand for surveillance and safety products and services in China, we’re optimistic about CSST’s prospect to continue to lead the industry in China,” said Tu. “We believe our market leadership extends across the industry’s broadest portfolio of products and services in China. Our scale and reach in China will provide meaningful and sustainable competitive advantages for us to capitalize on in the years ahead. Together with our sharp focus on high-growth initiatives, we have a tremendous set of assets and an impressive record in terms of executing and delivering on targets. I am very confident in our ability to deliver strong results in 2010.”