August 17, 2010 06:00 ET

China America Holdings Reports Financial Results for the Third Quarter and First Nine Months of Fiscal 2010 Ended June 30, 2010

SHANGHAI, CHINA--(Marketwire - August 17, 2010) - China America Holdings, Inc. (OTCBB: CAAH), a holding company operating in China that owns 56% of China based subsidiary Shanghai Aohong Chemical Co., Ltd., announced today the Company's financial results for the third quarter and first nine months of fiscal 2010 ended June 30, 2010.

• Revenue Reaches $14 million in 3^rd Quarter of Fiscal 2010, Up 71.3% from the $8.2 Million Recorded in the Three Month Period Ended June 30, 2009

• Operating Income Climbs to $368,000, Up 100% from the $184,000 Recorded in the Three Month Period Ended June 30, 2009

• Net Income for the First Nine Months of Fiscal 2010 of $32,000 Compared to a Net Loss of ($682,000) For the Nine Month Period Ended June 30, 2009 

Financial Highlights

For the third quarter of fiscal 2010 total revenues reached $14.0 million, up 71.3% from the $8.2 million recorded in the third quarter of fiscal 2009. For the first nine months of fiscal 2010, we recorded revenues of $33.8 million, up 51.6% from the $22.3 million recorded for the first nine months of fiscal 2009. Sequentially, our revenue increased by 63.9% compared to our fiscal second quarter ended March 31, 2010 where revenue was $8.6 million. Gross profit reached $1.3 million in the third quarter of fiscal 2010 with operating income of $368,000 compared to gross profit of $865,000 with operating income of $184,000 recorded in the same period in fiscal 2009. We recorded a net income of $38,000 for the third quarter of fiscal 2010 compared to a net loss of ($13,000) for the same period in 2009. This resulted in EPS of $0.00 per diluted and basic share for both periods. Net income for the first nine months of fiscal 2010 was $32,000 compared to a net loss of ($682,000) for the same period in 2009.

The improvement in overall financial results in the third quarter of fiscal 2010 was largely driven by an increase in our overall average selling price of our products due to a strong demand environment causing a shortage in supplies coupled with our direct marketing efforts leading to a significant increase in exports. Our export revenues increased $1.7 million to $3.5 million for the third quarter of fiscal 2010 compared to the three months ended June 30, 2009, and increased $4.1 million to $8.4 million for the first nine months of fiscal 2010 when compared to the same period last year.

Balance Sheet

At June 30, 2010, cash was $3.3 million, up 94% from the $1.7 million in cash at September 30, 2009. At June 30, 2010 total equity increased to $9.6 million with shareholder equity rising to $4.0 million compared to total equity of $8.7 million and shareholder equity of $3.6 million at September 30, 2009.

Commenting on the third quarter, Mr. Shaoyin Wang, CEO of China America Holdings, stated, "We continue to gain sales momentum through the first nine months of fiscal 2010. Our aggressive pricing strategy in the past quarters has expanded our customer base and along with our direct export sales efforts has yielded strong operational performance. This has enabled our company to reach a net profit for the first nine months of this fiscal year. Additionally, the first phase of the Tianjin facility is now contributing to our performance which should accelerate our growth in the coming quarters. Our export efforts come at a time when the global refrigerant market is becoming increasingly stronger and prices in China have improved significantly as the PRC begins its mandated transition into more environmentally friendly products. We are excited to continue our business expansion and look forward to a stronger performance in the coming quarters as we see business trends remaining favorable."

About China America Holdings, Inc.

China America Holdings, Inc. is a holding company which owns a 56% stake in Shanghai Aohong Chemical Co., Ltd. based in Shanghai, China. Shanghai Aohong Chemical Co., Ltd. is a distributor of assorted liquid coolants which are utilized in a variety of applications, primarily as refrigerants in air conditioning systems for automobiles, residential and commercial air conditioning systems, and a manufacturer of steel non-refillable cylinders. For more information, please visit http://www.caah.us.

CHINA AMERICA HOLDINGS, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
		June 30, 2010				September 30, 2009
ASSETS		Unaudited
CURRENT ASSETS:
Cash and cash equivalents		$	3,312,067			$	1,721,231
Accounts receivable, net			4,186,056				2,782,814
Notes receivable			80,817				829,890
Inventory			3,647,027				2,165,567
Taxes receivable			-				43,137
Prepaid expense and other current assets			1,026,310				159,083
Total current assets			12,252,277				7,701,722
LONG-TERM ASSETS:
Restricted cash			3,071,184				877,501
Property and equipment, net			6,559,083				4,442,662
Land use right, net			819,424				828,654
Other assets			29,375				29,250
Total other assets			10,479,066				6,178,067
Total assets		$	22,731,343			$	13,879,789
LIABILITIES AND EQUITY
CURRENT LIABILITIES:
Notes payable		$	7,426,071			$	3,036,290
Notes payable -- related party			494,000				400,000
Accounts payable and accrued expenses			2,942,870				893,391
Advances from customers			1,141,962				199,905
Taxes payables			637,804				458,570
Derivative liability			71,711				-
Due to related parties			451,687				228,467
Total current liabilities			13,166,105				5,216,623
EQUITY:
China America Holdings, Inc. shareholders' equity
Common stock: $.001 par value, 500,000,000 shares authorized; 168,710,792 and 151,810,792 shares issued and outstanding at June 30, 2010 and September 30, 2009, respectively			168,711				151,811
Additional paid-in capital			20,266,787				20,014,547
Statutory reserves			826,521				704,321
Accumulated deficit			(17,740,586	)			(17,650,606	)
Accumulated other comprehensive income			472,839				428,109
Total China America Holdings, Inc. shareholders' equity			3,994,272				3,648,182
Noncontrolling interest			5,570,966				5,014,984
Total equity			9,565,238				8,663,166
Total liabilities and equity		$	22,731,343			$	13,879,789
See notes to unaudited consolidated financial statements.

CHINA AMERICA HOLDNGS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
		For the Three Months Ended June 30,								For the Nine Months Ended June 30,
		2010				2009				2010				2009
Net revenues		$	14,018,162			$	8,185,254			$	33,832,116			$	22,312,182
Cost of sales			12,762,408				7,320,478				30,415,883				20,735,197
Gross profit			1,255,754				864,776				3,416,233				1,576,985
Operating expenses:
Selling expenses			424,943				314,058				1,334,822				648,925
Loss on disposition of property and equipment			-				-				236				61,958
Consulting expense -- related party			68,000				109,000				307,024				274,812
General and administrative			394,458				257,723				1,192,631				606,976
Total operating expenses			887,401				680,781				2,834,713				1,592,671
Total operating income (loss)			368,353				183,995				581,520				(15,686	)
Other income (expenses):
Interest expense			(21,018	)			(123	)			(49,067	)			(55,050	)
Interest expense -- related party			(4,663	)			(7,934	)			(12,687	)			(11,966	)
Other income (expense)			(65,456	)			1,875				(45,107	)			(1,906	)
Gain on acquisition			-				-				200,978				-
Realized loss on sale of marketable equity securities			-				-				-				(280,975	)
Total other income (expenses)			(91,137	)			(6,182	)			94,117				(349,897	)
Net income (loss) from continuing operations before income taxes			277,216				177,813				675,637				(365,583	)
Discontinued operations:
Loss from discontinued operations			-				-				-				(174,560	)
Total loss from discontinued operations			-				-				-				(174,560	)
Income (loss) before income taxes			277,216				177,813				675,637				(540,143	)
Income taxes (expense) benefit			(29,385	)			(102,699	)			(87,435	)			(115,031	)
Net income (loss)			247,831				75,114				588,202				(655,174	)
Net income attributable to noncontrolling interest			(209,589	)			(87,805	)			(555,982	)			(26,885	)
Net income (loss) attributable to China America Holdings, Inc.		$	38,242			$	(12,691	)		$	32,220			$	(682,059	)
Basic and diluted loss per common share:
Net income (loss) from continuing operations		$	0.00			$	0.00			$	0			$	(0	)
Net income (loss) from discontinued operations			-				-				-				(0	)
Net loss per common share		$	0.00			$	0.00			$	0			$	(0	)
Weighted average number of shares outstanding:
Basic and diluted			161,377,459				141,272,331				156,986,616				137,631,304
Amounts attributable to China America Holdings, Inc.
Income (loss) from continuing operations, net of tax		$	38,242			$	(12,691	)		$	32,220			$	(507,499	)
Loss from discontinued operations, net of tax			-				-				-				(174,560	)
Net (loss) income		$	38,242			$	(12,691	)		$	32,220			$	(682,059	)
See notes to unaudited consolidated financial statements.

Safe Harbor Statement

China America Holdings, Inc. is hereby providing cautionary statements identifying important factors that could cause our actual results to differ materially from those projected in forward-looking statements (as defined in such act). Any statements that are not historical facts and that express, or involve discussions as to, expectations, beliefs, plans, objectives, assumptions or future events or performance (often, but not always, indicated through the use of words or phrases such as "will likely result," "are expected to," "will continue," "is anticipated," "estimated," "intends," "plans," "believes" and "projects") may be forward-looking and may involve estimates and uncertainties which could cause actual results to differ materially from those expressed in the forward-looking statements. These statements include, but are not limited to, our ability to secure financing, as well as our belief about our sales momentum, pricing strategy, ability to grow, and our expectations regarding our expectations regarding growth of the refrigerant market, revenues, margins, net income and earnings.

We caution that the factors described herein could cause actual results to differ materially from those expressed in any forward-looking statements we make and that investors should not place undue reliance on any such forward-looking statements. Further, any forward-looking statement speaks only as of the date on which such statement is made, and we undertake no obligation to update any forward-looking statement to reflect events or circumstances after the date on which such statement is made or to reflect the occurrence of anticipated or unanticipated events or circumstances. New factors emerge from time to time, and it is not possible for us to predict all of such factors. Further, we cannot assess the impact of each such factor on our results of operations or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements. This press release is qualified in its entirety by the cautionary statements and risk factor disclosure contained in our Securities and Exchange Commission filings, including our Annual Report on Form 10-KT for the transition year ended September 30, 2009.