China Digital (CHID)

Website: www.chinadigitalgroup.com

Powering China??™s $2.1 Billion Battery Market

'Shenzhen E'Jenie unaudited pro forma sales for fiscal year 2004 totaled approximately $5.18 million, up 151% from approximately $2.06 million in 2003.'

'China Digital increased its production force by 12% when it hired 65 new production employees during March 2005.'

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CHID Investment Highlights

• Preliminary factory data for the first quarter of 2005, shows rapid sequential growth in its production of battery shells and caps. In response to high product demand it increased its production force by 12% when it hired 65 new production employees during March 2005.

• Shenzhen E'Jenie unaudited pro forma sales for fiscal year 2004 totaled approximately $5.18 million, up 151% from approximately $2.06 million in 2003.
• Shenzhen E'Jenie unaudited pro forma net income was approximately $245,000 for 2004, compared to net income of $132,000 in 2003.
• Based on initial estimates for the quarter ended March 31, 2005, the total production of shells and caps at China Digital's Shenzhen E'Jenie unit reached 63.85 million units, 25% higher than the 51.21 million units produced in the prior quarter, ended December 31, 2004. The increase was due to sharply higher demand for caps (up 42%) and aluminum shells (up 69%).

• China Digital is one of the fastest growing providers of power supply components for China's large and fast growing markets in mobile phones and other products.

• CHID has double-digit sales and earnings growth and a solid customer base in China's Shenzhen manufacturing center.

• CHID's new line of aluminum battery shells offer improved safety, capacity and electric conductivity over older steel models. Three months after the models have been introduced, sales are soaring. 

• CHID has a strong balance sheet with $400,000 in cash and no long term debt.

• Recently announced that it has opened its first office in the United States. The Los Angeles-based office will serve as the new center of its operations in North America. The opening of this new office is part of the Company's overall strategy to begin its penetration of the U.S. market for its battery shells and other products and to increase its exposure to the U.S. investment community.
• Announced that it will move its manufacturing operations to a new location in the Shenzhen region, providing it with 40% more production capacity. The new plant will provide E'Jenie a manufacturing area of nearly 65,000 square feet, up 50% from the 43,000 square feet at the current location.
• Expanded its research and development team to help develop and improve a new series of product lines. It also detailed steps taken recently to lower its operating and procurement costs.
• The company owns its own research and development arm, which has just recently developed a proprietary technology of preventing air leaks on aluminum battery caps.

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Overview 

China Digital, is a U.S. corporation with its business headquarters in Shenzhen, one of China's key manufacturing centers. Its primary business is the manufacture of components for batteries used in mobile phones, digital cameras, PDAs, laptop computers and other digital devices. The company has set a strategic goal of becoming the largest telecom-equipment producer, marketer and distributor in China, with a significant presence in the U.S. market as well.

With China becoming the world's manufacturing hub for cell phones and other digital mobile devices, CHID's wholly owned subsidiary E'Jenie is strategically positioned to supply vast numbers of battery shells for lithium-Ion batteries, an industry standard in today's digital world. With the E'Jenie acquisition, CHID is now a major presence in Chinese electronics manufacturing, with some 500 employees and potential to serve the worldwide market. U.S. investors are now able to gain a direct stake in a crucial part of the fast-growing market for electronic components in and outside of China.

To view the Full Profile for China Digital please visit http://www.smallcapreview.com/chid.htm

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