Zongshen Pem Power Systems Inc T.ZPP

News..Q4 update

[TheRock07]

Zongshen PEM Power Systems Inc. Updates 2008 Unit Sales Outlook
12/18/2008 8:00 AM - Canada NewsWire

VANCOUVER, Dec. 18, 2008 (Canada NewsWire via COMTEX News Network) --

TSX:ZPP

Zongshen PEM Power Systems Inc. ("ZPP" or "the Company") (TSX:ZPP), announced today that the Company has reduced its previously stated unit sales guidance of 260,000 units.

Due to the global economic environment and slower consumer spending in China and other target markets for ZPP's suite of electric and low emission, small gas bikes, the Company is reducing its 2008 unit sales target of 260,000 units by approximately 15 percent.

"We have been negatively impacted by the current global economic crisis which has resulted in lower consumer demand and spending in China, and in the respective export markets for our products," noted Zongshen Zuo, Chairman and Chief Executive Officer of Zongshen PEM Power Systems Inc. "I remain confident in ZPP's growth prospects. With positive earnings and cash flow, and a strong balance sheet, ZPP is very secure and well positioned to prosper once the current economic environment has stabilized."

The Company will preannounce its fourth quarter and full year unit sales in January 2009.

About Zongshen PEM Power Systems Inc.

[TheRock07]

This is not unexpected , but  Q4 sales will still be about 95,000 units............ still a record .For exampe, Production volumes increased to a record high of  87,000 units , grossing $24 million in sales in Q3, which was an increase of 360 % over 2007.It was also a substantial increase in production over Q2/08.As a consequence, gross margin increased to 11.1 % of sales , from 6.8 % in

[hf1234]

You unfortunately have no idea what 2009 sales will be for zpp.Sales in 2009 could be very poor as most of the sales 70 % of total sales are low emmission fuel efficient gas bikes. These sales are heavily correlated to gas prices. Oil has dropped to $ 36/barrell now. This company has been so far out to lunch on business planning and sales targets it is scary.Mr. Zou will likely take this company

[mooreman]

Interesting points, hf.  I fully agree with your guidance comments.  In the previous two news releases (to last week's), sales guidance of 260,000 units was confirmed and reconfirmed.  I guess I was a bit skeptical when they sold 133,000 units for the first three quarters, but reaffirmed guidance of 260,000 which meant they'd essentially have to sell as many units in Q4 as