China Stock Profile – China Fire & Security Group, Inc.

(CFSG)1

Statistics for CFSG:

P/E 17.2
Long Term EPS Growth 28%
PEG Ratio 0.63
Net Margin 36%
Average Rating Value 3
Average Rating Buy
Average Target Price 13.25
Current Price 15.64
Year to Date Performance 130%
Institutional Ownership 13.56%
Short Interest as % of Float 8.63%

Explanation of Terms

P/E - Price divided by Earnings

Long Term EPS Growth - Long-Term (next 3-5 years) EPS Growth Rate estimated by Wall Street analysts
PEG Ratio – P/E to Growth Ratio. Generally the lower the ratio the more attractive the stock
Net Margin – Net Profit divided by Revenue
Average Rating Value – Based on Ratings given by Wall Street analysts. Generally, the lower the value, the
higher the rating
Average Rating – Based on Ratings given by Wall Street analysts
Average Target Price – Based on Target Price given by Wall Street analysts
Current Price – Current Market Price of stock
Year to Date Performance – Year to Date Performance in Price of stock
Institutional Ownership - % of Shares held by Large Institutions
Short Interest as % of Float – Short Interest in the stock as a % of Equity Float

Chart for CFSG

CFSG Company Profile

CFSG is involved in the design, development, manufacture, and sale of fire protection products and services
for industrial clients in China. The company designs and installs fire protection systems and provides
maintenance services. The company offers fire detectors, such as linear heat fire detectors, multi-frequency
1
By H.U.
infrared flame detectors, long range infrared combustible gas detectors, fixed point combustible gas
detectors, and point fire detectors; and fire alarm control and network supervisory systems, which include
fire alarm control units, fire control room display systems, fire safety monitoring center systems, and remote
customer service systems. Its products also include fire extinguishing systems, such as water mist; anti-
false-spray water spray; and gas-based and foam-based fire-extinguishing systems, as well as portable and
transportable fire extinguishers and high-pressure cylinders.

CFSG markets its industrial fire safety products and systems to companies in the iron and steel, power, and
petrochemical industries, as well as for highway and railway tunnels, wine distilleries, tobacco warehouses,
and nuclear reactor projects. China Fire & Security Group, Inc. was founded in 1995 and is headquartered in
Beijing in China.

Key Executives of CFSG

Mr. Brian Lin , 44

Chief Exec. Officer, Principal Financial Officer
Mr. Xiaoyuan Yuan , 34
Chief Accounting Officer
Mr. Haijun Yang , 36
VP of Operations and Sec. of the Board
Mr. Weigang Li , 51
VP of Sales and Gen. Mang. of Sureland Industrial
Mr. Weishe Zhang , 44
Chief Technology Officer and Exec. Director

Major Holders of CFSG

TOP INSTITUTIONAL HOLDERS

Holder Shares % Out Value* Reported

VISION CAPITAL ADVISORS, LLC 746,428 2.71 $5,866,924 31-Mar-09
Barclays Global Investors UK Holdings Ltd 418,730 1.52 $3,291,217 31-Mar-09
FIRST WILSHIRE SECURITIES
321,090 1.16 $2,523,767 31-Mar-09
MANAGEMENT INC
NORTHPOINTE CAPITAL LLC 191,463 .69 $1,504,899 31-Mar-09
STATE STREET CORPORATION 179,868 .65 $1,413,762 31-Mar-09
FMR LLC 176,400 .64 $1,386,504 31-Mar-09
OAK RIDGE INVESTMENTS, LLC 175,200 .64 $1,377,072 31-Mar-09
QVT Financial LP 172,670 .63 $1,357,186 31-Mar-09
GOLDMAN SACHS GROUP INC 122,447 .44 $962,433 31-Mar-09
COLUMBIA PARTNERS, L.L.C,
114,595 .42 $900,716 31-Mar-09
INVESTMENT MANAGEMENT

TOP MUTUAL FUND HOLDERS

 Holder Shares % Out Value* Reported
PIONEER OAK RIDGE SMALL CAP
175,200 .64 $1,158,072 28-Feb-09
GROWTH FUND
ISHARES RUSSELL 2000 INDEX FD 172,233 .62 $2,101,242 31-May-09
ISHARES RUSSELL 2000 GROWTH
93,230 .34 $1,137,406 31-May-09
INDEX FD
Powershares Exhg Traded Fd-Powershares
79,044 .29 $870,274 30-Apr-09
Golden Dragon Halter
COLLEGE RETIREMENT EQUITIES
71,641 .26 $487,875 31-Dec-08
FUND-STOCK ACCOUNT
BRAZOS MICRO CAP PORTFOLIO 60,170 .22 $732,268 30-Jun-09
FIDELITY SELECT PORTFOLIOS -
54,500 .20 $664,900 31-May-09
TECHNOLOGY
Fidelity Asset Manager 50% 50,751 .18 $619,162 31-May-09
Jennison Blend Fund 47,700 .17 $581,940 31-May-09
Fidelity Asset Manager 70% 25,904 .09 $316,028 31-May-09

Analysts’ Estimates

Current Qtr Next Qtr Current Year Next Year

Earnings Estimate
Jun-09 Sep-09 Dec-09 Dec-10
Avg. Estimate 0.23 0.25 0.98 1.19
No. of Analysts 4 4 4 4
Low Estimate 0.21 0.23 0.96 1.15
High Estimate 0.25 0.26 0.99 1.25
Year Ago EPS 0.24 0.23 0.88 0.98

Analysts estimate earnings growth of CFSG to be 21.4% next year.

Recent News Headlines for CFSG

[July] The company announced that three of its linear heat detectors ("LHD") have passed the Underwriters
Laboratories ("UL") laboratory test and were awarded UL Certifications.

The company’s three products that were tested and certified by UL were its Nonrestorable Fixed-
Temperature Line-Type Heat Detector, Restorable Fixed-Temperature Line-Type Heat Detector and
Restorable Rate of Rise & Fixed-Temperature Line-Type Heat Detector. These products have many
competitive advantages over similar products of other companies, including its proprietary "Rate of Rise in
Temperature" technology that differentiates temperature rises caused by fire hazards from rises caused by
environmental or non-dangerous sources, superior operating distance and automatic notifications for
maintenance and repairs. The company’s proprietary "Fixed-Temperature" technology allows its LHDs to
"fix" their alarm temperature, so that it is not affected by heated cable length and ambient temperature as in
competing products.

The company’s LHDs have dozens of patents internationally and domestically, CFSG’s LHD products have
influenced the industry standards and its proprietary LHDs have come to be considered as a “must have” in
the iron and steel industry.
CFSG Financial Statements

Income Statement PERIOD ENDING 31-Dec-08 31-Dec-07 31-Dec-06

Total Revenue 69,079 46,754 32,455
Cost of Revenue 29,581 21,091 16,226

Gross Profit 39,498 25,663 16,229

Operating Expenses
Research Development 2,103 672 -
Selling General and Administrative 13,116 9,568 8,250
Non Recurring - - -
Others 712 536 -

Total Operating Expenses - - -

Operating Income or Loss 23,567 14,886 7,978

Income from Continuing Operations

Total Other Income/Expenses Net 1,185 1,920 (927)
Earnings Before Interest And Taxes 24,751 16,807 7,052
Interest Expense - - -
Income Before Tax 24,751 16,807 7,052
Income Tax Expense 47 5 82
Minority Interest - - -

Net Income From Continuing Ops 24,704 16,802 6,970

Non-recurring Events
Discontinued Operations - - -
Extraordinary Items - - -
Effect Of Accounting Changes - - -
Other Items - - -

Net Income 24,704 16,802 6,970

Preferred Stock And Other Adjustments - - -

Net Income Applicable To Common Shares $24,704 $16,802 $6,970

Balance Sheet PERIOD ENDING 31-Dec-08 31-Dec-07 31-Dec-06

Assets
Current Assets
Cash And Cash Equivalents 32,033 20,940 11,049
Short Term Investments - - -
Net Receivables 50,061 34,983 26,042
Inventory 6,539 4,048 4,191
Other Current Assets 2,817 2,218 2,397

Total Current Assets 91,450 62,190 43,679

Long Term Investments 2,525 1,716 501
Property Plant and Equipment 8,445 6,568 3,530
Goodwill - - -
Intangible Assets 1,116 1,151 558
Accumulated Amortization - - -
Other Assets 1,873 - -
Deferred Long Term Asset Charges - 21 41

Total Assets 105,409 71,646 48,309

Liabilities
Current Liabilities
Accounts Payable 20,618 16,681 17,936
Short/Current Long Term Debt - - -
Other Current Liabilities 6,102 4,757 2,713

Total Current Liabilities 26,720 21,438 20,649

Long Term Debt - - 2,681
Other Liabilities - - -
Deferred Long Term Liability Charges - - -
Minority Interest - - -
Negative Goodwill - - -

Total Liabilities 26,720 21,438 23,330

Stockholders' Equity
Misc Stocks Options Warrants - - -
Redeemable Preferred Stock - - -
Preferred Stock - - -
Common Stock 28 28 26
Retained Earnings 44,850 22,228 6,765
Treasury Stock - - -
Capital Surplus 19,357 19,317 13,393
Other Stockholder Equity 14,454 8,635 4,794

Total Stockholder Equity 78,689 50,208 24,979

Net Tangible Assets $77,573 $49,057 $24,420

Cash Flow Statement PERIOD ENDING 31-Dec-08 31-Dec-07 31-Dec-06

Net Income 24,704 16,802 6,970

Operating Activities, Cash Flows Provided By or Used In

Depreciation 803 610 539
Adjustments To Net Income 2,207 208 2,929
Changes In Accounts Receivables (14,977) (8,567) (9,174)
Changes In Liabilities 3,207 (450) 9,957
Changes In Inventories (2,169) 416 (1,664)
Changes In Other Operating Activities (413) 754 (622)

Total Cash Flow From Operating Activities 13,362 9,773 8,935

Investing Activities, Cash Flows Provided By or Used In

Capital Expenditures (2,015) (3,419) (583)
Investments - - -
Other Cashflows from Investing Activities 70 (511) (10,367)

Total Cash Flows From Investing Activities (1,945) (3,930) (10,950)

Financing Activities, Cash Flows Provided By or Used In

Dividends Paid - - (8,887)
Sale Purchase of Stock - 4,165 17,893
Net Borrowings - - (36)
Other Cash Flows from Financing Activities (3,098) (3,113) (35)

Total Cash Flows From Financing Activities (3,098) 1,052 8,936

Effect Of Exchange Rate Changes 1,226 789 148

Change In Cash and Cash Equivalents $9,545 $7,684 $7,069

Reference

Yahoo Finance and China Analyst