NEW YORK and BEIJING, May 15, 2009 -- China Advanced Construction Materials Group, Inc. ("China ACM") (OTC Bulletin Board: CADC), a leading provider of ready-mix concrete in China, today announced financial results for the three months ended March 31, 2009.

Mr. Xianfu Han, Chairman and Chief Executive Officer, stated, "China ACM has continued to experience year-over-year growth in revenue and net income as well as rapid margin expansion. In our fiscal third quarter, revenue increased to $9.3 million from $6.8 million during the comparable period last year, with higher margin manufacturing services and technical services contributing to our growth. As a result, gross margins for our fiscal third quarter increased to 41.9% from 26.5%, and our operating margin increased to 33.2% from 20.6% for the same period last year. Net income for the fiscal third quarter was $2.3 million versus $1.3 million during the fiscal third quarter of 2008. We remain on track to achieve net income of at least $9 million for fiscal 2009."

Mr. Han continued, "The Chinese government announced its $586 billion stimulus package in November of 2008, with much of the money allocated toward infrastructure projects, a key focus of China ACM. Among the many infrastructure projects on the Chinese government's agenda is the building of high speed railways through the year 2020 intended to better service the large population of Chinese citizens located outside major cities. This initiative is expected to consume 120 million tons of cement, as the network of track is set to increase by 41,000 kilometers over the next 11 years at a cost of approximately $730 billion. The Chinese government and many of the large general contractors are long-standing customers of China ACM. As a result, our company is now involved in over six such railway projects, with associated revenue of $19.7 million, in and around the Beijing area, the most recent additions being the Guizhou-Guangzhou Railway and the Jin-Qin High Speed Railway. Our investment in portable concrete facilities, combined with our solid reputation, quality products and services and competitive pricing, have placed us in a strong position to win railway projects and also fits our strategic plan of expanding outside the Beijing area. We continue to bid on projects of this type and have already begun benefiting from the Chinese government's stimulus package."

Revenue for the three months ended March 31, 2009 was $9.3 million, as compared to $6.8 million for the three months ended March 31, 2008. Gross profit was $3.9 million for the three months ended March 31, 2009, as compared to $1.8 million for the three months ended March 31, 2008, representing gross margin of approximately 41.9% and 26.5%, respectively. Net income for the three months ended March 31, 2009 increased to $2.3 million, or $0.16 per diluted share, compared to net income of $1.3 million, or $0.15 per diluted share, for the same quarter last year.

As of March 31, 2009, the company had cash of $870,140, restricted cash of $666,954, working capital of $8.0 million, and no long-term debt.

Conference Call

China ACM will also host a conference call at 8:00 a.m. Eastern Time on Friday, May 15, 2009. During the call, Mr. Xianfu Han, Chairman and Chief Executive Officer, Mr. Weili He, Vice Chairman and Chief Operating Officer, and Gene Hsiao, Chief Financial Officer, will discuss the Company's quarterly performance and financial results.

The telephone number for the conference call is (201) 689-8035. A live webcast of the call will also be available on the company's website, www.china-acm.com or the new China ACM IR Hub at: http://www.agoracom.com/IR/chinaacm. To listen to the live call online, please visit the site at least 10 minutes early to register, download and install any necessary audio software.

The webcast will be archived on the site as well as the China ACM IR Hub, and investors will be able to access an encore recording of the conference call for seven days by calling (201) 612-7415 and entering account #286, ID #323153. The encore recording will be available two hours after the conference call has concluded.

About China ACM

China ACM, founded in 2002 and based in Beijing, China, is a leading producer of advanced construction materials for large scale commercial, residential, and infrastructure developments. The company is primarily focused on producing and supplying a wide range of advanced ready-mix concrete materials for highly technical, large scale, and environmental construction projects. The company also aims to develop and produce new and innovative environmentally conscious construction materials.

China ACM provides materials and services through its seven ready-mix concrete plant network covering Beijing metropolitan area. China ACM owns one plant, leases two plants and has technical services and preferred procurement agreements with four other independently-owned plants. China ACM is ISO 9001 (product quality), ISO 14001 (environmental safety), and ISO 18001 (employment environment safety) certified. Additional information about the company is available at www.china-acm.com.

This press release contains "forward-looking statements" within the meaning of the "safe-harbor" provisions of the Private Securities Litigation Reform Act of 1995. Such statements involve known and unknown risks, uncertainties and other factors that could cause the actual results of the Company to differ materially from the results expressed or implied by such statements, including changes from anticipated levels of sales, future national or regional economic and competitive and regulatory conditions, changes in relationships with customers, access to capital, difficulties in developing and marketing new products, marketing existing products, customer acceptance of existing and new products, and other factors. Additional Information regarding risks can be found in the Company's Annual Report on Form 10K and in the Company's recent report on Form 8K filed with the SEC. Accordingly, although the Company believes that the expectations reflected in such forward-looking statements are reasonable, there can be no assurance that such expectations will prove to be correct. The Company has no obligation to update the forward-looking information contained in this press release.

Contact: Crescendo Communications, LLC David Waldman or Klea Theoharis Tel: (212) 671-1020 Email: ir@china-acm.com Web: http://www.china-acm.com

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CONSOLIDATED BALANCE SHEETS
AS OF MARCH 31, 2009 AND JUNE 30, 2008


ASSETS

March 31, 2009 June 30, 2008
(Unaudited) RESTATED

CURRENT ASSETS:
Cash $870,140 $1,910,495
Restricted cash 666,954 913,092
Marketable securities 58,451 61,767
Accounts receivable, net of
allowance for doubtful accounts
of $357,810
and $224,924 as of March 31,
2009 and June 30, 2008,
respectively 14,856,208 9,365,486
Inventories 777,548 237,836
Short term loan receivable 1,465,000 -
Other receivables 1,008,368 505,968
Prepayment 3,940,771 3,240,394
Total current assets 23,643,440 16,235,038

PLANT AND EQUIPMENT, net 15,237,656 16,730,220

OTHER ASSETS:
Accounts receivable (non-current),
net of allowance for doubtful accounts
of $664,503 and $411,061 as of March 31,
2009 and June 30, 2008,
respectively 7,529,760 4,753,006

Total assets 46,410,856 37,718,264

LIABILITIES AND SHAREHOLDERS' EQUITY

CURRENT LIABILITIES:
Short term loans $4,723,893 $4,271,222
Accounts payable 5,875,554 6,293,553
Customer deposits 10,751 165,434
Other payables 280,182 254,259
Other payables - shareholder 763,634 880,302
Accrued liabilities 411,168 145,207
Taxes payable 3,468,297 1,073,237
Interest payable 155,200 -
Total current liabilities 15,688,679 13,083,214

COMMITMENTS, CONTINGENCIES, AND SUBSEQUENT EVENT

REDEEMABLE PREFERRED STOCK ($0.001
par value, 873,000 and 875,000 shares
issued and outstanding) net of
discount of $717,822 and $1,168,548
at March 31, 2009 and June 30, 2008,
respectively, liquidation preference
of $8.00 per share and accrued
dividends 6,266,178 5,831,452

SHAREHOLDERS' EQUITY:
Preferred stock $0.001 par value,
1,000,000 shares authorized, 873,000 and
875,000 redeemable preferred shares
issued and outstanding, and classified
above outside shareholders' equity
above, liquidation preference of $8.00
per share and accrued dividends as of
March 31, 2009 and June 30, 2008 - -
Common Stock, $0.001 par value,
74,000,000 shares authorized, 10,508,000
and 10,525,000 shares issued and
outstanding, as of March 31, 2009 and June
30, 2008, respectively 10,508 10,525
Paid-in-capital 12,777,188 12,722,260
Contribution receivable (1,210,000) (1,210,000)
Retained earnings 8,011,906 3,257,276
Statutory reserves 2,172,408 1,452,779
Accumulated other comprehensive
income 2,693,989 2,598,466
Deferred compensation - (27,708)
Total shareholders' equity 24,455,999 18,803,598

Total liabilities, redeemable
preferred stock, and shareholders'
equity $ 46,410,856 $37,718,264







CONSOLIDATED STATEMENTS OF INCOME AND OTHER COMPREHENSIVE INCOME
FOR THE NINE MONTHS AND THREE MONTHS ENDED MARCH 31, 2009 AND 2008
(UNAUDITED)

Nine months ended Three months ended
March 31, March 31,
2009 2008 2009 2008


REVENUE:
Sales of concrete $16,382,049 $19,841,164 $6,544,484 $6,790,646
Manufacturing
services 5,301,154 - 1,304,615 -
Technical services 1,471,583 - 431,456 -
Mixer rental 1,992,520 - 995,939 -
Marketing cooperation 94,167 - 32 -
Total revenue 25,241,473 19,841,164 9,276,526 6,790,646

COST OF REVENUE:
Cost of concrete 12,147,067 15,538,513 4,592,863 4,988,211
Manufacturing
Services 1,803,356 - 510,268 -
Technical services 119,742 - 22,059 -
Mixer rental 602,485 - 265,442 -
Marketing cooperation 38,720 - 13 -
Total cost of
revenue 14,711,370 15,538,513 5,390,645 4,988,211

GROSS PROFIT 10,530,103 4,302,651 3,885,881 1,802,435

SELLING, GENERAL AND
ADMINISTRATIVE EXPENSES 2,079,257 1,033,958 809,777 404,692

INCOME FROM OPERATIONS 8,450,846 3,268,693 3,076,104 1,397,743

OTHER (EXPENSE) INCOME, NET
Other subsidy income 1,300,992 1,190,159 470,971 407,434
Non-operating expense,
net (201,531) (36,655) (118,343) (9,264)
Interest income 4,777 - 937 -
Interest expense (640,544) (215,532) (194,200) (67,963)
Total other income,
net 463,694 937,972 159,365 330,207

INCOME BEFORE PROVISION FOR
INCOME TAXES 8,914,540 4,206,665 3,235,469 1,727,950

PROVISION FOR INCOME TAXES 2,516,707 422,521 941,477 422,521

NET INCOME 6,397,833 3,784,144 2,293,992 1,305,429

Dividends and accretion on
redeemable preferred stock 923,575 - 305,443 -

Net income available to common
shareholders 5,474,258 3,784,144 1,988,549 1,305,429

RECONCILIATION OF
COMPREHENSIVE INCOME:
Net income 6,397,833 3,784,144 2,293,992 1,305,429
Unrealized (loss) gain
from marketable
securities (3,316) 5,223 15,901 (18,220)
Foreign currency
translation
adjustment 98,839 1,539,290 (39,340) 644,374

COMPREHENSIVE INCOME $6,493,356 $5,328,657 $2,270,553 $1,931,583

EARNING PER SHARE:
Basic $0.52 $0.43 $0.19 $0.15
Diluted $0.46 $0.43 $0.16 $0.15

WEIGHTED AVERAGE NUMBER OF
SHARES:
Basic 10,525,066 8,809,583 10,525,200 8,809,583
Diluted 14,024,081 8,809,583 14,021,832 8,809,583






CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE NINE MONTHS ENDED MARCH 31, 2009 AND 2008
(UNAUDITED)

2009 2008
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income $6,397,833 $3,784,144
Adjustments to reconcile net income to
net cash (used in) provided by operating
activities:
Depreciation 1,611,255 815,689
Stock-based compensation expense 66,619 -
Bad debt expense 383,581 3,136
Changes in operating assets and liabilities
Accounts receivable (14,505,340) 7,298,441
Inventories (538,551) 32,838
Other receivables (998,078) 703,888
Other receivables - related parties - (218)
Prepayment (83,374) (328,836)
Accounts payable 5,365,721 (9,139,259)
Other payables 25,142 363,910
Accrued liabilities 265,272 (94,066)
Customer deposits (155,310) -
Taxes payable 2,389,830 385,422
Net cash provided by operating
activities 224,600 3,825,089

CASH FLOWS FROM INVESTING ACTIVITIES:
Disbursement on short term loan (1,464,500)
Purchase of equipment (50,423) (15,665)
Net cash used in investing
activities (1,514,923) (15,665)

CASH FLOWS FINANCING ACTIVITIES:
Principal payments of short term loan (6,961,984) (5,679,400)
Proceeds from short term loan 7,398,231 3,404,168
Other payables - shareholders (117,160) -
Preferred dividends paid (317,649) -
Restricted cash 246,138 751,000
Net cash provided by (used in) financing
activities 247,576 (1,524,232)

EFFECTS OF EXCHANGE RATE CHANGE
IN CASH 2,392 125,468

DECREASE (INCREASE) IN CASH (1,040,355) 2,410,660

CASH, beginning of period 1,910,495 1,424,883

CASH, end of period $870,140 $3,835,543

SOURCE China Advanced Construction Materials Group, Inc.

http://www.china-acm.com

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