Wednesday, June 11, 2014

Armco Metals Holdings, Inc. (AMCO) Prepared to Scale Business with New Credit Approval and Green Light on Valuable Scrap Commodities Import

Over the past decade, Armco Metals has steadily evolved from a foreign enterprise into a global powerhouse of imported metal ore and metal recycling. As one of China’s largest metal recyclers, Armco Metals has established and enjoys strong customer relationships with some of the fastest growing steel producing mills and foundries. More than 100 small-sized and medium-sized metal manufacturing enterprises are partnered with Armco Metals for their product needs.

Armco Metals has a growing product portfolio, which includes ferrous and non-ferrous ore, iron ore, chrome ore, nickel ore, magnesium, copper ore, manganese ore, steel billet, and recycled scrap metals. For its product line, Armco Metals obtains raw materials from its established global supply network in South Korea, India, Australia, the United States, Brazil, and beyond.

In recent years, countries across the globe have stepped up their efforts of promoting environmental sustainability, and China is no stranger to that trend. The Chinese government has pushed for domestic consumption of recycled scrap steel to increase to 20% by 2015. In line with that standard, Armco Metals has opened a state-of-the-art recycling facility in Lianyungang, China, to source, process, and distribute up to 1 million tons of scrap steel per year. On the whole, Armco Metals conducts business operations through its subsidiaries: Armco (Lianyungang) Renewable Metals, Inc.; Armet (Lianyungang) Holdings, Inc.; Armco Metals International, Ltd.; Henan Armco & Metawise Trading Co., Ltd.; and Armco Metals (Shanghai) Holding, Ltd. Armco Renewable Metals serves as Armco Metals’ principal business unit.

In the recent months, Armco Metals had two company developments that could bode well for future scaling opportunities. In late May, the company reported its reception of an approval letter for a credit facility of $15 million, an increase of 18% compared to its former credit limit. Having adopted a platform strategy where it more fully involves its partners and customers in every stage of its business process, from raw material purchases to processed product sales, Armco Metals anticipates the new credit facility will help in three ways:

Enable it to purchase scrap metal using 20 percent of shipped cargo value as a deposit
Give it room to grow its global supply capabilities
Support up to $20 million in additional revenue capacity for greater growth into the Chinese raw materials market
As for the other development, Armco Metals in early June announced it had received approval from China’s Environmental Management of Solid Waste for importation of restricted materials. With the approval, Armco Metals will be able to import 20,000 metric tons of higher-margin materials including steel-based scrap, copper-based scrap, and aluminum-based scrap. Armco Metals anticipates its newly gained approval will strengthen sales revenue as these non-ferrous scrap metals typically have higher gross margins than scrap steel. With the $15 million credit facility at hand, Armco Metals has greater financial resources available for scaling its import operations for these materials.

For more information visit: www.armcometals.com

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