Sen Yu International Holdings, Inc. Reports Fiscal First Quarter 2012 Results
Record Revenue and Profit Driven by Increased Orders for Commercial Hogs From Major Customers and Significantly Higher Market Prices for Pork
(firmenpresse) - JIAMUSI CITY, CHINA -- (Marketwire) -- 11/15/11 -- Sen Yu International Holdings, Inc. ("Sen Yu International" or the "Company") (OTCBB: CSWG), a leading commercial hog breeder and supplier in Heilongjiang Province, the People's Republic of China, today announced its financial results for its fiscal first quarter ended September 30, 2011.
Total revenue increased 129.4% to a record $54.1 million from $23.6 million
Gross profit increased 260.2% year-over-year to $19.2 million from $5.3 million
Gross margin increased to 35.6% from 22.7% due to increased sales and strong increases in the average market price for hogs
Operating expenses were $2.3 million compared to $1.6 million in the same period last year
Operating income rose 349.6% to $17.0 million from $3.8 million a year ago
Adjusted net income for the fiscal first-quarter, which excludes a gain in the fair value of warrants, increased 356.8% to $16.9 million, or $0.60 per diluted share, versus $3.7 million, or $0.14 per diluted share, for the same period last year, which excludes a gain related to the fair value of warrants
Net income increased to $18.7 million, or $0.67 per diluted share, from $6.0 million, or $0.23 per diluted share, for the fiscal first quarter ended September 30, 2010
Working capital increased 34.3% to $79.6 million at September 30, 2011 from $59.2 million at June 30, 2011
Shareholders' equity inclusive of noncontrolling interest increased 33.8% to $80.0 million at September 30, 2011 from $59.8 million at June 30, 2011
"We are pleased to report significantly higher revenues and gross profits for our fiscal first quarter," stated Mr. Zhenyu (Jack) Shang, Founder, Chairman and CEO of Sen Yu International Holdings, Inc. "This increase was driven by increased orders from our two major customers, Beijing Dahongmen and Beijing Fifth Meat Factory and significantly higher market prices for hogs as compared to last year. As a result, revenue increased 129.4% during this quarter and gross profit increased 260.2%. Overall, hog sales increased by 59,034 heads to 193,595 in the first quarter. To stay competitive, we continue to refine our breeding techniques to ensure that our hogs are safe and of the highest quality. We believe the strong demand we see for our superior breeding hogs in China coupled with our efficient business model will allow us to capture more market share and steadily grow our business."
Revenue for the three months ended September 30, 2011 increased 129.4% to $54.1 million from $23.6 million for the same period a year ago. The increase in revenues resulted from increased orders from the Company's major customers, Beijing Dahongmen and Beijing Fifth Meat Factory. Hog sales increased to 193,595 heads for the quarter ended September 30, 2011 from 134,561 heads for the three months ended September 30, 2010.
Cost of goods sold for the three months ended September 30, 2011 increased by $16.6 million, or 91.1%, to 34.8 million from $18.2 million for the three months ended September 30, 2010. The increase was primarily attributable to increased sales volume and was less than the increase in revenues for the period.
Gross profit for the three months ended September 30, 2011 increased by $13.9 million, or 260.2%, to $19.2 million from $5.3 million for the three months ended September 30, 2010. The increase was primarily due to the increase in sales volume for the period. Gross margin for the three months ended September 30, 2011 increased to 35.6% from 22.7% for the three months ended September 30, 2010. The increase in gross margin was due to higher unit sales for the quarter compared to the three months ended September 30, 2011. The average market price per commercial hogs increased significantly during the three month period ended September 30, 2011 compared to the same period last year.
Operating expenses for the three months ended September 30, 2011 increased by $713,756, or 45.5%, to $2.3 million from $1.6 million for the three months ended September 30, 2010. The increase was primarily attributable to the increase in selling expenses and compensation expenses. Selling expenses for the three months ended September 30, 2011 increased to $1.4 million from $832,828 for the three months ended September 30, 2010. The increase was due to the increase in our revenues and the related transportation costs.
Operating income for the three months ended September 30, 2011 increased by $13.2 million, or 349.6%, to $17.0 million from $3.8 million for the same period a year ago. The increase was primarily due to an increase in sales.
Net income for the fiscal first quarter ended September 30, 2011 was $18.7 million, or $0.67 per diluted share, which includes a gain of $1.8 million related to the change in the fair value of warrants, compared to $6.0 million, or $0.23 per diluted share for fiscal first quarter ended September 30, 2010, which includes a gain of $2.3 million related to the fair value of warrants. Excluding these items, adjusted net income for the three months ended September 30, 2011 was $16.9 million, or $0.60 per diluted share, which translates into a 356.8% increase in net income for the fiscal first quarter ended September 30, 2011.
As of September 30, 2011, the Company had $29.0 million in cash and cash equivalents, an increase of 153.6% from $11.4 million as of June 30, 2011, and $79.6 million in working capital, an increase of 34.3% from working capital of $59.2 million at June 30, 2011. Shareholders' equity inclusive of noncontrolling interest at September 30, 2011 was approximately $80.0 million, an increase of 33.8% from $59.8 million at June 30, 2011. The Company generated $17.4 million in net cash flow from operating activities for the three months ended September 30, 2011 versus $871,501 in net cash used in operating activities for the three months ended September 30, 2010.
"The prospects for our growth are compelling," commented Mr. Shang. "The industry in which we operate is underpinned by strong fundamentals. Pork has historically been the primary animal protein source in Chinese diets. China is already the world's largest consumer of pork and produces some 50 million tons of pork every year to feed a growing population of over 1.3 billion. In addition, government subsidies to help increase and spur pork production in China are likely to help increase breeders' profits and growth. As demand for high quality pork products continues to rise, we believe that breeders with superior quality hogs and breeding techniques, such as Sen Yu, are poised to grow and profit. Our efficient business model and ability to scale our production allows us to capture more market share as consumers look to purchase the highest quality pork products available."
Sen Yu International Holdings, Inc. (OTCBB: CSWG), through its subsidiaries, is the largest commercial hog breeder and supplier in Heilongjiang Province, the People's Republic of China (PRC). Founded in 2004 and based in Jiamusi City, the Company owns and operates two farms in Heilongjiang Province with an aggregate annual capacity of over 11,000 breeding hogs. For the fiscal year ended June 30, 2011, the Company sold more than 500,000 commercial hogs in the Beijing market. The Company also conducts genetic and breeding research to improve pork production capabilities.
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Certain statements in this release concerning our future growth prospects are "forward-looking statements," which involve a number of risks and uncertainties that could cause actual results to differ materially from those in such forward-looking statements. Such statements may include, without limitation, statements with respect to the Company's plans, objectives, projections, beliefs, expectations and intentions and other statements identified by words such as "guidance," "projects," "may," "could," "would," "should," "believe," "expect," "anticipate," "estimate," "intend," "plan," or similar expressions. These statements are based upon the current beliefs and expectations of the Company's management and are subject to significant risks and uncertainties (many of which are beyond the Company's control), including, but not limited to, risks and uncertainties regarding the success of our investments, risks and uncertainties regarding fluctuations in earnings, our ability to sustain our previous levels of profitability including on account of our ability to manage growth, intense competition, wage increases in China, our ability to attract and retain highly skilled professionals, client concentration, our ability to successfully complete and integrate potential acquisitions, withdrawal of governmental fiscal incentives, political instability and regional conflicts and legal restrictions on raising capital or acquiring companies outside China. Additional risks that could affect our future operating results are more fully described in our filings with United States Securities and Exchange Commission. These filings are available at .
We may, from time to time, make additional written and oral forward-looking statements, including statements contained in our filings with the Securities and Exchange Commission and our reports to stockholders. We do not undertake to update any forward-looking statements that may be made from time to time by us or on our behalf.
-- FINANCIAL TABLES FOLLOW --
Robert Haag
Managing Director
Hampton Growth, LLC (HGR)
Tel: +86-152-2174-3282
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Datum: 15.11.2011 - 06:00 Uhr
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