Shengtai Pharmaceutical, Inc. Reports First Quarter Fiscal Year 2010 Financial Results
November 16 2009 - 6:00PM
PR Newswire (US)
WEIFANG, China, Nov. 16 /PRNewswire-Asia-FirstCall/ -- Shengtai
Pharmaceutical, Inc. (OTC:SGTI) (BULLETIN BOARD: SGTI) ("Shengtai"
or "the Company"), a leading manufacturer and distributor of
high-quality, pharmaceutical grade glucose products in China, today
reported financial results for the first quarter of fiscal 2010
ended September 30, 2009. First Quarter 2010 Financial Summary --
First quarter 2010 revenues totaled $23.13 million -- First quarter
had positive operating cash flow of $0.83 million -- Cash and
restricted cash of $12.78 million "The first quarter fiscal year
2010 brings our company back to profitable and creates a very good
opening for fiscal year 2010. Our glucose revenue increased
approximately 65% compared to the same period last year. The total
glucose revenue accounted for 58.41% of total revenue for the three
months ended September 30, 2009, compared to 45.29% the same period
last year. Selling, general and administrative (SG&A) expenses
for the three months ended September 30, 2009 were $2.08 million, a
decrease of $345,101 compared with the same period last year. Our
financial results demonstrate that our strategy of controlling
cost, improving product structure to create a higher gross profit
products mix, and expanding market share in pharmaceutical glucose
markets has been successful," said Mr. Qingtai Liu, Shengtai
Pharmaceutical's CEO. "The competition in the last year was tough
but we are proud that we survived the economic crisis and are on
the right track to our goal of becoming the largest pharmaceutical
glucose provider." First Quarter Fiscal 2010 Financial Results
First quarter 2010 revenues were $23.13 million, a 27.61% increase
year-over-year compared to the $18.12 million reported in the first
quarter of fiscal 2009. Sales of glucose products totaled $13.51
million during the first quarter as it accounted for 58.4% of
sales. Cornstarch sales for the quarter totaled $4.65 million or
20.1% of revenues. Sales of other products totaled $4.97 million or
21.5% of revenues. With the government stimulus plan taking effect,
and the recovery of the economy, and our increased competitive
strength, the demand of our glucose products was increased compared
to the same period last year. Gross profit for the three months
ended September 30, 2009 was $3.32 million compared with $3.19
million the same period last year. Gross margin was 14.36%, a
decline from 17.62% in the first quarter of fiscal 2009. The
decline in gross margin in the first quarter was primarily driven
by increased raw material cost and higher production cost per unit
due to the idle capacity from expanded new facilities. Selling,
general and administrative (SG&A) expenses for the three months
ended September 30, 2009 were $2.08 million, a decrease of $345,101
compared with the same period last year. The decrease in selling,
general and administrative expenses was mainly the result of our
efforts in controlling our costs. We incurred $158,818 in non-cash
stock option expenses for the three months ended September 30,
2009. First quarter 2010 net income was $783,833 or 4 cents per
diluted share, compared to first quarter 2009 net income of
$629,796 or 3 cents per diluted share. Financial Condition As of
September 30, 2009, Shengtai Pharmaceutical had cash and restricted
cash totaling $12.78 million. The Company generated $0.83 million
in positive cash flow from operations during the first quarter. The
Company's short-term loan totaled $29.63 million and long-term debt
totaled $4.96 million. The Company's total shareholders' equity
increased to $45.96 million. Business Outlook Based on its current
outlook, and existing and anticipated business conditions, Shengtai
expects net income for fiscal year ending June 30, 2010 to be
between $3-$5 million. "Looking forward we see several factors that
will create a continuous demand for the Company's pharmaceutical
graded glucose products. First of all, this winter is abnormally
cold in northern China with Swine flu a strong threat to health.
More people will get flu shots and other IV treatments. In China,
IV drips are the most commonly used in hospitals and clinics to
treat the symptoms of cold and flu," said Mr. Qingtai Liu, Shengtai
Pharmaceutical's CEO. "Second, we would also see the health care
stimulus package starting to show its effects in the next twelve
months and we expect increased demand for basic pharmaceutical
products from newly built clinics. Third, we believe we are in a
much better position than some of our key competitors in the
pharmaceutical glucose field. We have expanded production capacity
and have enough operating cash flow. Some of our key competitors
went bankrupt, have temporarily stopped production, or are on the
verge of going out of business. This is a good opportunity for us
to obtain an even higher market share in the pharmaceutical glucose
market. With these good external opportunities, we plan to stick to
our strategy of controlling costs, improving product structure to
create a higher gross profit products mix, and expanding market
share in the pharmaceutical glucose market. We are very confident
that our key competitive strength remains and will welcome a
profitable year in fiscal year 2010." Conference Call The Company
will host a conference call on Tuesday November 17, 2009 at 8:00
A.M. Eastern Standard Time / 9:00 P.M. Beijing Time. A question and
answer session will follow management's presentation. Ms. Yiru
Melody Shi (Chief Financial Officer), and Ms. Shenglian Iris Wang
(Investor Relations Assistant Manager) will be the primary speakers
on the call. To participate, please call the following numbers ten
minutes before the call start time: Phone Number: +1 (877) 407-8035
(North America) Phone Number: +1 (201) 689-8035 (International) A
replay of the call will be available through Tuesday, November 24,
2009, at 11:59 P.M. Eastern Standard Time. For the replay, please
call: Phone Number +1 (877) 660-6853 (North America) Phone Number
+1 (201) 612-7415 (International) Account Number: 286 Conference ID
Number: 337862 About Shengtai Pharmaceutical, Inc. Shengtai
Pharmaceutical, Inc. through its wholly owned subsidiary, Shengtai
Holding, Inc. (SHI), a New Jersey corporation, and the Chinese
operating company of Weifang Shengtai Pharmaceutical Co., Ltd., is
a leading manufacturer and supplier of pharmaceutical grade glucose
used for medical purposes. It also manufactures and supplies
glucose and cornstarch products to the food, beverage and
industrial production industries in China. For more information
about Shengtai Pharmaceutical, Inc., please visit
http://www.shengtaipharmaceutical.com/ . Forward-looking Statements
Certain statements made in this news release, may contain
forward-looking statements concerning the Company's business and
products. These statements include, without limitation, statements
regarding our ability to prepare the Company for growth, and
predictions and guidance relating to the Company's future financial
performance. We have based these forward-looking statements largely
on our current expectations and projections about future events and
financial trends that we believe may affect our financial
condition, results of operations, business strategy and financial
needs, but they involve risks and uncertainties that could cause
actual results to differ materially from those in the
forward-looking statements, which may include, but are not limited
to, such factors as unanticipated changes in product demand
especially in the pharmaceutical industry, pricing and demand
trends for the Company's products, changes to government
regulations, risk associated with operation of the Company's new
facilities, risk associated with large-scale implementation of the
Company's business plan, the ability to attract new customers,
ability to increase its product's applications, cost of raw
materials, downturns in the Chinese economy, and other information
detailed from time to time in the Company's filings and future
filings with the United States Securities and Exchange Commission.
Investors are urged to consider these factors carefully in
evaluating the forward-looking statements herein and are cautioned
not to place undue reliance on such forward-looking statements,
which are qualified in their entirety by this cautionary statement.
The forward-looking statements made herein speak only as of the
date of this press release and the Company undertakes no duty to
update any forward-looking statement to conform the statement to
actual results or changes in the Company's expectations. For
further information, please contact: Shengtai Pharmaceutical, Inc.
Ms. Yiru Melody Shi Chief Financial Officer Tel: +1-949-468-7078
Email: Shenglian Iris Wang Investor Relations Manger Tel:
+86-0536-6295802 Email: DATASOURCE: Shengtai Pharmaceutical, Inc.
CONTACT: Shengtai Pharmaceutical, Inc., Ms. Yiru Melody Shi, Chief
Financial Officer, +1-949-468-7078, and Ms. Shenglian Iris Wang,
Investor Relations Manager, +86-0536-6295802, Web site:
http://www.shengtaipharmaceutical.com/
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