Shengtai Pharmaceutical, Inc. Reports Second Quarter Fiscal Year 2010 Financial Results
February 16 2010 - 7:00PM
PR Newswire (US)
WEIFANG, Shandong, China, Feb. 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 second quarter
of fiscal 2010 ended December 31, 2009. Second Quarter 2010
Financial Summary -- Second quarter 2010 revenues totaled
approximately $28.51 million, approximately $13.71 million or
$92.7% increase compared to the same period last year -- Second
quarter 2010 gross margin is 15.68% compared to 13.48% same period
last year -- Second quarter had positive operating cash flow of
approximately $8.73 million -- Cash and restricted cash of
approximately $17.08 million "The first quarter fiscal year 2010
brings our company back to profitable and creates a very good
opening for fiscal year 2010. Our company continued this good
opening and sales revenue had a steady increase in the second
quarter fiscal year 2010. Our glucose revenue increased
approximately 50% compared to the same period last year. Selling,
general and administrative (SG&A) expenses for the three months
ended December 31, 2009 were approximately $2.20 million, a
decrease of $127,209 compared with the same period last year. Our
improving financial results show that our strategies of controlling
costs, improving product structure to create a higher gross profit
products mix, and expanding market share in pharmaceutical glucose
markets are 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." Second Quarter Fiscal 2010 Financial Results
Second quarter 2010 revenues were approximately $28.51 million, a
92.7% increase year-over-year compared to the approximately $14.80
million reported in the second quarter of fiscal 2009. Sales of
glucose products totaled approximately $13.89 million during the
second quarter as it accounted for 48.7% of sales. Cornstarch sales
for the quarter totaled approximately $7.00 million or 24.6% of
revenues. Sales of other products totaled approximately $7.62
million or 26.7% of revenues. The increase in sales revenue
resulted from the increase of our export sales and domestic
cornstarch and other products sales. Exporting sales revenue for
the three months ended December 31, 2009 increased approximately
307% compared with the corresponding period in 2008. The increase
is because with the recovery of the global economic crisis and with
our exporting department reorganization in fiscal year 2009, the
international demand of our glucose and protein powder products
increased compared to the same period last year. Domestic sales for
cornstarch and other products for the three months ended December
31, 2009 increased approximately 127% compared with the same period
last year. The increase in domestic sales was because of the higher
demand for cornstarch and increase in unit sales price for
cornstarch. Gross profit for the three months ended December 31,
2009 was approximately $4.47 million compared with approximately
$1.99 million the same period last year. The increase in gross
profits resulted from the increase in sales compared with the same
period in 2008. Gross margin was 15.7%, a rise from 13.5% in the
second quarter of fiscal 2009. The reasons for the increase in
gross profit margin was because of decreased selling, general, and
administrative expenses. Selling, general and administrative
(SG&A) expenses for the three months ended December 31, 2009
were approximately $2.20 million, a decrease of $127,209 compared
with the same period last year. The decrease in our Selling,
General and Administrative expenses was mainly the result of our
efforts in controlling our costs. Especially we have controlled our
professional expenses as a public company by lowering our legal,
audit, and investment relationship expenses. We incurred $158,818
in non-cash stock option expenses for the three months ended
December 31, 2009. Second quarter 2010 net income was approximately
$1.05 million or 5 cents per diluted share, compared to second
quarter 2009 net loss of $473,887 or 2 cents per diluted share. The
increase in net income was primarily due to the increase in our
sales, decreased selling, general, and administrative expenses, and
increase of other income. Financial Condition As of December 31,
2009, Shengtai Pharmaceutical had cash and restricted cash totaling
approximately $17.08 million. The Company generated approximately
$8.73 million in positive cash flow from operations during the
second quarter. The Company's short-term loan totaled approximately
$33.30 million and long-term debt totaled approximately $4.24
million. The Company's total shareholders' equity increased to
approximately $47.17 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 to 5 million. "Looking forward, we see increased demand
of our products and are confidant about our cash position," said
Mr. Qingtai Liu, Shengtai Pharmaceutical's CEO. "The Chinese
government's stimulus plan is taking effect. More medical clinics
are built or going to be built. The new clinics increased the
demand for our pharmaceutical glucose products. We remain our
leading position in this field to provide approximately 40% of the
China pharmaceutical market share. The oral glucose and the
cornstarch market are recovering. Some companies in the cornstarch
and oral glucose business did not survive during the world economic
crisis while we reserved our cash and other resources. We now have
the resources and capabilities to catch the recovered business. The
exporting market is recovering as well. Our reorganization of the
exporting department last year also contributed to our success. In
general, we are very confidant to welcome a profitable and growing
fiscal year 2010 and 2011". 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. Contact:
Shengtai Pharmaceutical, Inc. Mr. Yongqiang Wang Chief Financial
Officer Tel: +86-536-6295801 Email: Shengtai Pharmaceutical, Inc.
Ms. Shenglian Iris Wang Investor Relations Manager Tel:
+86-536-6295802 Email: DATASOURCE: Shengtai Pharmaceutical, Inc.
CONTACT: Mr. Yongqiang Wang, Chief Financial Officer,
+86-536-6295801, , or Ms. Shenglian Iris Wang, Investor Relations
Manager, +86-536-6295802, , both of Shengtai Pharmaceutical, Inc.
Web Site: http://www.shengtaipharmaceutical.com/
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