China Agritech, Inc. Announces Preliminary 2008 Financial Results
January 22 2009 - 7:00AM
PR Newswire (US)
BEIJING, Jan. 22 /PRNewswire-Asia-FirstCall/ -- China Agritech,
Inc. (OTC:CAGC) (BULLETIN BOARD: CAGC) ("China Agritech" or "the
Company"), a leading national-level liquid and granular organic
compound fertilizer manufacturer and distributor in China, today
announced its preliminary financial results for the year ended
December 31, 2008, with revenue expected to be approximately $47
million (unaudited) compared with $39 million in 2007, or 20%
year-over-year growth. In 2008, net income is expected to be
approximately $8.7 million (unaudited), compared with $8.5 million
in 2007. The preliminary revenue is now lower than the previous
guidance of $54 million and the preliminary net income remains
unchanged from guidance. The reason for the lower revenue was
mainly due to price decline and high sourcing costs for granular
fertilizers in the fourth quarter. In addition, in the fourth
quarter of 2008, the Company successfully collected $10 million of
back payments. As a result, as of December 31, 2008, the Company's
accounts receivable were approximately $36 million (unaudited) as
compared to $45 million (unaudited) at the end of September 2008.
"I am pleased with our preliminary 2008 results, especially with
our improvement on the balance sheet and our success in meeting our
previous net income target," said Mr. Yu Chang, Chairman and Chief
Executive Officer of China Agritech. "Entering into 2009, we will
continue to tighten our credit sales policy and improve receivable
management. On the demand side, so far this year we have not seen
any slowdown in our granular fertilizer demand, and all of our
three granular facilities have been fully prepared for the
commercial launch of our internally produced granular fertilizer
production. I am confident that granulars will lead us into a much
larger market, and with our current nationwide sales network and
our established distribution contract with Sinochem we will be
well-positioned to expand our market shares in the $1.5-billion
green food market in China." Mr. Chang continued, "In addition, the
Chinese government recently introduced policies to raise the
government purchase price of crops from farmers, and increase in
financial incentives and tax reduction for farmers who purchase
farm equipment and fertilizers. We believe this works in our favor
as we are already a leading producer of green fertilizers." About
China Agritech, Inc. China Agritech, Inc. is engaged in the
development, manufacturing and distribution of liquid organic
compound fertilizers and related products in China. The Company has
developed proprietary formulas that provide a continuous supply of
high-quality agricultural products while maintaining soil
fertility. The Company sells its products to farmers located in 26
provinces of China. For more information about the Company, please
visit http://www.chinaagritechinc.com/ . Safe Harbor Statement This
release contains certain "forward-looking statements" relating to
the business of China Agritech and its subsidiary companies, which
can be identified by the use of forward-looking terminology such as
"believes, expects" or similar expressions, including but not
limited to, statements regarding the continued demand for China
Agritech's products, China Agritech's ability to sustain growth for
the balance of the year and China Agritech's ability to generally
meet all of its objectives. Such forward-looking statements involve
known and unknown risks and uncertainties, including all business
uncertainties relating to product development, marketing,
concentration in a single customer, raw material costs, market
acceptance, future capital requirements, and competition in general
and other factors that may cause actual results to be materially
different from those described herein as anticipated, believed,
estimated or expected. Certain of these risks and uncertainties are
or will be described in greater detail in our filings with the SEC.
Except as required by law, China Agritech is under no obligation to
(and expressly disclaims any such obligation to) update or alter
its forward-looking statements whether as a result of new
information, future events or otherwise. For more information,
please contact: In China: Mr. Kelviz Lim Investor Relations China
Agritech, Inc. Tel: +86-10-5962-1228 Email: In the U.S.: Valentine
Ding Investor Relations Grayling Global Tel: +1-646-284-9412 Email:
DATASOURCE: China Agritech, Inc. CONTACT: In China: Mr. Kelviz Lim,
Investor Relations, China Agritech, Inc., +86-10-5962-1228, ; or In
the U.S.: Valentine Ding, Investor Relations, Grayling Global,
+1-646-284-9412,
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