China Kangtai Cactus Biotech Q2 Revenue Up 30% to Record $6.5M; Net Income Up 37% to $1.4M, EPS $0.07

Revenue Accelerates with Growing Popularity of Cactus Health Products in China

HARBIN, China, Aug. 14 /PRNewswire-Asia/ -- China Kangtai Cactus Biotech Inc. (OTC Bulletin Board: CKGT), a vertically integrated grower, developer, manufacturer, and marketer of a variety of cactus-based products in China, announced today that revenue for the second quarter of 2009 increased 30% to $6.5 million from $5.0 million in the second quarter of 2008. Diluted earnings per share for the quarter was $0.07 based on a net income of $1.4 million, compared to a net income of $1.0 million or $0.06 diluted EPS last year.

Second Quarter Highlights

-- Second quarter revenue increased 30% to $6.5 million from $5.0 million

in Q2 2008

-- On a sequential basis, Q2 revenue increased 96% from $3.3 million in Q1

2009

-- Cash and cash equivalents totaled $2.8 million, an increase of 19% from

$2.3 million as of March 31, 2009

-- Gross profit increased 80% to $2.7 million from $1.5 million in Q2 2008

-- Sequentially, gross profit increased 121% from 1.2 million in Q1, 2009

-- Gross margins were 42%, up from 30% reported in Q2 2008 and 37% in Q1

2009

-- Net income increased 37% to $1.4 million from $1.0 million in Q2 2008

-- Sequentially, net income experienced a 105% increase from $694,000 in

Q1 2009

For the first six months of 2009, revenue was $9.8 million, an increase of 27% from $7.8 million for the comparable period last year. Net income for the first six months of 2009 was up 29% at $2.1 million, compared to $1.6 million for the first six months of 2008.

China Kangtai CEO Jinjiang Wang said, "The pace of our revenue growth accelerated in the second quarter with a year-over-year increase of 30% and a sequential increase of 96%. This was primarily driven by growing acceptance of our cactus-derived products. The increase in consumer consumption, led by Kangtai's expanding brand awareness, indicates a bright future for our health and wellness products, including nutraceuticals, nutritional food and drinks, and animal feed products. We expect continued improvement throughout the second half of 2009 as we focus our integration efforts on the March acquisition to further expand our production and distribution capacity."

In March, the company acquired the assets of Qitaihe Kangwei Biotechnology Co., Ltd. The purchase included the right to use 49,000 square meters of state-owned land in Qitaihe City, as well as housing, machinery, equipment, and related facilities. The purchase price was approximately $5.42 million.

About China Kangtai Cactus Biotech, Inc.

China Kangtai Cactus Biotech, Inc. is a leading grower, developer, producer, and marketer of cactus-derived products, including nutraceuticals, nutritious food, health and energy drinks, beer, wine and liquor, extracts and powders, and animal feed. China Kangtai controls over 387 acres of plants and maintains an active R&D group that holds 18 product patents and is seeking another 12. China Kangtai's high-quality "green" products are sold throughout China via a distribution network that covers 12 of China's 23 provinces and two of China's four municipalities. More information may be found at http://www.biocactus.com or via e-mail: chinakangtai@gmail.com .

An investment profile on China Kangtai Cactus Biotech Inc. is available at http://www.hawkassociates.com/profile/ckgt.cfm . For an online investor relations kit, visit http://www.hawkassociates.com . For more investor-related questions, contact Susan Zhou, Hawk Associates, at 305-451-1888, e-mail: cactus@hawkassociates.com . To subscribe to future releases via e-mail alert, visit http://www.hawkassociates.com/about/alert/ .

This news release contains forward-looking statements as defined by the Private Securities Litigation Reform Act of 1995. Forward-looking statements include statements concerning plans, objectives, goals, strategies, future events or performance, and underlying assumptions and other statements that are other than statements of historical facts. These statements are subject to uncertainties and risks including, but not limited to, product and service demand and acceptance, changes in technology, economic conditions, the impact of competition and pricing, government regulation, and other risks contained in reports filed by the company with the Securities and Exchange Commission. All such forward-looking statements, whether written or oral, and whether made by or on behalf of the company, are expressly qualified by the cautionary statements and any other cautionary statements which may accompany the forward-looking statements. In addition, the company disclaims any obligation to update any forward-looking statements to reflect events or circumstances after the date hereof.