omniture

China Marine Reports Record 2010 Revenues of $122.7 million and Adjusted Net Income of $23.5 million

2011-03-03 07:06 1517
FY 2010 Exceeds Guidance



Company Provides 2011 Guidance: $150.0+million in revenues and $27.3 million in adjusted net income

SHISHI, China, March 3, 2011 /PRNewswire-Asia-FirstCall/ -- China Marine Food Group Limited (NYSE Amex: CMFO) ("China Marine" or the "Company"), a manufacturer of Mingxiang® seafood-based snack foods, "Hi-Power" marine algae-based beverages and a distributor of frozen marine catch, today announced its financial results for its fourth quarter ended December 31, 2010.

Full Year 2010 Highlights

  • Revenue was $122.7 million, up 76.3% and ahead of $100.0+ million projection
  • Gross margins expanded 300 basis point year-over-year to 30.5%
  • $26.0 million in "Hi-Power" sales exceeded prior guidance of $23.0-$25.0 million
  • Expanded Mingxiang®-branded snack foods to approximately 3,200 retail locations

Financial Summary


 

 

Fourth Quarter 2010 Results

 

 

 

Q4 2010

 

Q4 2009

 

CHANGE

 

 

Net Sales

 

$52.8 million

 

$24.9 million

 

+112.2%

 

 

Gross Profit

 

$12.3 million

 

$5.8 million

 

+111.3%

 

 

Net Income

 

$6.2 million

 

$4.4 million

 

+42.9%

 

 

Diluted EPS*

 

$0.21

 

$0.18

 

+16.7%

 

 

Adjusted Net Income**

 

$6.8 million

 

$4.4 million

 

+56.7%

 

 

Adjusted Diluted EPS**

 

$0.24

 

$0.18

 

+33.3%

 

 

 

 

 

 

 

 


* EPS calculated for the period is based on 29.1 million shares on December 31, 2010 versus 24.1 million shares reported on December 31, 2009.

** Adjusted Net Income and Diluted EPS in Q42010 are non-GAAP calculations and do not include $0.6 million of non-cash, amortization of intangible assets related to the Company's acquisition. For more information about the non-GAAP financial measures contained in this press release, please see "About Non-GAAP Financial Measures" below.

"2010 was a transformational year for China Marine for several reasons," began Mr. Pengfei Liu, Chairman and CEO of China Marine. "First, we entered a new growth business by acquiring 'Hi-Power' beverages in January of 2010. After incorporating improved labeling and packaging, 'Hi-Power' sales exceeded our expectations during its first year where we only penetrated the Fujian market. For the two years leading up to our 'Hi-Power' acquisition, we targeted a complementary marine-based business and this turned out to be the perfect fit. This high margin business will provide further growth in 2011 and remain an important component of our financial results for years to come. Second, our Mingxiang®-branded seafood snacks continued to gain shelf space and market share as we further invested in expanding our sales staff and strengthening our brand. Sales were especially robust in Zhejiang and Fujian, two provinces responsible for nearly 77.0% of total Mingxiang® sales. Third, our marine catch business has been a consistent contributor of revenues and provides us significant purchasing power when we are building raw material inventories. Lastly, we broke ground on our cold storage facility and have completed the foundation of a new business which we believe will generate a recurring $8.0 million in revenues and $4.0 million in earnings on an annual basis once the site is fully operational."

Fourth Quarter 2010 Results

Seafood Snack Foods

China Marine's sale of Mingxiang®-branded seafood snack foods produced $18.7 million in revenue, a 29.1% increase versus the fourth quarter of 2009, and accounted for 35.4% of total revenue in the fourth quarter of 2010. The Company added approximately 200 new retail locations which carry Mingxiang® snack foods and recorded increases in its core sales regions of Zhejiang and Fujian, while measurably growing sales in developing sales regions in Guangdong and Shandong. The Company has also hired six new sales staff during the fourth quarter increasing the total to 52. China Marine has maintained its product line of 29 varieties of seafood jerky snacks sold through 18 distributors who now service approximately 3,200 retail locations. Gross profit margins for the seafood snack foods segment were 34.5% and were in line with company guidance of 30-plus percent.

"Hi-Power" Beverages

In the fourth quarter, as a China Marine subsidiary, revenues from the "Hi-Power" algae-based beverages were $8.7 million and accounted for 16.5% of total revenues in the quarter. Sales were primarily driven by reorders in the Company's home province, Fujian. The total number of retail end-points for "Hi-Power" was approximately 13,000 on December 31, 2010, as compared to 11,000 points during the middle of 2010. "Hi-Power" beverages are sold in major international retailers such as Wal-Mart®, China-based supermarkets like Trust-Mart®, convenience stores, bars, restaurants, school canteens and local corner stores which feature "Hi-Power" beverages as a functional drink side by side with local and well-known international brands.

Gross margin was 41.2% in the fourth quarter and consistent with Company expectations. China Marine outsources production, bottling and distribution to two bottling facilities in Fujian province to minimize its working capital and capital expenditures. Management continues to invest in sales and marketing to drive trial and brand awareness for prospecting and new consumers. The Company spent approximately $2.4 million on advertising and promotions in the fourth quarter of 2010, which included taste testing and promotional product for retail customers, sponsorship of sporting events and continued a series of TV advertisements on stations in Fujian province. The sales and marketing staff has increased significantly from 23 members at the beginning of 2010 to 151at the end of 2010, including brand and sales managers recruited from international beverage brands.

Marine Catch

China Marine's frozen marine catch business segment generated $25.4 million sales during the fourth quarter of 2010 compared to $10.4 million in Q4 2009. Typically, in the third or fourth quarter of every year, the Company sells bulk orders of frozen marine catch to select domestic and export distributors. A significant amount of this catch represents similar types of squid species the Company uses in the production of its seafood snack foods and thus limits the Company's exposure to price fluctuations. Inventory accrued during the third quarter of the year for marine catch "trade" sales are shipped to customers in the fourth quarter on 60-day payment terms. Gross margin for the segment was 8.9% in Q4 2010 compared to 10.0% in the same period last year. Management continues to expect similar level of gross margin for its frozen marine catch business.

Total revenue in all segments including Mingxiang®-branded seafood snack foods, "Hi-Power" beverages and marine catch for the quarter ended December 31, 2010 was $52.8 million, up 112.2% from $24.9 million in the prior year's period.

Costs of goods sold totaled $40.5 million for the quarter, or 76.7% of revenues for the period ended December 31, 2010. Costs of goods consist of raw materials, packaging materials, direct labor and manufacturing overhead. In the seafood snack food segment, costs of raw materials account for the greatest percentage of costs and were 76.8% for the quarter, while packaging represented 12.8%. Conversely, in the beverage segment, costs of raw materials were 15.6% of the total costs of goods, with approximately 65.7% spent on packaging. China Marine produces seafood snack foods at its dedicated production facilities in Shi Shi while "Hi-Power" production is outsourced to blending and bottling facilities in Fujian province.

Gross profit in the fourth quarter of fiscal year 2010 was $12.3 million, an increase of 111.3% from $5.8 million in the prior year's corresponding period. Consolidated gross margins were 23.3% for the quarter, flat from 23.4% for the same period of the prior year. Gross margin for the processed seafood, "Hi-Power" and marine catch businesses were 34.5%, 41.2%, and 8.9%, respectively.

Selling, general and administrative ("SG&A") expenses in the quarter ended December 31, 2010 were $4.3 million compared to $1.0 million in the prior year period. Increases were mainly attributed to increased sales and advertising costs associated with "Hi Power" sales and the recruitment and training of new sales personnel in both Mingxiang® and "Hi-Power" sales teams.

Operating income in the fourth quarter of 2010 was $7.4 million, with operating margin of 14.0%, compared to $4.8 million and 19.4%, respectively in the prior year period. Excluding the $0.6 million non-cash amortization expense related to the "Hi-Power" acquisition, operating income was $8.0 million with adjusted operating profit margins of 15.0%.

GAAP net income for the quarter ended December 31, 2010 was $6.2 million, compared to $4.4 million in the prior year's corresponding period, a 42.9% increase year over year. Adjusted non-GAAP net income for the fourth quarter of 2010 excludes the non-cash amortization charges of $0.6 million was $6.8 million, a 56.7% increase year-over-year. Earnings per weighted average diluted shares were $0.21 based on 29.1 million fully diluted shares, while adjusted earnings were $0.24 per share. The Company's 15% preferential tax rate is secured through 2012.

Twelve Months Results


 

 

Full Year 2010 Results

 

 

 

FY 2010

 

FY 2009

 

CHANGE

 

 

Net Sales

 

$122.7 million

 

$69.6 million

 

+ 76.3%

 

 

Gross Profit

 

$37.5 million

 

$19.1 million

 

+ 95.8%

 

 

Net Income

 

$21.1 million

 

$14.6 million

 

+ 45.1%

 

 

Diluted EPS*

 

$0.73

 

$0.60

 

+ 21.7%

 

 

Adjusted Net Income**

 

$23.5 million

 

$14.6 million

 

+ 61.4%

 

 

Adjusted Diluted EPS**

 

$0.81

 

$0.60

 

+ 35.0%

 

 

 

 

 

 

 

 


* EPS calculated for the period is based on 29.0 million shares on December 31, 2010 versus 24.4 million shares reported on December 31, 2009.

** Adjusted Net Income and Diluted EPS in 2010 are non-GAAP calculations and do not include $2.4 million of non-cash, amortization of intangible assets related to the Company's acquisition. For more information about the non-GAAP financial measures contained in this press release, please see "About Non-GAAP Financial Measures" below.

Revenue during the twelve months ended December 31, 2010 increased by 76.3% to $122.7 million compared last year. Sales of seafood snack foods increased by 35.4% to $70.5 million. Sales of "Hi-Power" algae-based beverages were $26.0 million during the twelve months ended December 31, 2010, compared to $7.6 million in the same year ago period under "Hi-Power"s previous owner. Marine catch sales grew by $8.7 million, or 49.4% for the twelve months period.

Gross profit was $37.5 million, an increase of 95.8% from $19.1 million in 2009. Consolidated gross margins were 30.5%, a 300 basis point improvement over the year ago period. Gross margins for the processed seafood line, "Hi-Power" beverages and marine catch businesses were 34.5%, 41.0%, and 9.4%, respectively.

SG&A expenses for the twelve months period were $9.6 million compared to $2.9 million in the prior year's period. Increases were a result of sales and advertising costs associated with the new beverage business and new staff hires. Operating income for the twelve months of 2010 was $25.3 million, with operating margin of 20.7%, a 56.8% year-over-year increase from $16.2 million a year ago.

Year-to-date 2010 GAAP net income was $21.1 million, compared to $14.6 million in the prior year's corresponding period, a 45.1% increase. Excluding the non-cash charge of $2.4 million associated to the amortization costs of the "Hi-Power" acquisition, adjusted net income for the full year was $23.5 million and exceeded management expectations of $21.5 million in adjusted net income. GAAP earnings per weighted average diluted shares were $0.73 based on 29.0 million fully diluted shares, while adjusted non-GAAP earnings per share were $0.81 for the twelve months period ended December 31, 2010.

Financial Condition

As of December 31, 2010, the Company had $15.6 million in cash compared to $7.1 million as of December 31, 2009. Cash flows from operations were a negative $6.3 million, with higher net income being offset by increased accounts receivable related to the marine catch sales in December of 2010. The Company offers 60 day terms select marine catch customers who make up the majority of its sales. As of February 28, 2011, cash balances on hand were approximately $47.2 million on a proforma basis due to collection of marine catch receivables.

Working capital was $64.8 million, up from $48.4 million as of December 31, 2009. The current ratio was 7.9to1 on December 31, 2010 compared to 7.0to1 on December 31, 2009. Accounts receivable were $48.5 million, compared to $18.8 million as of December 31, 2009.Of which $29.5 million of the receivables were related to fresh marine catch. Shareholder equity increased 91.1% to $114.4 million due primarily to a $28.5 million equity offering on January 25, 2010.

Business Updates:

2011 Guidance

 

 

 

Projections

 

% Change

 

 

Revenues:

 

$150.0+ million

 

+ 22.3%

 

 

Adjusted Net Income:

 

$27.3 million

 

+ 16.1%

 

 

 

 

 


Construction Update – Cold Storage Facility

The Company broke ground on its cold storage facility in April of 2010 and completed the foundation of the building in the beginning of 2011. China Marine anticipates completing this facility in the second half of 2011. The project is expected to contribute approximately $8.0 million in revenues and $4.0 million in net income yearly once fully operational. Capital expenditures year-to-date were $11.6 million, while management expects a total spend of approximately $20.0 million, including the land cost, to complete the build-out.

Fourth Quarter 2010 Conference Call

Mr. Pengfei Liu, Chairman and CEO, and Mr. Marco Ku, CFO, will host the conference call. To attend the call, please use the dial in information below. When prompted, ask for the "China Marine Food Group call" and/or be prepared to provide the conference ID.

Date:

 

Thursday, March 3, 2011

 

 

Time:

 

9:00 am Eastern Time US

 

 

Conference Line Dial-In (U.S.):

 

1-877-941-4776

 

 

International Dial-In:

 

1-480-629-9762

 

 

Conference ID:

 

4417209  "China Marine Conference Call"

 

 

Webcast:

 

http://viavid.net/dce.aspx?sid=0000821C

 

 

 

 


Please dial in at least 10-minutes before the call to ensure timely participation.

A playback of the call will be available from 12:00 Noon Eastern Time on March 3until 11:59 pm Eastern Time on March 10, 2011. To listen, call 1-877-870-5176 within the United States or 1-858-384-5517 when calling internationally. Please use the replay pin number 4417209.

This call is being webcast by ViaVid Broadcasting and can be accessed by clicking on this link http://viavid.net/dce.aspx?sid=0000821C or at ViaVid's website at http://www.viavid.net, where the webcast can be accessed through March 3, 2012.

About China Marine

China Marine Food Group Ltd. is a food and beverage manufacturer of Mingxiang® seafood-based snack foods and "Hi-Power" marine algae-based health drinks, and a wholesaler of frozen marine catch in seven provinces in the PRC. Founded in 1994, China Marine has grown steadily and positioned its Mingxiang® brand as a category leader in 3,200 retail food sales points and 13,000 beverage sales points in China. The Company has received "The Famous Brand" and "Green Food" awards. Located in Fujian province, it is one of the largest coastal provinces in the PRC and a vital navigation hub between the East China Sea and the South China Sea. The Company is committed to the highest standard of quality control with the ISO9001, ISO14001, HACCP certification and EU export registration.

Forward Looking Statements

This release contains certain "forward-looking statements" relating to the business of China Marine Food Group Limited and its subsidiary companies, which can be identified by the use of forward-looking terminology such as "believes, expects" or similar expressions. 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, 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 Securities and Exchange Commission. China Marine Food Group Limited 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. This press release shall not constitute an offer to sell or the solicitation of an offer to buy nor shall there be any sale of these securities in any state or jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of such state or jurisdiction.

About Adjusted Non-GAAP Financial Measures

To supplement the Company's consolidated financial statements, which statements are prepared and presented in accordance with GAAP, we use the following non-GAAP financial measures: non-GAAP adjusted net income, and non-GAAP adjusted diluted EPS. The presentation of this financial information is not intended to be considered in isolation or as a substitute for, or superior to, the financial information prepared and presented in accordance with GAAP. The Company uses these non-GAAP financial measures for financial and operational decision making and as a means to evaluate period-to-period comparisons. Management believes that these non-GAAP financial measures provide meaningful supplemental information regarding the Company's performance and liquidity by excluding certain expenses and expenditures that may not be indicative of "recurring core business operating results", meaning operating performance excluding non-cash amortization charges for intangibles. China Marine believes that both management and investors benefit from referring to these non-GAAP financial measures in assessing performance and when planning, forecasting and analyzing future periods. These non-GAAP financial measures also facilitate management's internal comparisons to historical performance and liquidity as well as comparisons to competitors' operating results. The Company believes these non-GAAP financial measures are useful to investors both because (1) they allow for greater transparency with respect to key metrics used by management in its financial and operational decision making and (2) they are used by our institutional investors and the analyst community to help them analyze the health of the business.

- Financial Statements Follow -

CHINA MARINE FOOD GROUP LIMITED

CONSOLIDATED BALANCE SHEETS

AS OF DECEMBER 31, 2010 AND 2009

(Currency expressed in United States Dollars ("US$"), except for number of shares)


 

 

 

 

December 31,

 

 

 

 

2010

 

 

2009

 

 

ASSETS

 

 

 

 

 

 

 

 

Current assets:

 

 

 

 

 

 

 

 

Cash and cash equivalents

 

 

$

 

15,556,772

 

 

$

 

7,143,232

 

 

Accounts receivable, net

 

 

 

48,530,539

 

 

 

18,834,062

 

 

Inventories

 

 

 

9,992,870

 

 

 

3,876,950

 

 

Note receivable

 

 

 

-

 

 

 

26,399,696

 

 

Prepaid expenses and other current assets

 

 

 

105,640

 

 

 

151,653

 

 

 

 

 

 

 

 

 

 

Total current assets

 

 

 

74,185,821

 

 

 

56,405,593

 

 

 

 

 

 

 

 

 

 

Property, plant and equipment, net

 

 

 

8,801,267

 

 

 

8,599,977

 

 

Land use rights, net

 

 

 

2,991,459

 

 

 

615,355

 

 

Construction in progress

 

 

 

13,409,068

 

 

 

-

 

 

Prepayment for land use right

 

 

 

-

 

 

 

2,274,323

 

 

Intangible assets, net

 

 

 

21,926,593

 

 

 

-

 

 

Goodwill

 

 

 

2,460,971

 

 

 

-

 

 

TOTAL ASSETS

 

 

$

 

123,775,179

 

 

$

 

67,895,248

 

 

 

 

 

 

 

 

 

 

LIABILITIES AND STOCKHOLDERS' EQUITY

 

 

 

 

 

 

 

 

Current liabilities:

 

 

 

 

 

 

 

 

Short-term borrowings

 

 

$

 

-

 

 

$

 

4,139,121

 

 

Accounts payable, trade

 

 

 

3,764,722

 

 

 

885,286

 

 

Amount due to a stockholder

 

 

 

261,789

 

 

 

69,587

 

 

Income tax payable

 

 

 

537,751

 

 

 

618,664

 

 

Accrued liabilities and other payables

 

 

 

4,858,694

 

 

 

2,334,384

 

 

 

 

 

 

 

 

 

 

Total current liabilities

 

 

 

9,422,956

 

 

 

8,047,042

 

 

 

 

 

 

 

 

 

 

Commitments and contingencies

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Stockholders' equity:

 

 

 

 

 

 

 

 

Preferred stock, $0.001 par value; 1,000,000 shares authorized; 0 shares issued and outstanding as of December 31, 2010 and 2009

 

 

 

-

 

 

 

-

 

 

Common stock, $0.001 par value; 100,000,000 shares authorized; 28,977,976 and 23,413,639 shares issuedand outstanding as of December 31, 2010 and 2009

 

 

 

28,978

 

 

 

23,414

 

 

Additional paid-in capital

 

 

 

47,377,872

 

 

 

16,888,532

 

 

Statutory reserve

 

 

 

9,263,241

 

 

 

5,614,517

 

 

Accumulated other comprehensive income

 

 

 

7,402,582

 

 

 

3,576,135

 

 

Retained earnings

 

 

 

49,922,756

 

 

 

33,745,608

 

 

Total China Marine Food Group Limited stockholders' equity

 

 

 

113,995,429

 

 

 

59,848,206

 

 

Non-controlling interests

 

 

 

356,794

 

 

 

-

 

 

Total stockholders' equity

 

 

 

114,352,223

 

 

 

59,848,206

 

 

TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY

 

 

$

 

123,775,179

 

 

$

 

67,895,248

 

 

 

 

 

 

 

 

 

 

 



CHINA MARINE FOOD GROUP LIMITED

CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME

FOR THE YEARS ENDED DECEMBER 31, 2010 AND 2009

(Currency expressed in United States Dollars ("US$"), except for number of shares)


 

 

 

 

 

 

Year Ended December 31,

 

 

 

 

 

 

 

 

2010

 

 

2009

 

 

Revenue, net

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Processed seafood products

 

 

 

 

 

 

 

 

$

 

70,466,645

 

 

$

 

52,049,023

 

 

Marine catch

 

 

 

 

 

 

 

 

 

26,194,480

 

 

 

17,536,660

 

 

Algae-based beverage products

 

 

 

 

 

 

 

 

 

26,018,510

 

 

 

-

 

 

 

 

 

 

 

 

 

 

 

122,679,635

 

 

 

69,585,683

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cost of revenue (inclusive of depreciation and amortization)

 

 

 

 

 

 

 

 

Processed seafood products

 

 

 

 

 

 

 

 

 

(46,140,571)

 

 

 

(34,721,649)

 

 

Marine catch

 

 

 

 

 

 

 

 

 

(23,730,303)

 

 

 

(15,734,576)

 

 

Algae-based beverage products

 

 

 

 

 

 

 

 

 

(15,348,486)

 

 

 

-

 

 

 

 

 

 

 

 

 

 

 

(85,219,360)

 

 

 

(50,456,225)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Gross profit

 

 

 

 

 

 

 

 

 

37,460,275

 

 

 

19,129,458

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating expenses:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Depreciation and amortization

 

 

 

 

 

 

 

 

 

(2,522,058)

 

 

 

(79,725)

 

 

Sales and marketing

 

 

 

 

 

 

 

 

 

(6,359,641)

 

 

 

(608,685)

 

 

General and administrative

 

 

 

 

 

 

 

 

 

(3,230,177)

 

 

 

(2,276,006)

 

 

Total operating expenses

 

 

 

 

 

 

 

 

 

(12,111,876)

 

 

 

(2,964,416)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income from operations

 

 

 

 

 

 

 

 

 

25,348,399

 

 

 

16,165,042

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Other income (expenses):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Subsidy income

 

 

 

 

 

 

 

 

 

82,168

 

 

 

309,901

 

 

Rental income

 

 

 

 

 

 

 

 

 

92,199

 

 

 

82,299

 

 

Interest income

 

 

 

 

 

 

 

 

 

111,955

 

 

 

288,687

 

 

Interest expense

 

 

 

 

 

 

 

 

 

(40,032)

 

 

 

(230,433)

 

 

Income before income taxes

 

 

 

 

 

 

 

 

 

25,594,689

 

 

 

16,615,496

 

 

Income tax expense

 

 

 

 

 

 

 

 

 

(4,455,167)

 

 

 

(2,051,042)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

NET INCOME

 

 

 

 

 

 

 

 

 

21,139,522

 

 

 

14,564,454

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Less: net income attributable to non-controlling interests

 

 

 

(570)

 

 

 

-

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income attributable to China Marine Food Group Limited

 

 

$

 

21,138,952

 

 

$

 

14,564,454

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Other comprehensive income:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

- Foreign currency translation gain

 

 

 

 

 

 

 

 

 

3,826,447

 

 

 

127,699

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

COMPREHENSIVE INCOME

 

 

 

 

 

 

 

 

$

 

24,965,399

 

 

$

 

14,692,153

 

 

Net income per share attributable to China Marine Food Group Limited

 

 

 

 

 

 

 

 

- Basic

 

 

 

 

 

 

 

 

$

 

0.75

 

 

$

 

0.63

 

 

- Diluted

 

 

 

 

 

 

 

 

$

 

0.73

 

 

$

 

0.60

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted average shares outstanding

- Basic

 

 

 

 

 

 

 

 

 

28,301,949

 

 

 

23,062,839

 

 

- Diluted

 

 

 

 

 

 

 

 

 

28,971,080

 

 

 

24,391,942

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 



CHINA MARINE FOOD GROUP LIMITED

CONSOLIDATED STATEMENTS OF CASH FLOWS

FOR THE YEARS ENDED DECEMBER 31, 2010 AND 2009

(Currency expressed in United States Dollars ("US$"))


 

 

 

 

Year Ended December 31,

 

 

 

 

2010

 

 

2009

 

 

 

 

 

 

 

 

 

 

Cash flows from operating activities:

 

 

 

 

 

 

 

 

Net income

 

 

$

 

21,139,522

 

 

$

 

14,564,454

 

 

Adjustments to reconcile net income to net cash (used in) provided by operating activities:

 

 

 

 

 

 

 

 

Depreciation and amortization

 

 

 

2,793,954

 

 

 

330,419

 

 

Loss on disposal of property, plant and equipment

 

 

 

-

 

 

 

1,386

 

 

Stock issued to an executive

 

 

 

143,100

 

 

 

66,975

 

 

Stock issued for service

 

 

 

109,725

 

 

 

69,000

 

 

Allowance for doubtful accounts

 

 

 

149,229

 

 

 

70,425

 

 

Changes in operating assets and liabilities:

 

 

 

 

 

 

 

 

Accounts receivable

 

 

 

(29,845,706)

 

 

 

(14,085,053)

 

 

Inventories

 

 

 

(6,115,920)

 

 

 

2,802,538

 

 

Prepaid expenses and other current assets

 

 

 

46,013

 

 

 

175,324

 

 

Accounts payable, trade

 

 

 

2,879,436

 

 

 

468,823

 

 

Income tax payable

 

 

 

(80,913)

 

 

 

256,338

 

 

Accrued liabilities and other payables

 

 

 

2,524,310

 

 

 

946,957

 

 

 

 

 

 

 

 

 

 

Net cash (used in) provided byoperating activities

 

 

 

(6,257,250)

 

 

 

5,667,586

 

 

 

 

 

 

 

 

 

 

Cash flows from investing activities:

 

 

 

 

 

 

 

 

Purchase of property, plant and equipment

 

 

 

(233,121)

 

 

 

(353,177)

 

 

Cash paid to construction in progress

 

 

 

(13,409,068)

 

 

 

(995,235)

 

 

Cash paid to prepayment for land use right

 

 

 

-

 

 

 

(2,274,323)

 

 

Addition to land use right

 

 

 

(69,778)

 

 

 

-

 

 

Net cash received from acquisition of a subsidiary

 

 

 

952,170

 

 

 

-

 

 

Advances to note receivable

 

 

 

-

 

 

 

(26,399,696)

 

 

 

 

 

 

 

 

 

 

Net cash used in investing activities

 

 

 

(12,759,797)

 

 

 

(30,022,431)

 

 

 

 

 

 

 

 

 

 

Cash flows from financing activities:

 

 

 

 

 

 

 

 

Advance from(Repayment of) amount due to a stockholder

 

 

 

192,202

 

 

 

(100,504)

 

 

Advance to a non-controlling stockholder of a subsidiary

 

 

 

(145,999)

 

 

 

-

 

 

Proceeds from the registered direct offering, net of expenses

 

 

 

28,328,466

 

 

 

-

 

 

Proceeds from exercise of warrants

 

 

 

1,913,613

 

 

 

-

 

 

Proceeds from short-term borrowings

 

 

 

-

 

 

 

4,139,121

 

 

Repayment on short-term borrowings

 

 

 

(4,139,121)

 

 

 

(4,289,341)

 

 

Dividends paid

 

 

 

(1,313,080)

 

 

 

-

 

 

 

 

 

 

 

 

 

 

Net cash provided by (used in) financing activities

 

 

 

24,836,081

 

 

 

(250,724)

 

 

 

 

 

 

 

 

 

 

NET CHANGE IN CASH AND CASH EQUIVALENTS

 

 

 

5,819,034

 

 

 

(24,605,569)

 

 

 

 

 

 

 

 

 

 

Effect of exchange rate changes in cash and cash equivalents

 

 

 

2,594,506

 

 

 

108,494

 

 

 

 

 

 

 

 

 

 

CASH AND CASH EQUIVALENTS, BEGINNING OF YEAR

 

 

 

7,143,232

 

 

 

31,640,307

 

 

 

 

 

 

 

 

 

 

CASH AND CASH EQUIVALENTS, END OF YEAR

 

 

$

 

15,556,772

 

 

$

 

7,143,232

 

 

 

 

SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION

 

 

Cash paid for income taxes

 

 

$

 

4,536,080

 

 

$

 

1,794,704

 

 

Cash paid for interest

 

 

$

 

40,032

 

 

$

 

230,433

 

 

 

 

 

 

 

 

 

 

 

 




 

 

SUPPLEMENTAL DISCLOSURE OF NON-CASH INVESTING AND FINANCING TRANSACTIONS

 

 

Transfer from prepayment to land use rights

 

 

$

 

2,274,323

 

 

$

 

-

 

 

Transfer from construction in progress to property, plant and equipment

 

 

$

 

-

 

 

$

 

2,600,090

 

 

 

 

 

 

 

 

 

 

 




 

 

ACQUISITION OF XIANGHE

 

 

Transfer from note receivable to paid for acquisition of Xianghe

 

 

$

 

26,399,696

 

 

$

 

-

 

 

Consideration paid by Xianghe on behalf of Mingxiang

 

 

$

 

1,400,304

 

 

$

 

-

 

 

 

 

 

 

 

 

 

 

 



For more information, please contact:

 

 

 

 

   COMPANY

 

 

    Marco Hon Wai Ku, CFO

 

 

    Suite 815, 8th Floor

 

 

    Ocean Centre, Harbour City

 

 

    Kowloon, HONG KONG

 

 

    Tel:      +852-2111-8768

 

 

    Email:  marco.ku@china-marine.cn

 

 

    Web:    www.china-marine.cn

 

 

 

 

   INVESTOR RELATIONS

 

 

    John Mattio, SVP

 

 

    HC International, New York

 

 

    Tel:     +1-203-616-5144 (U.S.)

 

 

    Email:      john.mattio@hcinternational.net

 

 

    Web:       www.hcinternational.net

 

 
 
Source: China Marine Food Group Limited
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