HARBIN, China, November 13, 2012 /PRNewswire-FirstCall/-- Nutrastar International Inc. (OTCQB: NUIN; "Nutrastar" or the "Company"), a leading producer and supplier of premium branded consumer products, including commercially cultivated Cordyceps Militaris ("Cordyceps"), functional health beverages and organic and specialty foods, today announced its results for the three months and nine months ended September 30, 2012.
Financial Highlights for the Three Months Ended September 30, 2012
Financial Highlights for the Nine Months Ended September 30, 2012
Management Commentary
"Although demand remained strong, we experienced a supply shortage due to the scheduled operational maintenance within our facilities which began in July 2012. For the nine months and for the three months ended September 30, 2012, our sales were up approximately 6.2% and down roughly 20.8%, respectively. The maintenance shutdown of our facilities temporarily reduced production of our finished core product Cordyceps as well as the raw materials required for our beverage products by approximately 23%, thus causing a decline in sales during the third quarter. The operational maintenance was completed at the end of September and production has since returned to normal levels. As a result of the temporary shutdown and resource limitations which impacted the timing of bringing on additional production facilities, we will not meet our previously anticipated full year 2012 revenue guidance of $40 million to $44 million," Ms. Lianyun Han, CEO of Nutrastar, commented.
As for the remainder of the year, Ms. Han stated, "Fourth quarter demand is remaining robust and with the completion of required maintenance, sales are expected to be stronger than in the previous quarter. Our Cordyceps expansion project is expected to stay on track and we forecast meeting our goal of 100 tons production capacity by 2013, an increase of 14.9% from current levels. We believe that 2013 will be an even greater year for the company in terms of growth, sales and production."
Ms. Han added, "Regarding our financial position, we continue to have a significant cash balance, roughly $4.08 per diluted share, which is being managed conservatively. Having been seen and verified by our independent auditor, we have ear-marked this cash to go towards boosting our business development efforts across all consumer product lines, furthering our business expansion projects and branding strategies, as well as looking at inorganic growth opportunities - only those we see as being complementary to our business and products, and accretive to our shareholders."
Request for Call with Management
Investors are invited to request a call with Nutrastar's management team. For those investors who are interested in speaking with management, please contact American Capital Ventures at +1-305-918-7000 to schedule.
For more information regarding Nutrastar's financial performance during the quarter and nine months ended September 30, 2012, please refer to the Quarterly Report on Form 10-Q to be filed with the Securities and Exchange Commission on or about November 13, 2012.
About Nutrastar International Inc.
Nutrastar is a China based leading producer and supplier of premium branded consumer products including commercially cultivated Cordyceps Militaris, functional health beverages as well as specialty and organic foods. Cordyceps Militaris is one of the most highly regarded herbal nutrients in Traditional Chinese Medicine. The Company is headquartered in Harbin, capital of Heilongjiang Province, with 332 employees, including 21 in R&D, and 149 in sales and marketing. The products of Nutrastar are sold throughout China via a sales and distribution network that covers more than 10 provinces. More information may be found at http://www.nutrastarintl.com/ or e-mail: ir@nutrastarintl.com
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Safe Harbor Statement
This news release contains "forward-looking statements" relating to the business of Nutrastar International Inc., its subsidiaries and other affiliate companies. All statements, other than statements of historical fact included herein are "forward-looking statements" including 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 forward-looking statements are often identified by the use of forward-looking terminology such as "believes," "expects" or similar expressions. 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 forward-looking statements attributable to the Company or persons acting on its behalf are expressly qualified in their entirety by these factors. You should not place undue reliance on these forward-looking statements, which speak only as of the date of this press release. Other than as required under the securities laws, the Company does not assume a duty to update any forward-looking statements to reflect events or circumstances after the date hereof.
For more information, please contact:
Howard Gostfrand
American Capital Ventures
Tel: +1-305-918-7000
Email: info@amcapventures.com
NUTRASTAR INTERNATIONAL INC. AND SUBSIDIARIES | ||||||||||||
CONDENSED CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME | ||||||||||||
(Unaudited) | ||||||||||||
(AMOUNTS EXPRESSED IN US DOLLARS) | ||||||||||||
For the Three Months | For the Nine Months | |||||||||||
Ended September 30, | Ended September 30, | |||||||||||
2012 | 2011 | 2012 | 2011 | |||||||||
NET REVENUE | $ | 7,572,443 | $ | 9,558,282 | $ | 24,468,889 | $ | 23,037,815 | ||||
Cost of goods sold | (1,559,180) | (2,193,504) | (5,809,842) | (5,299,920) | ||||||||
GROSS PROFIT | 6,013,263 | 7,364,778 | 18,659,047 | 17,737,895 | ||||||||
Selling expenses | (350,426) | (336,876) | (1,198,434) | (1,210,687) | ||||||||
General and administrative expenses | (551,348) | (595,599) | (1,880,591) | (1,931,016) | ||||||||
Income from operations | 5,111,489 | 6,432,303 | 15,580,022 | 14,596,192 | ||||||||
Other income (expenses): | ||||||||||||
Interest income | 59,957 | 23,995 | 193,839 | 130,590 | ||||||||
Foreign exchange differences | (3,440) | (12,504) | (14,607) | 39,281 | ||||||||
Change in fair value of warrants | (25,915) | 200,754 | 114,845 | 1,029,879 | ||||||||
Total other income | 30,602 | 212,245 | 294,077 | 1,199,750 | ||||||||
Income before income taxes | 5,142,091 | 6,644,548 | 15,874,099 | 15,795,942 | ||||||||
Provision for income taxes | (1,397,501) | (1,664,065) | (4,278,897) | (3,906,071) | ||||||||
NET INCOME | 3,744,590 | 4,980,483 | 11,595,202 | 11,889,871 | ||||||||
OTHER COMPREHENSIVE INCOME: | ||||||||||||
Foreign currency translation adjustments | (199,602) | 1,121,422 | (486,711) | 2,348,153 | ||||||||
COMPREHENSIVE INCOME | $ | 3,544,988 | $ | 6,101,905 | $ | 11,108,491 | $ | 14,238,024 | ||||
Earnings per share: | ||||||||||||
Basic | $ | 0.24 | $ | 0.33 | $ | 0.74 | $ | 0.79 | ||||
Diluted | $ | 0.23 | $ | 0.30 | $ | 0.70 | $ | 0.73 | ||||
Weighted average number of shares outstanding: | ||||||||||||
Basic | 15,402,196 | 14,915,588 | 15,376,476 | 14,732,517 | ||||||||
Diluted | 16,532,296 | 16,516,910 | 16,515,212 | 16,322,356 | ||||||||
NUTRASTAR INTERNATIONAL INC. AND SUBSIDIARIES | ||||||
CONDENSED CONSOLIDATED BALANCE SHEETS | ||||||
(AMOUNTS EXPRESSED IN US DOLLARS) | ||||||
September 30, | December 31, | |||||
2012 | 2011 | |||||
(Unaudited) | ||||||
ASSETS | ||||||
CURRENT ASSETS | ||||||
Cash and cash equivalents | $ | 67,474,486 | $ | 54,556,329 | ||
Restricted cash | - | 4,170 | ||||
Accounts receivable | 83,100 | 82,516 | ||||
Inventories | 1,213,583 | 898,871 | ||||
Prepayments and other receivables | 1,077,702 | 1,194,466 | ||||
Total current assets | 69,848,871 | 56,736,352 | ||||
OTHER ASSETS | ||||||
Intangible assets, net | 1,656,776 | 2,024,593 | ||||
Property, plant and equipment, net | 11,749,428 | 12,395,567 | ||||
Construction in process | 3,992,484 | 5,271,609 | ||||
Total assets | $ | 87,247,559 | $ | 76,428,121 | ||
LIABILITIES AND STOCKHOLDERS' EQUITY | ||||||
CURRENT LIABILITIES | ||||||
Accounts payable | $ | - | $ | 6,339 | ||
Other payables and accruals | 1,334,322 | 1,064,045 | ||||
Taxes payable | 1,834,780 | 2,585,738 | ||||
Due to a related party | 149,412 | 80,648 | ||||
Preferred stock dividend payable | 546,831 | 529,851 | ||||
Warrants liabilities | 29,566 | 144,411 | ||||
Total current liabilities | 3,894,911 | 4,411,032 | ||||
Total liabilities | 3,894,911 | 4,411,032 | ||||
COMMITMENTS AND CONTINGENCIES (Note 19) | ||||||
STOCKHOLDERS' EQUITY | ||||||
Preferred Stock, $0.001 par value, (1,000,000 shares authorized, | ||||||
113,010 shares and 147,820 shares issued and outstanding, respectively; aggregate liquidation preference amount: | ||||||
$3,164,280 and $4,138,960, plus accrued but unpaid dividend of | ||||||
$546,831 and $529,851, at September 30, 2012 and | 2,577,324 | 3,371,206 | ||||
December 31, 2011, respectively) | ||||||
Common stock, $0.001 par value, 190,000,000 shares authorized | ||||||
15,462,381 shares issued and 15,418,826 shares outstanding at | 15,463 | 14,963 | ||||
September 30, 2012; 14,962,631 shares issued and 14,957,970 shares outstanding at December 31, 2011 | ||||||
Additional paid-in capital | 18,488,629 | 17,180,280 | ||||
Treasury stock, at cost, 43,555 shares and 4,661 shares of common stock | ||||||
as of September 30, 2012 and December 31, 2011 | (78,767) | (9,553) | ||||
Statutory reserves | 4,325,493 | 3,076,552 | ||||
Retained earnings | 53,294,650 | 43,167,074 | ||||
Accumulated other comprehensive income | 4,729,856 | 5,216,567 | ||||
Total stockholders' equity | 83,352,648 | 72,017,089 | ||||
Total liabilities and stockholders' equity | $ | 87,247,559 | $ | 76,428,121 | ||
NUTRASTAR INTERNATIONAL INC. AND SUBSIDIARIES | ||||||
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS | ||||||
(Unaudited) | ||||||
(AMOUNTS EXPRESSED IN US DOLLARS) | ||||||
For the Nine Months Ended September 30, | ||||||
2012 | 2011 | |||||
CASH FLOWS FROM OPERATING ACTIVITIES: | ||||||
Net income | $ | 11,595,202 | $ | 11,889,871 | ||
Adjustments to reconcile net income to cash provided by operating activities: | ||||||
Change in fair value of warrants | (114,845) | (1,029,879) | ||||
Warrants and consultant restricted stock expense | - | 58,340 | ||||
Depreciation and amortization | 926,272 | 842,198 | ||||
Share-based compensation expense | 313,262 | 351,515 | ||||
(Increase) decrease in assets: | ||||||
Accounts receivable | (1,110) | 72,686 | ||||
Inventories | (321,613) | (753,612) | ||||
Prepayments and other receivables | 109,625 | (762,258) | ||||
Increase (decrease) in liabilities: | ||||||
Accounts payable | (6,323) | (122,121) | ||||
Other payables and accruals | 277,756 | 139,029 | ||||
Taxes payable | (737,396) | 1,413,299 | ||||
Net cash provided by operating activities | 12,040,830 | 12,099,068 | ||||
CASH FLOWS FROM INVESTING ACTIVITIES: | ||||||
Refund of prepayments for cold studios | 1,266,424 | - | ||||
Addition to construction in progress | - | (4,716,169) | ||||
Purchase of property, plant and equipment and construction in progress | (15,903) | (2,019,305) | ||||
Net cash provided by (used in) investing activities | 1,250,521 | (6,735,474) | ||||
CASH FLOWS FROM FINANCING ACTIVITIES: | ||||||
Purchase common stocks | (69,214) | - | ||||
Advance from related party | 82,674 | - | ||||
Decrease in restricted cash | 4,170 | 140,860 | ||||
Net cash provided by financing activities | 17,630 | 140,860 | ||||
Foreign currency translation adjustment | (390,824) | 1,712,354 | ||||
INCREASE IN CASH AND CASH EQUIVALENTS | 12,918,157 | 7,216,808 | ||||
CASH AND CASH EQUIVALENTS, at the beginning of the period | 54,556,329 | 40,758,848 | ||||
CASH AND CASH EQUIVALENTS, at the end of the period | $ | 67,474,486 | $ | 47,975,656 | ||
NON-CASH TRANSACTIONS | ||||||
Preferred stock and dividend converted into common stock | $ | 995,587 | $ | 1,203,346 | ||
Share-based payment - IR warrants | - | 58,340 | ||||
Preferred stock dividend payable | 218,685 | 293,010 | ||||
Share-based payment to officers and directors under equity incentive plan | 313,262 | 351,515 | ||||
SUPPLEMENTAL DISCLOSURE INFORMATION | ||||||
Income taxes paid | $ | 4,773,432 | $ | 2,475,207 | ||
