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Nutrastar International, Inc. Announces Full Year 2014 Results

2015-03-30 21:00 1836

HARBIN, China, March 30, 2015 /PRNewswire/ -- 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 full year ended December 31, 2014.

Financial Highlights for the Full Year Ended December 31, 2014

  • Net revenue was $43.33 million, as compared to $43.35 million in full year 2013.
  • Gross profit was $34.01 million, representing a gross margin of 78.5%.
  • Net income was $22.72 million, representing a net margin of 52.4%.
  • Basic and diluted EPS were $1.34 and $1.28, respectively, with 16.83 million basic shares and 17.70 million diluted shares outstanding.

Management Commentary

Ms. Lianyun Han, CEO of Nutrastar, commented, "Over the past few years, we have worked hard at expanding product offerings, increasing revenue and creating opportunities through product development and capacity expansion. Although revenue for 2014 came in slightly under our estimates, it was a successful year nonetheless marked by the expansion and realignment of our product offerings in order to better position ourselves to meet current and future market demand. For the full year 2014, we operated at full production capacity and with the benefit of these economies of scale, our gross margins improved to 78.5%, up from 77.8% in the prior year. We also experienced a sales increase of approximately 10% or $3.36 million in our core premium consumer product Cordyceps, which includes sales of our new soluble, on-the-go Cordyceps powder solution. As expected, due to the strategic product realignment implemented in early 2014, sales growth of our core Cordyceps product segment was partially offset by $3.47 million decrease in sales of our beverages product line, resulting in year-over-year flat revenue growth."

Ms. Han continued, "Currently, we expect to continue operating at full production capacity and thus anticipate minimum year-over-year revenue growth in the current year. Since demand for our premium Cordyceps Militaris consumer products remains robust in our current markets, we will begin to evaluate avenues for future capacity expansion this year."

"One of our 2015 priorities will be exploring opportunities and securing the export of our products to markets abroad. Since receiving initial export approval from China's Ministry of Commerce as Foreign Trade Operator, we have been conducting and prototyping new product formats for select international markets such as South Korea and Hong Kong. We plan to evaluate and test our on-the-go soluble Cordyceps powder solution to determine its potential receptivity and viability in the U.S. market, and explore strategic packaging and distribution partners that will be integral to our international exportation approval and expansion efforts. It is our current intention to complete market testing, secure packaging and international distribution partners in 2015 and begin generating international sales revenue in 2016. We believe the international path is a vital part of the Company's future growth plan and we are committed to ensuring it happens as soon as possible beginning with our powder solution. We will keep the public apprised as initiatives progress."

"In closing, we believe 2015, despite our flat revenue growth expectations, will be a significant year that sets the stage for increased and sustained growth for the Company going forward. On behalf of the entire Nutrastar team, we would like to thank our shareholders and supporters for their continued patience and support for our Company and belief in our unique value proposition within the growing consumer product market. We look forward to sharing in our successes moving forward."

Outlook for the Year Ending December 31, 2015

Based on management's current expectations, full year 2015 revenue should be in the range of $43 million to $45 million.

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 full year ended December 31, 2014, please refer to the Annual Report on Form 10-K to be filed with the Securities and Exchange Commission on or about March 30, 2015.

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 336 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

Make sure you are first to receive timely up-to-date information on Nutrastar. Sign up for Nutrastar's email news alert system today at: http://www.nutrastarintl.com/alerts

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:

Richard Hull
American Capital Ventures
Tel: +1-305-918-7000
Email: rh@amcapventures.com


NUTRASTAR INTERNATIONAL INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME

(AMOUNTS EXPRESSED IN US DOLLARS)






Year Ended December 31,



2014



2013







REVENUE

$

43,328,218


$

43,348,989







Cost of goods sold


(9,315,526)



(9,633,349)







GROSS PROFIT


34,012,692



33,715,640







Selling expenses


(1,467,320)



(1,848,488)

General and administrative expenses








(2,376,873)



(3,216,459)

Gain on re-measurement of accrued staff fringe and social benefits


-



934,855







Income from operations


30,168,499



29,585,548







Other income (expenses):






Interest income


399,696



324,145

Foreign exchange differences


(10,765)



64,653

Change in fair value of warrants


-



173

Other income


32,558



8,073

Total other income (expenses)


421,489



397,044







Income before income taxes


30,589,988



29,982,592







Provision for income taxes


(7,870,214)



(7,812,222)







NET INCOME


22,719,774



22,170,370







OTHER COMPREHENSIVE INCOME:






Foreign currency translation adjustments


(324,662)



3,109,485







COMPREHENSIVE INCOME

$

22,395,112


$

25,279,855







Earnings per share






Basic

$

1.34


$

1.38

Diluted

$

1.28


$

1.30







Weighted average number of shares outstanding






Basic


16,827,010



15,949,537

Diluted


17,699,589



17,089,460


NUTRASTAR INTERNATIONAL INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

(AMOUNTS EXPRESSED IN US DOLLARS)






December 31,



2014



2013













ASSETS

CURRENT ASSETS






Cash and cash equivalents

$

126,542,564


$

102,599,186

Accounts receivable


93,066



56,922

Inventories


635,409



691,847

Prepayments and other receivables


1,489,800



1,300,012

Total current assets


128,760,839



104,647,967

OTHER ASSETS






Intangible assets, net


613,315



1,107,737

Property, plant and equipment, net


14,424,942



15,481,249







Total assets

$

143,799,096


$

121,236,953







LIABILITIES AND STOCKHOLDERS' EQUITY

CURRENT LIABILITIES






Other payables and accruals

$

990,290


$

1,167,957

Taxes payable


2,748,583



2,879,172

Due to a related party


511,054



265,223

Preferred stock dividend payable


690,662



738,903

Total current liabilities


4,940,589



5,051,255

Total liabilities


4,940,589



5,051,255

COMMITMENTS AND CONTINGENCIES






STOCKHOLDERS' EQUITY






Preferred Stock, $0.001 par value, 1,000,000 shares authorized, 77,776
shares and 110,066 shares issued and outstanding, respectively;
aggregate liquidation preference amount: $2,177,728 and $3,081,848,
plus accrued but unpaid dividend of $690,662 and $738,903, at
December 31, 2014 and 2013, respectively


1,773,772



2,510,183







Common stock, $0.001 par value, 190,000,000 shares authorized,
16,953,541 shares issued and 16,909,986 shares outstanding at
December 31, 2014; 16,421,161 shares issued and 16,377,606 shares
outstanding at December 31, 2013


16,954



16,422

Additional paid-in capital


21,122,372



19,934,551

Statutory reserves


4,989,033



4,983,935

Treasury stock, at cost, 43,555 shares as of December 31, 2014 and 2013


(78,767)



(78,767)

Retained earnings


102,783,308



80,242,877

Accumulated other comprehensive income


8,251,835



8,576,497

Total stockholders' equity


138,858,507



116,185,698







Total liabilities and stockholders' equity

$

143,799,096


$

121,236,953

NUTRASTAR INTERNATIONAL INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

(AMOUNTS EXPRESSED IN US DOLLARS)






Year Ended December 31,



2014



2013

CASH FLOWS FROM OPERATING ACTIVITIES:






Net income

$

22,719,774


$

22,170,370

Adjustments to reconcile net income to cash provided by operating activities:






Change in fair value of warrants


-



(173)

Depreciation and amortization


1,485,039



1,473,496

Share-based compensation expense


137,085



801,396

IR unregistered stock compensation expense


92,371



17,804

(Increase) decrease in assets:






Accounts receivable


(36,209)



26,676

Inventories


53,730



298,548

Prepayments and other receivables


(193,731)



61,626

Increase (decrease) in liabilities:






Other payables and accruals


(173,184)



-

Advance from related party


237,956



(351,591)

Taxes payable


(119,724)



(191,162)

Net cash provided by operating activities


24,203,107



24,306,990







CASH FLOWS FROM FINANCING ACTIVITIES:






Advance from related party


16,637



46,173

Net cash provided by financing activities


16,637



46,173







Foreign currency translation adjustment


(276,366)



2,719,490







INCREASE IN CASH AND CASH EQUIVALENTS


23,943,378



27,072,653

CASH AND CASH EQUIVALENTS, at the beginning of the period


102,599,186



75,526,533







CASH AND CASH EQUIVALENTS, at the end of the period

$

126,542,564


$

102,599,186







NON-CASH TRANSACTIONS






Preferred stock and dividend converted into common stock

$

958,897


$

86,279

Preferred stock dividend payable


174,245



229,513

Share-based payment to officers and directors under equity incentive plan


137,085



801,396

Share-based payment -- IR unregistered stock compensation expense


92,371



17,804

SUPPLEMENTAL DISCLOSURE INFORMATION






Income taxes paid

$

7,970,444


$

7,683,689

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Source: Nutrastar International Inc.
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