omniture

Tiens Biotech Group (USA) Reports 2010 Results

2011-04-01 10:27 1051

TIANJIN, China April 1, 2011 /PRNewswire-Asia/ -- Tiens Biotech Group (USA), Inc. (the "Company" or "Tiens", NYSE AMEX: TBV), a company dedicated to the research, development, manufacturing, and marketing of nutrition supplement products, including wellness products and dietary supplements, today announced financial results for the year ended December 31, 2010.

For 2010, revenue was $41.3 million, compared to $62.0 million for 2009.  

Net income for 2010 was $4.8 million, or $0.07 per share, compared to $23.8 million, or $0.33 per share for 2009.

Results for 2010 mainly reflect a decrease in international sales.  For 2010, international revenue was $16.4 million, compared to $34.7 million for 2009.  In 2008, China's Administration of Quality Supervision, Inspection and Quarantine carried out a national campaign against unsafe food and substandard products, which brought on a general slow-down and backlog of export clearances for Chinese food products. Upon the lifting of the regulations, overseas affiliated companies began to purchase more products, thereby increasing sales for 2009.

In addition, Tiens' Indonesia affiliated company has not purchased from the Company during the year of 2010, given they purchased more products in 2009 after the 2008 product scarcity for the reason noted above. In addition, local Original Equipment Manufacturers in Indonesia have been producing healthcare products with the Company's semi-finished goods, which have a profit margin that is much lower than the profit margin of finished goods.

Tiens' affiliated companies in many regions have made certain adjustments to their marketing programs and reorganizations at their branch and higher levels, which are expected to boost sales performance over the long-run, but negatively affect short-term sales.

Other Highlights  

Cost of sales were $15.0 million in 2010 compared to $20.2 million in 2009, a decrease of 25.6%.  This decrease was primarily due to the corresponding decrease in sales. Cost of sales decreased at a lower rate than revenue, primarily due to fixed costs, which do not increase or decrease in line with sales.

Gross profit decreased by 37.0% to $26.3 million in 2010, compared to $41.8 million in 2009. The gross profit margin for 2010 was 63.7% compared to 67.5% in 2009.

Selling, general and administrative expenses increased by 22.0% to $19.5 million in 2010, compared to $16.0 million in 2009. The increase was primarily due to increases in allowance for bad debt ($1.9 million), salaries expenses ($0.7 million) and research & development expenses ($0.6 million).

As of December 31, 2010, Tiens had $128.0 million of retained earnings and total shareholders' equity of $285.5 million.

In addition, Tiens reported that on March 11, 2011, Tianjin Tianshi Biological Engineering Co., Ltd. (Tianshi Engineering) was awarded a direct selling license in Tianjin.

Jinyuan Li, Chairman, President and CEO of Tiens, said, "We remain confident that domestic sales will return to, and potentially exceed, previous levels, as distributors begin to replenish their stock of our products.  In addition, we maintain this same positive sentiment regarding international sales, which we expect will benefit from the removal of export restrictions and gradual economic improvement.  We are steadfast in our commitment to building greater market share in China, expanding our international customer base, and further implementing our strategic plans for long-term domestic and international growth."

About Tiens Biotech Group (USA), Inc. www.tiens-bio.com

Tiens Biotech Group (USA), Inc. (NYSE AMEX: TBV) conducts its business operations from Tianjin, People's Republic of China. Tiens primarily engages in the research, development, manufacturing, and marketing of nutrition supplement products, including wellness products and dietary supplements.

Tiens derives its revenues principally from product sales to affiliated companies in China and internationally in 45 countries.  Since its establishment, Tiens has developed and produced 37 nutrition supplements, which include wellness products and dietary supplements.  Tiens develops its products at its own product research and development center, which employs highly qualified professionals in the fields of pharmacology, biology, chemistry and fine chemistry. Tiens has obtained all required certificates and approvals from government regulatory agencies to manufacture and sell its products in China.

In China, Tiens conducts the marketing and sales of its products through its affiliated company, Tianshi Engineering. Tianshi Engineering markets and sells Tiens' products in China through chain stores, domestic affiliated companies, and its 87 branches.  Outside of China, Tiens sells its products to affiliated companies in 45 countries who in turn sell through an extensive direct sales force, or multi-level marketing sales force. The Company's direct sales marketing program is subject to governmental regulation in each of these countries.  

Certain statements in this press release constitute "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities and Exchange Act of 1934.  Such forward-looking statements are not necessarily indicative of future financial results, and may involve known and unknown risks, uncertainties and other factors, which may cause the actual results, performance or achievements of the Company, to be materially different from any future results, performance, or achievements expressed or implied by such forward-looking statements. The Company's future operating results are dependent upon many factors, including but not limited to: (i) the Company's ability to obtain sufficient capital or a strategic business arrangement to fund its expansion plans; (ii) the Company's ability to build the management and human resources and infrastructure necessary to support the growth of its business; (iii) competitive factors and developments beyond the Company's control; (iv) whether the Company continues to experience delays in the export clearance of its products; and (v) other risk factors discussed in the Company's periodic filings with the Securities and Exchange Commission which are available for review at http://www.sec.gov.

-Tables Follow-

TIENS BIOTECH GROUP (USA), INC. AND SUBSIDIARIES

 

 

CONSOLIDATED STATEMENTS OF INCOME AND OTHER COMPREHENSIVE INCOME

 

 

FOR THE YEARS ENDED DECEMBER 31, 2010 and 2009

 

 

 

 

 

 

 

2010

 

 

2009

 

 

REVENUE - RELATED PARTIES

 

$

 

41,021,135

 

$

 

60,032,968

 

 

REVENUE - THIRD PARTIES

 

 

323,585

 

 

1,943,101

 

 

 

 

 

 

 

 

COST OF SALES - RELATED PARTIES

 

 

14,850,739

 

 

18,754,680

 

 

COST OF SALES - THIRD PARTIES

 

 

158,638

 

 

1,412,812

 

 

 

 

 

 

 

 

GROSS PROFIT    

 

 

26,335,343

 

 

41,808,577

 

 

 

 

 

 

 

 

SELLING, GENERAL AND  ADMINISTRATIVE EXPENSES        

 

 

19,530,501

 

 

16,009,382

 

 

 

 

 

 

 

 

INCOME FROM OPERATIONS

 

 

6,804,842

 

 

25,799,195

 

 

 

 

 

 

 

 

  Interest expense

 

 

(230,905)

 

 

(186,543)

 

 

  Interest income

 

 

18,362

 

 

301,709

 

 

  Other expense

 

 

35,965

 

 

(176,757)

 

 

OTHER EXPENSE, NET

 

 

(176,578)

 

 

(61,591)

 

 

 

 

 

 

 

 

INCOME BEFORE INCOME TAXES

 

 

6,628,264

 

 

25,737,604

 

 

 

 

 

 

 

 

INCOME TAXES

 

 

1,469,548

 

 

930,703

 

 

 

 

 

 

 

 

NET INCOME

 

 

5,158,716

 

 

24,806,901

 

 

 

 

 

 

 

 

   LESS: Net income attributable to the noncontrolling interest

 

 

(323,101)

 

 

(965,557)

 

 

 

 

 

 

 

 

NET INCOME ATTRIBUTABLE TO THE COMPANY

 

 

4,835,615

 

 

23,841,344

 

 

 

 

 

 

 

 

OTHER COMPREHENSIVE INCOME:

 

 

 

 

 

 

    Foreign currency translation adjustment

 

 

5,131,503

 

 

441,140

 

 

    Loss from the realization of foreign currency sale

 

 

-

 

 

(6,030,079)

 

 

 

 

 

 

 

 

COMPREHENSIVE INCOME ATTRIBUTABLE

 

 

 

 

 

 

TO THE COMPANY

 

 

9,967,118

 

 

18,252,405

 

 

 

 

 

 

 

 

COMPREHENSIVE INCOME ATTRIBUTABLE

 

 

 

 

 

 

TO THE NONCONTROLLING INTEREST

 

 

664,854

 

 

993,504

 

 

 

 

 

 

 

 

COMPREHENSIVE INCOME

 

$

 

10,631,972

 

$

 

19,245,909

 

 

 

 

 

 

 

 

EARNINGS PER SHARE,

 

 

 

 

 

 

BASIC AND DILUTED

 

$

 

0.07

 

$

 

0.33

 

 

 

 

 

 

 

 

WEIGHTED AVERAGE NUMBER OF SHARES,

 

 

 

 

 

 

BASIC AND DILUTED

 

 

71,333,586

 

 

71,333,586

 

 

 

 

 

 

 

 

The accompanying notes are an integral part of this statement.

 

 

 

 

 

 

 

 

 

 

 




 

 

 

 

 

 

 

 

 

TIENS BIOTECH GROUP (USA), INC. AND SUBSIDIARIES

 

 

 

 

 

 

 

 

 

 

 

CONSOLIDATED BALANCE SHEETS

 

 

AS OF DECEMBER 31, 2010 AND DECEMBER 31, 2009

 

 

 

 

 

 

 

December 31,

 

 

December 31,

 

 

 

 

 

 

 

2010

 

 

2009

 

 

 

 

 

A S S E T S

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

CURRENT ASSETS:

 

 

 

 

 

 

 

Cash

 

$

 

10,155,522

 

$

 

1,848,328

 

 

 

Accounts receivable, trade - related parties, net of allowance for doubtful accounts of $3,869,617 and $1,419,178 as of December 31, 2010 and December 31, 2009 , respectively

 

 

10,012,861

 

 

15,379,312

 

 

 

Inventories

 

 

5,703,349

 

 

5,328,052

 

 

 

Other receivables

 

 

1,045,952

 

 

995,657

 

 

 

Other receivables - related parties

 

 

17,376,522

 

 

44,561,626

 

 

 

Employee advances

 

 

170,842

 

 

115,673

 

 

 

Prepaid expenses, net

 

 

415,208

 

 

658,193

 

 

 

Prepaid taxes

 

 

3,646,140

 

 

407,534

 

 

 

 

Total current assets

 

 

48,526,396

 

 

69,294,375

 

 

 

 

 

 

 

 

 

 

 

PROPERTY, PLANT AND EQUIPMENT, net

 

 

72,037,542

 

 

10,124,483

 

 

 

 

 

 

 

 

 

 

 

OTHER ASSETS:

 

 

 

 

 

 

 

Construction in progress

 

 

128,715,283

 

 

125,572,621

 

 

 

Construction deposits

 

 

12,490,855

 

 

1,405,997

 

 

 

Intangible assets, net

 

 

12,987,000

 

 

12,864,295

 

 

 

Other assets

 

 

10,721,040

 

 

11,847,937

 

 

 

 

Total other assets

 

 

164,914,178

 

 

151,690,850

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total assets

 

$

 

285,478,116

 

$

 

231,109,708

 

 

 

 

 

 

 

 

 

 

 

L I A B I L I T I E S    A N D    S H A R E H O L D E R S'   E Q U I T Y

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

CURRENT LIABILITIES:

 

 

 

 

 

 

 

Accounts payable

 

$

 

14,120,791

 

$

 

5,012,157

 

 

 

Advances from customers - related parties

 

 

8,688,877

 

 

4,426,751

 

 

 

Wages and benefits payable

 

 

1,613,782

 

 

1,484,852

 

 

 

Short-term debt

 

 

3,024,800

 

 

-

 

 

 

Income taxes payable

 

 

490,782

 

 

-

 

 

 

Contractor deposits

 

 

209,376

 

 

183,395

 

 

 

Contractor payables

 

 

28,134,711

 

 

18,513,216

 

 

 

Other payables

 

 

1,113,416

 

 

1,151,551

 

 

 

Other payables - related parties

 

 

1,417,516

 

 

3,326,110

 

 

 

 

Total current liabilities

 

 

58,814,051

 

 

34,098,032

 

 

 

 

 

 

 

 

 

 

 

NON-CURRENT LIABILITIES

 

 

 

 

 

 

 

Long term debt

 

 

18,451,280

 

 

-

 

 

 

Deferred income                                                                                                  

 

 

11,473,853

 

 

11,236,501

 

 

 

 

Total non current liabilities

 

 

29,925,133

 

 

11,236,501

 

 

 

 

Total liabilities

 

 

88,739,184

 

 

45,334,533

 

 

 

 

 

 

 

 

 

 

 

Commitments and Contingencies

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

EQUITY:

 

 

 

 

 

 

 

Shareholders' equity of the Company:

 

 

 

 

 

 

 

 

Common stock, $0.001 par value, 250,000,000 shares authorized, 71,333,586 issued and outstanding, respectively

 

 

71,334

 

 

71,334

 

 

 

 

Paid-in-capital

 

 

18,349,908

 

 

18,042,189

 

 

 

 

Statutory reserves

 

 

16,465,144

 

 

13,217,217

 

 

 

 

Retained earnings

 

 

127,957,951

 

 

126,370,263

 

 

 

 

Accumulated other comprehensive income

 

 

23,393,626

 

 

18,262,123

 

 

 

 

 

Total shareholders' equity of the Company

 

 

186,237,963

 

 

175,963,126

 

 

 

 

Noncontrolling interest

 

 

10,500,969

 

 

9,812,049

 

 

 

 

Total equity

 

 

196,738,932

 

 

185,775,175

 

 

 

 

 

Total liabilities and equity

 

$

 

285,478,116

 

$

 

231,109,708

 

 

 

 

 

 

 

 

 

 

 

 

The accompanying notes are an integral part of this statement.

 

 

 

 

 

 

 

 

 

 

 

 

 

 



TIENS BIOTECH GROUP (USA), INC. AND SUBSIDIARIES

 

 

 

 

 

 

 

 

 

 

 

 

CONSOLIDATED STATEMENTS OF CASH FLOWS

 

 

FOR THE YEARS ENDED DECEMBER 31, 2010 AND 2009

 

 

 

 

 

 

 

 

2010

 

 

2009

 

 

CASH FLOWS FROM OPERATING ACTIVITIES:

 

 

 

 

 

 

 

Net income

 

$

 

5,158,716

 

$

 

24,806,901

 

 

 

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

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Deferred income

 

 

(142,070)

 

 

-

 

 

 

 

 

Provision for doubtful accounts

 

 

2,349,703

 

 

406,795

 

 

 

 

 

Increase (decrease) provision for obsolete inventory

 

 

(237,632)

 

 

309,343

 

 

 

 

 

Depreciation

 

 

2,036,280

 

 

2,173,251

 

 

 

 

 

Amortization

 

 

338,019

 

 

381,742

 

 

 

 

 

Interest expense

 

 

167,586

 

 

4,761

 

 

 

 

 

(Gain) loss on sale of assets

 

 

(63,773)

 

 

47,054

 

 

 

 

 

Loss on assets written off

 

 

40,982

 

 

5,876

 

 

 

 

 

Rental expense borne by a related party

 

 

330,708

 

 

326,774

 

 

 

 

(Increase) decrease in assets:

 

 

 

 

 

 

 

 

 

Accounts receivable, trade - related parties

 

 

3,411,877

 

 

8,308,993

 

 

 

 

 

Other receivables

 

 

(16,036)

 

 

(184,540)

 

 

 

 

 

Other receivables - related parties

 

 

9,936,038

 

 

1,668,812

 

 

 

 

 

Inventories

 

 

93,315

 

 

2,761,335

 

 

 

 

 

Employee advances

 

 

(50,112)

 

 

(38,359)

 

 

 

 

 

Prepaid expense

 

 

258,945

 

 

(419,419)

 

 

 

 

Increase (decrease) in liabilities:

 

 

 

 

 

 

 

 

 

Accounts payable

 

 

8,742,972

 

 

(1,249,152)

 

 

 

 

 

Advances from customers - related parties

 

 

21,603,664

 

 

1,178,463

 

 

 

 

 

Wages and benefits payable

 

 

76,914

 

 

(43,279)

 

 

 

 

 

Other taxes payable

 

 

(2,674,295)

 

 

968,294

 

 

 

 

 

Other payables

 

 

(74,068)

 

 

(650,296)

 

 

 

 

 

Other payables - related parties

 

 

9,069,853

 

 

3,107,699

 

 

 

 

 

 

Net cash provided by operating activities

 

 

60,357,586

 

 

43,871,048

 

 

 

 

 

 

 

 

 

 

 

 

CASH FLOWS FROM INVESTING ACTIVITIES:

 

 

 

 

 

 

 

Cash outflow arising from disposal of a subsidiary

 

 

-

 

 

(23,975,473)

 

 

 

Collections from loans to local government

 

 

-

 

 

105,229

 

 

 

Construction deposits

 

 

(11,248,302)

 

 

(2,664,741)

 

 

 

Contractor deposits

 

 

19,306

 

 

19,734

 

 

 

Addition to construction in progress

 

 

(54,487,459)

 

 

(42,734,161)

 

 

 

Equipment deposits

 

 

(6,102,039)

 

 

(11,782,984)

 

 

 

Proceeds from sales of properties

 

 

73,650

 

 

29,131

 

 

 

Purchase of equipment and automobiles

 

 

(1,441,906)

 

 

(2,009,536)

 

 

 

 

 

 

Net cash used in investing activities

 

 

(73,186,750)

 

 

(83,012,801)

 

 

 

 

 

 

 

 

 

 

 

 

CASH FLOWS FROM FINANCING ACTIVITIES:

 

 

 

 

 

 

 

Loan from (repayment to) related parties

 

 

-

 

 

(3,946,860)

 

 

 

Proceed from short term debt

 

 

2,958,800

 

 

-

 

 

 

Proceeds from long term debt

 

 

18,048,680

 

 

-

 

 

 

 

 

 

Net cash provided by (used in) financing activities

 

 

21,007,480

 

 

(3,946,860)

 

 

 

 

 

 

 

 

 

 

 

 

EFFECT OF EXCHANGE RATE CHANGES ON CASH

 

 

128,878

 

 

82,430

 

 

 

 

 

 

 

 

 

 

 

 

INCREASE (DECREASE) IN CASH

 

 

8,307,194

 

 

(43,006,183)

 

 

 

 

 

 

 

 

 

 

 

 

CASH, beginning of period

 

 

1,848,328

 

 

44,854,511

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

CASH, end of period

 

$

 

10,155,522

 

$

 

1,848,328

 

 

 

 

 

 

 

 

 

 

 

 

Supplemental disclosures of cash flow information

 

 

 

 

 

 

 

Cash paid during the period for:

 

 

 

 

 

 

 

 

Interest

 

$

 

217,154

 

$

 

105,817

 

 

 

 

Income taxes

 

$

 

1,489,417

 

$

 

3,287,531

 

 

 

 

 

 

 

 

 

 

 

 

 

 

The accompanying notes are an integral part of this statement.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 



TIENS BIOTECH GROUP (USA), INC. AND SUBSIDIARIES

REVENUE BY REGION

 

 

 

 

 

 

 

 

Twelve months ended

 

 

 

 

December 31,

 

 

 

 

 

 

 

 

 

    2010

 

    2009

 

Change

 

 

 

 

 

 

 

China  

 

$24,894,472

 

$27,241,333

 

          - 8.6%

 

 

International

 

$   16,450,248

 

$   34,734,736

 

          -52.6%

 

 

Total

 

$41,344,720

 

$61,976,069  

 

          -33.3%

 

 

 

 

 

 

 

 



CONTACT:

 

 

 

 

 

 

Investor Relations

 

Debra Berliner

 

 

Tiens Biotech Group (USA), Inc.

 

G. S. Schwartz & Co.

 

 

Tel:   +86-22-8213-7335

 

Tel:  212-725-4500

 

 

Fax:  +86-22-8213-7914

 

Fax: 212-725-9188

 

 

Email: investor@tiens-bio.com

 

Email: dberliner@schwartz.com

 

 

http://www.tiens-bio.com

 

 

 

 

 

Source: Tiens Biotech Group (USA), Inc.
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