NEW YORK, Nov. 14, 2006 (PRIMEZONE) -- Bodisen Biotech, Inc. (AMEX:BBC) (London:BODI) (website: www.bodisen.com), the first China-based environmentally friendly bio fertilizer company listed on a U.S. stock exchange, and dually listed in London, today announced that it achieved strong revenue and earnings growth from the production and sale of organic fertilizer and pesticide products during the third quarter ended September 30, 2006.
The following are some of the financial highlights for the third quarter from the company's Form 10-Q filed with the SEC:
THIRD QUARTER FINANCIAL & OPERATIONAL HIGHLIGHTS
-- Revenues grew 20.9% to $12.7 million from $10.5 million in the
same period of 2005.
-- Gross profit increased to $4.9 million from $4.0 million in the
same period last year.
-- Net Income grew 11.1% to $3.2 million from $2.9 million in the
same period of 2005.
-- Net income margin of approximately 25.1% due to strong sales in
high margin liquid fertilizers.
-- Fully diluted EPS was $0.17 compared with $0.18 in the same
period last year.
"We continued to demonstrate strong year-over-year growth during the third quarter of 2006 with double digit revenue and net income growth, following a record second quarter, when the company recorded the highest revenues and earnings in its history," said Karen Qiong Wang, chairwoman and CEO of Bodisen Biotech.
REVENUES
Bodisen achieved revenues of $12,713,217 for the third quarter of 2006, up 20.9% from the prior year period when the company reported revenues of $10,516,790. For the nine month period ended September 30, 2006, the company recorded $39,630,766 in revenues, an increase of 67.7% from the same period last year, when the company recorded $23,635,270 in revenues.
GROSS PROFIT
Bodisen achieved a gross profit of $4,873,866 for the third quarter of 2006, up 23.2% from the prior year period gross profit of $3,955,609. Gross margin increased to 38.3% in the third quarter of 2006 from 37.6% in the same year ago period. The increase in gross margin was primarily attributable to the increase in the prices of main products. For the nine months ended September 30, 2006, the company achieved gross profit of $15,522,041, an increase of 75.1%, compared to $8,865,450 for the nine months ended September 30, 2005.
OPERATING EXPENSES
Operating expenses for the third quarter of 2006 were $1,712,639, compared to $594,417 for the same period in 2005, due to increased sales and marketing costs related to increased sales for the quarter. For the nine month period ended September 30, 2006, the company recorded operating expenses of $3,709,243, compared with $1,684,207 for the same period in 2005.
NET INCOME
Bodisen achieved net income of $3,190,045 or fully diluted EPS of $0.17 in the third quarter of 2006 compared to net income of $2,871,041 or fully diluted EPS of $0.18 in the same quarter last year. The decrease in EPS was related to the increase in the total shares outstanding to 18.3 million in 2006 from 15.6 million shares for the third quarter of 2005.
Net income increased by 84.8% to $11,752,366, or fully diluted EPS of $0.65, during the nine months ended September 30, 2006, from $6,359,787, or fully diluted EPS of $0.40, for the same period in 2005.
BALANCE SHEET
The company recorded $15,223,935 in cash and cash equivalents at the end of the third quarter of 2006. Accounts receivables account totaled $20,128,848 on September 30, 2006. The company stated that accounts receivables balance remained high because sales in 2006 have grown sharply compared with 2005 and that as part of its expansion into northern China, it has increased the number of distributors who market their product and has had to extend credit to these distributors. At the same time, the company stated that it has recouped all of the credit extended to distributors within five months.
OUTLOOK
"With the end of the third quarter, our 2006 year-to-date revenues and earnings already exceed our total revenues and earnings for fiscal 2005," said Wang. "While the fourth quarter, which represents the end of the harvest season, typically is our slowest period of the year, we expect to continue to achieve year-over-year revenue and earnings growth in the last quarter of the year."
AMEX LETTER CLARIFICATION
Bodisen also clarified information contained in its press release issued November 12, 2006 regarding the letter it received from the Staff of the American Stock Exchange. The letter was a notice of deficiency, which means that problems have been identified that Bodisen must seek to address. It was not a notice of delisting, and thus Bodisen's shares will continue to trade on AMEX. Part of the problems cited in the AMEX letter relate to Bodisen's inability to timely provide information to AMEX that it has requested. AMEX also believes that the Company made incomplete, misleading and /or inaccurate disclosure in its public filings with regard to its relationship with, and payments to, a consultancy firm and its affiliates both prior to and subsequent to its listing on the AMEX. Bodisen has retained additional legal counsel to assist it in ensuring that such information is provided promptly in the future. The deficiencies noted in the AMEX letter may have resulted in Bodisen's prior SEC filings being incomplete, misleading and/or inaccurate. To the extent that any prior disclosure is of such nature, Bodisen will undertake to amend or correct the prior filings.
About Bodisen Biotech, Inc.
Bodisen Biotech Inc. is a leading manufacturer of liquid and organic compound fertilizers, pesticides, insecticides and agricultural raw materials certified by the Petroleum Chemical Industry Administrative office of China (Chemical Petroleum Production Administrative Bureau), Shaanxi provincial government and Chinese government. Ranked the 16th fastest growing company in China by Forbes China in January 2006, the company is headquartered in Shaanxi province and is a Delaware corporation. The company's environmentally friendly "green" products have been proven to improve soil and plant quality, and increase crop yields.
Safe Harbor Statement
This press release may contain forward-looking statements within the meaning of the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995. These statements are based on the current expectations or beliefs of Bodisen Biotech, Inc. management and are subject to a number of factors and uncertainties that could cause actual results to differ materially from those described in the forward-looking statements.
BODISEN BIOTECH, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEET
AS OF SEPTEMBER 30, 2006
(Unaudited)
ASSETS
------
CURRENT ASSETS:
Cash & cash equivalents $15,223,935
Accounts receivable, net
of allowance for doubtful
accounts of $1,515,074 20,128,848
Other receivable 2,705,935
Inventory 1,454,741
Advances to suppliers 8,304,715
Prepaid expense 61,401
-----------
Total current assets 47,879,575
PROPERTY AND EQUIPMENT, net 5,142,797
CONSTRUCTION IN PROGRESS 2,712,078
MARKETABLE SECURITY 5,881,739
INTANGIBLE ASSETS 2,062,000
OTHER ASSETS 744,959
-----------
TOTAL ASSETS $64,423,148
===========
LIABILITIES AND STOCKHOLDERS' EQUITY
------------------------------------
CURRENT LIABILITIES:
Accounts payable $ 154,844
Accrued expenses 469,928
-----------
Total current liabilities 624,772
STOCKHOLDERS' EQUITY:
Preferred stock, $0.0001 per share;
authorized 5,000,000 shares;
none issued
Common stock, $0.0001 per share;
authorized 30,000,000 shares;
issued and outstanding 18,176,917 1,818
Additional paid-in capital 32,860,075
Other comprehensive income 4,382,429
Statutory reserve 4,129,786
Retained earnings 22,424,268
-----------
Total stockholders' equity 63,798,376
-----------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $64,423,148
===========
Please see notes in the Company's Quarterly Report on Form 10-Q for
the period ended September 30, 2006 for further explanation.
BODISEN BIOTECH, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME AND OTHER COMPREHENSIVE INCOME
FOR THE THREE AND NINE MONTH PERIODS ENDED SEPTEMBER 30, 2006 AND 2005
(Unaudited)
Three Month Periods Nine Month Periods
Ended September 30, Ended September 30,
2006 2005 2006 2005
----------- ----------- ----------- -----------
Net Revenue $12,713,217 $10,516,790 $39,630,766 $23,635,270
Cost of Revenue 7,839,351 6,561,181 24,108,725 14,769,820
----------- ----------- ----------- -----------
Gross profit 4,873,866 3,955,609 15,522,041 8,865,450
Operating
expenses
Selling
expenses 557,965 294,860 1,703,608 674,768
General and
administrative
expenses 1,154,673 299,557 2,005,635 1,009,439
----------- ----------- ----------- -----------
Total
operating
expenses 1,712,638 594,417 3,709,243 1,684,207
----------- ----------- ----------- -----------
Income from
operations 3,161,228 3,361,192 11,812,798 7,181,243
Non-operating
income
(expense):
Other income
(expense) (31,771) -- 500,604 --
Interest
income 60,835 (5,461) 118,129 42,594
Interest
expense (247) (484,690) (679,165) (864,050)
----------- ----------- ----------- -----------
Total
non-operating
income
(expense) 28,817 (490,151) (60,432) (821,456)
----------- ----------- ----------- -----------
Net income 3,190,045 2,871,041 11,752,366 6,359,787
Other comprehensive
income
Foreign
currency
translation
gain 662,012 524,838 780,115 524,838
Unrealized
gain
(loss) on
marketable
equity
security 165,102 -- (928,695) --
----------- ----------- ----------- -----------
Comprehensive
Income $ 4,017,159 $ 3,395,879 $11,603,786 $ 6,884,625
=========== =========== =========== ===========
Weighted
average
shares
outstanding:
Basic 18,176,917 15,326,344 17,859,878 15,289,569
=========== =========== =========== ===========
Diluted 18,303,299 15,619,663 18,002,639 15,982,006
=========== =========== =========== ===========
Earnings per
share:
Basic $ 0.18 $ 0.19 $ 0.66 $ 0.42
=========== =========== =========== ===========
Diluted $ 0.17 $ 0.18 $ 0.65 $ 0.40
=========== =========== =========== ===========
Please see notes in the Company's Quarterly Report on Form 10-Q for
the period ended September 30, 2006 for further explanation.
BODISEN BIOTECH, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE NINE MONTH PERIODS ENDED SEPTEMBER 30, 2006 AND 2005
(Unaudited)
Nine Month Periods Ended
September 30,
2006 2005
---- -----
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income $ 11,752,366 $ 6,359,787
Adjustments to reconcile
net income to net cash
provided by (used in) operating
activities:
Depreciation and amortization 335,842 498,950
Amortization of debt discounts 603,886 634,285
Exchange loss (16,828) --
Value of vested option issued
to directors 7,523 --
(Increase) / decrease in assets:
Accounts receivable (12,336,536) (2,639,949)
Other receivable (4,968,421) --
Inventory (246,935) (269,999)
Advances to suppliers (3,599,885) 90,686
Other assets 3,960 (26,087)
Increase / (decrease) in
current liabilities:
Accounts payable 99,935 292,786
Other payables 3,374,315 378,699
Accrued expenses 51,735 (307,900)
Other -- --
------------- ------------
Net cash provided by (used in)
operating activities (4,939,043) 5,011,258
------------- ------------
CASH FLOWS FROM INVESTING ACTIVITIES
Acquisition of property
and equipment (386,268) (3,393,085)
Additions to construction
in progress (789,911) (356,405)
Loan receivable -- (29,274)
Investments (735,536) (2,869,360)
------------- ------------
Net cash used in investing
activities (1,911,715) (6,648,124)
------------- ------------
CASH FLOWS FROM FINANCING ACTIVITIES:
Payments on note payable (5,000,000) --
Repayments of loans to
officers -- (99,700)
Proceeds from issuance
of convertible note -- 3,000,000
Proceeds from issuance
of common stock 26,682,511 --
Payment of offering costs (6,132,707) --
Proceeds from the exercise
of warrants 220,160 --
------------- ------------
Net cash provided by
financing activities 15,769,964 2,900,300
------------- ------------
Effect of exchange rate changes
on cash and cash equivalents 27,832 455,983
------------- ------------
NET INCREASE IN CASH & CASH
EQUIVALENTS 8,947,038 1,719,417
CASH & CASH EQUIVALENTS,
BEGINNING BALANCE 6,276,897 2,121,811
------------- ------------
CASH & CASH EQUIVALENTS,
ENDING BALANCE $ 15,223,935 $ 3,841,228
============= =============
SUPPLEMENTAL DISCLOSURE OF
CASH FLOW INFORMATION:
Interest paid $ 112,500 $ 78,143
============= =============
Income taxes paid $ -- $ --
============= =============
Please see notes in the Company's Quarterly Report on Form 10-Q for
the period ended September 30, 2006 for further explanation.