Bon Natural Life Limited Announces Record First Half-Year Revenue and Net Income

Xi'an, CHINA


XI’AN, China, Sept. 11, 2023 (GLOBE NEWSWIRE) -- Bon Natural Life Limited (Nasdaq: BON) (“BON” or the “Company”), one of the leading bio-ingredient solutions providers in the natural, health and personal care industries, today announced its half-year financial results for the six months ended March 31, 2023.

1H-2023 Financial Highlights

  • Revenue - Total revenues were $14.1 million, representing a 3.4% increase from US$13.7 million for the same period in 2022.
  • Income from operation – for the six months ended March 31, 2023 was $2,985,234 increase of $196,875 or 7.1% as compared to $2,788,359 in the same period of 2022.
  • Net income attributable to BON Natural Life Limited - for the six months ended March 31, 2023 was $2,119,760 as compared to $2,548,678 in the same period of 2022.
  • Earnings per share – Basic earnings per share was $0.24 for the six months ended March 31, 2023 as compared to $0.31 in the same period of 2022. Diluted earnings per share was $0.24 for the six months ended March 31, 2023 as compared to $0.30 in the same period of 2022.

1H-2023 Product Categories Summary: Growth vs. Prior Year

 Revenues increase (decrease)Gross Profits increase (decrease)
Fragrance Compounds(8.4%)12.3%
Health Supplements (Powder Drinks)37.2%21.0%
Bioactive Food Ingredients(5.2%)20.0%


Fragrance Compounds

Revenues from sales of fragrance compound products decreased by 8.4% to US$6.8 million in the six months ended March 31, 2023 from US$7.4 million for the same period in 2022. The decrease was primarily attributable to a 10.1% decrease in average selling price and a 9.5% negative impact from currency exchange, partially offset by an increase of 1.8% in sales volume.

Gross profit from fragrance compound products increased by 12.3% to US$2.0 million from US$1.8 million for the same period in 2022. The increase was primarily attributable to a 16.6% decrease in cost of products due to our ability to negotiate better price from suppliers and an increase of 1.8% in sales volume, partially offset by a 9.5% negative impact from currency exchange.

Health Supplements (Powder Drinks)

Revenues from sales of health supplement (powder drinks) products increased by 37.2% to US$4.6 million in the six months ended March 31, 2023 from US$3.3 million for the same period in 2022. The increase was primarily attributable to an increase of 50% in sales volume and partially offset by a 9.5% negative impact from currency exchange.

Gross profit from health supplement (powder drinks) products increased by 21.0% to US$1.4 million from US$1.2 million for the same period in 2022. The increase was primarily attributable to the above referenced factors.

Bioactive Food Ingredients

Revenues from sales of bioactive food ingredient products decreased by 5.2% to US$2.8 million in the six months ended March 31, 2023 from US$2.9 million for the same period in 2022. The decrease was primarily attributable to a 7.5% decrease in average price and a 9.5% negative impact from currency exchange, partially offset by a 2.4% increase in sales volume due to strong customer demand and sales effort.

Gross profit from bioactive food ingredient products increased by 20.0% to US$1.3 million from US$1.1 million for the same period in 2022. The increase was mainly due to a 2.4% increase in sales volume and a decrease of 21.7% in cost of products due to the decreased raw materials purchase price, partially offset by a 9.5% negative impact from currency exchange.

General and administrative expenses increased by $467,012, or approximately 46.8%, from $998,943 in the six months ended March 31, 2022, to $1,465,955 in the same period of 2023, mainly attributable to an increase of 44.2% in staff payroll due to the increase in staff headcount, a 234.8% increase in rent expenses and a 42.7% increase in expenses such as professional service and consulting fees and investor relation expenses, etc. as we become a public company since we completed the IPO in July 2021.

Research and development (“R&D”) expenses decreased by $34,680, or approximately 21.1%, from $164,675 in the six months ended March 31, 2022, to $129,995 in the same period of 2023. The decrease was mainly due to a 79.3% decrease in staff payroll and a 34.4% decrease in outsourcing R&D activities to external consulting firms.

Government subsidies received in the form of provincial-level export credit insurance subsidy and unemployment insurance expansion grant totaled $11,916 in the six months ended March 31, 2023.

Net income decreased from $2.5 million in the six months ended March 31, 2022 to $2.1 million in the same period of 2023.

Net cash used in operating activities during the six months ended March 31, 2023 was $2,177,992 compared to net cash used in operating activities of $130,577 in the same period of 2022.

Diluted earnings per share ("EPS") was $0.24, compared to $0.30 for the same period in 2022.

Investors are encouraged to review the Company’s complete financial statements and related disclosures for additional information. These materials are available at https://www.sec.gov/edgar/browse/?CIK=1816815&owner=exclude 

About Bon Natural Life Limited

The Company focuses on the manufacturing of personal care ingredients, such as plant extracted fragrance compounds for perfume and fragrance manufacturers, natural health supplements such as powder drinks and bioactive food ingredient products mostly used as food additives and nutritional supplements by their customers. For additional information, please visit the Company’s website at www.bnlus.com.

Safe Harbor Statement

This press release contains forward-looking statements as defined by the Private Securities Litigation Reform Act of 1995. Forward-looking statements include statements concerning plans, objectives, goals, strategies, future events or performance, and underlying assumptions and other statements that are other than statements of historical facts. When the Company uses words such as "may, "will, "intend," "should," "believe," "expect," "anticipate," "project," "estimate" or similar expressions that do not relate solely to historical matters, it is making forward-looking statements. Forward-looking statements are not guarantees of future performance and involve risks and uncertainties that may cause the actual results to differ materially from the Company's expectations discussed in the forward-looking statements. These statements are subject to uncertainties and risks including, but not limited to, the following: the Company's goals and strategies; the Company's future business development; product and service demand and acceptance; changes in technology; economic conditions; the growth of the natural, health and personal care market in China and the other international markets the Company plans to serve; reputation and brand; the impact of competition and pricing; government regulations; fluctuations in general economic and business conditions in China and the international markets the Company plans to serve and assumptions underlying or related to any of the foregoing and other risks contained in reports filed by the Company with the SEC. For these reasons, among others, investors are cautioned not to place undue reliance upon any forward-looking statements in this press release. Additional factors are discussed in the Company's filings with the SEC, which are available for review at www.sec.gov. The Company undertakes no obligation to publicly revise these forward–looking statements to reflect events or circumstances that arise after the date hereof.

For more information, please contact:

Bon Natural Life
Cindy Liu | IR
Email: bonnatural@appchem.cn


BON NATURAL LIFE LIMITED AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(UNAUDITED)   
  As of 
  March 31, 2023  September 30, 2022 
ASSETS      
CURRENT ASSETS        
Cash $542,272  $840,861 
Accounts receivable, net  9,260,407   6,784,307 
Inventories, net  1,803,374   1,722,120 
Advance to suppliers, net  7,644,920   4,091,990 
Acquisition deposit  1,000,000   1,000,000 
Prepaid expenses and other current assets  3,967,756   277,509 
TOTAL CURRENT ASSETS  24,218,729   14,716,787 
         
Property, plant and equipment, net  22,135,274   21,624,437 
Intangible assets, net  373,751   366,167 
Right-of-use lease assets, net  450,282   546,690 
Deferred tax assets, net  29,023   2,768 
TOTAL ASSETS $47,207,059  $37,256,849 
         
LIABILITIES AND EQUITY        
CURRENT LIABILITIES        
Short-term loans $2,666,457  $2,424,587 
Current portion of long-term loans  1,934,411   2,135,979 
Accounts payable  324,240   214,585 
Due to related parties  120,203   72,836 
Taxes payable  1,676,714   1,239,708 
Deferred revenue  989,027   188,745 
Accrued expenses and other current liabilities  3,503,550   114,431 
Finance lease liabilities, current  -   26,285 
Operating lease liability, current  247,397   230,182 
TOTAL CURRENT LIABILITIES  11,461,999   6,647,338 
         
Long-term loans  30,336   189,813 
Operating lease liability, noncurrent  212,955   327,202 
TOTAL LIABILITIES $11,705,290  $7,164,353 
         
COMMITMENTS AND CONTINGENCIES        
EQUITY        
Ordinary shares, $0.0001 par value, 500,000,000 shares authorized, 11,146,226 and 8,396,226 shares issued and outstanding as of March 31, 2023 and September 30, 2022, respectively  1,115   840 
Additional paid in capital  17,946,174   15,711,450 
Statutory reserve  1,804,116   1,804,116 
Retained earnings  16,796,529   14,676,769 
Accumulated other comprehensive income  (1,559,550)  (2,631,171)
TOTAL BON NATURAL LIFE LIMITED SHAREHOLDERS’ EQUITY  34,988,384   29,562,004 
Non-controlling interest  513,387   530,492 
TOTAL SHAREHOLDERS’ EQUITY  35,501,771   30,092,496 
TOTAL LIABILITIES AND EQUITY $47,207,059  $37,256,849 


BON NATURAL LIFE LIMITED AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME
(UNAUDITED)   
  For the six months ended
March 31,
 
  2023  2022 
REVENUE $14,149,967  $13,688,400 
COST OF REVENUE  (9,432,619)  (9,652,453)
GROSS PROFIT  4,717,348   4,035,947 
         
OPERATING EXPENSES        
Selling expenses  (136,164)  (83,970)
General and administrative expenses  (1,465,955)  (998,943)
Research and development expenses  (129,995)  (164,675)
Total operating expenses  (1,732,114)  (1,247,588)
         
INCOME FROM OPERATIONS  2,985,234   2,788,359 
         
OTHER INCOME (EXPENSES)        
Interest income  8,732   589 
Interest expense  (178,557)  (277,764)
Unrealized foreign transaction exchange loss  8,452   (16,994)
Government subsidies  11,916   542,256 
Income from short-term investments  -   12,419 
Other income  (223,043)  43,532 
Total other income, net  (372,501)  304,038 
         
INCOME BEFORE INCOME TAX PROVISION  2,617,733   3,092,397 
         
INCOME TAX PROVISION  (510,077)  (562,737)
         
NET INCOME  2,102,656   2,529,660 
Less: net loss attributable to non-controlling interest  (17,104)  (19,018)
NET INCOME ATTRIBUTABLE TO BON NATURAL LIFE LIMITED $2,119,760  $2,548,678 
         
NET INCOME  2,102,656   2,529,660 
         
OTHER COMPREHENSIVE INCOME        
Total foreign currency translation adjustment  1,071,621   485,503 
TOTAL COMPREHENSIVE INCOME  3,174,277   3,015,163 
Less: comprehensive loss attributable to non-controlling interest  (17,104)  (21,314)
COMPREHENSIVE INCOME ATTRIBUTABLE TO BON NATURAL LIFE LIMITED $3,191,381  $3,036,477 
         
EARNINGS PER SHARE        
Basic $0.24  $0.31 
Diluted $0.24  $0.30 
         
WEIGHTED AVERAGE NUMBER OF SHARES OUTSTANDING        
Basic  8,918,309   8,350,381 
Diluted  8,979,243   8,386,306 


BON NATURAL LIFE LIMITED AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)   
  For the six months ended
March 31,
 
  2023  2022 
Cash flows from operating activities        
Net income $2,102,656  $2,529,660 
Adjustments to reconcile net income to cash provided by operating activities        
Allowance for doubtful accounts  -   187 
Depreciation and amortization  282,888   112,945 
Inventory reserve  105,314   - 
Deferred income tax  (25,749)  (28)
Amortization of operating lease right-of-use assets  114,179   33,122 
Amortization of stock options  35,000   89,820 
Unrealized foreign currency exchange loss  (8,452)  16,994 
Gain on disposal of property and equipment  -   (745)
Changes in operating assets and liabilities:        
Accounts receivable  (2,198,450)  (1,265,109)
Inventories  (124,601)  (515,690)
Advance to suppliers, net  (3,353,433)  977,033 
Prepaid expenses and other current assets  (3,595,458)  (38,795)
Accounts payable  100,386   165,741 
Operating lease liabilities  (115,170)  (30,589)
Taxes payable  386,510   (1,806,543)
Deferred revenue  781,183   (440,032)
Accrued expenses and other current liabilities  3,335,205   41,452 
Net cash used in operating activities  (2,177,992)  (130,577)
         
Cash flows from investing activities        
Purchase of short-term investments  -   (3,678,199)
Proceeds upon redemption of short-term investments  -   5,273,186 
Purchase of property and equipment  (15,131)  (10,231)
Proceeds from sales of property and equipment  -   1,659 
Capital expenditures on construction-in-progress  (2,970)  (3,577,995)
Net cash used in investing activities  (18,101
  (1,991,580)
         
Cash flows from financing activities        
Net proceeds from issuance of Ordinary Shares in initial public offerings  2,200,000   - 
Proceeds from short-term loans  259,767   1,608,378 
Proceeds from long-term loans  -   594,864
 
Repayment of short-term loans  (79,165)  (41,945)
Repayment of long-term loans  (437,412)  (393,343
Proceeds from (repayment of) borrowings from related parties  (1,038)  91,965 
Principal repayment of capital lease  (27,236)  (89,465)
Net cash provided by financing activities  1,914,916   1,824,454 
         
Effect of changes of foreign exchange rates on cash  (17,412)  2,915 
Net decrease in cash  (298,589)  (294,788)
Cash, beginning of period  840,861   1,903,867 
Cash, end of period $542,272  $1,609,079 
         
Supplemental disclosure of cash flow information        
Cash paid for interest expense $178,557  $277,764 
Cash paid for income tax $500,251  $785,853 
Supplemental disclosure of non-cash investing and financing activities        
Amortization of share-based compensation for initial public offering services $35,000  $89,820 
Right-of-use assets obtained in exchange for operating lease obligations $458,181  $-