-- Corn Seeds: The third quarter typically represents the low season
annually for corn seed sales. Based on sales orders received, the company
is optimistic about the corn seeds segment and overall prospects for the
fourth quarter. Agria is also in the process of acquiring additional land
for future growth. The company expects average selling prices of
proprietary corn seeds will improve in the fourth quarter compared to the
same period in 2006, while average selling prices of generic corn seeds
will experience typical declines. Agria's corn seed R&D pipeline remains
strong. The company expects to introduce two new proprietary corn seeds to
the market in 2008.
-- Sheep Breeding: Sales of Agria's frozen sheep semen remained strong in
the third quarter and the growth trend is expected to continue in the
fourth quarter. Average selling prices of the company's frozen sheep semen
remained stable with the potential for price increases. Agria is currently
building a new sheep breeding center which it expects will significantly
boost the company's production capacity of sheep breeding products.
-- Seedlings: Agria introduced several new seedling products in the
quarter and continues to explore growth opportunities in new areas.
As of September 30, 2007, Agria had cash and cash equivalents of RMB 288.6
million (US$ 38.5 million). This does not include approximately US$183
million, net of issuance costs, in proceeds from the company's initial
public offering completed in November 2007.
Business Outlook
Based primarily on the sales orders received to date, Agria expects to
generate total revenues in the range of approximately RMB 238 million (US$
31.8 million) to RMB 253 million (US$ 33.8 million) for the fourth quarter
of 2007, representing year-over-year growth in the range of 60% to 70%,
respectively, compared to RMB 149 million in the fourth quarter of 2006.
This forecast reflects Agria's current and preliminary view, which is
subject to change.
Convenience Currency Translation The conversion of RMB into U.S. dollars in this release, made solely for the convenience of the reader, is based on the noon buying rate in The City of New York for cable transfers of RMB as certified for customs purposes by the Federal Reserve Bank of New York as of September 28, 2007, which was RMB 7.4928 to US$ 1.0000. No representation is intended to imply that the RMB amounts could have been, or could be, converted, realized or settled into U.S. dollars at that rate on September 28, 2007, or at any other date. The percentages stated in this press release are calculated based on RMB.
Investor Conference Call / Webcast Details The dial-in number for the live audio call beginning on December 3, 2007 at 8:00 a.m. U.S. Eastern Time (9:00 p.m. December 3, 2007 in Beijing) is +1-201-689-8560. A live webcast of the conference call will be available on Agria's website at www.agriacorp.com. A replay of the call will be available approximately 2 hours after the conclusion of the live call through midnight on December 17, 2007, U.S. Eastern Time (1 p.m., December 18, 2007 in Beijing) by telephone at +1-201-612-7415. To access the replay use conference ID# 263900, with account #3055. A webcast replay will also be available at www.agriacorp.com.
About Agria Corporation Agria Corporation (
Agria Corporation
Consolidated Statements of Operations
(In thousands of RMB, except per share and per ADS data)
(Unaudited)
Three months ended Nine months ended
30-Sep 30-Sep 30-Sep 30-Sep
2006 2007 2006 2007
Revenue:
Corn seeds 6,137 -- 148,263 133,853
Sheep breeding products 52,868 61,482 150,386 172,081
Seedlings 12,254 11,814 41,848 46,769
----------- ----------- ----------- -----------
Total revenue 71,259 73,296 340,497 352,703
----------- ----------- ----------- -----------
Cost of revenue:
Corn seeds (5,489) -- (86,867) (80,395)
Sheep breeding products (13,054) (14,046) (39,683) (44,589)
Seedlings (2,995) (3,717) (7,207) (14,396)
----------- ----------- ----------- -----------
Total cost of revenue (21,538) (17,763) (133,757) (139,380)
----------- ----------- ----------- -----------
Gross profit 49,721 55,533 206,740 213,323
Operating (expense)
income (Note 1):
Selling expenses (2,402) (2,971) (9,944) (10,908)
General and
administrative
expenses (1,243) (7,554) (4,688) (11,116)
Research and
development expenses (562) (642) (3,185) (1,667)
Government Grants 80 -- 80 --
----------- ----------- ----------- -----------
Total operating
expenses (4,127) (11,167) (17,737) (23,691)
----------- ----------- ----------- -----------
Operating profit 45,594 44,366 189,003 189,632
Interest income 63 693 213 843
Interest expense (1,345) (4,033) (3,759) (6,272)
Other income 79 123 1,044 297
----------- ----------- ----------- -----------
Income before income tax 44,391 41,149 186,501 184,500
Income tax -- -- -- --
----------- ----------- ----------- -----------
Net income 44,391 41,149 186,501 184,500
=========== =========== =========== ===========
Earnings per share:
-Basic RMB0.44 RMB0.41 RMB1.87 RMB1.85
-Diluted RMB0.44 RMB0.39 RMB1.87 RMB1.81
=========== =========== =========== ===========
Weighted average number
of ordinary shares
outstanding:
-Basic 100,000,000 100,000,000 100,000,000 100,000,000
-Diluted 100,000,000 105,603,039 100,000,000 101,955,592
Earnings per ADS (Note 2):
-Basic RMB0.89 RMB0.82 RMB3.73 RMB3.69
-Diluted RMB0.89 RMB0.78 RMB3.73 RMB3.62
=========== =========== =========== ===========
Note 1:
Share-based
compensation expense
are included in
general and
administrative
expenses -- 4,365 -- 4,365
=========== =========== =========== ===========
Note 2:
Each ADS represents two
ordinary shares.
Agria Corporation
Consolidated Statements of Operations
(In thousands of US$, except per share and per ADS data)
(Unaudited)
Three months ended Nine months ended
30-Sep 30-Sep
2007 2007
Revenue:
Corn seeds -- 17,864
Sheep breeding products 8,205 22,966
Seedlings 1,577 6,242
-------------------- --------------------
Total revenue 9,782 47,072
-------------------- --------------------
Cost of revenue:
Corn seeds -- (10,730)
Sheep breeding products (1,875) (5,951)
Seedlings (496) (1,921)
-------------------- --------------------
Total cost of revenue (2,371) (18,602)
-------------------- --------------------
Gross profit 7,411 28,470
Operating (expense) income
(Note 1):
Selling expenses (397) (1,456)
General and administrative
expenses (1,008) (1,484)
Research and development
expenses (86) (222)
-------------------- --------------------
Total operating expenses (1,491) (3,162)
-------------------- --------------------
Operating profit 5,920 25,308
Interest income 93 113
Interest expense (538) (837)
Other income 16 40
-------------------- --------------------
Income before income tax 5,491 24,624
Income tax -- --
-------------------- --------------------
Net income 5,491 24,624
==================== ====================
Earnings per share:
-Basic US$0.05 US$0.25
-Diluted US$0.05 US$0.24
==================== ====================
Weighted average number of
ordinary shares outstanding:
-Basic 100,000,000 100,000,000
-Diluted 105,603,039 101,955,592
Earnings per ADS (Note 2):
-Basic US$0.11 US$0.49
-Diluted US$0.10 US$0.48
==================== ====================
Note 1:
Share-based compensation
expense are included in
general and administrative
expenses 583 583
==================== ====================
Note 2:
Each ADS represents two
ordinary shares.
Agria Corporation
Reconciliation of Non-GAAP measures
(In thousands of RMB, except per share and per ADS data)
(Unaudited)
Three months ended Nine months ended
30-Sep 30-Sep 30-Sep 30-Sep
2006 2007 2006 2007
Net income 44,391 41,149 186,501 184,500
Share based compensation
expense -- 4,365 -- 4,365
---------- ---------- ---------- ----------
Non-GAAP net income 44,391 45,514 186,501 188,865
========== ========== ========== ==========
Net income per ADS - basic RMB0.89 RMB0.82 RMB3.73 RMB3.69
Net income per ADS - diluted RMB0.89 RMB0.78 RMB3.73 RMB3.62
========== ========== ========== ==========
Non-GAAP net income per ADS -
basic RMB0.89 RMB0.91 RMB3.73 RMB3.78
Non-GAAP net income per ADS -
diluted RMB0.89 RMB0.86 RMB3.73 RMB3.70
========== ========== ========== ==========
Weighted average shares used in
calculating basic net income
per ADS 50,000,000 50,000,000 50,000,000 50,000,000
Weighted average shares used in
calculating diluted net income
per ADS 50,000,000 52,801,520 50,000,000 50,977,796
Agria Corporation
Reconciliation of Non-GAAP measures
(In thousands of US$, except per share and per ADS data)
(Unaudited)
Three months ended Nine months ended
30-Sep 30-Sep
2007 2007
Net income 5,491 24,624
Share-based compensation
expense 583 583
--------------------- ---------------------
Non-GAAP net income 6,074 25,207
===================== =====================
Net income per ADS - basic US$0.11 US$0.49
Net income per ADS - diluted US$0.10 US$0.48
===================== =====================
Non-GAAP net income per ADS -
basic US$ 0.12 US$ 0.50
Non-GAAP net income per ADS -
diluted US$ 0.12 US$ 0.49
===================== =====================
Weighted average shares used
in calculating basic net
income per ADS 50,000,000 50,000,000
Weighted average shares used
in calculating diluted net
income per ADS 52,801,520 50,977,796
Note 1: Each ADS represents two common shares.
Agria Corporation
Consolidated Balance Sheets
(In thousands)
(Audited) (Unaudited) (Unaudited)
31-Dec 30-Sep 30-Sep
2006 2007 2007
(RMB) (RMB) (US$)
ASSETS
Current assets:
Cash and cash equivalents 42,782 288,615 38,519
Accounts receivable (net of
allowance for doubtful accounts) 156,440 132,960 17,745
Inventories 58,007 56,290 7,513
Prepayments and other current assets 22,584 97,926 13,069
Amounts due from related parties 1,059 118 16
------------ ------------ ------------
Total current assets 280,872 575,909 76,862
------------ ------------ ------------
Non-current assets:
Property, plant and equipment, net 40,126 51,867 6,922
Investment 205 205 27
Intangible assets, net 74,437 90,036 12,016
Deferred share issuance costs -- 15,631 2,086
Other assets, net 94,836 106,775 14,250
------------ ------------ ------------
Total non-current assets 209,604 264,514 35,301
------------ ------------ ------------
Total assets 490,476 840,423 112,163
============ ============ ============
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities:
Short-term bank borrowings 36,900 26,400 3,523
Long-term bank borrowing, current
portion 1,500 -- --
Accounts payable 27,161 13,242 1,767
Accrued expenses and other
liabilities 14,907 36,430 4,862
Amount due to a shareholder 29,992 187,972 25,087
Amounts due to related parties 16,884 4,001 534
------------ ------------ ------------
Total current liabilities 127,344 268,045 35,773
------------ ------------ ------------
Non-current liabilities:
Amounts due to related parties 8,996 8,996 1,201
------------ ------------ ------------
Total non-current liabilities 8,996 8,996 1,201
------------ ------------ ------------
Total liabilities 136,340 277,041 36,974
------------ ------------ ------------
Series A Redeemable convertible
preferred shares
(par value US$0.0000001 per share;
100,000,000 shares authorized; nil
and 2,400,000 shares issued and
outstanding at December 31, 2006
and September 30, 2007) -- 65,111 8,690
------------ ------------ ------------
Redeemable ordinary shares (par
value US$0.0000001 per share; nil
and 6,250,000 shares issued and
outstanding at December 31, 2006
and September 30, 2007) -- 155,928 20,810
------------ ------------ ------------
Shareholders’ equity:
Ordinary shares (par value
US$0.0000001 per share;
499,900,000,000 shares authorized;
100,000,000 shares issued and
outstanding at December 31, 2006
and September 30, 2007) -- -- --
Additional paid-in capital 8,098 4,365 582
Statutory reserves 76,953 76,953 10,270
Retained earnings 269,085 261,025 34,837
------------ ------------ ------------
Total shareholders’ equity 354,136 342,343 45,689
------------ ------------ ------------
Total liabilities, preferred shares
and shareholders’ equity 490,476 840,423 112,163
============ ============ ============
Contact Information: Contacts: Matt Feng Investor Relations China Tel: 86 10 8785-9020 David Pasquale EVP The Ruth Group U.S. Tel: +646-536-7006