XI'AN, China, May 13, 2016
/PRNewswire/ -- China Green Agriculture, Inc. (NYSE: CGA;
"China Green Agriculture" or the "Company"), a company mainly
produces and distributes humic acid-based compound fertilizers,
other varieties of compound fertilizers and agricultural products
through its subsidiaries in China, today announced its
financial results for the quarter ended March 31, 2016.
Highlights
- Net sales in the Third Quarter of FY 2016 decreased 1.1%
to $78.6 million; net income decreased 16.8% to $8.3
million with EPS of $0.22.
- The Company Provided Fourth Quarter of Fiscal Year 2016
Guidance Range: Revenue, Net Income and EPS of between $74 million and $80 million, $3 million and
$7 million, and $0.08 and
$0.19 based on 37 million fully
diluted shares, respectively.
- The Company Raised
Guidance Range of Fiscal Year 2016 as the following: Revenue, Net
Income and EPS of between $264 million and
$270 million, $23 million and $27 million, and $0.62 and $0.73 based on 37 million fully diluted shares,
respectively.
Financial Summary
Third Quarter 2016
Results (USD)
|
(Three Months ended
March 31, 2016)
|
|
|
|
|
|
Q3 FY2016
|
Q3 FY2015
|
CHANGE (%)
|
Net Sales
|
$78.6
million
|
$79.5
million
|
(1.1)%
|
Gross
Profit
|
$24.7million
|
$28.2
million
|
(12.3)%
|
Net Income
|
$8.3
million
|
$9.9
million
|
(16.8)%
|
EPS
(Diluted)
|
$0.22
|
$0.29
|
(21.7)%
|
Weighted Average
Shares Outstanding (Diluted)
|
$37.0million
|
$34.8
million
|
6.3%
|
|
(Nine Months ended
March 31, 2016)
|
|
|
|
|
|
Q3 FY2016
|
Q3 FY2015
|
CHANGE (%)
|
Net Sales
|
$189.8
million
|
$184.8
million
|
2.7%
|
Gross
Profit
|
$71.6
million
|
$75.8
million
|
(5.6)%
|
Net Income
|
$19.8
million
|
$23.2
million
|
(14.9)%
|
EPS
(Diluted)
|
$0.54
|
$0.69
|
(22.2)%
|
Weighted Average
Shares Outstanding (Diluted)
|
$36.6
million
|
$33.5
million
|
9.4%
|
"We are very pleased with our performance in business operation,
which generated $8.3 million net
income in the third quarter ended March 31,
2016. Although revenues and net income decreased year over
year, we did better than we expected," said Mr. Tao Li, Chairman and Chief
Executive Officer of China Green Agriculture."Looking ahead to the
fourth quarter of fiscal year 2016, we expect net sales of $74
to $80 million, net income of $3
to $7 million, and EPS of $0.08
to $0.19 based on 37 million
fully diluted weighted average shares outstanding for the fourth
quarter ended June 30, 2016. We are confident in achieving our
target for the fourth quarter of fiscal year 2016. We believe our
growth plan will well serve the interests of our shareholders."
"I have aspired to apply my skill set
and experience in the agriculture industry," said Mr. Zhuoyu Li,
the newly appointed President of the Company, "Joining the Company
and being able to work side by side with my father is that
aspiration realized. I am very excited for this career opportunity
and am humbly grateful for the trust from the board. I will devote
myself to the growth of the Company with full energy."
Third Quarter of FY2016 Results of
Operations
Net Sales
Total net sales for the three months ended March 31, 2016 were $78,638,474, a decrease of $848,741, or 1.1%, from $79,487,215 for the three months ended
March 31, 2015. This decrease was due
to the decrease in Jinong's sales volume and Gufeng's lowering
selling prices to answer to the market demand.
Cost of Goods Sold
Total cost of goods sold for the three months ended March 31, 2016 was $53,904,185, an increase of $2,607,487, or 5.1%, from $51,296,698 for the three months ended
March 31, 2015. This increase was
mainly due to higher raw material cost and packaging cost.
Gross Profit
Total gross profit for the three months ended March 31, 2016 decreased by $3,456,228, or 12.3% to $2,441,652, as compared to $28,190,517 for the three months ended
March 31, 2015. Gross profit margin
was 31.5% and 35.5% for the three months ended March 31, 2016 and 2015, respectively. The
decrease was mainly due to the increase in Jinong's product costs
and the increased weight for lower-margin products sales in
Gufeng's total sales.
Selling Expenses
Selling expenses were $3,441,511,
or 4.4%, of net sales for the three months ended March 31, 2016, as compared to $2,054,025 or 2.6% of net sales for the three
months ended March 31, 2015, an
increase of $1,387,486, or 67.5%. The
increase was mainly due to Jinong's expanded marketing efforts and
the increase in shipping costs.
Selling Expenses – amortization of deferred assets
Our selling expenses - amortization of our deferred assets were
$8,780,893, or 11.2%, of net sales
for the three months ended March 31,
2016, as compared to $10,604,586, or 13.3% of net sales for the three
months ended March 31, 2015, a
decrease of $1,823,693, or 17.2%.
This decrease was due to the fact that some of the deferred assets
were fully amortized and therefore no amortization was recorded on
the fully amortized assets during the three months ended
March 31, 2016.
General and Administrative Expenses
General and administrative expenses were $2,204,771, or 2.8% of net sales for the three
months ended March 31, 2016, as
compared to $2,606,749, or 3.3% of
net sales for the three months ended March
31, 2015, a decrease of $401,978, or 15.4%. The decrease in general and
administrative expenses was mainly due to the related expenses in
the stock compensation awarded to the employees which amounted
to $580,388 for the three months
ended March 31, 2016 as compared to
$1,081,125 for the three months ended
March 31, 2015.
Net Income
Net income for the three months ended March 31, 2016 was $8,251,771, a decrease of $1,664,423, or 16.8%, compared to $9,916,194 for the three months ended
March 31, 2015. The decrease was
attributable to the increased selling expenses and lower net sales
in the quarter ended March 31, 2016.
Net income as a percentage of total net sales was approximately
10.5% and 12.5% for the three months ended March 31, 2016 and 2015, respectively.
The First Nine Months of FY2016 Results of Operations
Net Sales
Total net sales for the nine months ended March 31, 2016 were $189,788,745, an increase of $4,948,566 or 2.7%, from $184,840,179 for the nine months ended
March 31, 2015. This increase was
largely due to Gufeng's expanded marketing promotion strategy and
the increase in sales demand on Yuxing's top-grade flowers.
Cost of Goods Sold
Total cost of goods sold for the nine months ended March 31, 2016 was $118,230,726, an increase of $9,164,492, or 8.4%, from $109,066,234 for the nine months ended
March 31, 2015. This increase was
mainly due to the 2.7% increase in net sales and an increase in the
cost of raw materials.
Gross Profit
Total gross profit for the nine months ended March 31, 2016 decreased by $4,215,926 to $71,558,019, as compared to $75,773,945 for the nine months ended
March 31, 2015. Gross profit margin
was 37.7% and 41.0% for the nine months ended March 31, 2016 and 2015, respectively. The
decrease was mainly due to Jinong's higher raw material cost and
packaging cost and the increased weight for lower-margin products
sales in Gufeng's total sales answering to market demand.
Selling Expenses
Selling expenses were $11,070,727,
or 5.8%, of net sales for the nine months ended March 31, 2016, as compared to $4,770,727 or 2.6% of net sales for the nine
months ended March 31, 2015, an
increase of $6,299,642, or 132.0%.
The increase was mainly due to Jinong's expanded marketing efforts
and the increase in shipping costs.
Selling Expenses – amortization of deferred assets
Our selling expenses - amortization of our deferred assets were
$27,158,360, or 14.3%, of net sales
for the nine months ended March 31,
2016, as compared to $31,587,102, or 17.1% of net sales for the nine
months ended March 31, 2015, a
decrease of $4,428,742, or 14.0%.
This decrease was due to the fact that some of the deferred assets
were fully amortized and therefore no amortization was recorded on
the fully amortized assets during the nine months ended
March 31, 2016.
General and Administrative Expenses
General and administrative expenses were $7,864,395, or 4.1% of net sales for the nine
months ended March 31, 2016, as
compared to $8,920,360, or 4.8%, of
net sales for the nine months ended March
31, 2015, a decrease of $1,055,965, or 11.8%. The decrease in general and
administrative expenses was mainly due to the decreased related
expenses in the stock compensation awarded to the employees
which amounted to $2,899,390 for the
nine months ended March 31, 2016 as
compared to $4,150,995 for the nine
months ended March 31, 2015.
Net Income
Net income for the nine months ended March 31, 2016 was $19,764,978, a decrease of $3,465,735, or 14.9%, compared to $23,230,713 for the nine months ended
March 31, 2015. The decrease was
attributable to the increase in net sales offset by an increase in
selling expenses and the higher cost of good sold. Net income as a
percentage of total net sales was approximately 10.4% and 12.6% for
the nine months ended March 31, 2016
and 2015, respectively.
Financial Condition
As of March 31, 2016, cash and
cash equivalents were $90,470,157, a
decrease of $2,512,407, or 2.7%, from
$92,982,564 as of June 30, 2015. Net cash used in investing
activities for the nine months ended March
31, 2016 was $16,608, a
decrease of $7,658,533, or 99.8% from
$7,675,141 for the nine months ended
March 31, 2015. Net cash used in
financing activities for the nine months ended March 31, 2016 was $17,493,160, an increase of $14,803,429 or 550.4% compared to cash provided
by financing activities of $2,689,731
for the nine months ended March 31,
2015. We had accounts receivable of $74,730,414 as of March
31, 2016, as compared to $68,528,598 as of June 30,
2015, an increase of $6,201,816 or 9.0%.
Fourth Quarter Fiscal Year 2016 and Fiscal Year 2016
Guidance
For the fourth quarter ending June 30,
2016, management expects net sales of $74 to $80 million, net income of $3 to $7 million, and EPS of $0.08 to $0.19
based on 37 million fully diluted shares. For the fiscal year
ended June 30, 2016, management expects net sales of $264
million to $270 million, net income
of $23 million to $27 million,
and an EPS of $0.62 to $0.73 based on 37 million fully diluted
shares.
Conference Call Information
The Company will hold a conference call at 7:30 am ET on May 13,
2016 to discuss its third quarter 2016 results. The Company's newly appointed President, Mr. Zhouyu
Li will host the earnings conference call. Listeners may
access the call by dialing:
PARTICIPANT DIAL IN
(TOLL FREE):
|
1-888-346-8982
|
PARTICIPANT
INTERNATIONAL DIAL IN:
|
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|
Hong Kong-Local
Toll
|
852-301-84992
|
Beijing-Local
Toll
|
86-105-357-3132
|
China Toll
Free
|
4001-201203
|
Hong Kong Toll
Free
|
800-905945
|
To access the replay, please dial any of the following
numbers:
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Free:
|
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|
International
Toll:
|
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|
Canada Toll
Free:
|
855-669-9658
|
Replay Access
Code:
|
10086244
|
About China Green Agriculture, Inc.
The Company produces and distributes humic acid-based compound
fertilizers, other varieties of compound fertilizers and
agricultural products through its wholly-owned subsidiaries, i.e.:
Shaanxi TechTeam Jinong Humic Acid Product Co., Ltd. ("Jinong"),
Beijing Gufeng Chemical Products Co., Ltd. ("Gufeng"), and a
variable interest entity, Xi'an Hu County Yuxing Agriculture
Technology Development Co., Ltd. ("Yuxing"). Jinong produced and
sold 130 different kinds of fertilizer products as of March 31, 2016, all of which are certified by the
government of the People's Republic of
China (the "PRC") as Green Food Production Materials, as
stated by the China Green Food Development Center. Jinong currently
markets its fertilizer products to private wholesalers and
retailers of agricultural farm products in 27 provinces, four
autonomous regions, and three central-government-controlled
municipalities in the PRC. Jinong had 1,064 distributors in the PRC
as of March 31, 2016. Gufeng, and its
wholly-owned subsidiary, Beijing Tianjuyuan Fertilizer Co., Ltd.,
are Beijing-based producers of
compound fertilizers, blended fertilizers, organic compound
fertilizers, and mixed organic-inorganic compound fertilizers. As
of March 31, 2016, Gufeng produced
and sold 332 different kinds of fertilizer products, and had 299
distributors in the PRC. For more information, visit
http://www.cgagri.com. The Company routinely posts important
information on its website.
Safe Harbor Statement
This press release contains forward-looking statements within
the meaning of the Private Securities Litigation Reform Act of 1995
concerning the Company's business, products and financial results.
The Company's actual results may differ materially from those
anticipated in the forward-looking statements depending on a number
of risk factors including, but not limited to, the following:
general economic, business and environment conditions, development,
shipment, market acceptance, additional competition from existing
and new competitors, changes in technology, the execution of its
ten-year growth plan, a satisfactory conclusion of the pending
securities class action litigation and various other factors beyond
the Company's control. All forward-looking statements are expressly
qualified in their entirety by this Safe Harbor Statement and the
risk factors detailed in the Company's reports filed with the SEC.
China Green Agriculture undertakes no duty to revise or update any
forward-looking statements to reflect events or circumstances after
the date of this release, except as required by applicable law or
regulations.
For more information, please contact:
China Green Agriculture, Inc.
Mr: Fang Wang (English and Chinese)
Tel: +86-29-88266500
Email: wangfang@cgagri.com
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SOURCE China Green Agriculture, Inc.