SOURCE: Man Shing

September 05, 2012 09:01 ET

Man Shing Earns $0.23 per Share for the 2012 Fiscal Year Ending June 30, 2012

HONG KONG--(Marketwire - Sep 5, 2012) -  Man Shing Agricultural Holdings, Inc. (OTCBB: MSAH) ("Man Shing," the "Company," "we," "us," or "our"), located in the Shandong Province and one of the largest Chinese exporters of high quality, fresh ginger to Japan, the United Kingdom, and the Netherlands, today announced the financial results for the year ended June 30, 2012. The Company had earnings per share of $0.23 for the fiscal year ending June 30, 2012. Additionally, Man Shing reported $14.1 million, or $0.29 per share, in cash and cash equivalents as of June 30, 2012.

Financial Highlights for the year Ended June 30, 2012

  • Revenue totaled $33.4 million;
  • Gross profit increased 9.3% to $14.9 million, gross margin improved to 44.5% vs. 42.2% YOY;
  • Total operating expenses decreased 21.5%, driven by a decrease of 23.9% in selling and marketing expenses and a decrease of 16.9% in general and administrative expenses;
  • Net income increased 24.1% to $11.2 million;
  • EPS of $0.23 based on 48.1 million shares outstanding;
  • Cash and cash equivalents totaled $14.1 million, or $0.29 per share.

Mr. Shili Liu, Chairman and Chief Executive Officer of Man Shing, stated, "During our 2012 fiscal year we achieved several key milestones from a financial and operational perspective. Financially, we increased net income while managing costs and driving profitability. Revenue for the year increased 3.5% while gross profit increased 9.3%, gross profit margin improved to 44.5% and net income increased 24.1%. Our increased profitability during the year was driven by our ability to leverage our current infrastructure to maintain stable cost of sales. We successfully reduced our operating expenses by 22% year-over-year as sales and marketing and general and administrative expenses decreased 23.9% and 16.9%, respectively. Operationally, we continue to experience stable demand for our existing products. Additionally, we are always testing the market with new and potentially higher margin products to increase profits."

Financial results for the year ended June 30, 2012

 
2012 Fiscal Year End (USD) (audited)
Year Ended June 30, 2012 2011 CHANGE
Revenue $33.4 million $32.3 million +3.5%
Gross Profit $14.9 million $13.6 million +9.3%
Gross Profit Margin 44.5% 42.2% +5.5%
Total Operating Expenses $3.5 million $4.5 million -21.5%
Net Income $11.2 million $9 million +24.1%
Basic EPS* $0.23 $0.21 -
Diluted EPS ** $0.23 $0.15 -
* Based on 48.1 million and 42.3 million shares outstanding for 2012 and 2011 fiscal years, respectively.
** Based on 49.5 million and 59.6 million fully diluted shares outstanding for 2012 and 2011 fiscal years, respectively.
 

Financial Results for the year Ended June 30, 2012
Revenue for the fiscal year ended June 30, 2012 totaled $33.4 million, an increase of 3.5%, as compared to $32.3 million for the fiscal year ended June 30, 2011. Revenues were derived from the sales of our frozen and fresh ginger and other agricultural products. Geographic revenue contribution during the 2012 fiscal year was 66% through distribution partners within China and direct sales of 22% to Japan, 7% to the United Kingdom, 3% to the Netherlands and 2% to other countries.

Cost of sales for the 2012 fiscal year totaled $18.5 million, a decrease of 1%, compared to $18.7 million for the 2011 fiscal year. Cost of sales includes the costs associated with the planting, harvesting, and storing of ginger and other agricultural products such as ginger seeds and fertilizers. Cost of revenues as a percentage of total revenue decreased from 58% in fiscal 2011 to 55% year-over-year, due primarily to a decrease in the costs of planting and production costs, such as raw material costs.

Gross profit for the 2012 fiscal year totaled $14.9 million, an increase of 9.3% compared to $13.6 million for the 2011 fiscal year. Gross profit margin increased to 44.5% during the 2012 fiscal year as compared to 42.2% for the prior fiscal year. The increase in gross profit margin was primarily attributable to a decrease in the cost of planting and production.

Operating expenses for the 2012 fiscal year decreased 21.5% to $3.5 million as compared to $4.5 million the prior fiscal year. Selling and marketing expenses decreased 23.9% year-over-year and general and administrative expenses decreased 16.9%.

Net income for the 2012 fiscal year totaled $11.2 million, an increase of 24.1% as compared to $9 million for the prior year. Net income margin improved to 34% for the 2012 fiscal year as compared to 28% the year prior. Basic and diluted earnings per share for the 2012 fiscal year were $0.23, based on 48.1 million basic and 49.5 million diluted shares outstanding, respectively. These results compare to basic and diluted earnings per share of $0.21 and $0.15 for the same periods the year prior, based on 42.3 million basic and 59.6 million diluted shares outstanding, respectively.

Liquidity and Capital Resources
As of June 30, 2012, Man Shing had approximately $14.1 million in cash and cash equivalents, or $0.29 per share based on 48.1 million shares outstanding. As of June 30, 2012, total current assets and total assets were approximately $39.5 million and $41.3 million, respectively. Total current liabilities and total liabilities were approximately $5.7 million, respectively. Shareholder's equity totaled $35.6 million as of June 30, 2012, as compared to $23.7 million as of June 30, 2011. 

About Man Shing Agricultural Holdings, Inc.
Man Shing Agricultural Holdings, Inc., through its operating subsidiary in Shandong China, is focused on the production and processing of fresh ginger and other select vegetables such as onion and garlic. The Company produces high quality ginger which meets the requirements of the British Retail Consortium Global Food Standard. The Company focuses on customers located in countries such as Japan and the European Union which are food safety oriented. For further information about Man Shing Agricultural Holdings, Inc., please visit the Company's website at http://www.msaginger.com/

Forward Looking Statements:
This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, and Section 21E of the Securities Exchange Act of 1934. These statements relate to future events or our future financial performance. We have attempted to identify forward-looking statements by terminology including "anticipates," "believes," "expects," "can," "continue," "could," "estimates," "expects," "intends," "may," "plans," "potential," "predict," "should" or "will" or the negative of these terms or other comparable terminology. These statements are only predictions. Uncertainties and other factors may cause our actual results, levels of activity, performance or achievements to be materially different from any future results, levels or activity, performance or achievements expressed or implied by these forward-looking statements.

Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, levels of activity, performance or achievements. Our expectations are as of the date hereof, and we do not intend to update any of the forward-looking statements after the filing date to conform these statements to actual results, unless required by law.

We file annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K and proxy and information statements and amendments to reports filed or furnished pursuant to Sections 13(a) and 15(d) of the Securities Exchange Act of 1934, as amended. You may read and copy these materials at the SEC's Public Reference Room at 100 F Street, N.E., Washington, D.C. 20549. You may obtain information on the operation of the public reference room by calling the SEC at 1-800-SEC-0330. The SEC also maintains a website (http://www.sec.gov) that contains reports, proxy and information statements and other information regarding us and other companies that file materials with the SEC electronically.

   
   
Man Shing Agricultural Holdings, Inc. and Subsidiaries  
Consolidated Balance Sheets  
As of June 30, 2012 and 2011  
   
    June 30, 2012     June 30, 2011  
ASSETS                
CURRENT ASSETS                
  Cash and cash equivalents   $ 14,114,741     $ 7,081,297  
  Accounts receivable, trade, net     8,487,628       6,330,625  
  Inventories     6,863,831       4,880,266  
  Deferred inventory costs     9,750,038       9,064,571  
  Prepayments     269,607       371,881  
  Other receivables     817       787  
  Tax recoverable     4,418       577,995  
    TOTAL CURRENT ASSETS     39,491,080       28,307,422  
                 
FIXED ASSETS                
  Property, plant, and equipment     2,199,393       1,619,838  
  Accumulated depreciation     (433,015 )     (257,250 )
  Construction in progress     -       211,752  
    NET FIXED ASSETS     1,766,378       1,574,340  
                 
    TOTAL ASSETS   $ 41,257,458     $ 29,881,762  
                 
LIABILITIES AND STOCKHOLDERS' EQUITY                
CURRENT LIABILITIES                
  Convertible note   $ 1,500,000     $ -  
  Short-term borrowing     1,960,505       1,916,064  
  Accounts payable     486,683       691,628  
  Other payables and accrued liabilities     1,409,089       1,685,016  
  Receipts in advance     349,366       402,557  
    TOTAL CURRENT LIABILITIES     5,705,643       4,695,265  
                 
LONG-TERM LIABILITIES                
  Convertible note     -       1,500,000  
                 
    TOTAL LIABILITIES     5,705,643       6,195,265  
                 
STOCKHOLDERS' EQUITY                
  Preferred stock, $.001 par, 25,000,000 shares authorized, 0 and 176,750 shares issued and outstanding at June 30, 2012 and June 30, 2011, respectively     -       177  
  Common stock, $.001 par, 175,000,000 shares authorized, 48,226,958 and 48,026,958 shares issued and outstanding at June 30, 2012 and June 30, 2011, respectively     48,227       48,027  
  Additional paid-in capital     4,242,522       4,210,545  
  Accumulated other comprehensive income     1,813,485       1,180,599  
  Statutory reserves     10,198,223       5,823,139  
  Accumulated earnings     19,249,358       12,424,010  
    TOTAL STOCKHOLDERS' EQUITY     35,551,815       23,686,497  
                 
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY   $ 41,257,458     $ 29,881,762  
                 
The accompanying notes are on integral part of these consolidated financial statements.  
                 
                 
                 
Man Shing Agricultural Holdings, Inc. and Subsidiaries  
Consolidated Statements of Operations and Comprehensive Income  
For the Years Ended June 30, 2012 and 2011  
   
    For the Years Ended  
    June 30, 2012     June 30, 2011  
Revenues                
  Sales   $ 33,395,103     $ 32,253,922  
  Cost of sales     18,527,142       18,652,553  
Gross profit     14,867,961       13,601,369  
                 
Operating expenses                
  Selling and marketing expenses     2,263,770       2,974,674  
  General and administrative expenses     1,252,109       1,505,852  
Total operating expenses     3,515,879       4,480,526  
                 
Operating income     11,352,082       9,120,843  
                 
Other income (expenses), net                
  Financial expenses, net     (201,083 )     (169,791 )
  Interest on convertible note     (120,000 )     (120,000 )
  Non-operating income, net     169,433       195,989  
Total other income (expenses), net     (151,650 )     (93,802 )
                 
Income from operations before income tax     11,200,432       9,027,041  
                 
Income taxes     -       -  
                 
Net income     11,200,432       9,027,041  
                 
Other comprehensive income, net                
  Foreign currency translation gain, net     632,886       991,412  
                 
Total comprehensive income   $ 11,833,318     $ 10,018,453  
                 
Weighted average number of shares outstanding                
                 
Basic     48,094,355       42,273,533  
                 
Diluted     49,503,513       59,590,191  
                 
Earnings per share                
                 
Basic   $ 0.23     $ 0.21  
                 
Diluted   $ 0.23     $ 0.15  

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