American Lorain Corporation Reports Third Quarter Fiscal Year 2015 Financial Results

- Q3 Operating income increased by 47.86% YOY;

- Q3 Net income increased by 157.24% YOY;

- Total sales reached $120.79 million for the first nine months of FY 2015

Nov 20, 2015, 08:30 ET from American Lorain Corporation

LINYI, China, Nov. 20, 2015 /PRNewswire/ -- American Lorain Corporation (NYSE MKT: ALN) (the "Company" or "American Lorain"),  an international processed snack foods, convenience foods, and frozen foods company based in Shandong Province, China, today announced financial results for the third quarter ended September 30, 2015.  

Third Quarter FY 2015 Highlights vs. the Comparable Period of 2014

Revenue decreased by $7.58 million to $47.68 million for the third quarter FY 2015 compared to the prior year period;

Gross profit of $8.29 million for the third quarter FY 2015 as compared to $9.16 million of the same period in 2014;

Gross margin of 17.39% for the third quarter of FY 2015 as compared to 16.57% in comparison to the same period in 2014;

Operating income of $4.07 million an increase of 47.86% in comparison to $2.75 million of the same period in 2014;

Net income of $1.88 million or $0.06 per fully diluted share, compared with net income of $0.73 million or $0.03 per fully diluted share of the same period in 2014;

Management Comments

"We were so glad to see both our operating income and net income increased by 48% YOY and 157% YOY, respectively. During the third quarter, the Company made tremendous progresses for our newly launched Youtiao product. And the Company was also actively moving forward with new products for China breakfast market along with the other business segment. Our offices all around the country were working very closely with local dealers to promote all kinds of the product," Said Mr. Chen Si, Chairman and CEO of American Lorain Corporation, "The Company continues to expand new sales channels to grow its customer base and increase its revenues. We will continuously devote ourselves to deliver the optimal returns to our shareholders in the future."

Third Quarter 2015 Financial Results

Revenue and Gross Profit


 

Stated in US Dollars


3Q15


3Q14


Y-O-Y%

Revenue

47,681,598


55,264,211


-13.72%

Gross Profit

8,290,041


9,156,591


-9.46%

Gross Margin

17.39%


16.57%


0.82%

Revenue for the three months ended September 30, 2015 dropped by $7.58 million, or 13.72%, as compared to the three months ended September 30, 2014, it is principally as a result of a question raised by CTCPA, with respect to the origin of canned chestnuts sold by Conserverie Minerve ("Minerve") and  Minerve chestnuts come from a Chinese cultivar, while CTCPA stated that only chestnuts based on the European or Japanese cultivars can be used in canned chestnut products sold in France according to CTCPA policies. The Company has since shipped chestnuts based on the Japanese cultivar grown in China to Minerve.   

Gross Margin was 17.39% for the three months ended September 30, 2015 as compared to 16.57% for the same period of 2014, it was primarily due to the fact that higher-margin products contributed more revenue in current quarter than in the same period of last year.

Operating Income/Expenses  

Stated in US Dollars


3Q15


3Q14


Y-O-Y%

Operating Expenses

4,224,141


6,406,721


-34.07%

Operating Income

4,065,900


2,749,870


47.86%

Operating Margin

8.53%


4.98%


3.55%

Selling and
marketing
expenses

1,875,739


3,044,877


-38.40%

General and
administrative
expenses

2,348,402


3,361,844


-30.15%


4,224,141


6,406,721


-34.07%

Selling and Marketing Expenses. Our selling and marketing expenses decreased by approximately $1.17 million, or 38.40%, to $1.88 million for the three months ended September 30, 2015. The overall decrease was mainly due to the decrease of personnel costs and transportation costs, which was in line with the decline of net revenue. Management actively worked to control sales related expenses in accordance with market and sales conditions.

General and Administrative Expenses. Our general and administrative expenses decreased by approximately $1.01 million, or 30.15%, to $2.35 million for the three months ended September 30, 2015. As our revenues decreased, we prepared our budget to strictly control our expenses incurred. The main items leading to the decrease of our expenses are our staff welfare expense and office supply expense.  

The operating income increased by 47.86%, or $1.32 million, to approximately $4.07 million YOY. It was mainly due to the fact that the operating expense dropped by approximately 34.07% YOY to 4.22 million for the three months ended September 30, 2015.

Net Income

Net income increased by approximately $1.15 million, or 157.24%, to $1.88 million for the three months ended September 30, 2015. The increase was attributable to decrease of operating expenses in the three months ended September 30, 2015 as compared to the three months ended September 30, 2014.

As of September 30, 2015, we had cash and cash equivalents of approximately $31.1 million. The Company's total current assets as of September 30, 2015, were $197.4 million and total current liabilities were $105.4 million, which resulted in a positive net working capital of $92.0 million.

 

 

AMERICAN LORAIN CORPORATION

UNAUDITED CONSOLIDATED BALANCE SHEETS

AT SEPTEMBER 30, 2015 AND DECEMBER 31, 2014

(Stated in US Dollars)







(Audited)



At September 30,



At December 31,

ASSETS


2015



2014

Current assets






Cash and cash equivalents

$

31,145,108


$

30,279,988

Restricted cash


14,262,450



4,195,114

Trade accounts receivable


41,142,978



58,806,466

Other receivables


12,670,630



8,183,485

Inventory


58,002,702



51,648,160

Advance to suppliers


33,473,757



42,479,437

Prepaid expenses and taxes


2,887,635



2,758,334

Security deposits and other assets


3,821,959



3,578,514

Total current assets

$

197,407,219


$

201,929,498







Non-current assets






Investment


3,284,719



3,258,125

Property, plant and equipment, net


84,823,722



89,148,530

Construction in Progress, net


13,866,188



14,340,145

Intangible assets, net


16,652,212



17,537,868

Goodwill


9,955,983



10,327,553

TOTAL ASSETS

$

325,990,043


$

336,541,719







LIABILITIES AND STOCKHOLDERS' EQUITY






Current liabilities






Short-term bank loans

$

36,839,015


$

41,645,100

Notes payable


3,053,465



6,005,430

Convertible promissory note


-



3,500,000

Long-term debt – current portion


34,925,487



19,226,094

Accounts payable


18,680,167



10,071,009

Taxes payable


3,511,059



4,320,470

Accrued liabilities and other payables


5,655,640



4,153,054

Related party payable


1,809,493



2,433,300

Deferred tax liabilities


19,204



70,545

Customers deposits


412,954



61,428

Capital lease – current portion


465,916



-

Total current liabilities

$

105,372,400


$

91,486,430

 

 

AMERICAN LORAIN CORPORATION

UNAUDITED CONSOLIDATED BALANCE SHEETS

AT SEPTEMBER 30, 2015 AND DECEMBER 31, 2014

(Stated in US Dollars)







(Audited)



At September 30,



At December 31,



2015



2014







Long-term liabilities






Long-term bank loans


567,112



2,707,587

Notes payable and debenture


11,009,160



32,581,249

Capital lease


831,595



-

TOTAL LIABILITIES

$

117,780,267


$

126,775,266







COMMITMENTS AND CONTINGENCIES












STOCKHOLDERS' EQUITY






Preferred Stock, $0.001 par value, 5,000,000 shares

authorized; 0 shares issued and outstanding at
September 30, 2015 and December 31, 2014,
respectively


-



-

Common Stock, $0.001 par value, 200,000,000 shares

authorized; 38,259,490 shares and 34,916,714 shares
issued and
outstanding as of September 30, 2015 and
December 31, 2014, respectively


38,259



34,917

Additional paid-in capital


57,844,419



53,853,089

Statutory reserves


23,038,917



23,038,917

Retained earnings


100,340,007



99,021,555

Accumulated other comprehensive income


15,838,394



20,796,420

Non-controlling interests


11,109,780



13,021,555







TOTAL STOCKHOLDER'S EQUITY

$

208,209,776


$

209,766,453







TOTAL LIABILITIES AND STOCKHOLDER'S EQUITY

$

325,990,043


$

336,541,719

 

 

AMERICAN LORAIN CORPORATION

UNAUDITED CONSOLIDATED STATEMENTS OF INCOME

AND COMPREHENSIVE INCOME

FOR THE THREE AND NINE MONTHS PERIOD ENDED SEPTEMBER 30, 2015 AND 2014

(Stated in US Dollars)




For the three months period



For the nine months period




ended September 30,



ended September 30,




2015



2014



2015



2014















Net revenues

$

47,681,598


$

55,264,211


$

120,786,813


$

119,469,809


Cost of revenues


39,391,557



46,107,620



101,073,478



96,582,685


Gross profit

$

8,290,041


$

9,156,591


$

19,713,335


$

22,887,124















Operating expenses













Selling and marketing expenses


1,875,739



3,044,877



5,037,527



5,783,319


General and administrative expenses


2,348,402



3,361,844



9,530,701



6,756,226




4,224,141



6,406,721



14,568,228



12,539,545















Operating income

$

4,065,900


$

2,749,870


$

5,145,107


$

10,347,579















Government subsidy income


941,545



401,443



1,947,630



2,209,814


Interest income


116,451



94,186



391,056



151,510


Other income


87,371



779,644



649,045



935,198


Other expenses


(347,684)



(74,946)



(850,313)



(220,456)


Interest expense


(2,017,820)



(2,553,415)



(5,620,812)



(6,332,249)




























Earnings/(loss) before tax

$

2,845,763


$

1,396,782


$

1,661,713


$

7,091,396















Income tax


(967,650)



(666,673)



(2,255,036)



(2,378,889)















Net income/(loss)

$

1,878,113


$

730,109


$

(593,323)


$

4,712,507















Other comprehensive income/(loss):













Foreign currency translation gain/(loss)


(6,063,073)



82,660



(4,958,027)



(2,020,740)


Comprehensive Income/(Loss)


(4,184,960)



812,769



(5,551,350)



2,691,767















Net income/(loss) attributable to:













-Common stockholders

$

2,263,262


$

1,179,001


$

1,318,452


$

4,909,926


-Non-controlling interest


(385,149)



(448,892)



(1,911,775)



(197,419)



$

1,878,113


$

730,109


$

(593,323)


$

4,712,507















Earnings/(loss) per share













- Basic

$

0.06


$

0.03


$

0.04


$

0.14


- Diluted

$

0.06


$

0.03


$

0.04


$

0.14















Weighted average shares outstanding













- Basic


38,259,490



34,745,285



36,727,504



34,873,699


- Diluted


38,259,490



34,745,285



36,727,504



34,873,699


 

 


AMERICAN LORAIN CORPORATION

UNAUDITED CONSOLIDATED STATEMENTS OF CASH FLOW

FOR THE THREE AND NINE MONTHS PERIOD ENDED SEPTEMBER 30, 2015 AND 2014

(Stated in US Dollars)




For the three months period



For the nine months period



ended September 30,



ended September 30,



2015



2014



2015



2014

Cash flows from operating activities












Net income


1,878,113



730,109



(593,323)



4,712,507

Stock compensation expense


-



366,000



987,500



366,000

Depreciation of fixed assets


1,023,350



1,093,167



3,037,385



2,926,095

Amortization of intangible assets


97,727



485,916



289,497



672,370

(Increase)/decrease in accounts and

other receivables


(12,837,631)



(17,077,118)



11,063,323



2,262,344

(Increase)/decrease in inventories


8,567,805



(15,298,226)



(1,034,711)



(35,514,753)

Decrease/(increase) in prepayment


(96,065)



(178,964)



(230,948)



(2,488,951)

Decrease/(increase) in deferred tax

asset


(12,351)



(52)



(38,327)



1,263

Increase/(decrease) in accounts and

other payables


7,629,986



27,357,598



12,887,010



28,019,912

Increase/(decrease) in related party

payable


40,442



-



(397,660)



-

Net cash (used in)/provided by

operating activities


6,291,376



(2,521,570)



25,969,746



956,787













Cash flows from investing activities












Payment for acquisition of Athena

Group


-



2,100,000



-



-

Purchase of plant and equipment


(1,512,795)



(5,152,779)



(1,905,906)



(6,167,956)

Disposal/(Purchase) of intangible assets


444



(2,064,247)



(56,813)



(1,935,326)

(Increase)/decrease in restricted cash


(4,655,012)



198,008



(10,529,664)



(2,444,287)

(Increase)/decrease in deposit


(62,971)



(8,427,528)



(606,921)



(8,403,929)

Sales of investments


(159,615)



-



-



-

Net cash used in investing activities


(6,389,949)



(13,346,546)



(13,099,304)



(18,951,498)













Cash flows from financing activities












Repayment of bank borrowings


(4,241,287)



(505,914)



(7,731,253)



(8,970,772)

Proceeds from bank borrowings and

debentures


12,257,115



7,563,144



16,388,949



21,867,129

(Repayment)/proceeds of long-term

borrowings and notes payable


(14,225,110)



4,605,638



(21,109,957)



11,354,924

Net cash provided by/(used in)

financing activities

$

(6,209,282)


$

11,662,868


$

(12,452,261)


$

24,251,281













Net Increase/(decrease) of cash and

cash equivalents


(6,307,855)



(4,205,248)



418,181



6,256,570













Effect of foreign currency translation on

cash and cash equivalents


185,641



2,777,136



446,939



673,737













Cash and cash equivalents–beginning of

period


37,267,322



42,215,612



30,279,988



33,857,193













Cash and cash equivalents–end of

period

$

31,145,108


$

40,787,500


$

31,145,108


$

40,787,500













Supplementary cash flow information:












Interest received

$

116,451


$

94,186


$

391,056


$

151,510

Interest paid

$

554,080


$

1,482,803


$

2,815,173


$

3,243,753

Income taxes paid

$

788,965


$

961,838


$

1,973,428


$

4,003,028

 

About American Lorain Corporation

American Lorain Corporation (NYSE: ALN) is China's leading chestnut, convenience food product and frozen food product manufacturer. The company currently has 8 world-class production facilities in China and Europe, which can supply more than 200 kinds of product categories. For domestic trade, it has more than thirty offices, with its sales network covers large cities, medium-size cities and coastal open cities all over China. Regarding to international trade, the products are exported to more than 20 countries and regions, such as Japan, South Korea, Taiwan, Southeast Asia and Europe, which makes our company enjoys a high reputation in the international market. For more information on American Lorain Corporation, please visit: http://en.usalr.cn/index.html

Forward Looking Statements

This news release contains "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and as defined in the U.S. Private Securities Litigation Reform Act of 1995. These forward-looking statements can be identified by terminology such as "will," "expects," "anticipates," "future," "intends," "plans," "believes," "estimates" and similar statements. All statements other than statements of historical fact in this press release are forward-looking statements and involve certain risks and uncertainties that could cause actual results to differ materially from those in the forward-looking statements. These forward-looking statements are based on management's current expectations, assumptions, estimates and projections about the Company and the industry in which the Company operates, but involve a number of unknown risks and uncertainties. Further information regarding these and other risks is included in the Company's filings with the U.S. Securities and Exchange Commission. The Company undertakes no obligation to update forward-looking statements to reflect subsequent occurring events or circumstances, or changes in its expectations, except as may be required by law. Although the Company believes that the expectations expressed in these forward looking statements are reasonable, it cannot assure you that such expectations will turn out to be correct, and actual results may differ materially from the anticipated results. You are urged to consider these factors carefully in evaluating the forward-looking statements contained herein and are cautioned not to place undue reliance on such forward-looking statements, which are qualified in their entirety by these cautionary statements.

Contact: Johnny Zhou Tel.: +86 13917303401 E-mail: johnny.zhou@usalr.cn 

SOURCE American Lorain Corporation



RELATED LINKS

http://www.americanlorain.com