BEIJING, June 12, 2012 /PRNewswire-Asia-FirstCall/ -- Deyu Agriculture Corp. (OTCQB: DEYU - News) ("the Company" or "Deyu"), announced today that it has formed a supply relationship with Guangdong Wen's Food Group Co., Ltd. ("WFG"), in which Deyu shall provide raw corn to four of WFG's feed mills in Southwestern China on a non-exclusive basis.
The Company has recorded $3 million (RMB 20 million) in sales revenue attributable to WFG since shipments commenced to WFG in January, 2012, which is equal to approximately 7,600 tons of raw corn. The Company anticipates this to be an on-going supply relationship with WFG. Overall, the four feed mills use approximately 200,000 tons of raw corn per year.
Founded in 1983, WFG is a large-scale modern multi-industry and trans-regional livestock enterprise that is engaged mainly in the feed, poultry and pig industries. WFG's business operations involve bio-pharmaceutical and food processing in 20 of China's Provinces, and it has established more than 110 integrated companies. In 2010, WFG achieved sales revenue of RMB 21.94 billion and its feed production amounted to 5.14 million tons. In 2011, WFG's feed production approached 10 million tons. In view of this growth, Deyu believes it will we well positioned to serve WFG's trending demand for its feed products.
"Corn is the foundation of our business and we are very pleased to establish a new relationship that supports this segment," said Jianming Hao, Chief Executive Officer and Chairman of Deyu. "By working with WFG, we are confident that will be able to build upon the success that our corn division experienced last year, as this business segment increased its sales 156% from $69.5 million in fiscal 2010 to $177.7 million in fiscal 2011. Our new advanced processing center boosted our total storage capacity and annual turnover of corn to over 100,000 tons and 700,000 tons, respectively, and we believe that our robust corn reserves and output capabilities will facilitate our supply to WFG, and help foster further progress in our corn division."
About Deyu Agriculture
Deyu Agriculture Corp. is a vertically integrated producer, processor, marketer and distributor of organic and other agricultural products made from corn and grains operating in Shanxi Province of the People's Republic of China. The Company has access to over 109,000 acres of farmland in Shanxi Province for breeding, cultivating, processing, warehousing and distributing grain and corn products. Deyu has an extensive wholesale network in over 15 provinces and a retail distribution network of approximately 20,000 supermarkets and convenience stores in 29 provinces across China. Deyu's facilities include advanced production lines and modern warehouses with a total production capacity of over 105,000 tons for grain products, storage capacity of over 100,000 tons and annual turnover of 700,000 tons for corn products. The Company's website is located at www.deyuagri.com.
Safe Harbor Statements
This press release contains forward-looking statements made under the "safe harbor" provisions of the U.S. Private Securities Litigation Reform Act of 1995. Forward looking statements are based upon the current plans, estimates and projections of Deyu's management and are subject to risks and uncertainties, which could cause actual results to differ from the forward looking statements. Such statements include, among others, those concerning market and industry segment growth and demand and acceptance of new and existing products; any projections of sales, earnings, revenue, margins or other financial items; any statements of the plans, strategies and objectives of management for future operations; any statements regarding future economic conditions or performance; uncertainties related to conducting business in China, as well as all assumptions, expectations, predictions, intentions or beliefs about future events. Therefore, you should not place undue reliance on these forward-looking statements. The following factors, among others, could cause actual results to differ from those set forth in the forward-looking statements: business conditions in China, general economic conditions; geopolitical events and regulatory changes, availability of capital, changes in the agricultural industry, the Company's ability to maintain its competitive position. Additional Information regarding risks can be found in the Company's quarterly and annual reports filed with the U.S. Securities and Exchange Commission at www.sec.gov.
Mr. Kevin Fickle, President
NUWA Group LLC.
Ms. Amy He, Chief Financial Officer
Deyu Agriculture Corp.
Tel: +86-10-5224-1802 X389
Ms. Cynthia Yang, Assistant to CFO
SOURCE Deyu Agriculture Corp.