SkyPeople Fruit Juice Reports Third Quarter 2012 Financial Results

13 Nov, 2012, 06:00 ET from SkyPeople Fruit Juice, Inc.

XI'AN, China, Nov. 13, 2012 /PRNewswire-FirstCall/ -- SkyPeople Fruit Juice, Inc. (NASDAQ: SPU) ("SkyPeople" or "the Company"), a producer of fruit juice concentrates, fruit juice beverages and other fruit-related products, today announced its financial results for the third quarter ended September 30, 2012.

Third Quarter 2012 Highlights:

  • Total revenue was $28.6 million, an increase of 64% year-over-year
  • Revenue of concentrated pear juice increased 459% to $11.4 million year-over-year
  • Revenue of fruit juice beverages increased 102% to $10.5 million year-over-year
  • Net income attributable to SkyPeople Fruit Juice, Inc. increased 177% to $5.0 million year-over-year
  • Cash flow from operations for nine months ended September 30, 2012 was $20.3 million
  • Cash and cash equivalents were $80.9 million as of September 30, 2012

"We are very pleased to have achieved strong year-to-year growth in revenues and net income for the third quarter of 2012. Our strong results were driven by exceptional performance in two of our key product segments, concentrated pear juice and fruit juice beverages," said Mr. Yongke Xue, Chief Executive Officer of SkyPeople. "Our overall profitability improved significantly as well on the basis of an expansion of gross margins attributable to better raw material costs as well as lower operating expenses. We believe that our strategy of diversifying our product mix has been very effective in that it provides us with flexibility to shift our manufacturing focus towards better performing products so as to optimize our operating performance. "

CEO Xue continued, "As recently announced, we are further diversifying our business into the orange products segment. We recently entered into an agreement with the Yidu Municipal People's Government in Hubei Province, one of the biggest citrus production provinces in China, with regard to an orange comprehensive deep processing project. The project is estimated to require a total investment of approximately $61 million by the Company that includes land use rights, development of an orange plantation and the construction of a processing plant, a storage facility and other general purpose facilities. We believe that this strategic expansion is complementary to our existing product platform. It is expected to broaden our product mix, enhance our competitive advantage and further mitigates both the regional and seasonal cyclicality of our major fruit product segments." 

"We will work hard to successfully implement this new venture and hope to close the year 2012 on a positive note," CEO Xue concluded.

Third Quarter 2012 Financial Results

Revenue for the three months ended September 30, 2012 was $28.6 million, an increase of 64%, as compared to $17.4 million for the same period in 2011. This increase was primarily due to an increase in the sales of concentrated pear juice and fruit juice beverages, which offset a decrease in the sales of concentrated apple juice and apple aroma and concentrated kiwifruit juice and kiwifruit puree.

Third Quarter 2012 Revenue by Segment (in thousands)

 

Three Months Ended September 30,

Change

2012

2011

%

Concentrated apple juice and apple aroma

$3,962

$8,782

(55)%

Concentrated kiwifruit juice and kiwifruit puree

399

499

(20)%

Concentrated pear juice

11,382

2,036

459%

Fruit juice beverages

10,460

5,188

102%

Fresh fruits and vegetables

707

897

(21)%

Other

1,653

35

4,623%

Total

$28,563

$17,437

64%

Gross profit was $8.5 million, an increase of 76% from $4.8 million in the third quarter of 2011.  Gross profit margin was 30% as compared to 28% for the same period of 2011. The year-over-year increase in gross margin was attributable to a substantial rise in gross margin of the Company's fruit juice beverages segment and concentrated pear juice segments, which offset declines in gross margins of its other product segments.

Third Quarter 2012 Gross Profit by Segment (in thousands)

 

Three Months Ended September 30,

2012

2011

Gross Profit

Gross Margin

Gross Profit

Gross Margin

Concentrated apple juice and apple aroma

679

17%

2,045

23%

Concentrated kiwifruit juice and kiwifruit puree

189

47%

267

54%

Concentrated pear juice

3,469

30%

516

25%

Fruit juice beverages

3,951

38%

1,582

30%

Fresh fruits and vegetables

218

31%

424

47%

Other

19

1%

7

20%

Total

8,525

30%

4,841

28%

Operating expenses for the third quarter of 2012 decreased 8% to $1.8 million, or 6% of sales, compared to $2.0 million, or 11% of sales for the same period of 2011. General and administrative expenses decreased 21% to $1.0 million, mainly due to decreases in legal fees related to currently pending litigations. Selling expenses increased 15% to $0.7 million, which was mainly due to an increase in the headcount of the Company's sales force.

Income from operations for the third quarter of 2012 increased 136% to $6.7 million as compared to $2.8 million for the same period of 2011.

Other income was $0.5 million for the third quarter of 2012, as compared to other expense of $0.2 million in the same period of 2011. The increase in other income was primarily due to an increase in the subsidy income of $0.6 million in the third quarter as a result of the value-added tax rebates provided on the Company's exports, which significantly increased in the third quarter of 2012 from the corresponding period of 2011.

Net income attributable to common shareholders and diluted earnings per share for the third quarter of 2012 increased 177% to $5.0 million and $0.19, respectively, compared to $1.8 million and $0.07, respectively, for the third quarter of 2011.

Nine-Month 2012 Financial Results

Revenue for the nine months ended September 30, 2012 increased 15% to $56.4 million, from $49.1 million for the same period of 2011. Gross profit decreased to $17.5 million from $17.6 million in the corresponding period of 2011.  Operating income declined to $12.2 million for the first nine months of 2012 from $12.4 million for the same period of 2011.  Net income attributable to common shareholders and earnings per share for the first nine months of 2012 increased to $9.4 million, or $0.35 per diluted share compared to net income attributable to common shareholders of $8.6 million, or $0.32 per diluted share, for the same period of 2011.

Conference Call

The Company will hold a conference call on Wednesday, November 14, 2012 at 9:00 a.m. Eastern Time to discuss its financial results for the third quarter ended September 30, 2012.

The Company's CEO, Mr. Yongke Xue, and CFO, Mr. Xin Ma, will host the call.

To attend the live conference call, please dial in at least 10 minutes before the call to ensure timely participation.  Please use the dial-in information below.  When prompted by the operator, mention the conference Pass Code.

Date:

Wednesday, November 14, 2012

Time:

9:00 a.m. Eastern Time, US

Conference Line Dial-In:                          

+1-855-880-8437

International Dial-In:

+1-931-229-4159

Conference Pass Code:

70094777

To access the replay, please dial 1-855-859-2056 within the United States or 1-404-537-3406 when dialing internationally, and enter the pass code 70094777 for the replay. The replay will be available on November 14 at 12:00 pm.

About SkyPeople Fruit Juice, Inc.

SkyPeople Fruit Juice, Inc., a Florida company, through its wholly-owned subsidiary Pacific Industry Holding Group Co., Ltd. ("Pacific"), a Vanuatu company, and SkyPeople Juice International Holding (HK) Ltd., a company organized under the laws of Hong Kong Special Administrative Region of the People's Republic of China and a wholly owned subsidiary of Pacific, holds 99.78% ownership interest in SkyPeople Juice Group Co., Ltd. ("SkyPeople (China)"). SkyPeople (China), together with its operating subsidiaries in China,  is engaged in the production and sales of fruit juice concentrates, fruit beverages, and other fruit related products in the PRC and overseas markets. Its fruit juice concentrates are sold to domestic customers and exported directly or via distributors. Fruit juice concentrates are used as a basic ingredient component in the food industry. Its brands, "Hedetang" and "SkyPeople," which are registered trademarks in the PRC, are positioned as high quality, healthy and nutritious end-use juice beverages. For more information, please visit http://www.skypeoplefruitjuice.com.

Safe Harbor Statement

Certain of the statements made in this press release are "forward-looking statements" within the meaning and protections of Section 27A of the Securities Act of 1933, as amended and Section 21E of the Securities Exchange Act of 1934, as amended, or the Exchange Act. Forward-looking statements include statements with respect to our beliefs, plans, objectives, goals, expectations, anticipations, assumptions, estimates, intentions, and future performance, and involve known and unknown risks, uncertainties and other factors, which may be beyond our control, and which may cause the actual results, performance, capital, ownership or achievements of the Company to be materially different from future results, performance or achievements expressed or implied by such forward-looking statements. All statements other than statements of historical fact are statements that could be forward-looking statements. You can identify these forward-looking statements through our use of words such as "may," "will," "anticipate," "assume," "should," "indicate," "would," "believe," "contemplate," "expect," "estimate," "continue," "plan," "point to," "project," "could," "intend," "target" and other similar words and expressions of the future.

All written or oral forward-looking statements attributable to us are expressly qualified in their entirety by this cautionary notice, including, without limitation, those risks and uncertainties described in our annual report on Form 10-K for the year ended December 31, 2011 and otherwise in our SEC reports and filings, including the final prospectus for our offering. Such reports are available upon request from the Company, or from the Securities and Exchange Commission, including through the SEC's Internet website at http://www.sec.gov. We have no obligation and do not undertake to update, revise or correct any of the forward-looking statements after the date hereof, or after the respective dates on which any such statements otherwise are made.

For more information, please contact:

COMPANY

Xin Ma, Chief Financial Officer

SkyPeople Fruit Juice, Inc.

Tel:   China + 86 - 29-8837-7161

Email: oliver.x.ma@skypeoplefruitjuice.com

Web: http://www.skypeoplefruitjuice.com 

-Financial Tables Follow-

SKYPEOPLE FRUIT JUICE, INC.

CONSOLIDATED BALANCE SHEETS

September 30,

December 31,

2012

2011

(Unaudited)

ASSETS

CURRENT ASSETS

    Cash and cash equivalents

$

80,869,190

$

61,154,007

    Restricted cash

31,541

316,396

    Accounts receivables, net of allowance of $46,234         and $46,529 as of September 30, 2012 and December 31,         2011, respectively

29,245,668

35,999,858

    Other receivables

304,310

192,032

    Inventories

6,382,796

6,126,376

    Deferred tax assets

31,647

174,285

    Advances to suppliers and other current assets

114,080

66,528

TOTAL CURRENT ASSETS

116,979,232

104,029,482

PROPERTY, PLANT AND EQUIPMENT, NET

49,781,361

44,277,228

LAND USE RIGHT, NET

7,695,834

6,673,496

OTHER ASSETS

347,494

5,323,162

TOTAL ASSETS

$

174,803,921

$

160,303,368

LIABILITIES

CURRENT LIABILITIES

    Accounts payable

$

6,788,625

$

2,972,916

    Accrued expenses

2,000,465

4,701,054

    Income tax payable

1,728,077

1,910,779

    Advances from customers

-

178,857

    Short-term bank loans

11,559,691

6,425,713

    Short-term notes payable

-

284,654

TOTAL CURRENT LIABILITIES

22,076,858

16,473,973

SHAREHOLDERS' EQUITY

SkyPeople Fruit Juice, Inc, Stockholders' equity

    Series B Preferred stock, $0.001 par value;        10,000,000 shares authorized; 230,147 shares        and 1,456,647 shares issued and outstanding as of        September 30, 2012 and December 31, 2011,        respectively

230

1,457

    Common stock, $0.001 par value; 66,666,666         shares authorized; 26,508,068 shares and          25,690,402 shares issued and outstanding as of         September 30, 2012 and  December 31, 2011         respectively

26,508

25,690

    Additional paid-in capital

59,189,783

59,189,374

    Retained earnings

73,975,364

64,623,453

    Accumulated other comprehensive income

13,216,615

14,086,620

    Total SkyPeople Fruit Juice, Inc. stockholders'         equity

146,408,500

137,926,594

    Non-controlling interests

6,318,563

5,902,801

TOTAL EQUITY

152,727,063

143,829,395

TOTAL LIABILITIES AND EQUITY

$

174,803,921

$

160,303,368

 

SKYPEOPLE FRUIT JUICE, INC.

CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME

(Unaudited)

For the Three Months Ended September 30,

For the Nine Months Ended September 30,

2012

2011

2012

2011

Revenue

$

28,563,469

$

17,437,105

$

56,394,242

$

49,062,726

Cost of goods sold

20,038,559

12,595,983

38,861,942

31,448,900

Gross profit

8,524,910

4,841,122

17,532,300

17,613,826

Operating Expenses

    General and administrative expenses

960,617

1,217,206

3,091,992

3,042,100

    Selling expenses

732,751

638,211

1,779,867

1,741,814

    Research and development expenses

142,077

145,413

427,447

420,121

Total operating expenses

1,835,445

2,000,830

5,299,306

5,204,035

Income from operations

6,689,465

2,840,292

12,232,994

12,409,791

Other income (expenses)

    Interest income

77,846

81,720

234,551

223,806

    Subsidy income

615,997

50,632

1,699,108

622,396

    Interest expenses

(213,847)

(308,447)

(616,991)

(648,635)

    Others incomes

-

(118)

(1,000)

39,454

Total other income (expenses)

479,996

(176,213)

1,315,668

237,021

Income before income tax

7,169,461

2,664,079

13,548,662

12,646,812

    Income tax provision

1,917,425

726,239

3,710,098

3,419,625

Net income

5,252,036

1,937,840

9,838,564

9,227,187

Less: Net income attributable to non-controlling interests

219,934

124,420

486,653

633,642

NET INCOME ATTRIBUTABLE TO SKYPEOPLE FRUIT JUICE, INC. 

$

5,032,102

$

1,813,420

$

9,351,911

$

8,593,545

Earnings per share:

    Basic earnings per share

$

0.19

$

0.07

$

0.35

$

0.32

    Diluted earnings per share

$

0.19

$

0.07

$

0.35

$

0.32

Weighted average number of  shares outstanding

    Basic

26,251,920

25,690,402

25,922,298

25,690,402

    Diluted

26,661,500

26,661,500

26,661,500

26,661,500

Comprehensive Income

Net income

$

5,252,036

$

1,937,840

$

9,838,564

$

9,227,187

Foreign currency translation adjustment

(311,480)

1,342,180

(870,005)

4,293,977

Total Comprehensive income

$

4,940,556

$

3,280,020

$

8,968,559

$

13,521,164

Comprehensive income attributable to non-controlling interests

172,179

182,649

415,762

800,375

Comprehensive income attributable to SkyPeople Fruit Juice, Inc.

$

4,768,377

$

3,097,371

$

8,552,797

$

12,720,789

SKYPEOPLE FRUIT JUICE, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

For the Nine Months Ended September 30,

2012

2011

CASH FLOWS FROM OPERATING ACTIVITIES

Net income

$

9,838,564

$

9,227,187

Adjustments to reconcile net income to net cash provided by operating activities

    Depreciation and amortization

3,376,671

2,674,081

    Deferred income tax assets

142,638

-

Changes in operating assets and liabilities

    Accounts receivable

6,551,325

25,987,583

    Other receivable

(113,858)

19,660

    Advances to suppliers and other current assets

(47,955)

(399,945)

    Inventories

(296,284)

(2,442,658)

    Accounts payable

3,849,078

(398,972)

    Accrued expenses

(2,683,737)

(1,491,478)

    Income tax payable

(170,942)

(3,825,519)

    Advances from customers 

(178,401)

(535,017)

Net cash provided by operating activities

20,267,099

28,814,922

CASH FLOWS FROM INVESTING ACTIVITIES

    Additions to property, plant and equipment

(3,829,822)

(138,927)

    Additions to construction progress

-

(46,437)

    Additions to land use right

(1,204,179)

-

    Prepayment for other assets

(256,585)

(5,894,322)

Net cash used in investing activities

(5,290,586)

(6,079,686)

CASH FLOWS FROM FINANCING ACTIVITIES

  Decreased(Increased) in restricted cash

283,929

(679,744)

    Short-term notes payable

(283,929)

657,590

    Proceeds from short-term bank loans

6,332,120

7,733,603

    Repayment of short-term bank loans

(1,137,847)

(5,181,670)

Net cash provided by financing activities

5,194,273

2,529,779

Effect of change in exchange rate

(455,603)

1,809,779

NET INCREASE IN CASH AND CASH EQUIVALENTS

19,715,183

27,074,794

    Cash and cash equivalents, beginning of period

61,154,007

49,350,385

    Cash and cash equivalents, end of period

80,869,190

76,425,179

SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION

    Cash paid for interest

640,184

648,635

    Cash paid for income taxes

3,740,987

7,245,144

SUPPLEMENTARY DISCLOSURE OF SIGNIFICANT NON-CASH TRANSACTION

    Transferred from other assets to property, plant and equipment and construction in process

$

5,217,366

$

457,070

The notes in the Company's 10-Q are an integral part of these consolidated financial statements.

SOURCE SkyPeople Fruit Juice, Inc.



RELATED LINKS

http://www.skypeoplefruitjuice.com