SHOUGUANG, China, April 23, 2013 /PRNewswire/ -- China New Borun Corporation (NYSE: BORN; "Borun" or the "Company"), a leading producer and distributor of corn-based edible alcohol in China, announced today that it has secured sufficient corn to cover its 2013 production needs in the non-harvest season.
The Company has pre-purchased directly from local farmers up to 300,000 tons of corn in the harvest season, funded by the Company's working capital and the Bonds proceeds issued in January 2013. In addition, Borun has also entered into framework agreements with eight granaries in Heilongjiang Province, China to supply approximately 200,000 tons of corn. As a result, the Company has secured up to 500,000 tons of corn in total to fulfill all the Company's estimated production needs during the non-harvest season.
Mr. Jinmiao Wang, Chairman and Chief Executive Officer of Borun, remarked, "The procurement of corn will provide us with sufficient supply at favorable price during the non-harvest season. We are glad that we've expanded our sourcing strength this year by pre-purchasing a large portion of corn directly from local farmers during the harvest season, which will help us to further lower our average corn cost. By eliminating the additional charges from local granaries, we believe that we have gained a significant competitive advantage during the non-harvest season."
Based on preliminary estimates, the Company currently expects that it will exceed its previous 1Q13 forecast of RMB385.0 million ($61.3 million) to RMB420.0 million ($66.8 million). The Company also currently expects that it will maintain positive net profits for the first quarter of 2013.
Mr. Wang continued, "We're encouraged that our solid execution and strong sourcing capabilities not only helped us to remain profitable in the first quarter, but also strengthened our overall operating stability in 2013. With our superior sourcing capabilities and production efficiencies, we believe we are better positioned than smaller competitors to withstand the current industry challenges."
All statements included in this press release, other than statements or characterizations of historical fact, are forward-looking statements. These forward-looking statements are based on our current expectations, estimates and projections about our industry, management's beliefs, and certain assumptions made by us, all of which are subject to change. Forward-looking statements can often be identified by words such as "anticipates," "expects," "intends," "plans," "predicts," "believes," "seeks," "estimates," "may," "will," "should," "would," "could," "potential," "continue," "ongoing," similar expressions, and variations or negatives of these words. These forward-looking statements are not guarantees of future results and are subject to risks, uncertainties and assumptions that could cause our actual results to differ materially and adversely from those expressed in any forward-looking statement.
About China New Borun Corporation
China New Borun Corporation (NYSE: BORN) is a leading producer and distributor of corn-based edible alcohol in China. Borun's edible alcohol products are primarily sold as an ingredient to producers of baijiu, a popular grain-based alcoholic beverage that is sold throughout China in retail stores, restaurants and bars. The Company also produces DDGS Feed, liquid carbon dioxide and crude corn oil as by-products of edible alcohol production. China New Borun is based in Shouguang, Shandong Province. Additional information about the company can be found at http://www.chinanewborun.com and in documents filed with the U.S. Securities and Exchange Commission ("SEC"), which are available on the SEC's website at www.sec.gov.
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SOURCE China New Borun Corporation