Rodobo International, Inc. Reports the First Quarter of Fiscal Year 2010 Results

HARBIN, China, Feb. 12 /PRNewswire-Asia-FirstCall/ -- Rodobo International, Inc. (OTC Bulletin Board: RDBO), a leading manufacturer and distributor of high quality milk formula products for infants, children, the middle-aged and the elderly in China, today announced its financial results for the first quarter of its fiscal year 2010.

Results for the Three Months Ended December 31, 2009

Revenue for the first quarter ended December 31, 2009 was $10.1 million, an increase of 14% compared to the same period ended December 31, 2008. This increase was primarily driven by volume growth, with the average selling price remaining flat over both periods. We continued our efforts to develop distribution networks and expand the market areas in the 9 provinces and Beijing where we currently sell products. The new baby/infant formula product series marketed under the brand name of "Peer" which was launched in July 2009 attributed approximately $3.8 million to the first quarter.

Gross profit for the first quarter ended December 31, 2009 was $5.3 million, an increase of 18% compared to the same period ended December 31, 2008. The overall gross margin increased from 51% in the first quarter ended December 31, 2008 to 53% in the first quarter ended December 31, 2009. The improvement of our gross margin was mainly driven by the increase in sales of high-margin new baby/infant formula which is marketed under the brand name of "Peer", which had a gross margin of 70% and accounted for approximately 38% of total sales in the first quarter ended December 31, 2009.

Due to the increase in revenue and improvement in gross profit margin, offsetting by the increase in operating expenses, operating income increased 2% to $2.0 million in the first quarter ended December 31, 2009, compared to the same period ended December 31, 2008.

Net income grew 21% to $2.3 million in the first quarter ended December 31, 2009 compared with $1.9 million in the first quarter ended December 31, 2008. This increase in net income was mainly attributable to the growth in revenue, partially offset by an increase in cost of goods sold and operating expenses. This increase in net income was also attributable to a $0.3 million non-recurring subsidiary income from government support funds.

Company and Market Outlook

"During the first quarter of our fiscal year 2010, Rodobo International had experienced a healthy growth in revenues and earnings," stated Mr. Yanbin Wang, Chairman and CEO of Rodobo, "We continue to focus on providing high quality premium products to our customers. Our new organic dairy farm with 1,140 cows and 15 company-owned raw milk collection stations currently provides 65 tons of high quality fresh milk per day. We believe that our recent acquisition of three Chinese dairy companies will expand our production capacity from 200 tons to 1,200 tons per day and increase our distribution channels. We expect exciting further growth in the coming quarters of this year."

About Rodobo International, Inc.:

Rodobo International, Inc. is one of the leading non-state-owned dairy companies in China. Through its wholly-owned operating subsidiaries and variable interest entity, Rodobo International, Inc. is a producer and distributor of high-quality formula milk powder products for infants, children, the middle-aged and the elderly in China. The Company's products are sold under the brand names "Rodobo", "Healif" and "Peer" and are produced in cutting edge facilities under best quality control systems and in compliance with high industry standards.

Cautionary Note Regarding Forward Looking Statements

This press release and the statements of representatives of Rodobo International, Inc., and its consolidated subsidiaries (collectively, the "Company") related thereto contain, or may contain, among other things, "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. All statements, other than statements of historical fact included herein are "forward-looking statements," including statements regarding: the impact of the recent acquisitions on the business and operations of the Company; the ability of the Company to achieve its commercial objectives including increase growth, revenues, earnings, and production capacity; the business strategy, plans and objectives of the Company; and any other statements of non-historical information. These forward-looking statements are subject to significant involve known and unknown risks and uncertainties ad are often identified by the use of forward-looking terminology such as "projects," "may," "could," "would," "should," "believes," "expects," "anticipates," "estimates," "intends," "plans," or similar expressions. Although the Company believes that the expectations reflected in these forward-looking statements are reasonable, they do involve assumptions, risks and uncertainties, and these expectations may prove to be incorrect. Investors should not place undue reliance on these forward-looking statements, which speak only as of the date of this press release. The Company's actual results could differ materially from those anticipated in these forward-looking statements as a result of a variety of factors, including those discussed in the periodic reports that are filed with the Securities and Exchange Commission and available on its website (http://www.sec.gov ). All forward-looking statements attributable to the Company or persons acting on its behalf are expressly qualified in their entirety by these factors. The Company undertakes no duty to update these forward-looking statements except as required by law.

    For more information, please contact:

     Xiuzhen Qiao
     Rodobo International, Inc.
     Tel:   +86-451-8226-5922
     Email: [email protected]

    Table to follow:



                            RODOBO INTERNATIONAL, INC.
    CONDENSED CONSOLIDATED STATEMENTS OF INCOME AND OTHER COMPREHENSIVE INCOME
                                   (UNAUDITED)

                                                   For The Three Months Ended
                                                          December 31
                                                      2009             2008


    Net sales                                    $10,075,445       $8,860,825
    Cost of goods sold                             4,780,299        4,357,117

            Gross profit                           5,295,146        4,503,708

    Operating expenses:
      Distribution expenses                        2,586,173        2,119,352
      General and administrative expenses            607,215          388,682
      Depreciation and amortization expenses         115,665           42,450

            Total operating expenses               3,309,053        2,550,484

    Operating income                               1,986,094        1,953,224

    Subsidy income                                   273,897               --
    Other income                                       2,390          (80,618)

    Income before income taxes                     2,262,381        1,872,604

    Provision for income taxes                            --               --

    Net income                                    $2,262,381       $1,872,604

    Other comprehensive income:
        Foreign currency translation
         adjustment                                   (2,184)         (39,780)

    Comprehensive income                          $2,260,197       $1,832,824




                             RODOBO INTERNATIONAL, INC.
                      CONDENSED CONSOLIDATED BALANCE SHEETS

                                                December 31,      September 30,
                                                   2009               2009
                                                (Unaudited)         (Audited)

                                      ASSETS

    Current assets:
      Cash and cash equivalents                 $2,876,418         $1,640,259
      Accounts receivable                        3,533,430          2,015,044
      Advances to employees                         11,978              5,602
      Inventories                                  562,560          1,576,723
      Prepaid expenses                             226,542             19,040

            Total current assets                 7,210,929          5,256,668

    Property, plant and equipment, net
     of accumulated depreciation                 1,985,487            738,537

    Biological assets, net                       2,439,713          2,499,625

    Other assets:
      Investment advances                          410,135                 --
      Deposits on biological assets                988,718            988,818
      Deposits on land and equipment             9,520,991          9,961,429
      Intangible assets, net                     4,462,142          4,526,117

            Total other assets                  15,381,986         15,476,364

            Total Assets                       $27,018,115        $23,971,194



                       LIABILITIES AND STOCKHOLDERS' EQUITY

    Current liabilities:
      Accounts payable                          $1,518,958         $1,246,818
      Other payable                                290,149             50,293
      Accrued expenses                              70,248            175,456
      Due to related parties                     1,185,054          1,185,062

          Total current liabilities              3,064,409          2,657,629

    Stockholders' equity
      Common stock, $0.0001 par value,
       200,000,000 shares authorized,
       16,292,614 and 16,216,717 shares
       issued and outstanding
       as of December 31, 2009 and
       September 30, 2009, respectively              1,629              1,622
      Additional paid in capital                 4,735,022          4,355,085
      Additional paid in capital -
       warrants                                    971,788            971,788
      Subscription receivable                      (50,000)           (50,000)
      Retained earnings                         17,452,241         15,189,860
      Accumulated other comprehensive
       income                                      843,027            845,210

            Total stockholders' equity          23,953,706         21,313,565

            Total Liabilities and
             Stockholders' Equity              $27,018,115        $23,971,194

SOURCE Rodobo International, Inc.