American Lorain Corporation Reports 2011 Year-end Financial Results

2012-03-30


JUNAN COUNTY, ChinaMarch 30, 2012 /PRNewswire-Asia-FirstCall/ — American Lorain Corporation (NYSEAmex: ALN(“American Lorain” or the “Company”), an international processed snack foods, convenience foods, and frozen foods company based in the Shandong ProvinceChina, today announced financial results for its year ended December 31, 2011.

Full-year 2011 Financial Highlights

  • Total revenues of $213.2 million, an increase of 15.8% from the prior year
  • Total gross profit of $45.0 million, an increase of 7.5% from the prior year
  • Net income attributable to common stockholders was $19.9 million, an increase of 11.5% year-over-year
  • Diluted earnings per share of $0.57 compared to $0.55 in the prior year

American Lorain's Chairman and CEO, Mr. Si Chen, stated, “We are very pleased with our growth during the year ended December 31, 2011.  We have continued to benefit from our existing long-term supplier and customer relationships, and continued to make diligent efforts for consumer acceptance of products.  Despite the uncertain global economic environment and a very stringent credit environment in 2011, we have remained growing and profitable. American Lorain maintains a growing and diverse network of customers throughout 26 provinces in China and 42 countries around the world. We continued to expand our brand name throughout China, and improved sales domestically by 16.3% during 2011.  In 2011, 73.7% of the Company's sales were generated domestically through our network of distribution channels and relations, and 26.3% through international sales, primarily in the Asia-pacific region. Despite the earthquake Japan experienced in the first quarter of 2011, it remains our largest and most important export market, with revenue contribution from Japan increased from 10.7% in 2010 to 13.0% in 2011. 

2011 Operations and Market Overview

Category

 

For the 12 months ended

%

 

 

12/31/2011

 

12/31/2010

Growth

 

 

 

 

 

 

Chestnut

$

110,263,973

$

101,165,457

9.0%

Convenience food

 

72,887,580

 

56,751,766

28.4%

Frozen food

 

30,070,553

 

26,259,344

14.5%

Total

 

213,222,106

 

184,176,567

15.8%

American Lorain's sales of chestnuts increased by 9.0% to $110.3 million, and represented approximately 51.7% of the Company's total revenues, as compared with 54.9% over the same period of last year.  This growth was largely due to increased marketing efforts of the Company's 50+ varieties of chestnut products such as sweetheart chestnuts and chestnut in syrup, as well as the increase in chestnut retail prices.  Sales of chestnuts were particularly strong during the fourth quarter, which has historically been the Company's strongest quarter due to the seasonality of chestnuts.

Convenience foods remained American Lorain's fastest growing business segment, improving to $72.9 million (up 28.4%) for the year.  Products in American Lorain's convenience foods product line include 'ready to cook' foods such as French fries, 'ready to eat' foods such as snack beans and pickle vegetables, and 'meals ready to eat' which are microwavable lunch box entrees or packaged foods with self-heating devices for military personnel.  For 2011, this segment represented 34.2% of the Company's total sales as compared with 30.8% over the same period of last year, and the Company expects this segment to continue to grow the fastest of its three business lines. 

American Lorain's frozen food segment contributed an increase of 14.5% to $30.1 million in 2011 from $26.3 million in 2010, representing 14.1% of the total revenue as compared with 14.3% over the same period of last year.  The Company expects the frozen food segment continues steady growth, although at a slower rate compared with the convenience food segment.

2011 Year End Financial Review

American Lorain Corporation

Selected Financial Statements in USD ($ in 000s)

 

 

 

 

 

 

12 months ended

 

12 months ended

 

 

 

 

 

12/31/2011

 

12/31/2010

 

 

 

 

 

 

 

 

Sales

$213,222,106

 

$184,176,567

Cost of Revenues

($168,208,856)

 

($142,292,716)

Gross Profit

$45,013,250

 

$41,883,851

 

Gross Profit Ratio

21.1%

 

22.7%

Income from operations

$27,915,832

 

$27,517,774

 

 

 

 

Earnings before tax

$27,903,173

 

$25,078,749

 

 

 

 

Net income attributable to common stockholders

$19,887,498

 

$17,839,463

 

 

 

 

Diluted earnings per share

$0.57

 

$0.55

Weighted average diluted shares outstanding

34,726,494

 

32,204,555

  • For the year ended December 31, 2011, the Company reported revenues of $213.2 million, an increase of 15.8% compared to $184.2 million in the prior year.
  • Gross profit increased 7.5% to $45.0 million from $41.9 million in the prior year.  Gross margin was 21.1% for the year ended December 31, 2011, compared with 22.7% in full-year 2010, due to increase in raw material prices as well as increased manufacturing costs such as labor and utility.
  • Income from operations for the year was $27.9 million, an increase of 1.4% from $27.5 millionreported in the prior year.  Operating margin for 2011 was 13.1% compared with 14.9% for the prior year.
  • The Company reported net income for the year ended December 31, 2011, of $19.9 million, or $0.57 per diluted share based on 34.7 million weighted average diluted shares outstanding, compared with net income of $17.8 million, or $0.55 per diluted share based on 32.2 million diluted shares outstanding, in the prior year.

Balance Sheet Highlights and Financial Position

At December 31, 2011, American Lorain's cash and cash equivalents (excluding $13.0 million in restricted cash) were $17.4 million, working capital was $82.3 million, total liabilities was $61.7 million, and stockholders' equity was $156.9 million, compared to $12.7 million$57.4 million$45.6 million, and $129.3 million, respectively, at December 31, 2010.  

The Company currently has a book value per share at December 31, 2011 of $4.55.

Outlook for 2012

Mr. Chen concluded, “We are optimistic about the outlook of our market growth in China and abroad because of growing demand, improving brand recognition, balanced supply, and a potentially easing credit environment.  During 2011 and into 2012, our core strategy was to continue building our brand recognition in China through consistent marketing efforts towards supermarkets, wholesalers, and significant customers, enhancing the cooperation with other manufacturers and factories, and enhancing the turnover for our existing chestnut, convenience and frozen food products. We believe a persistent focus on these strategies will enable us to achieve a solid growth in 2012 and beyond.” 

Conference Call

The Company will also discuss these results in a conference call on April 2, 2012 at 8:00 a.m. ET.

Participant Dial-In Numbers:

Toll-Free Dial-In Number:

877-407-8031

International Dial-In Number:

201-689-8031

A recorded replay of the call will be available until 11:59 PM Eastern Time on April 5, 2012.  Listeners may dial 877-660-6853 (Domestic) or 201-612-7415 (International) and use the account # 286 and conference ID # 391462 for the replay.  The call will also be simultaneously broadcast over the Internet. To listen to the live webcast, please go to www.americanlorain.com and click on the conference call link, or go directly to: http://www.investorcalendar.com/IC/CEPage.asp?ID=167866 .

About American Lorain Corporation

American Lorain Corporation products include chestnut products, convenience food products and frozen food products. The Company currently sells over 240 products to 26 provinces and administrative regions in China as well as to 42 foreign countries. The Company operates through its five direct and indirect subsidiaries and one leased factory located in China. For further information about American Lorain Corporation, please visit the Company's website at http://www.americanlorain.com.

Forward-Looking Statements

This press release contains certain “forward-looking statements” that involve a number of risks and uncertainties. There can be no assurance that such statements will prove to be accurate and the actual results and future events could differ materially from management's current expectations. Such factors include, but are not limited to, the Company's ability to obtain the necessary financing to continue and expand operations, to market its products in new markets and to offer products at competitive pricing, to attract and retain management, and to integrate and maintain technical information and management information systems, political and economic factors in the PRC, compliance requirement of laws and regulations of the PRC, the effects of currency policies and fluctuations, general economic conditions and other factors detailed from time to time in the Company's filings with the United States Securities and Exchange Commission and other regulatory authorities. The Company undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

For more information, please contact:

At the Company:

American Lorain Corporation

Mr. David She, CFO

+86-10 8411 3393

david.she@americanlorain.com

http://www.americanlorain.com

AMERICAN LORAIN CORPORATION

CONSOLIDATED STATEMENTS OF INCOME

FOR YEARS ENDED DECEMBER 31, 2011 AND 2010

(Stated in US Dollars)

 

 

 

 

 

 

 

December 31,

 

December 31,

 

 

 

 

 

2011

 

2010

 

 

 

 

 

 

 

 

Net revenues

 

 

 

$

213,222,106

$

184,176,567

Cost of revenues

 

 

 

 

(168,208,856)

 

(142, 292,716)

Gross profit

 

 

 

$

45,013,250

$

41,883,851

 

 

 

 

 

 

 

 

Operating expenses

 

 

 

 

 

 

 

Selling and marketing expenses

 

 

 

 

(10,513,567)

 

(8,559,003)

General and administrative expenses

 

 

 

 

(6,583,851)

 

(5,807,074)

 

 

 

 

 

(17,097,418)

 

(14,366,077)

 

 

 

 

 

 

 

 

Operating income

 

 

 

$

27,915,832

$

27,517,774

 

 

 

 

 

 

 

 

Government subsidy income

 

 

 

 

745,708

 

1,270,957

Interest income

 

 

 

 

86,562

 

10,375

Other income

 

 

 

 

2,449,950

 

1,047,234

Other expenses

 

 

 

 

(733,179)

 

(415,877)

Interest expense

 

 

 

 

(2,561,700)

 

(4,351,714)

 

 

 

 

 

 

 

 

Earnings before tax

 

 

 

$

27,903,173

$

25,078,749

 

 

 

 

 

 

 

 

Income tax

 

 

 

 

(6,819,245)

 

(5,830,472)

 

 

 

 

 

 

 

 

Net income

 

 

 

$

21,083,928

$

19,248,277

 

 

 

 

 

 

 

 

Other comprehensive income:

 

 

 

 

 

 

 

Foreign currency translation gain

 

 

 

 

5,972,198

 

3,994,293

Comprehensive Income

 

 

 

 

27,056,126

 

23,242,570

Net income attributable to:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

-Common stockholders

 

 

 

$

19,887,498

$

17,839,463

-Non-controlling interest

 

 

 

 

1,196,430

 

1,408,814

 

 

 

 

$

21,083,928

$

19,248,277

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Earnings per share

 

 

 

 

 

 

 

–        Basic

 

 

$

0.58

$

0.57

–        Diluted

 

 

$

0.57

$

0.55

 

 

 

 

 

 

 

 

Weighted average shares outstanding

 

 

 

 

 

 

 

–        Basic

 

 

 

34,445,972

 

31,507,044

–        Diluted

 

 

 

34,726,494

 

32,204,555

 

 

 

 

 

 

 

 

AMERICAN LORAIN CORPORATION

CONSOLIDATED BALANCE SHEETS

AT DECEMBER 31, 2011 AND 2010

(Stated in US Dollars)

 

 

 

 

December 31,

 

December 31,

ASSETS

 

 

2011

 

2010

   Current assets

 

 

 

 

 

Cash and cash equivalents

 

$

17,353,494

$

12,730,626

Restricted cash

 

 

13,017,371

 

2,308,898

Short-term investment

 

 

 

9,447,585

Trade accounts receivable

 

 

41,469,880

 

33,226,612

Other receivables

 

 

6,147,550

 

1,492,850

Inventory

 

 

34,348,997

 

29,807,198

Advance to suppliers

 

 

15,772,736

 

7,744,976

Prepaid expenses and taxes

 

 

132,710

 

434,061

      Deferred tax asset

 

 

164,394

 

103,713

      Security deposits and other Assets

 

 

16,373

 

693,858

Total current assets

 

$

128,423,505

$

97,990,377

 

 

 

 

 

 

   Non-current assets

 

 

 

 

 

Investment

 

 

472,270

 

 

Property, plant and equipment, net

 

 

84,377,306

 

72,095,007

Land use rights, net

 

 

5,425,252

 

4,877,438

Deposit

 

 

 

20,297

TOTAL ASSETS

 

$

218,698,333

$

174,983,119

 

 

 

 

 

 

LIABILITIES AND STOCKHOLDERS' EQUITY

 

 

 

 

 

 

 

 

 

 

Short-term bank loans

 

$

36,018,450

$

25,164,469

Long-term debt – current portion

 

 

57,066

 

218,935

Notes payable

 

 

 

4,249,977

Accounts payable

 

 

3,900,317

 

6,284,532

Taxes payable

 

 

4,237,142

 

3,266,502

Accrued liabilities and other payables

 

 

1,938,759

 

1,335,947

Customers deposits

 

 

 

89,370

Total current liabilities

 

$

46,151,734

$

40,609,733

 

 

 

 

 

 

Long-term liabilities

 

 

 

 

 

Long-term bank loans

 

 

15,597,831

 

5,030,930

 

 

 

 

 

 

TOTAL LIABILITIES

 

$

61,749,565

$

45,640,663

 

STOCKHOLDERS' EQUITY

 

 

 

 

 

Preferred Stock, $.001 par value, 5,000,000 shares authorized; 0 shares issued 

    and outstanding at December 31, 2010 and 2009, respectively

 

 

 

Common stock, $0.001 par value, 200,000,000 shares authorized; 34,507,874 and 

    34,419,709 shares issued and outstanding as of December 31, 2011 and 2010, respectively

 

 

34,508

 

34,420

Additional paid-in capital

 

 

53,015,636

 

52,371,481

Statutory reserves

 

 

13,976,899

 

11,340,739

Retained earnings

 

 

65,939,713

 

48,688,375

Accumulated other comprehensive income

 

 

15,353,885

 

9,475,745

Non-controlling interests

 

 

8,628,127

 

7,431,697

 

 

 

 

 

 

TOTAL STOCKHOLDER'S EQUITY

 

$

156,948,768

$

129,342,457

 

 

 

 

 

 

TOTAL LIABILITIES AND

 

 

 

 

 

STOCKHOLDER'S EQUITY

 

$

218,698,333

$

174,983,119

 

AMERICAN LORAIN CORPORATION

CONSOLIDATED STATEMENTS OF CASH FLOW

FOR YEARS ENDED DECEMBER 31, 2011 AND 2010

 (Stated in US Dollars)

 

 

 

December 31,

 

December 31,

 

 

2011

 

2010

Cash flows from operating activities

 

 

 

 

Net income

$

21,083,928

$

19,248,277

   Stock and share based compensation

 

644,243

 

890,210

   Depreciation of fixed assets

 

2,196,052

 

1,360,134

   Amortization of intangible assets

 

155,754

 

144,611

   Write down of short-term investments

 

(94,058)

 

587,117

   Gain on acquisition of subsidiary

 

 

(383,482)

   (Increase)/decrease in accounts & other receivables

 

(21,015,097)

 

(2,541,158)

   (Increase)/decrease in inventories

 

(4,541,799)

 

(2,812,751)

 Decrease/(increase) in prepayment

 

301,351

 

9,665,103

   Decrease/(increase) in deferred tax asset

 

(60,681)

 

96,155

   Increase/(decrease) in accounts and other payables

 

(810,763)

 

(1,816,937)

   Net cash (used in)/provided by operating activities

 

(2,141,070)

 

24,437,279

 

 

 

 

 

Cash flows from investing activities

 

 

 

 

Shandong Greenpia acquisition net of cash acquired

 

 

(1,695,315)

Purchase of plant and equipment

 

(14,478,351)

 

(17,566,907)

Payment of construction in progress

 

 

(11,188,400)

(Increase)/decrease in restricted cash

 

(10,708,473)

 

(1,009,009)

Payments for the purchase of land use rights

 

(703,569)

 

(190,109)

Payments for security deposits

 

697,783

 

(698,067)

Purchase  of long-term investment

 

(472,270)

 

(3,301,571)

Proceeds from sale of short-term investments

 

9,447,585

 

Net cash used in investing activities

 

(16,217,295)

 

(35,649,378)

 

 

 

 

 

Cash flows from financing activities

 

 

 

 

Issuance of common stock

 

 

8,955,673

Repayment of notes

 

(4,249,977)

 

Proceeds from issuance of notes

 

 

4,249,977

Proceeds from bank borrowings

 

45,058,403

 

80,338,300

Repayment of bank borrowings

 

(34,366,292)

 

(90,443,107)

Proceeds from long-term bank borrowings

 

10,566,901

 

4,736,057

Net cash provided by/(used in) financing activities

$

17,009,035

$

7,836,900

 

 

 

 

 

Net Increase/(decrease) of Cash and Cash Equivalents

 

(1,349,330)

 

(3,375,199)

 

 

 

 

 

Effect of foreign currency translation on cash

 

 

 

 

and cash equivalents

 

5,972,198

 

3,994,293

 

 

 

 

 

Cash and cash equivalents–beginning of year

 

12,730,626

 

12,111,532

 

 

 

 

 

Cash and cash equivalents–end of year

$

17,353,494

$

12,730,626

 

 

 

 

 

Supplementary cash flow information:

 

 

 

 

Interest received

$

86,562

$

10,375

Interest paid

$

2,261,004

$

4,457,597

Income taxes paid

$

6,871,539

$

5,157,436

SOURCE American Lorain Corporation