WUHAN CITY, China, May 11,
2016 /PRNewswire/ -- Aoxin Tianli Group, Inc. (NASDAQ:ABAC)
("Aoxin Tianli" or the "Company"), a leading producer of breeder
hogs, market hogs and black hogs, as well as specialty processed
black hog pork products sold through retail and the internet, today
announced its financial results for the first quarter ended
March 31, 2016.
Ms. Hanying Li, Chairwoman and
Chief Executive Officer of Aoxin Tianli Group, Inc., commented,
"Our revenues decreased by 5.5% in the first quarter, resulting
from a 19.8% reduction in the number of hogs sold which was
partially offset by an 18.5% increase in the average selling price
("ASP") for hogs. The decrease in the number of hogs sold was a
result of reduction in capacity of 20,000 hogs due to the sales of
Farm 2 and 3 during the third quarter of 2015. The increase in ASP
reflected improving market condition in the first quarter,
particularly during the Chinese New
Year holiday season. The number of black market hogs sold
also decreased slightly by 2.8% in the first quarter as a result of
decreased production by the independent farmers in our black hog
program."
Three Months Ended March 31,
2016 Financial Results
Revenues
|
For the Three
Months Ended March 31,
|
|
($ thousands,
except per share data)
|
2016
|
|
2015
|
|
%
Change
|
|
Revenues
|
$ 9,059
|
|
$ 9,588
|
|
-5.5%
|
|
Hog farming
|
8,639
|
|
9,092
|
|
-5.0%
|
|
Retail
|
420
|
|
497
|
|
-15.4%
|
|
Gross
margin
|
23.2%
|
|
16.1%
|
|
7.1%
|
|
Operating
margin
|
11.6%
|
|
-3.1%
|
|
NM
|
|
Net loss
|
(274)
|
|
(217)
|
|
26.6%
|
|
Net income (loss) from
continuing operations
|
1,137
|
|
(359)
|
|
NM
|
|
Gain (loss) from
operations and disposal of discontinued component
|
(1,411)
|
|
142
|
|
NM
|
|
Net income (loss) for
common shareholders
|
(105)
|
|
(240)
|
|
NM
|
|
Earnings (loss) per
share
|
(0.00)
|
|
(0.01)
|
|
NM
|
|
Continuing
operations
|
0.03
|
|
(0.01)
|
|
NM
|
|
Discontinued
components
|
(0.04)
|
|
0.00
|
|
NM
|
Revenues for the three months ended March
31, 2016 decreased by $0.53
million, or 5.5%, to $9.06
million from $9.59 million for
the same period of last year. The reduction in revenues reflected a
reduction in the number of hogs sold as a result of the sale of two
hog farms during the third quarter of 2015 and was partially offset
by improved prices for market hogs.
Revenues from hog farming, which includes sales of regular
breeder hogs, regular market hogs, and black hogs, decreased by
$0.45 million, or 5.0%, to
$8.64 million for the three months
ended March 31, 2016 from
$9.09 million for the same period of
last year. The Company sold a total of 35,112 regular breeder hogs,
regular market hogs and black hogs with a blended average selling
price of $246 per hog during the
three months ended March 31, 2016,
compared to 43,795 hogs sold and a blended average selling price of
$208 per hog for the same period of
last year.
|
For the Three
Months Ended March 31,
|
|
2016
|
|
2015
|
|
No. of
Hogs Sold
|
|
Average
Price/Hog ($)
|
|
Sales
($ thousands)
|
|
No. of
Hogs Sold
|
|
Average
Price/Hog ($)
|
|
Sales
($ thousands)
|
|
Breeder hogs- regular
hogs
|
4,340
|
|
$ 252
|
|
$ 1,095
|
|
7,183
|
|
$ 263
|
|
$ 1,888
|
|
Market hogs- regular
hogs
|
15,930
|
|
219
|
|
3,481
|
|
21,343
|
|
183
|
|
3,902
|
|
Market hogs- black
hogs
|
14,842
|
|
274
|
|
4,063
|
|
15,269
|
|
216
|
|
3,302
|
|
Total Hog
Farming
|
35,112
|
|
246
|
|
8,639
|
|
43,795
|
|
208
|
|
9,092
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Kilogram
|
|
Average
Price/kg($)
|
|
Sales
($ thousands)
|
|
Kilogram
|
|
Average
Price/kg ($)
|
|
Sales
($ thousands)
|
|
Retail- specialty
black hog pork products
|
87,384
|
|
$ 5
|
|
$ 420
|
|
114,932
|
|
$ 4
|
|
$ 497
|
Revenues for the three months ended March
31, 2016 from regular breeder hog sales decreased by 42.0%
to $1.09 million with the number of
regular breeder hogs sold decreasing by 39.6% to 4,340 hogs and the
average selling price of regular breeder hogs decreasing by 4.0% to
$252 per hog. Revenues for the three
months ended March 31, 2016 from
regular market hog sales decreased by 10.8% to $3.48 million as the number of regular market
hogs sold decreased by 25.4% to 15,930 hogs while the average
selling price of regular market hogs increased by 19.5% to
$219 per hog. Revenues for the three
months ended March 31, 2016 from
black market hogs increased by 23.0% to $4.06 million with the number of black hogs sold
decreasing by 2.8% to 14,842 hogs and the average selling price of
black hogs increasing by 26.9% to $274 per hog. The decrease in black hogs sold was
primarily a result of decreased production by the independent
farmers in our black hog program. We anticipate that as the
production of these farmers reaches capacity, the number of black
hogs available for sale will level off.
We sold 87,384 kilograms of specialty black hog pork products
through retail at approximately $5
per kilogram, generating revenues of $0.42
million for the three months ended March 31, 2016. This compares to 114,932
kilograms sold at approximately $4
per kilogram and revenues of $0.50
million for the same period of last year. These revenues,
combined with the sales of black market hogs, led to $4.48 million in revenues from our black hog
program for the three months ended March 31,
2016, compared to $3.80
million for the same period of last year.
The results of operations of Hang-ao and OV Orange and their
wholly owned subsidiaries, were reclassified as discontinued
operations in the Company's financial statements for the three
months ended March 31, 2016 and 2015
based on the Company's decision to focus on the hog industry and
sell both subsidiaries and relevant businesses in the near future.
OV Orange was sold on December 29,
2015. We have not found a buyer for Hang-ao as of today.
Gross profit
Cost of goods sold decreased by $1.09
million, or 13.5%, to $6.96
million for the three months ended March 31, 2016 from $8.04
million for the same period of last year. Cost of goods sold
for hog farming decreased by $1.02
million, or 13.3%, to $6.65
million for the three months ended March 31, 2016 from $7.66
million for the same period of last year, benefitting from a
reduction in the purchase prices for our feeds and the sale of two
farms during the third quarter of 2015. Cost of goods sold for
retail decreased by $0.07 million, or
17.6%, to $0.31 million for the three
months ended March 31, 2016 from
$0.38 million for the same period of
last year.
Overall gross profit increased by $0.56
million, or 36.0%, to $2.10
million for the three months ended March 31, 2016 from $1.54
million for the same period of last year, mainly due to a
decrease in cost of goods sold for hog farming as
aforementioned.
Gross profits for hog farming and retail were $1.99 million and $0.11
million, respectively, for the three months ended
March 31, 2016, compared to
$1.43 million and $0.12 million, respectively, for the same period
of last year.
Overall gross margin was 23.2%, with gross margins for hog
farming and retail of 23.1% and 25.2%, respectively, for the three
months ended March 31, 2016. This
compared to overall gross margin of 16.1%, and gross margins for
hog farming and retail of 15.7% and 23.4%, respectively, for the
same period of last year.
Operating income (loss)
Total operating expenses, including general and administrative
expenses and selling and marketing expenses, decreased by
$0.79 million, or 43.1%, to
$1.05 million for the three months
ended March 31, 2016 from
$1.84 million for the same period of
last year. The decrease was primarily the result of a cancelation
of a stock grant to key employees which generated non-cash
compensation expense of $0.36
million, a decrease of $0.25
million in our depreciation and amortization expenses as a
result of the disposal of two hog farms during the third quarter of
2015, and a decrease of $0.12 million
in bad debt expense.
Operating income for the three months ended March 31, 2016 was $1.05
million, compared to an operating loss of $0.30 million for the same period of last year.
Operating margin for the three months ended March 31, 2016 was 11.6%, compared to operating
loss of 3.1% for the same period of last year.
Net income (loss)
Net loss increased by $0.06
million, or 26.6%, to $0.27
million for the three months ended March 31, 2016 from $0.22
million for the same period of last year. Our net income
from continuing operations, including both hog farming and retail,
was $1.14 million for the three
months ended March 31, 2016, compared
to a net loss of $0.36 million for
the same period of last year. The operating results of our
discontinued operations, Hang-ao and OV Orange, decreased
significantly from net income of $0.14
million for the first quarter of 2015 to net loss of
$1.41 million for the same period of
2016. After the deduction of non-controlling interests, net loss
attributable to common shareholders for the three months ended
March 31, 2016 was $0.10 million, or $0.003 loss per diluted share. This compared to
net loss attributable to common shareholders of $0.24 million, $0.007 loss per diluted share, for the same
period of last year.
Financial Condition
As of March 31, 2016, the Company
had cash and cash equivalents of $51.72
million, compared to $49.66
million at the end of 2015. Working capital as of
March 31, 2016 was $62.70 million as compared to $63.98 million at December
31, 2015. Net cash provided by operating activities was
$3.24 million for the three months
ended March 31, 2016, compared to
$3.37 million for the same period of
last year. Net cash used in investing activities was $1.61 million for the three months ended
March 31, 2016, primarily for
purchases of new equipment for our hog farms. This compared to net
cash provided by investing activities of $1.62 million for the same period of last year,
mostly generated by our discontinued operations. Net cash used in
financing activities was $nil for the three months ended
March 31, 2016, compared to
$3.66 million used in financing
activities for the same period of last year.
Company Update
On March 23, 2016, the Company
announced it received a letter from NASDAQ, granting the Company an
additional 180-day period, or until September 19, 2016, to regain compliance with
NASDAQ's minimum $1.00 bid price per
share rule (the "Bid Price Rule") for continued listing on the
NASDAQ Capital Market.
Earnings Conference Call
Aoxin Tianli will host an earnings conference call and live
webcast covering its first quarter of 2016 financial results at
8:00 a.m. ET on May 12, 2016, which is 8:00 p.m. in Beijing on May 12,
2016. To attend the call, please use the information below
for either dial-in access or webcast access. When prompted on
dial-in, ask for "AoxinTianli / ABAC".
|
Conference
Call
|
|
|
Date:
|
Thursday, May 12,
2016
|
|
Time:
|
8:00 am ET,
U.S.
|
|
U.S.
Dial-in:
|
+1
877-317-6789
|
|
International
Dial-in:
|
+1
412-317-6789
|
|
Conference
ID:
|
Aoxin Tianli /
ABAC
|
|
Webcast
Link:
|
http://mms.prnasia.com/ABAC/20160512/default.aspx
|
For those unable to participate, an audio replay of the call
will be available beginning approximately one hour after the end of
the live call through May 19, 2016.
The audio replay can be accessed by dialing +1-877-344-7529 within
the United States or
+1-412-317-0088 internationally, and entering access ID No.
10086002.
About Aoxin Tianli Group, Inc.
Aoxin Tianli Group, Inc. (the "Company"), previously known as
Tianli Agritech, Inc., is in the business of breeding, raising and
selling breeder and market hogs in China. The Company also sells specialty
processed black hog pork products through supermarkets and other
retail outlets, as well as the internet. The Company also owns an
88% equity interest in Hubei Hang-ao Servo-valve Manufacturing
Technology Co., Ltd. ("Hang-ao"), which the Company acquired in
July 2014 and currently is seeking to
sell.
Forward-Looking Statements
This news release contains forward-looking statements as
defined by the Private Securities Litigation Reform Act of 1995.
Forward-looking statements include statements concerning plans,
objectives, goals, strategies, future events or performance, and
underlying assumptions and other statements that are other than
statements of historical facts. These statements are subject to
uncertainties and risks including, but not limited to, product and
service demand and acceptance, changes in technology, economic
conditions, the impact of competition and pricing, government
regulations, and other risks contained in reports filed by the
company with the Securities and Exchange Commission. All such
forward-looking statements, whether written or oral, and whether
made by or on behalf of the Company, are expressly qualified by
this cautionary statement and any other cautionary statements which
may accompany the forward-looking statements. In addition, the
Company disclaims any obligation to update any forward-looking
statements to reflect events or circumstances after the date
hereof.
For more information, please contact:
Tina Xiao
Weitian Group LLC
Phone: +1-917-609-0333
Email: tina.xiao@weitian-ir.com
|
AOXIN TIANLI
GROUP, INC. AND SUBSIDIARIES
|
|
CONSOLIDATED
BALANCE SHEETS
|
|
|
|
|
|
|
|
March 31,
|
|
December
31,
|
|
|
2016
|
|
2015
|
|
|
|
|
|
|
ASSETS
|
|
|
|
|
|
Current
Assets:
|
|
|
|
|
|
Cash and cash
equivalents
|
$
|
51,719,456
|
$
|
49,656,897
|
|
Accounts receivable,
net
|
|
167,275
|
|
292,684
|
|
Inventories
|
|
6,092,519
|
|
5,656,165
|
|
Advances to
suppliers, net
|
|
5,847,964
|
|
7,823,138
|
|
Prepaid
expenses
|
|
334,734
|
|
816,646
|
|
Other receivables,
net
|
|
313,597
|
|
312,161
|
|
Restricted
cash
|
|
3,101,088
|
|
9,242,571
|
|
Assets from
discontinued operations
|
|
6,610,381
|
|
7,926,437
|
|
Total Current
Assets
|
|
74,187,014
|
|
81,726,699
|
|
|
|
|
|
|
Long-term prepaid
expenses, net
|
|
1,370,907
|
|
1,389,144
|
|
Plant and equipment,
net
|
|
24,629,880
|
|
23,410,803
|
|
Biological assets,
net
|
|
1,682,450
|
|
1,580,847
|
|
Intangible assets,
net
|
|
2,763,106
|
|
2,802,948
|
|
|
|
|
|
|
Total
Assets
|
$
|
104,633,357
|
$
|
110,910,441
|
|
|
|
|
|
|
LIABILITIES AND
STOCKHOLDERS' EQUITY
|
|
|
|
|
|
|
|
|
|
|
Current
Liabilities:
|
|
|
|
|
|
Bank acceptance notes
payable
|
$
|
6,202,175
|
$
|
12,323,428
|
|
Accounts payable and
accrued payables
|
|
23,934
|
|
19,655
|
|
Other
payables
|
|
2,926,237
|
|
3,041,085
|
|
Liabilities from
discontinued operations
|
|
2,333,206
|
|
2,359,696
|
|
Total Current
Liabilities
|
|
11,485,552
|
|
17,743,864
|
|
|
|
|
|
|
Stockholders'
Equity:
|
|
|
|
|
|
Common stock ($0.001
par value, 100,000,000 shares authorized, 32,999,000 shares issued
and 31,952,000 shares outstanding as of March 31, 2016 and
33,203,000 shares issued and 33,183,000 shares outstanding as of
December 31, 2015)
|
|
31,952
|
|
33,183
|
|
Additional paid in
capital
|
|
61,395,561
|
|
61,743,410
|
|
Statutory surplus
reserves
|
|
2,457,180
|
|
2,457,180
|
|
Retained
earnings
|
|
28,490,408
|
|
28,595,306
|
|
Accumulated other
comprehensive income
|
|
(410,598)
|
|
(1,018,861)
|
|
Stockholders' Equity -
Aoxin Tianli Group Inc. and Subsidiaries
|
|
91,964,503
|
|
91,810,218
|
|
Noncontrolling
interest
|
|
1,183,302
|
|
1,356,359
|
|
Total Stockholders'
Equity
|
|
93,147,805
|
|
93,166,577
|
|
Total Liabilities and
Stockholders' Equity
|
$
|
104,633,357
|
$
|
110,910,441
|
|
AOXIN TIANLI
GROUP, INC. AND SUBSIDIARIES
|
|
CONSOLIDATED
STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME
|
|
(UNAUDITED)
|
|
|
|
|
|
|
|
For the Three Months
Ended March 31,
|
|
|
2016
|
|
2015
|
|
|
|
|
|
|
|
|
|
|
|
Revenues
|
$
|
9,059,268
|
$
|
9,588,415
|
|
Cost of goods
sold
|
|
6,958,752
|
|
8,043,856
|
|
Gross
profit
|
|
2,100,516
|
|
1,544,559
|
|
|
|
|
|
|
Operating
expenses:
|
|
|
|
|
|
General and
administrative expenses
|
|
943,935
|
|
1,646,982
|
|
Selling
expenses
|
|
102,288
|
|
192,839
|
|
Total operating
expenses
|
|
1,046,223
|
|
1,839,821
|
|
|
|
|
|
|
Income (loss) from
operations
|
|
1,054,293
|
|
(295,262)
|
|
|
|
|
|
|
Other income
(expense):
|
|
|
|
|
|
Interest
income
|
|
81,843
|
|
5,133
|
|
Other income
(expense), net
|
|
459
|
|
(68,754)
|
|
Total other income
(expense)
|
|
82,302
|
|
(63,621)
|
|
|
|
|
|
|
Income (loss) before
income taxes
|
|
1,136,595
|
|
(358,883)
|
|
Income
taxes
|
|
-
|
|
-
|
|
Net income (loss)
from continuing operations
|
|
1,136,595
|
|
(358,883)
|
|
|
|
|
|
|
Discontinued
operations:
|
|
|
|
|
|
Gain (loss) from
operations of discontinued component, net of taxes
|
|
(1,410,787)
|
|
142,371
|
|
Net loss
|
|
(274,192)
|
|
(216,512)
|
|
|
|
|
|
|
Net loss(income)
attributable to noncontrolling interest
|
|
169,294
|
|
(23,439)
|
|
Net loss attributable
to Aoxin Tianli Group Inc.and subsidiaries
|
|
(104,898)
|
|
(239,951)
|
|
|
|
|
|
|
Earnings(loss) per
share, continuing operations-Basic & Diluted
|
$
|
0.03
|
$
|
(0.01)
|
|
Loss per share,
discontinued operations-Basic & Diluted
|
$
|
(0.04)
|
$
|
-
|
|
Weighted-average
shares outstanding, basic and diluted
|
|
33,121,667
|
|
32,913,000
|
|
|
|
|
|
|
Comprehensive income
(loss):
|
|
|
|
|
|
Net loss attributable
to Aoxin Tianli Group, Inc. and Subsidiaries
|
|
(104,898)
|
|
(239,951)
|
|
Unrealized foreign
currency translation adjustment
|
|
608,263
|
|
13,625
|
|
Comprehensive income
(loss)
|
$
|
503,365
|
$
|
(226,326)
|
|
AOXIN TIANLI
GROUP, INC. AND SUBSIDIARIES
|
|
CONSOLIDATED
STATEMENTS OF CASH FLOWS
|
|
|
|
|
|
|
|
|
For the Three Months
Ended March 31,
|
|
|
2016
|
|
2015
|
|
|
|
|
|
|
|
|
|
|
|
CASH FLOWS FROM
OPERATING ACTIVITIES
|
|
|
|
|
|
Net income from
continuing operations
|
$
|
1,136,595
|
$
|
(216,512)
|
|
Adjustments to
reconcile net income to net cash
|
|
|
|
|
|
provided by
operating activities:
|
|
|
|
|
|
Depreciation and
amortization
|
|
550,631
|
|
797,626
|
|
Amortization of
prepaid expenses
|
|
130,844
|
|
684,115
|
|
Amortization of
long-term prepaid expenses
|
|
26,977
|
|
28,755
|
|
Bad debt expense
(Recovery gain from bad debt expense)
|
|
-
|
|
117,932
|
|
Loss from inventory
valuation
|
|
-
|
|
12,017
|
|
Loss from disposal of
biological assets
|
|
185,099
|
|
68,594
|
|
|
|
|
|
|
Changes in operating
assets and liabilities:
|
|
|
|
|
|
Accounts
receivable
|
|
125,558
|
|
51,170
|
|
Inventories
|
|
1,195,471
|
|
853,717
|
|
Advances to
suppliers
|
|
-
|
|
1,073,475
|
|
Prepaid
expenses
|
|
(9,828)
|
|
(37,346)
|
|
Other
receivables
|
|
605
|
|
39,081
|
|
Accounts payable and
accrued payables
|
|
16,092
|
|
(3,259)
|
|
Advances from
customers
|
|
-
|
|
(45,177)
|
|
Other
payables
|
|
-
|
|
(82,114)
|
|
Total
adjustments
|
|
2,221,449
|
|
3,558,586
|
|
Net cash provided by
operating activities from continuing operations
|
|
3,358,044
|
|
3,342,074
|
|
Net cash provided by
(used in) operating activities from discontinued
operations
|
|
(121,221)
|
|
29,094
|
|
Net cash provided by
operating activities
|
|
3,236,823
|
|
3,371,168
|
|
|
|
|
|
|
CASH FLOWS FROM
INVESTING ACTIVITIES
|
|
|
|
|
|
Purchase of plant and
equipment
|
|
(1,610,201)
|
|
(274)
|
|
Net cash used in
investing activities from continuing operations
|
|
(1,610,201)
|
|
(274)
|
|
Net cash provided by
investing activities from discontinued operations
|
|
-
|
|
1,618,458
|
|
Net cash provided by
(used in) investing activities
|
|
(1,610,201)
|
|
1,618,184
|
|
|
|
|
|
|
CASH FLOWS FROM
FINANCING ACTIVITIES
|
|
|
|
|
|
Restricted cash
received from (deposited to) banks
|
|
6,115,787
|
|
(3,585,339)
|
|
Due to (from) related
party
|
|
-
|
|
117,507
|
|
Repayment of
short-term loans
|
|
(6,115,787)
|
|
(1,629,700)
|
|
Net cash used in
financing activities from continuing operations
|
|
-
|
|
(5,097,532)
|
|
Net cash provided by
financing activities from discontinued operations
|
|
-
|
|
1,436,374
|
|
Net cash used in
financing activities
|
|
-
|
|
(3,661,158)
|
|
|
|
|
|
|
EFFECT OF EXCHANGE
RATE CHANGES ON CASH
|
|
435,937
|
|
302,270
|
|
|
|
|
|
|
NET
INCREASE IN CASH
|
|
2,062,559
|
|
1,630,464
|
|
|
|
|
|
|
CASH, BEGINNING OF
PERIOD
|
|
49,656,897
|
|
39,123,869
|
|
|
|
|
|
|
CASH, END OF
PERIOD
|
$
|
51,719,456
|
$
|
40,754,333
|
|
|
|
|
|
|
SUPPLEMENTAL
DISCLOSURES:
|
|
|
|
|
|
Cash paid during the
period for:
|
|
|
|
|
|
Interest
paid
|
$
|
-
|
$
|
28,216
|
|
Income tax
paid
|
$
|
-
|
$
|
87,119
|
|
|
|
|
|
|
NON-CASH
TRANSACTIONS OF INVESTING AND FINANCING ACTIVITIES
|
|
|
|
Prepayments for raw
material purchases made with bank acceptance notes
|
$
|
-
|
$
|
6,518,799
|
|
Shares issued to
employees
|
$
|
-
|
$
|
1,433,700
|
|
Inventories received
from prior year prepayments
|
$
|
1,998,318
|
$
|
-
|
|
Inventories
transferred to biological assets
|
$
|
409,197
|
$
|
-
|
|
Cancelation of shares
related to Hang-ao acquisition
|
$
|
1,047
|
$
|
-
|
|
Cancelation of shares
related to employees' compensation
|
$
|
361,080
|
$
|
-
|
To view the original version on PR Newswire,
visit:http://www.prnewswire.com/news-releases/aoxin-tianli-group-inc-reports-first-quarter-of-2016-financial-results-300266933.html
SOURCE Aoxin Tianli Group, Inc.
