CHANGZHOU, China, Aug. 21, 2012 /PRNewswire-Asia/ -- China Kanghui
Holdings (NYSE: KH) ("Kanghui" or the "Company"), a leading
domestic developer, manufacturer and marketer of orthopedic
implants in China, today announced
its unaudited financial results for the second quarter of 2012.
Second Quarter 2012 Highlights
- Total net revenue for the second quarter of 2012 increased by
23.6% year-over-year to RMB101.1
million from RMB81.8 million
in the corresponding period of the prior year.
- Gross profit for the second quarter of 2012 increased by 24.0%
year-over-year to RMB71.9 million
from RMB58.0 million in the
corresponding period of the prior year.
- Operating income for the second quarter of 2012 increased by
27.3% year-over-year to RMB38.7
million from RMB30.4 million
in the corresponding period of the prior year.
- Net income attributable to Kanghui for the second quarter of
2012 increased by 24.7% year-over-year to RMB34.8 million from RMB27.9 million in the corresponding period of
the prior year.
- Non-GAAP[1] net income for the second quarter of 2012 increased
by 33.0% year-over-year to RMB39.1
million from RMB29.4 million
in the corresponding period of the prior year.
Mr. Libo Yang, Chief Executive Officer of the Company,
stated, "We are delighted that Kanghui's second quarter marked
another strong performance. Growth from trauma and spine sales
remained robust, and we further expanded our product offerings by
launching our joint reconstruction product into the international
markets, while adding another new spine product exclusively
marketed in China. Domestic
sales were strong, as we continued to gain momentum throughout
China. With unabated strong demand
and promising new product launches, we believe we are well
positioned for sustained success going forward."
Ms. Sarah Wang, Chief Financial Officer of Kanghui,
commented, "I am proud that Kanghui delivered our eighth
consecutive strong quarter since its initial public offering, with
our first-ever quarter of recording over RMB
100 million in net revenue. Our outstanding growth in net
revenue, along with double-digit growth in key operating metrics,
exemplify the strength of our business model. Benefiting from
the strong domestic sales of our proprietary products, our gross
profit margins continued to exceed expectations, and as we build on
this positive momentum, we are incrementally more confident in
outlook for the remainder of 2012."
Second Quarter 2012 Financial and Operating Results
Net revenue increased by 23.6% year-over-year to
RMB101.1 million ($15.9 million)[2] in the second quarter of 2012
from RMB81.8 million in the
corresponding period of the prior year.
Net revenue by product category:
Net revenue from trauma products increased by 25.3%
year-over-year to RMB59.5 million
($9.4 million) in the second quarter
of 2012 from RMB47.5 million in the
corresponding period of the prior year. Net revenue from spine
products increased by 24.3% year-over-year to RMB32.7 million ($5.1
million) in the second quarter of 2012 from RMB26.3 million in the corresponding period of
the prior year. Net revenue from OEM products increased by 11.3%
year-over-year to RMB8.9 million
($1.4 million) in the second quarter
of 2012 from RMB8.0 million in the
corresponding period of the prior year. Joint Reconstruction
products initialed sales in June, and generated net revenue of
RMB102,000 ($16,000) in the second quarter of 2012.
Net revenue by geographic markets:
Domestic sales of proprietary products increased by 34.7%
year-over-year to RMB77.6 million
($12.2 million) in the second quarter
of 2012 from RMB57.6 million in the
corresponding period of the prior year, while international sales
of proprietary products decreased by 8.7% year-over-year to
RMB14.7 million ($2.3 million) in the second quarter of 2012 from
RMB16.1 million in the corresponding
period of the prior year. The decrease in international sales was
primarily attributable to the Company's strategic shift in
production to fulfill the strong domestic orders, as well as lower
sales in the Middle East due to
the region's political instability.
In the second quarter of 2012, cost of revenue increased
by 23.2% year-over-year to RMB29.2
million ($4.6 million) from
RMB23.7 million in the corresponding
period of the prior year. Gross profit increased by
24.0% year-over-year to RMB71.9
million ($11.3 million) in the
second quarter of 2012 from RMB58.0
million in the corresponding period of the prior year.
Gross margin for the second quarter of 2012 was 71.1%,
compared to 71.0% in the corresponding period of the prior
year.
Selling expenses decreased by 1.7% year-over-year to
RMB11.6 million ($1.8 million) in the second quarter of 2012 from
RMB11.8 million in the corresponding
period of the prior year. General and administrative
expenses increased by 28.4% year-over-year to RMB18.1 million ($2.8
million) in the second quarter of 2012 from RMB14.1 million in the corresponding period of
the prior year. Research and development expenses
increased by 88.9% year-over-year to RMB3.4
million ($0.5 million) in the
second quarter of 2012 from RMB1.8
million in the corresponding period of the prior year.
Operating income increased by 27.3% year-over-year to
RMB38.7 million ($6.1 million) in the second quarter of 2012 from
RMB30.4 million in the corresponding
period of the prior year. Operating margin increased to
38.3% in the second quarter of 2012 from 37.2% in the corresponding
period of the prior year.
Income tax expense in the second quarter of 2012 was
RMB6.5 million ($1.0 million), representing an effective tax rate
of 15.8%, compared to an income tax expense of RMB3.8 million, and an effective tax rate of
12.0% in the corresponding period of the prior year.
Net income attributable to China Kanghui Holdings
was RMB34.8 million ($5.5 million) in the second quarter of 2012,
representing a year-over-year increase of 24.7% from RMB27.9 million in the corresponding period of
the prior year. On a diluted per ADS[3] basis, the Company reported
net income per diluted ADS of RMB1.33 ($0.21) in
the second quarter of 2012, compared to a net income per diluted
ADS of RMB1.09 in the corresponding
period of the prior
year.
Non-GAAP net income, which excludes share-based
compensation expenses, increased by 33.0% to RMB39.1 million ($6.2
million) from RMB29.4 million
in the corresponding period of the prior year. The Company reported
non-GAAP net income per diluted ADS of RMB1.50 ($0.24) in
the second quarter of 2012, compared to a non-GAAP net income per
diluted ADS of RMB1.11 in the
corresponding period of the prior year.
During the second quarter of 2012, the Company had a weighted
average diluted share count of 156.3 million shares (equivalent to
26.1 million ADSs), compared to 153.7 million shares (equivalent to
25.6 million ADSs) in the corresponding period of the prior
year.
Balance Sheet
As of June 30, 2012, the Company
had cash and cash equivalents of RMB432.1
million ($68.0 million),
compared to RMB380.1 million as of
December 31, 2011. As of June 30 2012, the Company held short-term
investments of RMB10.3 million
($1.6 million), compared to
RMB77.0 million as of December 31, 2011.
Business Outlook
Mr. Yang added, "Our solid performance in the first half of 2012
and the recent successful new product launches have set the stage
for continued success in the remainder of 2012, providing us with
greater comfort in our top line forecast. Moreover, reflecting on
our strong gross margins and continuing discipline in optimizing
operations and controlling overhead costs, we are slightly raising
our full year 2012 guidance for Non-GAAP net income."
The Company narrows its total net revenue outlook for full year
2012 to be in the range of RMB395 million to
RMB403 million, which represents year-over-year growth of
20.8% to 23.3%. The Company raises its full year 2012
non-GAAP net income to a range of RMB149
million to RMB154 million, from its prior expectation of
RMB146 million to RMB153 million.
This guidance is based on the current market conditions and
reflects the Company's current and preliminary estimates of market
and operating conditions and customer demand, which are all subject
to change.
Non-Cash Share-Based Compensation
Expenses
The Company recognized non-cash share-based compensation
expenses of RMB4.4 million
($0.7 million) in the second quarter
of 2012.
The Company classified these non-cash share-based compensation
expenses in its costs of revenue, selling expenses, general and
administrative expenses as well as in research and development
expenses. The break out of these expenses per line item is provided
in the financial tables attached to this press release.
The Company has provided a non-GAAP presentation of results,
which excludes the non-cash share-based compensation expenses.
Please refer to the non-GAAP presentation provided in the appendix
for a year-over-year comparison of non-cash share-based
compensation expenses. The Company believes that this non-GAAP
presentation is a helpful tool for the Company to plan and forecast
future periods and both management and investors benefit from
referring to such non-GAAP presentation in assessing the
performance of the Company.
Conference Call
Kanghui will hold a corresponding conference call and live
webcast at 8:00 a.m. ET (8:00 p.m. Beijing Time) on Wednesday, August 22, 2012 to discuss second
quarter 2012 results and answer questions from investors.
Listeners may access the call by dialing:
US Toll
Free:
|
1-866-519-4004
|
US
Toll/International:
|
1-718-354-1231
|
Hong Kong Toll
Free:
|
800-930-346
|
Hong Kong
Toll:
|
852-2475-0994
|
China Toll Free:
|
800-819-0121
|
China Toll Free
(Mobile):
|
400-620-8038
|
Conference
ID:
|
12464049
|
A replay of the webcast will be accessible through August 29, 2012 on http://ir.kanghui.com or by
dialing:
United States toll free:
|
1-866-214-5335
|
US
Toll/International:
|
1-718-354-1232
|
Passcode:
|
12464049
|
About China Kanghui Holdings
Founded in 1997, Kanghui is a leading domestic developer,
manufacturer and marketer of orthopedic implants in China. The Company offers a wide array of
proprietary orthopedic implant products in trauma, spine and joint
reconstruction, and has an extensive nationwide network of
distributors for its products in China, as well as in 29 other countries, as of
June, 30, 2012. Kanghui has strong research and development
capabilities, focused on developing new proprietary products and
product lines, and enhancing existing products and product lines.
For more information, please visit www.kanghui.com.
Use of Non-GAAP Financial Measures
The Company has included non-GAAP financial measures in this
press release. Non-GAAP financial measures are defined as GAAP
gross profit excluding non-cash share-based compensation expenses,
operating income excluding non-cash share-based compensation
expenses, net income excluding non-cash share-based compensation
expenses, net margin excluding non-cash share-based compensation
expenses, basic earnings per share and per ADS excluding non-cash
share-based compensation expenses, and diluted earnings per share
and per ADS excluding non-cash share-based compensation expenses.
The Company believes that management and investors benefit from
referring to the non-GAAP financial measures in assessing the
performance of the Company and when planning and forecasting future
periods. These non-GAAP operating measures are useful for
understanding and assessing underlying business performance and
operating trends. The use of non-GAAP financial measures has
limitations and readers should not consider non-GAAP financial
measures in isolation from or as alternatives to consolidated
financial metrics prepared in accordance with U.S. GAAP. Readers
are encouraged to refer to the reconciliation of non-GAAP measures
to GAAP measures included herein.
Safe-Harbor Statement
This press release contains statements of a forward-looking
nature, including, among other things, the Company's unaudited
operating results for 2012, expected new product introductions, the
demand for orthopedic products in China, future prospects of the Company and the
ability for the Company to realize its business plans for 2012.
These forward-looking statements are not historical facts but
instead represent only the Company's belief regarding expected
results and events, many of which, by their nature, are inherently
uncertain and outside of the Company's control. The actual results
and other circumstances of the Company may differ, possibly
materially, from the anticipated results and events indicated in
these forward-looking statements. Announced results for the second
quarter of 2012 are preliminary, unaudited and subject to audit
adjustment. Adjustments to the financial statements may be
identified when audit work is performed for the year-end audit,
which could result in significant differences from this preliminary
unaudited financial information. These statements are made under
the "safe harbor" provisions of the Private Securities Litigation
Reform Act of 1995, including certain plans, expectations, goals,
and projections, which are subject to numerous assumptions, risks,
and uncertainties. These forward-looking statements may include,
but are not limited to, statements containing words such as "may,"
"could," "would," "plan," "anticipate," "believe," "estimate,"
"predict," "potential," "expects," "intends" and "future" or
similar expressions. These forward-looking statements speak only as
of the date of this press release and are subject to change at any
time. These forward-looking statements are based upon
management's current expectations and are subject to a number of
risks, uncertainties and contingencies, many of which are beyond
the Company's control that may cause actual results, levels of
activity, performance or achievements to differ materially from any
future results, levels of activity, performance or achievements
expressed or implied by such forward-looking statements. The
Company's actual results could differ materially from those
contained in the forward-looking statements due to a number of
factors, including the Company's beliefs regarding its strengths
and strategies; the Company's ability to expand its international
business; the Company's ability to develop and successfully market
new products in China and
internationally; the Company's current expansion strategy,
including its ability to expand its manufacturing and research and
development facilities and capabilities and the Company's future
prospects, business development, results of operations and
financial condition. The financial information contained in this
release should be read in conjunction with the consolidated
financial statements and notes thereto included in the Company's
annual report on Form 20-F for the fiscal year 2011, as filed with
the Securities and Exchange Commission on April 30, 2012, and are available on the
Securities and Exchange Commission's website at www.sec.gov.
For additional information on these and other important factors
that could adversely affect our business, financial condition,
results of operations, and prospects, please see "Risk Factors"
that begins on page 6 of the Company's annual report for fiscal
year 2011 and in documents subsequently filed by the Company from
time to time with the Securities and Exchange Commission, which can
be found on the Company's website at www.kanghui.com or at
www.sec.gov.
Investor Relations Contact Information
Asia Bridge Capital Limited
Wendy Sun
Tel: 86-10-8556-9033 (China)
1-888-321-2558 (U.S.)
Email: wendy.sun@asiabridgegroup.com
China Kanghui
Holdings
|
Summary -
Second Quarter of 2012
|
(RMB in thousands,
except for per share data and per ADS data)
|
|
|
|
|
|
Three Months Ended
June 30,
|
|
Six Months Ended
June 30,
|
|
2011
|
2012
|
|
2011
|
2012
|
|
Unaudited
|
Unaudited
|
|
Unaudited
|
Unaudited
|
Net revenue
|
81,758
|
101,101
|
|
149,733
|
183,814
|
Gross profit
|
58,049
|
71,882
|
|
106,765
|
130,454
|
Non-GAAP gross
profit
|
58,098
|
72,034
|
|
106,864
|
130,639
|
Operating
income
|
30,374
|
38,721
|
|
60,178
|
70,207
|
Non-GAAP operating
income
|
31,912
|
43,087
|
|
63,133
|
77,534
|
Net income attributable
to China Kanghui Holdings
|
27,879
|
34,766
|
|
49,848
|
64,475
|
Non-GAAP net
income
|
29,417
|
39,132
|
|
52,803
|
71,802
|
Earnings per share
–basic
|
0.20
|
0.25
|
|
0.36
|
0.46
|
Earnings per share
–diluted
|
0.18
|
0.22
|
|
0.33
|
0.41
|
Earnings per ADS
–basic
|
1.21
|
1.48
|
|
2.17
|
2.75
|
Earnings per ADS
–diluted
|
1.09
|
1.33
|
|
1.96
|
2.49
|
Non-GAAP earnings per
share –basic
|
0.20
|
0.28
|
|
0.38
|
0.51
|
Non-GAAP earnings per
share -diluted
|
0.18
|
0.25
|
|
0.35
|
0.46
|
Non-GAAP earnings per
ADS –basic
|
1.23
|
1.67
|
|
2.30
|
3.06
|
Non-GAAP earnings per
ADS -diluted
|
1.11
|
1.50
|
|
2.08
|
2.77
|
|
|
|
|
|
|
- Revenue By
Product Category
|
|
|
|
|
|
Trauma
|
47,452
|
59,450
|
|
89,482
|
111,022
|
Spine
|
26,260
|
32,686
|
|
45,454
|
58,579
|
OEM
|
8,046
|
8,863
|
|
14,797
|
14,111
|
Joint
Reconstruction
|
-
|
102
|
|
-
|
102
|
|
|
|
|
|
|
- Revenue by
Business Sector
|
|
|
|
|
|
Domestic
|
57,633
|
77,561
|
|
107,742
|
141,877
|
International
|
16,079
|
14,678
|
|
27,194
|
27,827
|
OEM
|
8,046
|
8,862
|
|
14,797
|
14,110
|
China Kanghui
Holdings
|
Consolidated Balance
Sheets
|
(Expressed in
thousands)
|
|
|
|
|
|
|
|
As of December
31, 2011
|
|
As of
June 30,
2012
|
|
|
RMB
|
|
RMB
|
US$
|
|
|
Audited
|
|
Unaudited
|
Unaudited
|
Assets
|
|
|
|
|
|
Current
assets:
|
|
|
|
|
|
Cash and cash
equivalents
|
|
380,092
|
|
432,055
|
68,008
|
Bills
receivable
|
|
5,873
|
|
4,130
|
650
|
Short-term
investments
|
|
76,998
|
|
10,300
|
1,621
|
Accounts receivable,
net
|
|
87,578
|
|
136,619
|
21,505
|
Inventories,
net
|
|
110,907
|
|
134,280
|
21,136
|
Prepayments and other
current assets
|
|
13,428
|
|
13,521
|
2,131
|
Deferred tax
assets
|
|
9,090
|
|
12,124
|
1,908
|
Amount due from related
parties
|
|
5,672
|
|
4,189
|
659
|
Total current
assets
|
|
689,638
|
|
747,218
|
117,618
|
|
|
|
|
|
|
Non-current
assets:
|
|
|
|
|
|
Property, plant and
equipment, net
|
|
259,825
|
|
316,325
|
49,791
|
Intangible assets,
net
|
|
62,026
|
|
59,857
|
9,422
|
Prepaid land lease
payments
|
|
22,812
|
|
22,569
|
3,552
|
Goodwill
|
|
155,341
|
|
155,341
|
24,452
|
Long-term
investments
|
|
25,204
|
|
25,412
|
4,000
|
Deposits for non-current
assets
|
|
4,731
|
|
5,598
|
881
|
Deferred tax
assets
|
|
2,444
|
|
2,335
|
368
|
Other assets,
non-current
|
|
257
|
|
34
|
5
|
Total non-current
assets
|
|
532,640
|
|
587,471
|
92,471
|
Total
assets
|
|
1,222,278
|
|
1,334,689
|
210,089
|
|
|
|
|
|
|
Liabilities and
equity
|
|
|
|
|
|
Current
liabilities:
|
|
|
|
|
|
Accounts
payable
|
|
19,278
|
|
23,812
|
3,748
|
Accrued expenses and
other liabilities
|
|
65,388
|
|
98,626
|
15,524
|
Income tax
payable
|
|
5,800
|
|
8,594
|
1,353
|
Uncertain tax
positions
|
|
4,197
|
|
4,727
|
744
|
Amount due to related
parties
|
|
1,137
|
|
1,312
|
207
|
Total current
liabilities
|
|
95,800
|
|
137,071
|
21,576
|
|
|
|
|
|
|
Non-current
liabilities:
|
|
|
|
|
|
Deferred government
grants
|
|
6,409
|
|
3,827
|
602
|
Deferred tax
liabilities
|
|
14,857
|
|
14,474
|
2,278
|
Total non-current
liabilities
|
|
21,266
|
|
18,301
|
2,880
|
Total
liabilities
|
|
117,066
|
|
155,372
|
24,456
|
|
|
|
|
|
|
Commitments and
contingencies
|
|
|
|
|
|
|
|
|
|
|
|
Equity:
|
|
|
|
|
|
Ordinary shares (par
value of US$0.001 per share;
1,000,000,000 shares authorized as of December 31, 2011 and June
30, 2012 (unaudited); 140,401,842 shares issued and outstanding as
of December 31, 2011 and 141,204,612 shares issued and outstanding
as of June 30, 2012 (unaudited))
|
|
1,022
|
|
1,027
|
162
|
Additional paid-in
capital
|
|
912,972
|
|
922,625
|
145,227
|
Accumulated other
comprehensive loss
|
|
(19,604)
|
|
(18,954)
|
(2,983)
|
Statutory
reserves
|
|
45,417
|
|
45,417
|
7,149
|
Retained
earnings
|
|
156,387
|
|
220,862
|
34,765
|
Total China Kanghui
Holdings shareholders' equity
|
|
1,096,194
|
|
1,170,977
|
184,320
|
Non-controlling
interests
|
|
9,018
|
|
8,340
|
1,313
|
Total
equity
|
|
1,105,212
|
|
1,179,317
|
185,633
|
Total liabilities and
equity
|
|
1,222,278
|
|
1,334,689
|
210,089
|
China Kanghui
Holdings
|
|
|
Consolidated
Statements of Comprehensive Income
|
|
|
Expressed in
thousands, except for number of shares
and per share data
|
|
|
|
|
|
|
|
Three Months
Ended June 30,
|
|
Six Months
Ended June 30,
|
|
2011
|
2012
|
|
2011
|
2012
|
|
RMB
|
RMB
|
US$
|
|
RMB
|
RMB
|
US$
|
|
Unaudited
|
Unaudited
|
Unaudited
|
|
Unaudited
|
Unaudited
|
Unaudited
|
|
|
|
|
|
|
|
|
Net
revenue
|
81,758
|
101,101
|
15,914
|
|
149,733
|
183,814
|
28,933
|
Cost of
revenue
|
(23,709)
|
(29,219)
|
(4,599)
|
|
(42,968)
|
(53,360)
|
(8,399)
|
Gross
profit
|
58,049
|
71,882
|
11,315
|
|
106,765
|
130,454
|
20,534
|
|
|
|
|
|
|
|
|
Operating
expenses
|
|
|
|
|
|
|
|
Selling
expenses
|
(11,750)
|
(11,648)
|
(1,833)
|
|
(18,738)
|
(21,408)
|
(3,370)
|
General and
administrative expenses
|
(14,126)
|
(18,131)
|
(2,854)
|
|
(24,548)
|
(32,338)
|
(5,090)
|
Research and development
expenses
|
(1,799)
|
(3,382)
|
(532)
|
|
(3,301)
|
(6,501)
|
(1,023)
|
Operating
income
|
30,374
|
38,721
|
6,096
|
|
60,178
|
70,207
|
11,051
|
Interest
income
|
2,529
|
3,274
|
515
|
|
4,248
|
7,141
|
1,124
|
Government
grants
|
484
|
132
|
21
|
|
3,190
|
283
|
45
|
Other income
|
848
|
477
|
75
|
|
993
|
962
|
151
|
Other
expenses
|
(511)
|
(1,471)
|
(232)
|
|
(908)
|
(1,828)
|
(288)
|
Foreign exchange (loss)
gain
|
(2,333)
|
25
|
4
|
|
(5,341)
|
(146)
|
(23)
|
Income before income
taxes
|
31,391
|
41,158
|
6,479
|
|
62,360
|
76,619
|
12,060
|
Income taxes
|
(3,779)
|
(6,498)
|
(1,023)
|
|
(12,761)
|
(12,822)
|
(2,018)
|
Net
income
|
27,612
|
34,660
|
5,456
|
|
49,599
|
63,797
|
10,042
|
Net loss attributable to
non-controlling interests
|
267
|
106
|
17
|
|
249
|
678
|
107
|
Net income
attributable to China Kanghui Holdings
|
27,879
|
34,766
|
5,473
|
|
49,848
|
64,475
|
10,149
|
|
|
|
|
|
|
|
|
Earnings per
share
|
|
|
|
|
|
|
|
Basic
|
0.20
|
0.25
|
0.04
|
|
0.36
|
0.46
|
0.07
|
Diluted
|
0.18
|
0.22
|
0.04
|
|
0.33
|
0.41
|
0.07
|
|
|
|
|
|
|
|
|
Shares used in
earnings per share computation
|
|
|
|
|
|
|
|
Basic
|
138,702,487
|
140,757,363
|
140,757,363
|
|
137,770,862
|
140,598,892
|
140,598,892
|
Diluted
|
153,748,894
|
156,262,908
|
156,262,908
|
|
152,290,642
|
155,615,320
|
155,615,320
|
|
|
|
|
|
|
|
|
Other comprehensive
(loss) income, net of tax[4]
|
|
|
|
|
|
|
|
Foreign currency
translation adjustments
|
(271)
|
692
|
109
|
|
(474)
|
650
|
102
|
Total other
comprehensive (loss) income, net of tax
|
(271)
|
692
|
109
|
|
(474)
|
650
|
102
|
Comprehensive income
attributable to
China Kanghui Holdings
|
27,608
|
35,458
|
5,582
|
|
49,374
|
65,125
|
10,251
|
|
|
|
|
|
|
|
|
Share-based
compensation charges incurred during
the period related to:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of
revenue
|
49
|
152
|
24
|
|
99
|
185
|
29
|
Selling
expenses
|
109
|
468
|
74
|
|
221
|
604
|
95
|
General and
administrative expenses
|
1,330
|
3,604
|
567
|
|
2,537
|
6,366
|
1,002
|
Research and development
expenses
|
50
|
142
|
22
|
|
98
|
172
|
27
|
Total
|
1,538
|
4,366
|
687
|
|
2,955
|
7,327
|
1,153
|
China Kanghui
Holdings
|
Reconciliations
of Non-GAAP Results to GAAP Results
of Operations
|
(RMB in thousands,
except for share, ADS, per share data and per ADS
data)
|
|
|
|
|
|
|
|
Three Months
Ended
June 30,
|
|
Six Months
Ended
June 30,
|
|
|
2011
|
2012
|
|
2011
|
2012
|
|
|
Unaudited
|
Unaudited
|
|
Unaudited
|
Unaudited
|
|
|
|
|
|
|
|
Net revenue
|
|
81,758
|
101,101
|
|
149,733
|
183,814
|
|
|
|
|
|
|
|
Non-GAAP net
income
|
|
29,417
|
39,132
|
|
52,803
|
71,802
|
Non-GAAP
net margin
|
|
36.0%
|
38.7%
|
|
35.3%
|
39.1%
|
Share-based
compensation
|
|
(1,538)
|
(4,366)
|
|
(2,955)
|
(7,327)
|
GAAP net
income
|
|
27,879
|
34,766
|
|
49,848
|
64,475
|
GAAP net
margin
|
|
34.1%
|
34.4%
|
|
33.3%
|
35.1%
|
|
|
|
|
|
|
|
Non GAAP earnings per
share -basic
|
|
0.20
|
0.28
|
|
0.38
|
0.51
|
Non GAAP earnings per
share -diluted
|
|
0.18
|
0.25
|
|
0.35
|
0.46
|
Non GAAP earnings per
ADS -basic
|
|
1.23
|
1.67
|
|
2.30
|
3.06
|
Non GAAP earnings per
ADS -diluted
|
|
1.11
|
1.50
|
|
2.08
|
2.77
|
|
|
|
|
|
|
|
GAAP earnings per share
-basic
|
|
0.20
|
0.25
|
|
0.36
|
0.46
|
GAAP earnings per share
-diluted
|
|
0.18
|
0.22
|
|
0.33
|
0.41
|
GAAP earnings per ADS
-basic
|
|
1.21
|
1.48
|
|
2.17
|
2.75
|
GAAP earnings per ADS
-diluted
|
|
1.09
|
1.33
|
|
1.96
|
2.49
|
|
|
|
|
|
|
|
Shares used in
computation of:
|
|
|
|
|
|
|
Basic earnings per
share
|
|
138,702,487
|
140,757,363
|
|
137,770,862
|
140,598,892
|
Diluted earnings per
share
|
|
153,748,894
|
156,262,908
|
|
152,290,642
|
155,615,320
|
Basic earnings per
ADS
|
|
23,117,081
|
23,459,561
|
|
22,961,810
|
23,433,149
|
Diluted earnings per
ADS
|
|
25,624,816
|
26,043,818
|
|
25,381,774
|
25,935,887
|
|
|
|
|
|
|
|
Non-GAAP operating
income
|
|
31,912
|
43,087
|
|
63,133
|
77,534
|
Non-GAAP
operating margin
|
|
39.0%
|
42.6%
|
|
42.2%
|
42.2%
|
Share-based
compensation
|
|
(1,538)
|
(4,366)
|
|
(2,955)
|
(7,327)
|
GAAP operating
income
|
|
30,374
|
38,721
|
|
60,178
|
70,207
|
GAAP
operating margin
|
|
37.2%
|
38.3%
|
|
40.2%
|
38.2%
|
|
|
|
|
|
|
|
Non-GAAP gross
profit
|
|
58,098
|
72,034
|
|
106,864
|
130,639
|
Non-GAAP
gross margin
|
|
71.1%
|
71.2%
|
|
71.4%
|
71.1%
|
Share-based
compensation
|
|
(49)
|
(152)
|
|
(99)
|
(185)
|
GAAP gross
profit
|
|
58,049
|
71,882
|
|
106,765
|
130,454
|
GAAP
gross margin
|
|
71.0%
|
71.1%
|
|
71.3%
|
71.0%
|
[1] All non-GAAP
measures exclude share-based compensation expenses. For further
details on non-GAAP measures, please refer to the reconciliation
tables and a detailed discussion of the Company's use of non-GAAP
information set forth elsewhere in this press release.
|
[2] This
announcement contains translations of certain Renminbi ("RMB")
amounts into US dollars ("$") at specified rates solely for the
convenience of readers. Unless otherwise noted, all translations
from Renminbi to US dollars as of and for the quarter ended June
30, 2012 were made at the noon buying rate of RMB6.3530 to $1.00 on
June 29, 2012 in the City of New York for cable transfers in
Renminbi per US dollar as certified for customs purposes by the
Federal Reserve Bank of New York. The Company makes no
representation that the Renminbi or US dollar amounts referred to
in this press release could have been or could be converted into US
dollars or Renminbi, at any particular rate or at all.
|
[3] Each of the
Company's American Depositary Shares ("ADS"), which are traded on
New York Stock Exchange, represents six of the Company's ordinary
shares.
|
[4] Beginning in
the first quarter 2012, in accordance with Accounting Standards
Update 2011-05, the Company is presenting other comprehensive
income and its components in the unaudited condensed consolidated
Statement of Comprehensive Income. Other comprehensive income
mainly consists of currency translation adjustments relating to the
translation of our subsidiaries' financial statements from their
functional currency to our reporting currency, which is in the
United States dollar. The functional currency of our main
subsidiaries in China is the RMB.
|
SOURCE China Kanghui Holdings