YUHE INTERNATIONAL, INC. 
By WEIFANG,
First Quarter 2010 Highlights and Recent Events
-- Net revenue increased 7.7% to $11.8 million year over year
-- Sales volume grew 11% to 25.6 million birds year over year
-- Gross profit was $3.9 million with gross margin of 33.2%
-- Operating income was $3.0 million, down 7.9% year over year
-- Net income increased 0.4% to $2.9 million, or $0.18 per fully diluted
share
"While the first quarter is traditionally one of our slowest in terms of
sales due to the cold weather and the Chinese Spring Festival, we saw an
uptick in sales volume of our day old broilers," commented Mr.
First Quarter 2010 Results
Net revenue for the first quarter of 2010 increased 7.7% to
Gross profit decreased 4.0% year over year to
Operating income decreased 7.9% to
Net income increased 0.4% to
Financial Condition
As of
2010 Outlook
The Company's management expects sales volume and net income to rise
throughout the remainder of 2010. Yuhe's strongest results will occur in the
second half of the year, given the seasonality of the business and the fact
that the new parent breeders that were purchased in early 2010 will begin to
generate revenue in the fourth quarter of 2010. Therefore, management
re-affirms its previously issued guidance for 2010 of production totaling 150
million day-old broilers and net income of approximately
Recent Events
In
In
Upcoming Event
Yuhe will present at the Second Annual China Rising Investment Conference
presented by CCG Investor Relations in
Conference Call
The Company will host a conference call at
A replay will be available for two weeks beginning on
About Yuhe International, Inc.
Founded in 1996, Yuhe is the fourth largest day-old broiler breeder in
Cautionary Statement
This press release contains forward-looking statements concerning the Company's business, products and financial results. The Company's actual results may differ materially from those anticipated in the forward-looking statements depending on a number of risk factors including, but not limited to, the following: general economic and business conditions, development, shipment, market acceptance, additional competition from existing and new competitors, changes in technology, and various other factors beyond the Company's control. All forward-looking statements are expressly qualified in their entirety by this Cautionary Statement and the risk factors detailed in the Company's reports filed with the Securities and Exchange Commission. The Company undertakes no duty to revise or update any forward-looking statements to reflect events or circumstances after the date of this release.
- FINANCIAL TABLES FOLLOW -
YUHE INTERNATIONAL, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(Stated in US Dollars)
March 31, December 31,
2010 2009
ASSETS (unaudited)
Current assets:
Cash and cash equivalents $ 15,710,565 $ 14,047,147
Accounts receivable, net of
allowances of $18,871 and $18,868 838 838
Inventories 8,268,393 6,560,783
Advances to suppliers 359,927 359,179
Deferred tax assets 15,167 17,766
Total current assets 24,354,890 20,985,713
Plant and equipment, net 29,433,188 29,556,712
Deposits paid for acquisition of
long term assets 16,213,668 16,082,613
Notes receivable, net and other
receivable, net 46,818 33,635
Unlisted investments held for sale 300,220 300,172
Intangible assets, net 2,835,473 2,851,411
Net investment in direct financing lease 390,907 382,742
Long term prepaid rent 6,544,822 6,570,038
Total assets $ 80,119,986 $ 76,763,036
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable $ 5,687,433 $ 5,740,912
Current portion of long term loans 2,311,259 9,433,686
Other payable 1,459,548 1,343,901
Accrued expenses and payroll related
liabilities 2,564,740 2,366,134
Advances from customers 655,302 678,366
Other taxes payable 152,626 150,764
Loan from director 292,564 292,517
Other liabilities 143,972 143,949
Due to related companies 1,208 1,208
Total current liabilities 13,268,652 20,151,437
Non-current liabilities
Long-term loans 8,484,371 1,360,206
Total liabilities 21,753,023 21,511,643
Stockholders' Equity:
Preferred stock, $.001 par value,
1,000,000 shares authorized, no
shares issued and outstanding -- --
Common stock at $.001 par value;
authorized 500,000,000 shares
authorized, 15,809,563 and
15,722,180 equivalent shares issued
and outstanding, respectively 15,809 15,722
Additional paid-in capital 30,852,457 30,672,849
Retained earnings 26,243,794 23,316,794
Accumulated other comprehensive
income 1,254,903 1,246,028
Total stockholders' equity 58,366,963 55,251,393
Total liabilities and stockholders'
equity $ 80,119,986 $ 76,763,036
YUHE INTERNATIONAL, INC.
CONDENSED CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME
(UNAUDITED)
(Stated in US Dollars)
Three Months Ended March 31,
2010 2009
Net revenue $ 11,756,917 $ 10,914,390
Cost of revenue (7,856,562) (6,852,353)
Gross profit 3,900,355 4,062,037
Operating Expenses
Selling (110,947) (92,940)
General and administrative expenses (820,516) (743,990)
Total operating expenses (931,463) (836,930)
Income from operations 2,968,892 3,225,107
Non-operating income (expenses)
Interest income 58 96
Other income (expenses) 10,989 (465)
Investment income 15,612 15,509
Interest expenses (65,950) (325,427)
Total other income (expenses) (39,291) (310,287)
Net income before income taxes 2,929,601 2,914,820
Income tax expense (2,601) --
Net income $ 2,927,000 $ 2,914,820
Other comprehensive income
Foreign currency translation 8,875 48,272
Comprehensive income $ 2,935,875 $ 2,963,092
Earnings per share
Basic $ 0.19 $ 0.19
Diluted $ 0.18 $ 0.19
Weighted average shares outstanding
Basic 15,735,773 15,722,180
Diluted 16,056,599 15,722,180
YUHE INTERNATIONAL, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
(Stated in US Dollars)
Three Months Ended March 31,
2010 2009
Cash flows from operating activities
Net income $ 2,927,000 $ 2,914,820
Adjustments to reconcile net income to
net cash provided by operating activities:
Stock based compensation 179,608 179,712
Depreciation 553,496 500,545
Amortization 16,397 16,372
Capitalized interest in construction in
progress (206,063) --
Income from unlisted investment (15,612) --
Gain on disposal of property, plant and
equipment 176 --
Changes in operating assets and liabilities:
Inventories (1,706,572) (423,234)
Advances to suppliers 2,489 (71,013)
Deferred tax assets 2,601 9,443
Long term prepaid rent 26,273 --
Accounts payable (54,403) 1,049,384
Other payable 115,430 286,867
Accrued expenses and payroll related
liabilities 198,272 127,994
Advances from customers (23,172) 51,425
Other taxes payable 1,839 616
Change in net investment in direct
financing lease (8,104) --
Net cash provided by operating activities 2,009,655 4,386,943
Cash flows from investing activities
Deposit paid and acquisition of
property, plant and equipment (332,155) (41,133)
Advance to notes receivable -- (335)
Repayment of notes receivable (16,357) --
Proceeds received from related parties
receivables -- 41,442
Net cash used in investing activities (348,512) (26)
Cash flows from financing activities
Proceeds from related party payable -- 275,336
Net cash flows provided by financing
activities: -- 275,336
Effect of foreign currency translation
on cash and cash equivalents 2,275 17,521
Net increase in cash 1,663,418 4,679,774
Cash- beginning of period 14,047,147 13,412,205
Cash- end of period $ 15,710,565 $ 18,091,979
Cash paid during the period for:
Interest paid $ 231,576 $ 357,632
Supplemental disclosure
Transfer of construction in progress to
fixed assets $ -- $ 1,831,131
Cashless exercise of 142,816 warrants $ 87 $ --
For more information, please contact:
Yuhe International, Inc.
Mr. Vincent Hu, CFO
Phone: +86-536-7300-667
Email: vincent.hu@yuhepoultry.com
Mr. Jason Wang, Director of IR
Phone: +1-765-409-1844
Email: jason.wang@yuhepoultry.com
Web: http://www.yuhepoultry.com
CCG Investor Relations Inc.
Mr. Athan Dounis, Account Manager
Phone: +1-646-213-1916
Email: athan.dounis@ccgir.com
Shaun Smolarz, Financial Writer
Phone: +1-646-101-7444
Email: shaun.smolarz@ccgir.com
Web: http://www.ccgirasia.comSOURCE Yuhe International, Inc.
