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Bodisen Biotech Reports Third Quarter Financial Results Review & Extracts of the Form10Q as required by the Securities & Exchange Commission

 

Bodisen Biotech, Inc., (AMEX:BBC, London AIM: BODI, website: www.bodisen.com) the first China based environmentally friendly bio fertilizer company listed on a US stock exchange, and dually listed in London, today announced that it achieved strong revenue and earnings growth from the production and sale of organic fertilizer and pesticide products during the third quarter ended September 30, 2006.

 

The following are some of the financial highlights for the third quarter from the companys Form 10-Q filed with the SEC:

 

THIRD QUARTER FINANCIAL & OPERATIONAL HIGHLIGHTS

 

  • Revenues grew 20.9% to $12.7 million from $10.5 million in the same period of 2005.
  • Gross profit increased to $4.9 million from $4.0 million in the same period last year.
  • Net Income grew 11.1% to $3.2 million from $2.9 million in the same period of 2005.
  • Net income margin of approximately 25.1% due to strong sales in high margin liquid fertilizers.
  • Fully diluted EPS was $0.17 compared with $0.18 in the same period last year.

 

We continued to demonstrate strong year-over-year growth during the third quarter of 2006 with double digit revenue and net income growth, following a record second quarter, when the company recorded the highest revenues and earnings in its history, said Karen Qiong Wang, chairwoman and CEO of Bodisen Biotech.

 

REVENUES

Bodisen achieved revenues of $12,713,217 for the third quarter of 2006, up 20.9% from the prior year period when the company reported revenues of $10,516,790. For the nine month period ended September 30, 2006, the company recorded $39,630,766 in revenues, an increase of 67.7% from the same period last year, when the company recorded $23,635,270 in revenues.

 

GROSS PROFIT

Bodisen achieved a gross profit of $4,873,866 for the third quarter of 2006, up 23.2% from the prior year period gross profit of $3,955,609. Gross margin increased to 38.3% in the third quarter of 2006 from 37.6% in the same year ago period. The increase in gross margin was primarily attributable to the increase in the prices of main products. For the nine months ended September 30, 2006, the company achieved gross profit of $15,522,041, an increase of 75.1%, compared to $8,865,450 for the nine months ended September 30, 2005.

 

OPERATING EXPENSES

Operating expenses for the third quarter of 2006 were $1,712,639, compared to $594,417 for the same period in 2005, due to increased sales and marketing costs related to increased sales for the quarter. For the nine month period ended September 30, 2006, the company recorded operating expenses of $3,709,243, compared with $1,684,207 for the same period in 2005.

 

NET INCOME

Bodisen achieved net income of $3,190,045 or fully diluted EPS of $0.17 in the third quarter of 2006 compared to net income of $2,871,041 or fully diluted EPS of $0.18 in the same quarter last year. The decrease in EPS was related to the increase in the total shares outstanding to 18.3 million in 2006 from 15.6 million shares for the third quarter of 2005.

 

Net income increased by 84.8% to $11,752,366, or fully diluted EPS of $0.65, during the nine months ended September 30, 2006, from $6,359,787, or fully diluted EPS of $0.40, for the same period in 2005.

 

BALANCE SHEET

The company recorded $15,223,935 in cash and cash equivalents at the end of the third quarter of 2006. Accounts receivables account totaled $20,128,848 on September 30, 2006. The company stated that accounts receivables balance remained high because sales in 2006 have grown sharply compared with 2005 and that as part of its expansion into northern China, it has increased the number of distributors who market their product and has had to extend credit to these distributors. At the same time, the company stated that it has recouped all of the credit extended to distributors within five months.

 

OUTLOOK

With the end of the third quarter, our 2006 year-to-date revenues and earnings already exceed our total revenues and earnings for fiscal 2005, said Wang. While the fourth quarter, which represents the end of the harvest season, typically is our slowest period of the year, we expect to continue to achieve year-over-year revenue and earnings growth in the last quarter of the year.

 

AMEX LISTING

Bodisen also clarified information contained in its press release issued November 12, 2006 regarding the letter it received from the Staff of the American Stock Exchange. The letter was a notice of deficiency, which means that problems have been identified that Bodisen must seek to address. It was not a notice of delisting, and thus Bodisen's shares will continue to trade on AMEX.

 

About Bodisen Biotech, Inc.

Bodisen Biotech Inc. is a leading manufacturer of liquid and organic compound fertilizers, pesticides, insecticides and agricultural raw materials certified by the Petroleum Chemical Industry Administrative office of China (Chemical Petroleum Production Administrative Bureau), Shaanxi provincial government and Chinese government. Ranked the 16th fastest growing company in China by Forbes China in January 2006, the company is headquartered in Shaanxi province and is a Delaware corporation. The company's environmentally friendly ``green'' products have been proven to improve soil and plant quality, and increase crop yields.

SafeHarbor Statement

This press release may contain forward-looking statements within the meaning of the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995. These statements are based on the current expectations or beliefs of Bodisen Biotech, Inc. management and are subject to a number of factors and uncertainties that could cause actual results to differ materially from those described in the forward-looking statements.

Investor Relations:

The Piacente Group, Inc.

212-481-2050


CONSOLIDATED BALANCE SHEET

AS OF SEPTEMBER 30, 2006

 

 

September 30, 2006

 

(unaudited)

 

$

ASSETS

 

CURRENT ASSETS:

 

Cash & cash equivalents

15,223,935

Accounts receivable, net of allowance for doubtful accounts of $1,515,074

20,128,848

Other receivable

2,705,935

Inventory

1,454,741

Advances to suppliers

8,304,715

Prepaid expense

61,401

 

-------------------

Total current assets

47,879,575

 

 

PROPERTY AND EQUIPMENT, net

5,142,797

CONSTRUCTION IN PROGRESS

2,712,078

MARKETABLE SECURITY

5,881,739

INTANGIBLE ASSETS

2,062,000

OTHER ASSETS

744,959

 

-------------------

TOTAL ASSETS

64,423,148

 

==========

LIABILITIES AND STOCKHOLDERS' EQUITY

 

CURRENT LIABILITIES:

 

Accounts payable

154,844

Accrued expenses

469,928

 

-------------------

Total current liabilities

624,772

 

 

STOCKHOLDERS' EQUITY:

 

Preferred stock, $0.0001 per share; authorized 5,000,000 shares; none issued

 

Common stock, $0.0001 per share; authorized 30,000,000 shares; issued and outstanding 18,176,917

 

1,818

Additional paid-in capital

32,860,075

Other comprehensive income

4,382,429

Statutory reserve

4,129,786

Retained earnings

22,424,268

 

-------------------

Total stockholders' equity

63,798,376

 

-------------------

TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY

64,423,148

 

==========

 

 

CONSOLIDATED STATEMENTS OF INCOME AND OTHER COMPREHENSIVE INCOME

FOR THE THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2006 AND 2005

 

<' ;&,"vIE' ;&,"">

Net income

 

Three Month Periods

Ended September 30

Nine Month Periods

Ended September 30

 

2006

2005

2006

2005

 

(Unaudited)

(Unaudited)

(Unaudited)

(Unaudited)

 

$

$

$

$

Net Revenue

12,713,217

10,516,790

39,630,766

23,635,270

 

 

 

 

 

Cost of Revenue

7,839,351

6,561,181

24,108,725

14,769,820

 

--------------------

--------------------

--------------------

--------------------

Gross profit

4,873,866

3,955,609

15,522,041

8,865,450

Operating expenses

 

 

 

 

Selling expenses

557,965

294,860

1,703,608

674,768

General and administrative expenses

1,154,673

299,557

2,005,635

1,009,439

 

--------------------

--------------------

--------------------

--------------------

Total operating expenses

1,712,638

594,417

3,709,243

1,684,207

 

--------------------

--------------------

--------------------

--------------------

Income from operations

3,161,228

3,361,192

11,812,798

7,181,243

Non-operating income (expense):

 

 

 

 

Other income (expense)

(31,771)

-

500,604

-

Interest income

60,835

(5,461)

118,129

42,594

Interest expense

(247)

(484,690)

(679,165)

(864,050)

 

--------------------

--------------------

--------------------

--------------------

Total non-operating income (expense)

28,817

(490,151)

(60,432)

(821,456)

 

--------------------

--------------------

--------------------

--------------------

3,190,045

2,871,041

11,752,366

6,359,787

Other comprehensive income

 

 

 

 

Foreign currency translation gain

662,012

524,838

780,115

524,838

Unrealised gain (loss) on marketable equity security

 

165,102

 

-

 

(928,695)

 

-

 

--------------------

--------------------

--------------------

--------------------

Comprehensive Income

4,017,159

3,395,879

11,603,786

6,884,625

 

===========

===========

===========

===========

Weighted average shares outstanding :

 

 

 

 

Basic

18,176,917

15,326,344

17,859,878

15,289,569

 

===========

===========

===========

===========

Diluted

18,303,299

15,619,663

18,002,639

15,982,006

 

===========

===========

===========

===========

Earnings per share:

 

 

 

 

Basic

0.18

0.19

0.66

0.42

 

===========

===========

===========

===========

Diluted

0.17

0.18

0.65

0.40

 

===========

===========

===========

===========

 

 

 

 

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

 

Earnings per share

 

Earnings per share for nine months September 30, 2006 and 2005 were determined by dividing net income for the periods by the weighted average number of both basic and diluted shares of common stock and common stock equivalents outstanding.

 

The following is an analysis of the differences between basic and diluted earnigs per common share in accordance with Statement of Financial Accounting Standards No. 128, Earnings Per Share.

 

 

Three Months Ended September, 30

 

2006

2005

 

Income

Shares

Per Share

Income

Shares

Per Share

 

 

 

 

 

 

 

Basic earnings per share

 

 

 

 

 

 

Net income

$3,190,045

 

 

$2,871,041

 

 

 

=========

 

 

=========

 

 

 

 

 

 

 

 

 

Weighted shares outstanding

 

 

18,176,917

 

 

 

15,326,344

 

 

 

 

$0.18

 

 

$0.19

 

 

 

=========

 

 

=========

 

 

 

 

 

 

 

Diluted earnings per share

 

 

 

 

 

 

Net income

$3,190,045

 

 

$2,871,041

 

 

 

=========

 

 

=========

 

 

 

 

 

 

 

 

 

Weighted shares outstanding

 

 

18,176,917

 

 

 

15,326,344

 

Effect of dilutive securities

 

 

 

 

 

 

Options

 

75,544

 

 

293,319

 

Warrants

 

50,838

 

 

-

 

 

 

18,303,299

 

 

15,619,663

 

 

 

=========

 

 

=========

 

 

 

 

$0.17

 

 

$0.18

 

 

 

=========

 

 

=========

 


 

 

Nine Months Ended September, 30

 

2006

2005

 

Income

Shares

Per Share

Income

Shares

Per Share

 

 

 

 

 

 

 

Basic earnings per share

 

 

 

 

 

 

Net income

$11,752,366

 

 

$6,359,787

 

 

 

=========

 

 

=========

 

 

 

 

 

 

 

 

 

Weighted shares outstanding

 

 

17,859,878

 

 

 

15,289,569

 

 

 

 

$0.66

 

 

$0.42

 

 

 

=========

 

 

=========

 

 

 

 

 

 

 

Diluted earnings per share

 

 

 

 

 

 

Net income

$11,752,366

 

 

$6,359,787

 

 

 

=========

 

 

=========

 

 

 

 

 

 

 

 

 

Weighted shares outstanding

 

 

17,859,878

 

 

 

15,289,569

 

Effect of dilutive securities

 

 

 

 

 

 

Options

 

82,476

 

 

692,437

 

Warrants

 

60,285

 

 

-

 

 

 

18,002,639

 

 

15,982,006

 

 

 

=========

 

 

=========

 

 

 

 

$0.65

 

 

$0.40

 

 

 

=========

 

 

=========

 

 

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