Bodisen Biotech, Inc. reports Unaudited Third Quarter Financial Results Review & Extracts of the Form10-Q as required by the Securities & Exchange Commission
Bodisen Biotech, Inc. (the ¡°Company¡±) (OTC Pink Sheets: BBCZ; London AIM: BODI; website: www.bodisen.com) today announced its third quarter results for the period ended September 30, 2007 which are extracted fro the Company¡¯s Form 10-Q filed with the SEC.
Results of Operations
Revenue.We generated revenues of $10,494,694 for the nine months ended September 30, 2007, a decrease of $29,136,072 or 73.5%, compared to $39,630,766 for the nine months ended September 30, 2006.The significant decrease in revenue was due to the decline in our customer base, which decreased following our delisting from the Amex and, to a lesser extent, the abnormally cold Spring time weather of Shaanxi province as well as a storm and drought in the third quarter of 2007, all of which affected crop plantings and decreased the use of fertilizer.
Gross Profit.We achieved a gross profit of $4,618,129 for the nine months ended September 30, 2007, a decrease of $10,903,912 or 70.2%, compared to $15,522,041 for the nine months ended September 30, 2006.The significant decrease in gross profit was due to the significant decrease in revenue as result of decreased sales, and, to a lesser extent, increased commodities prices which increased our costs of revenues.Gross margin (gross profit as a percentage of revenues), increased, from 39.2% for the nine months ended September 30, 2006, to 44.0% for the nine months ended September 30, 2007 primarily due to changes in overall product mix comprising sales.
Operating expenses.We incurred operating expenses of $6,699,732 for the nine months ended September 30, 2007, an increase of $2,990,489 or 80.6% compared to $3,709,243 for the nine months ended September 30, 2006.The significant increase in our operating expenses is related to legal fees associated with litigation and other matters in connection with the Amex delisting and a loss of approximately $1,700,000 due to storm damage in August 2007.
Aggregated selling expenses accounted for $1,276,208 of our operating expenses for the nine months ended September 30, 2007, a decrease of $427,400 or 25.1% compared to $1,703,608 for the nine months ended September 30, 2006. The decrease in our aggregated selling expenses is primarily due the reduction in transportation costs, which continued to be negatively affected by the continued increases in petroleum prices.The reduction in our transportation costs was partially offset by increased labor costs.General and administrative expenses accounted for the remainder of our operating expenses of $5,423,524 for the nine months ended September 30, 2007, which increased $3,417,889 or 170.4% compared to $2,005,635 for the nine months ended September 30, 2006.The significant increase in our general and administrative expenses is primarily related to legal fees associated with litigation and other matters in connection with the Amex delisting and a loss of approximately $1,700,000 due to storm damage in August 2007.
Non Operating Income and Expenses.We had total non-operating income of $258,820 for the nine months ended September 30, 2007 compared to total non-operating expense of $60,432 for the nine months ended September 30, 2006.We had other expense of $143 for the nine months ended September 30, 2007 compared to other income of $500,604 for nine months ended September 30,2006.In 2006, other income was due to the effects of a foreign currency transaction gain, which we did not have in 2007. Total non-operating income includes interest income of $262,870 for the nine months ended September 30, 2007 compared to only $118,129 of interest income for the nine months ended September 30, 2006.The increasein interest income for the nine months ended September 30, 2007 is due to the full year effects of the increased cash balance that resulted from our sale of stock in the first quarter of 2006.Total non-operating income for the nine months ended September 30, 2007 also includes interest expense of only $3,907 compared to $679,165 for the nine months ended September 30, 2006.The majority of the interest expense in the nine months ended September 30, 2006 relates to the $5 million note issued December 8, 2005, which was repaid during March 2006.
Net Income (Loss).For the foregoing reasons, we had a net loss of $1,822,783 for the nine months ended September 30, 2007, a decrease of $13,575,149 or 115.5% compared to net income of $11,752,366 for the nine months ended September 30, 2006.We had earnings (loss) per share of $(0.10) for the nine months ended September 30, 2007 compared to earnings per share of $0.66 for the nine months ended September 30, 2006.
About Bodisen Biotech, Inc.
Bodisen Biotech, Inc. is a leading manufacturer of liquid and organic compound fertilizers, pesticides, insecticides and agricultural raw material certified by the Petroleum Chemical Industry Administrative office of China (Chemical Petroleum Production Administrative Bureau), Shaanxi provincial government and Chinese government.The company is headquartered in Shaanxi province and is a Delaware corporation.The company files annual and periodic reports with the U.S. Securities and Exchange Commission, which are accessible at www.sec.gov.
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.
Enquiries:
Charles Stanley Securities
Rick Thompson / Philip Davies / Freddy Crossley020 7149 6000
Bodisen Biotech, Inc.
Scott King001 219 939 3073
CONSOLIDATED STATEMENTS OF OPERATIONS AND OTHER COMPREHENSIVE INCOME (LOSS) FOR THE THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2007 AND 2006
|
|
Three Months
Ended September 30, |
|
Nine Months
Ended September 30, |
|
|
2007 |
|
2006 |
|
2007 |
|
2006 |
|
|
(Unaudited) |
|
(Unaudited) |
|
(Unaudited) |
|
(Unaudited) |
|
|
|
|
|
|
|
|
|
Net Revenue |
$ |
2,314,059 |
$ |
12,713,217 |
$ |
10,494,694 |
|
39,630,766 |
|
|
|
|
|
|
|
|
|
Cost of Revenue |
|
1,207,774 |
|
7,839,351 |
|
5,876,565 |
|
24,108,725 |
|
|
|
|
|
|
|
|
|
Gross profit |
|
1,106,285 |
|
4,873,866 |
|
4,618,129 |
|
15,522,041 |
|
|
|
|
|
|
|
|
|
Operating expenses |
|
|
|
|
|
|
|
|
Selling expenses |
|
596,921 |
|
557,965 |
|
1,276,208 |
|
1,703,608 |
General and administrative expenses |
|
2,879,530 |
|
1,154,673 |
|
5,423,524 |
|
2,005,635 |
Total operating expenses |
|
3,476,451 |
|
1,712,638 |
|
6,699,732 |
|
3,709,243 |
|
|
|
|
|
|
|
|
|
Income (loss) from operations |
|
(2,370,166) |
|
3,161,228 |
|
(2,081,603) |
|
11,812,798 |
|
|
|
|
|
|
|
|
|
Non-operating income (expense): |
|
|
|
|
|
|
|
|
Other income (expense) |
|
(639,729) |
|
(31,771) |
|
(143) |
|
500,604 |
Interest income |
|
83,418 |
|
60,835 |
|
262,870 |
|
118,129 |
Interest expense |
|
(1,531) |
|
(247) |
|
(3,907) |
|
(679,165) |
|
|
|
|
|
|
|
|
|
Total non-operating income (expense) |
|
(557,842) |
|
28,817 |
|
258,820 |
|
(60,432) |
|
|
|
|
|
|
|
|
|
Net income (loss) |
|
(2,928,008) |
|
3,190,045 |
|
(1,822,783) |
|
11,752,366 |
|
|
|
|
|
|
|
|
|
Other comprehensive income |
|
|
|
|
|
|
|
|
Foreign currency translation gain (loss) |
|
(1,657,890) |
|
662,012 |
|
- |
|
780,115 |
Unrealized gain (loss) on marketable equity security |
|
(2,538,435) |
|
165,102 |
|
- |
|
(928,695) |
|
|
|
|
|
|
|
|
|
Comprehensive Income (loss) |
$ |
(7,124,333) |
$ |
4,017,159 |
$ |
(1,822,783) |
$ |
11,603,786 |
|
|
|
|
|
|
|
|
|
Weighted average shares outstanding : |
|
|
|
|
|
|
|
|
Basic |
|
18,310,250 |
|
18,176,917 |
|
18,310,250 |
|
17,859,878 |
Diluted |
|
18,310,250 |
|
18,303,299 |
|
18,310,250 |
|
18,002,639 |
|
|
|
|
|
|
|
|
|
Earnings per share: |
|
|
|
|
|
|
|
|
Basic |
$ |
(0.16) |
$ |
0.18 |
$ |
(0.10) |
$ |
0.66 |
Diluted |
$ |
(0.16) |
$ |
0.17 |
$ |
(0.10) |
$ |
0.65 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CONSOLIDATED BALANCE SHEETS
AS OF SEPTEMBER 30, 2007 AND DECEMBER 31, 2006
|
|
|
|
|
|
|
September 30, |
|
December 31, |
|
|
2007 |
|
2006 |
|
|
(unaudited) |
|
|
ASSETS |
|
|
|
|
CURRENT ASSETS: |
|
|
|
|
Cash & cash equivalents |
$ |
962,534 |
$ |
11,824,327 |
Accounts receivable, net of allowance for |
|
|
|
|
doubtful accounts of $901,621 and $659,653 |
|
24,729,956 |
|
18,875,368 |
Other receivable |
|
2,130,282 |
|
888,230 |
Inventory |
|
1,258,339 |
|
1,794,585 |
Advances to suppliers |
|
8,853,953 |
|
12,662,139 |
Prepaid expense and other current assets |
|
4,452,306 |
|
195,821 |
|
|
|
|
|
Total current assets |
|
42,387,370 |
|
46,240,470 |
|
|
|
|
|
PROPERTY AND EQUIPMENT, net |
|
5,249,471 |
|
5,195,283 |
|
|
|
|
|
CONSTRUCTION IN PROGRESS |
|
7,481,447 |
|
3,669,807 |
|
|
|
|
|
MARKETABLE SECURITY |
|
14,239,999 |
|
6,500,869 |
|
|
|
|
|
INTANGIBLE ASSETS, net |
|
2,032,211 |
|
2,054,346 |
|
|
|
|
|
OTHER ASSETS |
|
3,698,060 |
|
3,553,433 |
|
|
|
|
|
LOAN RECEIVABLE |
|
2,297,236 |
|
1,982,410 |
|
|
|
|
|
TOTAL ASSETS |
$ |
77,385,794 |
$ |
69,196,618 |
|
|
|
|
|
LIABILITIES AND STOCKHOLDERS' EQUITY |
|
|
|
|
CURRENT LIABILITIES: |
|
|
|
|
Accounts payable |
$ |
989,106 |
$ |
1,022,352 |
Accrued expenses |
|
136,217 |
|
347,948 |
|
|
|
|
|
Total current liabilities |
|
1,125,323 |
|
1,370,300 |
|
|
|
|
|
STOCKHOLDERS' EQUITY: |
|
|
|
|
Preferred stock, $0.0001 per share; authorized 5,000,000 shares; |
|
|
|
|
nil issued and outstanding |
|
|
|
|
Common stock, $0.0001 per share; authorized 30,000,000 shares; |
|
|
|
|
issued and outstanding 18,310,250 and 18,310,250 |
|
1,831 |
|
1,831 |
Additional paid-in capital |
|
15,688,846 |
|
33,860,062 |
Other comprehensive income |
|
15,688,846 |
|
5,431,910 |
Statutory reserve |
|
4,314,488 |
|
4,314,488 |
Retained earnings |
|
22,395,244 |
|
24,218,027 |
Total stockholders' equity |
|
58,089,255 |
|
67,826,318 |
|
|
|
|
|
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY |
$ |
59,214,578 |
$ |
69,196,618 |
CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2007 AND 2006
|
|
Nine Months Ended September 30, |
|
|
2007 |
|
2006 |
|
|
(unaudited) |
|
(unaudited) |
|
|
|
|
|
CASH FLOWS FROM OPERATING ACTIVITIES: |
|
|
|
|
Net income (loss) |
$ |
- |
$ |
11,752,366 |
Adjustments to reconcile net income (loss) to net cash |
|
|
|
|
provided by (used in) operating activities: |
|
|
|
|
Depreciation and amortization |
|
354,753 |
|
335,842 |
Amortization of debt discounts |
|
- |
|
603,886 |
Exchange gain (loss) |
|
- |
|
(16,828) |
Value of vested option issued to directors |
|
- |
|
7,523 |
Allowance for bad debts |
|
210,095 |
|
- |
(Increase) / decrease in assets: |
|
|
|
|
Accounts receivable |
|
(5,469,096) |
|
(12,336,536) |
Other receivable & Loan Receivable |
|
(1,407,655) |
|
(4,968,421) |
Inventory |
|
598,013 |
|
(246,935) |
Advances to suppliers |
|
4,243,485 |
|
(3,599,885) |
Prepaid expense |
|
(4,159,646) |
|
- |
Other assets |
|
- |
|
3,960 |
Increase / (decrease) in current liabilities: |
|
|
|
|
Accounts payable |
|
(57,313) |
|
99,935 |
Other payable |
|
- |
|
3,374,315 |
Accrued expenses |
|
(221,025) |
|
51,735 |
|
|
|
|
|
Net cash provided by (used in) operating activities |
|
(5,908,389) |
|
(4,939,043) |
|
|
|
|
|
CASH FLOWS FROM INVESTING ACTIVITIES |
|
|
|
|
Acquisition of property and equipment |
|
(91,381) |
|
(386,268) |
Additions to construction in progress |
|
(3,582,845) |
|
(789,911) |
Investments |
|
- |
|
(735,536) |
Payments for other assets |
|
(44,168) |
|
- |
|
|
|
|
|
Net cash used in investing activities |
|
(3,718,394) |
|
(1,911,715) |
|
|
|
|
|
CASH FLOWS FROM FINANCING ACTIVITIES: |
|
|
|
|
Payments on note payable |
|
- |
|
(5,000,000) |
Proceeds from issuance of common stock |
|
- |
|
26,682,511 |
Payment of offering costs |
|
- |
|
(6,132,707) |
Proceeds from the exercise of warrants |
|
- |
|
220,160 |
|
|
|
|
|
Net cash provided by financing activities |
|
- |
|
15,769,964 |
|
|
|
|
|
Effect of exchange rate changes on cash and cash equivalents |
|
587,773 |
|
27,832 |
|
|
|
|
|
NET INCREASE /(DECREASE) IN CASH & CASH EQUIVALENTS |
|
(9,039,010) |
|
8,947,038 |
|
|
|
|
|
CASH & CASH EQUIVALENTS, BEGINNING OF PERIOD |
|
11,824,327 |
|
6,276,897 |
|
|
|
|
|
CASH & CASH EQUIVALENTS, END OF PERIOD |
$ |
2,785,317 |
$ |
15,223,935 |
|
|
|
|
|
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION: |
|
|
|
|
Interest paid |
$ |
- |
$ |
112,500 |
Income taxes paid |
$ |
- |
$ |
- |
|
|
|
|
|
Earnings Per Share
Earnings per share for nine months ended September 30, 2007 and 2006 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 earnings per common share in accordance with Statement of Financial Accounting Standards No. 128, ¡°Earnings Per Share¡±.
|
Three Months Ended September 30, |
|
2007 |
|
2006 |
|
|
|
|
|
Per |
|
|
|
|
|
Per |
|
Income |
|
Shares |
|
Share |
|
Income |
|
Shares |
|
Share |
|
|
|
|
|
|
|
|
|
|
|
|
Basic earnings per share |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss) |
$(2,928,008) |
|
|
|
|
|
$ 3,190,045 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighed shares outstanding |
|
|
18,310,250 |
|
|
|
|
|
18,176,917 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$(0.16) |
|
|
|
|
|
$0.18 |
|
|
|
|
|
|
|
|
|
|
|
|
Diluted earnings per share |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss) |
$(2,928,008) |
|
|
|
|
|
$ 3,190,045 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighed shares outstanding |
|
|
18,310,250 |
|
|
|
|
|
18,176,917 |
|
|
Effect of dilutive securities |
|
|
|
|
|
|
|
|
|
|
|
Options |
|
|
- |
|
|
|
|
|
75,544 |
|
|
Warrants |
|
|
- |
|
|
|
|
|
50,838 |
|
|
|
|
|
18,310,250 |
|
|
|
|
|
18,303,299 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$(0.16) |
|
|
|
|
|
$0.17 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Nine Months Ended September30, |
|
2007 |
|
2006 |
|
|
|
|
|
Per |
|
|
|
|
|
Per |
|
Income |
|
Shares |
|
Share |
|
Income |
|
Shares |
|
Share |
|
|
|
|
|
|
|
|
|
|
|
|
Basic earnings per share |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss) |
$(1,822,783) |
|
|
|
|
|
$ 11,752,366 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighed shares outstanding |
|
|
18,310,250 |
|
|
|
|
|
17,859,878 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$(0.10) |
|
|
|
|
|
$0.66 |
|
|
|
|
|
|
|
|
|
|
|
|
Diluted earnings per share |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss) |
$(1,822,783) |
|
|
|
|
|
$ 11,752,366 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighed shares outstanding |
|
|
18,310,250 |
|
|
|
|
|
17,859,878 |
|
|
Effect of dilutive securities |
|
|
|
|
|
|
|
|
|
|
|
Options |
|
|
- |
|
|
|
|
|
82,476 |
|
|
Warrants |
|
|
- |
|
|
|
|
|
60,285 |
|
|
|
|
|
18,310,250 |
|
|
|
|
|
18,002,639 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$(0.10) |
|
|
|
|
|
$0.65 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|