VANCOUVER, Aug. 31 /CNW/ - IND DairyTech Ltd. ("IND" or the "Company") (TSXV 'IND') today announced financial results for the quarter ended June 30, 2010. The unaudited interim financial statements along with management's discussion and analysis have been filed with SEDAR.
Revenue for the quarter was $7.9 million compared to $1.2 million in the second quarter of 2009. Net income for the quarter was $3.2 million or $0.03 per share as compared to a loss of $1.7 million in the second quarter of last year. The current quarter's revenues include $2.8 million from raw milk sales, and $4.9 million from sales of cows. The sales of milk increased $1.5 million from the first quarter of 2010, or an 87% growth, reflecting the increasing milking herd and increased milk price. The gross margin of raw milk was 17%, compared to a negative margin in the first quarter of 2010 due to foot and mouth disease. The Company expects the farms will continue to recover from the disease, and milk production per cow will improve, and the sales from raw milk will continue to grow with an increasing margin.
At June 30, 2010, IND had a herd size of 17,298 (December 31, 2009: 12,858) and should continue to expand its herds by increasing the purchase of Chinese Holsteins for embryo transfer and artificial insemination. Management remains dedicated to its strict quality control standards and cow herd monitoring; a total of 1,968 cows, primarily Chinese Holsteins, were disposed in this quarter. In this quarter the Company reported an operating loss of $1.2 million, mainly due to a $1.0 million loss from the disposal of cows. The Company reported a net income of $3.2 million and an earnings per share of $0.03, mainly due to gains on its investing activities.
"The Company is still facing the challenges due to diseases as milk productions in some farms are still affected." said Jesse Zhu, IND's CEO and Chairman. "However we have seen the impact of the disease fading. Management has been making efforts to control and reduce the loss. In the coming quarters, after the disease gone, we expect to see a positive operating income. The Company's net income in the quarter reflects the management's successful efforts in creating value for the shareholders and expanding the Company through business combinations."
The Company also announces that Mr. Paul Haber and Mr. Guangyi Xu have resigned as directors of the Company effective today and Mr. James Xiang has resigned as VP Corporate Finance effective two months from today. The Company would like to thank them for their services and great contributions during their tenure.
About IND Dairytech Ltd.
IND, through its operating subsidiaries, is an emerging raw milk and Holsteins producer in China that is seeking to become a leading provider of high quality raw milk and Holsteins to the Chinese dairy industry. To meet China's increasing demand for dairy products, the Company is using Canadian cattle genetics and North American farming practices to establish and develop its dairy herd in China.
The Company plans to develop its herd in China through the use of advanced breeding techniques employing Canadian Holstein embryos that it intends to use to impregnate surrogate cows. These embryos have been created through in vitro fertilization using sexed semen to achieve an approximate 90% female birth rate. The use of these advanced breeding techniques is expected to allow the Company to rapidly expand its herd. The use of Canadian Holstein embryos also provides a practical solution to China's ban on the import of live Canadian cattle.
The TSX Venture Exchange has not reviewed and does not accept responsibility for the adequacy or accuracy of this release.
FORWARD LOOKING INFORMATION
Certain information set out in this News Release constitutes forward-looking information, which may include information relating to estimates of sales and revenue of IND. Forward-looking statements (often, but not always, identified by the use of words such as "expect", "may", "could", "anticipate" or "will" and similar expressions) may describe expectations, opinions or guidance that are not statements of fact and which may be based upon information provided by third parties. Forward-looking statements are based upon the opinions, expectations and estimates of management of the Company as at the date the statements are made and are subject to a variety of known and unknown risks and uncertainties and other factors that could cause actual events or outcomes to differ materially from those anticipated or implied by such forward-looking statements. In light of the risks and uncertainties associated with forward-looking statements, readers are cautioned not to place undue reliance upon forward-looking information. Although the Company believes that the expectations reflected in the forward-looking statements set out in this press release or incorporated herein by reference are reasonable, it can give no assurance that such expectations will prove to have been correct. The forward-looking statements of the Company contained in this press release, or incorporated herein by reference, are expressly qualified, in their entirety, by this cautionary statement.
SOURCE IND DAIRYTECH LIMITED
For further information: For further information: Jesse Zhu, Chief Executive Officer, IND DairyTech Limited, 604-522-1619, firstname.lastname@example.org; Winfield Ding, Chief Financial Officer, IND DairyTech Limited, 604-522-1619, email@example.com