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Zhongpin Reports Higher Revenues, Net Income, and Diluted EPS for the Year 2011
BEIJING and CHANGGE, China, March 13, 2012 /PRNewswire-Asia-FirstCall/ -- Zhongpin Inc. ("Zhongpin", Nasdaq: HOGS), a leading meat and food processing company in the People's Republic of China, today reported higher revenues, net income, and diluted earnings per share for the year 2011.
Year 2011 highlights:
|·||Revenues increased 54% to $1,456.2 million in 2011 from $946.7 million in 2010.|
|·||Net income increased 10% to $64.2 million in 2011 from $58.3 million in 2010.|
|·||Basic earnings per share decreased 0.6% to $1.66 in 2011 from $1.67 in 2010 on average basic shares outstanding that were 10.5% higher than 2010.|
|·||Diluted earnings per share increased 0.6% to $1.66 in 2011 from $1.65 in 2010 on average diluted shares outstanding that were 9.3% higher than 2010.|
|·||Guidance for 2012: Zhongpin expects that sales revenues should be within a range of US$1.55 billion to $1.72 billion for 2012. Gross profit margin is expected to be within the range of 8.6% to 10.2%. Net profit margin is expected to be within the range of 3.3% to 4.2%. The resulting diluted earnings per share for the year 2012 is expected to be within the range of $1.36 to $1.92 per share, assuming average diluted common shares outstanding of about 37.5 million shares in 2012. Assumptions supporting the guidance are shown below.|
|·||Zhongpin added 201,000 metric tons of annual capacity for pork and pork products during 2011 to bring total capacity at yearend 2011 to 904,760 metric tons.|
|·||Zhongpin will be investing about $10.5 million in a by-product processing plant in Changge, Henan province, to product sausage casings and the raw material used to make heparin sodium. Annual production capacity will be 100 million meters of casings and 300 billion units of the raw material for heparin sodium. The construction is scheduled to start in the first quarter of 2012 and operations should begin in fourth quarter of 2012.|
Mr. Xianfu Zhu, Chairman and Chief Executive Officer for Zhongpin, said, "We continued to deepen our penetration in our current markets and aggressively increase our geographic markets, sales locations, customers, and operations in 2011 to support higher sales, profits, and operating cash flow in the years ahead, so the year was good in operations.
"Our financial results in 2011 reflected new aggressive price competition in the markets and our higher expenses in operations, promotion, marketing, and sales to build our market share in 2011 and prepare the Company for increasing success in the future.
"Most of our 54% increase in sales revenues in 2011 came from our pork products prices for which rose an average of 44% for the year, on tonnage that was up 7%. With the prices of both hogs and pork expected to decline from 15% to 20% in 2012, it will be difficult to report higher results in 2012 compared with 2011.
"In 2012, we will slow the rate of our capacity expansions and focus on greater use of existing facilities, which we believe should help our financial results.
The following information was filed by Zhongpin Inc. (HOGS) on Wednesday, March 14, 2012 as an 8K 2.02 statement, which is an earnings press release pertaining to results of operations and financial condition. It may be helpful to assess the quality of management by comparing the information in the press release to the information in the accompanying 10-K Annual Report statement of earnings and operation as management may choose to highlight particular information in the press release.
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