WEB NEWS Comments & Business Outlook
HANGZHOU, China, April 4, 2019 /PRNewswire / -- BEST Inc. (NYSE: BEST) ("BEST" or the "Company"), a leading smart supply chain and logistics solutions and services provider in China, announced a strategic collaboration with Beijing Yiside Logistics Technology ("Yiside") to introduce eco-friendly packaging for express deliveries.
BEST has pledged to replace all of its current plastic express satchels with environment-friendly "Nbags" produced by Yiside. The new polyethylene (PE) bags are made primarily from corn starch and will result in an approximately 30% reduction to the use of plastic in production of BEST's express satchels.
Zhou Shaohua, Senior Vice President of BEST and General Manager of BEST Express, said: "BEST is committed to eco-friendly and sustainable growth for its express business and helping to promote the green development of the industry as a whole. By replacing all of the plastic satchels used in our express network with the new Nbag, we can help reduce the use of plastic by 900 tons and lower the emission of greenhouse gasses by 903 tons annually, equivalent to planting 50,000 trees."
The waterproof and tear-resistant Nbags are extremely durable, with only a 5% damage rate, and are the same cost as the current plastic satchels. Sustainability is at the heart of BEST's mission to provide more efficient logistics and supply chain solutions. The Company announced its "Green Initiative" in 2016 and has introduced several initiatives to promote green logistics, including through the use of PE bags and digital waybills.
Comments & Business Outlook
ITEM 8.01 OTHER INFORMATION.
Shiner International, Inc. (the “Company”) has determined to terminate and suspend the registration of its common stock with the Securities and Exchange Commission (the “SEC”). On or about June 15, 2016, the Company intends to file a Form 15 with the SEC to voluntarily deregister its common stock and suspend its reporting obligations under the Securities Exchange Act of 1934, as amended. The Company is eligible to file Form 15 because there are fewer than 300 holders of record of its common stock. As a result of the filing of the Form 15, the Company’s obligation to file certain reports and forms with the SEC, including Forms 10-K, 10-Q, and 8-K, will cease. Other filing requirements will terminate upon the effectiveness of the deregistration, which is expected to occur 90 days after the filing of the Form 15.
Comments & Business Outlook
2016
2015
Net revenue
$
12,305,719
$
13,806,856
Cost of goods sold
10,360,581
11,479,169
Gross profit
1,945,138
2,327,687
Operating expenses:
Selling
445,100
1,045,384
General and administrative
1,897,733
1,759,842
Total operating expenses
2,342,833
2,805,226
Loss from operations
(397,695
)
(477,539
)
Non-operating income (expense):
Other income, net
106,149
201,857
Interest income
432,828
733,954
Interest expense
(590,179
)
(1,252,610
)
Exchange loss
(12,414
)
2,108
Total non-operating income (expense)
(63,616
)
(314,691
)
Income before income tax
(461,311
)
(792,230
)
Income tax expense
103,653
62,609
Net loss
(564,964
)
(854,839
)
Net loss attributed to noncontrolling interest
(62,693
)
(20,912
)
Net loss attributed to Shiner
$
(502,271
)
$
(833,927
)
Comprehensive loss:
Net loss
$
(564,964
)
$
(854,839
)
Foreign currency translation gain
284,921
154,264
Comprehensive loss
$
(280,043
)
$
(700,575
)
Weighted average shares outstanding :
Basic
27,541,491
27,541,491
Diluted
27,541,491
27,541,491
Loss per share attributed to Shiner common stockholders:
Basic
$
(0.02
)
$
(0.03
)
Diluted
$
(0.02
)
$
(0.03
)
Management Discussion and Analysis
Revenues
Revenues for the three months ended March 31, 2016 decreased $1.5 million (or 10.9 %), to $12.3 million, compared to $13.8 million in 2015. The decrease was primarily attributable to decreased revenues generated from our coated film, color printing, and water-based latex segments. During the three months ended March 31, 2016, revenue from sales of our coated film decreased $1.5 million (or 37.1%) to $2.6 million, down from $4.1 million, revenue from color printing decreased $0.3 million (or 25.8%) to $0.8 million, down from $1.1 million, and revenue from water-based latex decreased $0.06 million (or 45.0%) to $.07 million, down from $0.13 million; offset by an increase in revenue from advanced film of $0.3 million (or 35.1%) to $1.3 million, up from $1.0 million and revenue from BOPP tobacco film was up just slightly. During the first quarter of 2016, our domestic (China Mainland) sales decreased as a percentage of total sales from 87.1% in 2015 to 85.5% in 2016. The decrease in revenue from our coated film, color printing, and water-based latex segments for the three months ended March 31, 2016, compared to the same period in 2015, was largely due to the Company’s limited acceptance of customer orders for these product lines that have become only marginally profitable.
Net Income (Loss)
Due to the factors explained above, for the three months ended March 31, 2016 we generated a net loss of $0.5 million, compared to a net loss of $0.8 million in the 2015 period.
Comments & Business Outlook
SHINER INTERNATIONAL, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF INCOME AND OTHER COMPREHENSIVE INCOME (LOSS) YEARS ENDED DECEMBER 31, 2015 AND 2014
2015
2014
Net revenue $
76,331,519
$
101,117,821
Cost of goods sold
59,694,988
85,284,144
Gross profit
16,636,531
15,833,677
Operating expenses:
Selling
4,096,456
4,355,567
General and administrative
11,654,538
7,025,634
Total operating expenses
15,750,994
11,381,201
Income from operations
885,537
4,452,476
Non-operating income (expense):
Other income, net
994,041
2,100,948
Interest income
2,334,276
2,192,067
Interest expense
(3,782,252
)
(3,628,174
)
Exchange loss
(154,737
)
(34,017
)
Total non-operating income (expense)
(608,672
)
630,824
Income before income tax
276,865
5,083,300
Income tax expense
962,688
1,022,512
Net income (loss)
(685,823
)
4,060,788
Net income (loss) attributed to noncontrolling interest
(109,015
)
3,841
Net income (loss) attributed to Shiner $
(576,808
)
$
4,056,947
Comprehensive income (loss):
Net income
$
(685,823
)
$
4,060,788
Foreign currency translation loss
(1,778,038
)
(197,740
)
Comprehensive income (loss) $
(2,463,861
)
$
3,863,048
Weighted average shares outstanding :
Basic
27,541,491
27,541,491
Diluted
27,541,491
27,541,491
Earnings per share attributed to Shiner common stockholders:
Basic
$
(0.02
)
$
0.15
Diluted
$
(0.02
)
$
0.15
Management Discussion and Analysis
Revenues for the year ended December 31, 2015 decreased $24.8 million (or 24.5%), to $76.3 million, compared to $101.1 million in 2014. The decrease was primarily attributable to decreased revenues generated from sales in all five of our segments, but largely from our BOPP tobacco segment. During the year ended December 31, 2015, revenue from BOPP tobacco decreased $17.9 million (or 30.9%) to $40.1 million, down from $58.1 million; revenue from coated film decreased $4.4 million (or 14.2%) to $26.7 million, down from $31.1 million; revenue from color printing decreased $0.7 million (or 14.7%) to $3.9 million, down from $4.6 million; and revenue from advanced film decreased $1.6 million (or 23.4%) to $5.1 million, down from $6.7 million. During 2015, our domestic (China Mainland) sales decreased as a percentage of total sales from 88.6% in 2014 to 87.2% in 2015. The decrease in revenue for the year ended December 31, 2015, compared to the same period in 2014, was largely due to decrease in revenues during the 2015 first quarter as a direct result of the declining economic growth in China during that period. In addition, Chinese regulators have intensified supervision of consumer products resulting in an impact on consumer purchasing. During the fourth quarter of 2015, the Company also stopped accepting orders for product lines that were only marginally profitable which resulted in a reduction in revenue.
Net Income (Loss)
Due to the factors explained above, for the year ended December 31, 2015, we generated a net loss attributed to Shiner of $0.6 million, compared to net income attributed to Shiner of $4.1 million in 2014.
Comments & Business Outlook
SHINER INTERNATIONAL, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF INCOME AND OTHER COMPREHENSIVE INCOME (LOSS)
Three Months Ended September 30,
Nine Months Ended September 30,
2015
2014
2015
2014
Net revenue $
24,958,212
$
20,006,848
$
59,646,341
$
69,470,699
Cost of goods sold
19,171,448
17,797,028
46,565,648
61,643,938
Gross profit
5,786,764
2,209,820
13,080,693
7,826,761
Operating expenses:
Selling
820,563
1,138,772
2,590,857
3,412,455
General and administrative
262,600
3,285,551
5,232,364
6,858,150
Total operating expenses
1,083,163
4,424,323
7,823,221
10,270,605
Income (loss) from operations
4,703,601
(2,214,503
)
5,257,472
(2,443,844
)
Non-operating income (expense):
Other income, net
349,100
3,744,255
906,570
4,403,679
Interest income
540,487
559,105
1,775,220
1,363,169
Interest expense
(806,508
)
(960,292
)
(2,933,713
)
(2,712,641
)
Exchange loss
(105,581
)
(2,852
)
(132,226
)
(6,253
)
Total non-operating income (expense)
(22,502
)
3,340,216
(384,149
)
3,047,954
Income before income tax
4,681,099
1,125,713
4,873,323
604,110
Income tax expense
552,563
246,927
974,107
560,856
Net income
4,128,536
878,786
3,899,216
43,254
Net income (loss) attributed to noncontrolling interest
(18,176
)
5,919
(46,841
)
3,563
Net income attributed to Shiner $
4,146,712
$
872,867
$
3,946,057
$
39,691
Comprehensive income (loss):
Net income
$
4,128,536
$
878,786
$
3,899,216
$
43,254
Foreign currency translation loss
(1,426,810
)
(254,405
)
(1,200,152
)
(254,405
)
Comprehensive income (loss) $
2,701,726
$
624,381
$
2,699,064
$
(211,151
)
Weighted average shares outstanding :
Basic
27,541,491
27,541,491
27,541,491
27,541,491
Diluted
27,541,491
27,541,491
27,541,491
27,541,491
Earnings per share attributed to Shiner common stockholders:
Basic
$
0.15
$
0.03
$
0.14
$
0.00
Diluted
$
0.15
$
0.03
$
0.14
$
0.00
Management Discussion and Analysis
Revenues
Revenues for the three months ended September 30, 2015 increased $5.0 million (or 24.7 %), to $25.0 million, compared to $20.0 million in 2014. The increase was primarily attributable to increased revenues generated from our BOPP tobacco segment. During the three months ended September 30, 2015, revenue from BOPP tobacco increased $5.2 million (or 56.6%) to $14.5 million, up from $9.3 million, revenue from color printing increased $0.3 million (or 40.6%) to $1.0 million, up from $.07 million, and revenue from advanced film increased $0.2 million (or 13.9%) to $1.7 million, up from $1.5 million; offset by a decrease in revenue from coated film of $0.8 million (or 8.9%) to $7.6 million, down from $8.4 million. During the third quarter of 2015, our domestic (China Mainland) sales increased as a percentage of total sales from 85.6% in 2014 to 88.8% in 2015. The increase in revenue for the three months ended September 30, 2015, compared to the same period in 2014, is a result of our expanding customer base as a result of increased marketing activities in the interim periods.
Net Income (Loss)
Due to the factors explained above, for the three months ended September 30, 2015 we generated a net income of $4.1 million, compared to a net income of $0.9 million in the 2014 period.
Comments & Business Outlook
SHINER INTERNATIONAL, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS AND OTHER COMPREHENSIVE INCOME (LOSS)
(Unaudited)
Three Months Ended June 30,
Six Months Ended June 30,
2015
2014
2015
2014
Net revenue $
20,881,273
$
24,199,071
$
34,688,129
$
49,463,851
Cost of goods sold
15,915,031
22,801,060
27,394,200
43,846,910
Gross profit
4,966,242
1,398,011
7,293,929
5,616,941
Operating expenses:
Selling
724,910
1,308,378
1,770,294
2,273,683
General and administrative
3,209,922
2,256,241
4,969,764
3,572,599
Total operating expenses
3,934,832
3,564,619
6,740,058
5,846,282
Income (loss) from operations
1,031,410
(2,166,608
)
553,871
(229,341
)
Non-operating income (expense):
Other income, net
355,613
1,365,602
557,470
659,424
Interest income
500,779
797,413
1,234,733
804,064
Interest expense
(874,595
)
(1,214,307
)
(2,127,205
)
(1,752,349
)
Exchange gain (loss)
(28,753
)
629
(26,645
)
(3,401
)
Total non-operating expense
(46,956
)
949,337
(361,647
)
(292,262
)
Income (loss) before income tax
984,454
(1,217,271
)
192,224
(521,603
)
Income tax expense
358,935
20,587
421,544
313,929
Net income (loss)
625,519
(1,237,858
)
(229,320
)
(835,532
)
Net income (loss) attributed to noncontrolling interest
(7,753
)
(5,555
)
(28,665
)
(2,356
)
Net income (loss) attributed to Shiner $
633,272
$
(1,232,303
)
$
(200,655
)
$
(833,176
)
Comprehensive income (loss):
Net income (loss)
$
625,519
$
(1,237,858
)
$
(229,320
)
$
(835,532
)
Foreign currency translation gain (loss)
72,394
30,479
226,658
(258,949
)
Comprehensive income (loss) $
697,913
$
(1,207,379
)
$
(2,662
)
$
(1,094,481
)
Weighted average shares outstanding :
Basic
27,541,491
27,541,491
27,541,491
27,541,491
Diluted
27,541,491
27,541,491
27,541,491
27,541,491
Earnings (loss) per share attributed to Shiner common stockholders:
Basic
$
0.02
$
(0.04
)
$
(0.01
)
$
(0.03
)
Diluted
$
0.02
$
(0.04
)
$
(0.01
)
$
(0.03
)
Management Discussion and Analysis
Revenues
Revenues for the three months ended June 30, 2015 decreased $3.3 million (or 13.7%), to $20.9 million, compared to $24.2 million in 2014. The decrease was primarily attributable to decreased revenues generated from the sale in all five of our segments, but largely from our BOPP tobacco segment. During the three months ended June 30, 2015, revenue from BOPP tobacco decreased $1.9 million (or 17.1%) to $9.2 million, down from $11.2 million; revenue from color printing decreased $0.4 million (or 31.6%) to $0.9 million, down from $1.3 million; revenue from advanced film decreased $0.5 million (or 30.0%) to $1.2 million, down from $1.7 million; revenue from coated film decreased $0.4 million (or 4.4%) to $9.4 million, down from $9.9 million; the decrease in revenue from water-based latex was insignificant. During the second quarter of 2015, our domestic (China Mainland) sales decreased as a percentage of total sales from 91.3% in 2014 to 87.1% in 2015. The decrease in revenue for the three months ended June 30, 2015 compared to the same period in 2014 is a result of the economic growth in China that has slowed in 2015. In addition, the Chinese regulators have intensified supervision of consumer products which has had an impact on consumer purchasing.
For the three months ended June 30, 2015, we generated a net income attributed to Shiner of $633,272 compared to a net loss of $1,207,379 in the 2014 period. The change is due to the factors explained above.
Comments & Business Outlook
SHINER INTERNATIONAL, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND OTHER COMPREHENSIVE INCOME (LOSS)
THREE MONTHS ENDED MARCH 31, 2015 AND 2014
(Unaudited)
2015
2014
Net revenue
$
13,806,856
$
25,264,780
Cost of goods sold
11,479,169
21,045,850
Gross profit
2,327,687
4,218,930
Operating expenses:
Selling
1,045,384
965,305
General and administrative
1,759,842
1,316,358
Total operating expenses
2,805,226
2,281,663
Income (loss) from operations
(477,539
)
1,937,267
Non-operating income (expense):
Other income, net
201,857
(706,178
)
Interest income
733,954
6,651
Interest expense
(1,252,610
)
(538,042
)
Exchange gain (loss)
2,108
(4,030
)
Total non-operating expense
(314,691
)
(1,241,599
)
Income (loss) before income tax
(792,230
)
695,668
Income tax expense
62,609
293,342
Net income (loss)
(854,839
)
402,326
Net income (loss) attributed to noncontrolling interest
(20,912
)
3,199
Net income (loss) attributed to Shiner
$
(833,927
)
$
399,127
Comprehensive income (loss):
Net income (loss)
$
(854,839
)
$
402,326
Foreign currency translation gain (loss)
154,264
(289,428
)
Comprehensive income (loss)
$
(700,575
)
$
112,898
Weighted average shares outstanding :
Basic
27,541,491
27,541,491
Diluted
27,541,491
27,541,491
Earnings (loss) per share attributed to Shiner common stockholders:
Basic
$
(0.03
)
$
0.01
Diluted
$
(0.03
)
$
0.01
Management Discussion and Analysis
Revenues
Revenues for the three months ended March 31, 2015 decreased $11.5 million (or 45.4%), to $13.8 million, compared to $25.3 million in 2014. This decrease was primarily attributable to a decrease in revenues generated from the sale of BOPP tobacco, coated film, color printing and advanced film, which, was partially offset by a small increase in revenues generated from the sale of water-based index. During the three months ended March 31, 2015, revenue from BOPP tobacco decreased $10.0 million (or 57.0%) to $7.5 million, down from $17.5 million; revenue from coated film decreased $0.8 million (or 17.2%) to $4.1 million, down from $4.9 million; revenue from color printing decreased $0.3 million (or 19.0%) to $1.1 million, down from $1.4 million; revenue from advanced film decreased $0.4 million (or 30.5%) to $1.0 million, down from $1.4 million; and revenue from water-based latex increased by $25,554 (or 24.3%) to $130,848, up from $105,294. During the 2015 period, our domestic (China Mainland) sales decreased as a percentage of total sales from 91.3% in 2014 to 86.7% in 2015. The significant decrease in revenue is a direct result of a 0.4% decline in economic growth in China during the 2015 first quarter, renewed government enforcement of Chinese food safety laws, including food packaging, resulting in a decrease in our packaging products as our customers adjust their packaging needs to comply with the law, and the Chinese government’s increase in taxation of the tobacco industry, resulting in a decline in cigarette sales and a decrease in the need for tobacco packaging products. We expect revenue in the second quarter to improve over the most recent quarter once our customers are able to adjust their product structures to meet raw material needs.
For the three months ended March 31, 2015, we generated a net loss attributed to Shiner of $833,927 compared to net income attributed to Shiner of $399,127 in the 2104 period. The change in net loss is due to the factors explained above.
Comments & Business Outlook
SHINER INTERNATIONAL, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF OPERATIONS AND OTHER COMPREHENSIVE INCOME (LOSS) YEARS ENDED DECEMBER 31, 2014 AND 2013
2014
2013
Net revenue
$
101,117,821
$
85,641,394
Cost of goods sold
85,284,144
77,016,733
Gross profit
15,833,677
8,624,661
Operating expenses:
Selling
4,355,567
2,757,835
General and administrative
7,025,634
6,836,517
Total operating expenses
11,381,201
9,594,352
Income (loss) from operations
4,452,476
(969,691
)
Non-operating income (expense):
Other income, net
2,100,948
839,115
Interest income
2,192,067
243,686
Interest expense
(3,628,174
)
(1,752,069
)
Exchange gain (loss)
(34,017
)
(132,790
)
Total non-operating income (expense)
630,824
(802,058
)
Income (loss) before income tax
5,083,300
(1,771,749
)
Income tax expense
1,022,512
414,693
Net income (loss)
4,060,788
(2,186,442
)
Net income (loss) attributed to noncontrolling interest
(3,841
)
503,578
Net income (loss) attributed to Shiner
$
4,056,947
$
(1,682,864
)
Comprehensive income (loss):
Net income (loss)
$
4,060,788
$
(2,186,442
)
Foreign currency translation gain (loss)
(197,740
)
1,065,006
Comprehensive income (loss):
$
3,863,048
$
(1,121,436
)
Weighted average shares outstanding :
Basic
27,541,491
27,541,491
Diluted
27,541,491
27,541,491
Earnings (loss) per share attributed to Shiner common stockholders:
Basic
$
0.15
$
(0.06
)
Diluted
$
0.15
$
(0.06
)
Management Discussion and Analysis
Revenues
Revenues for the year ended December 31, 2014 increased $15.5 million (or 18.1%), to $101.1 million, compared to $85.6 million in 2013. The increase was primarily attributable to increased revenues generated from the sale of coated film, BOPP tobacco, color printing and advanced film, which, was partially offset by a decrease in revenues generated from the sale of water-based index. During the year ended December 31, 2014, revenue from BOPP tobacco increased $7.9 million (or 15.7%) to $58.1 million, up from $50.2 million; revenue from coated film increased $6.7 million (or 27.4%) to $31.1 million, up from $24.4 million; revenue from color printing increased $0.6 million (or 14.5%) to $4.6 million, up from $4.0 million; revenue from advanced film increased $0.5 million (or 7.8%) to $6.7 million, from $6.2 million; and revenue from water-based latex decreased $0.2 million (or 21.4%) to $0.6 million, from $0.8 million. During 2014, our domestic (China Mainland) sales increased as a percentage of total sales from 86.3% in 2013 to 88.6% in 2014.
For the year ended December 31, 2014, we generated a net income of $4.1 million, representing an increase of $5.7 million (or 341.1%) from a net loss of $1.7 million during 2013. The change in net loss is due to the factors explained above.
Auditor trail
Item 4.01 Change in Registrant's Certifying Accountant
On January 12, 2015, the audit committee of the Board of Directors of Shiner International, Inc. (the "Company"), approved the dismissal of Goldman Kurland and Mohidin, LLP ("GKM") as the Company's independent auditor, effective immediately.
GKM served as the Company's independent auditor for the year ended December 31, 2008 through the year ended December 31, 2013. GKM's report on the Company's financial statements as of and for such years did not contain an adverse opinion or disclaimer of opinion and were not qualified or modified as to uncertainty, audit scope, or accounting principles.
During the years ended December 31, 2008 through 2013, and through GKM's dismissal on January 12, 2015, there were (1) no disagreements with GKM on any matter of accounting principles or practices, financial statement disclosure, or auditing scope or procedures, which disagreements, if not resolved to the satisfaction of GKM, would have caused GKM to make reference to the subject matter of the disagreements in connection with its reports, and (2) no events of the type listed in paragraphs (A) through (D) of Item 304(a)(1)(v) of Regulation S-K.
The Company furnished GKM with a copy of this disclosure on April 9, 2015, providing it with the opportunity to furnish the Company with a letter addressed to the SEC stating whether it agrees with the statements made by the Company herein in response to Item 304(a) of Regulation S-K and, if not, stating the respect in which it does not agree. A letter from GKM, dated April 9, 2015 is filed as Exhibit 16.1 to this report.
Engagement of New Independent Registered Public Accounting Firm
Concurrent with the decision to dismiss GKM as the Company's independent auditor, the Board of Directors of the Company elected to appoint MJF & Associates, APC ("MJF") as the Company's independent auditor.
Comments & Business Outlook
Three Months Ended September 30,
Nine Months Ended September 30,
2014
2013
2014
2013
Net revenue
$
20,006,848
$
24,155,629
$
69,470,699
$
55,949,455
Cost of goods sold
17,797,028
22,433,178
61,643,938
51,490,516
Gross profit
2,209,820
1,722,451
7,826,761
4,458,939
Operating expenses:
Selling
1,138,772
511,134
3,412,455
1,946,463
General and administrative
3,285,551
2,811,940
6,858,150
5,740,618
Total operating expenses
4,424,323
3,323,074
10,270,605
7,687,081
Loss from operations
(2,214,503
)
(1,600,623
)
(2,443,844
)
(3,228,142
)
Non-operating income (expense):
Other income (expense), net
3,744,255
(1,224,348
)
4,403,679
3,355,200
Interest income
559,105
64,849
1,363,169
140,610
Interest expense
(960,292
)
(356,454
)
(2,712,641
)
(1,243,460
)
Exchange loss
(2,852
)
(29,250
)
(6,253
)
(108,321
)
Total non-operating income (expense)
3,340,216
(1,545,203
)
3,047,954
2,144,029
Income (loss) before income tax
1,125,713
(3,145,826
)
604,110
(1,084,113
)
Income tax expense
246,927
241,689
560,856
526,373
Net income (loss)
878,786
(3,387,515
)
43,254
(1,610,486
)
Net loss attributed to noncontrolling interest
5,919
8,575
3,563
15,727
Net income (loss) attributed to Shiner
$
872,867
$
(3,396,090
)
$
39,691
$
(1,626,213
)
Comprehensive income (loss):
Net income (loss)
$
878,786
$
(3,387,515
)
$
43,254
$
(1,610,486
)
Foreign currency translation gain (loss)
(254,405
)
172,285
(254,405
)
878,994
Comprehensive income (loss):
$
624,381
$
(3,215,230
)
$
(211,151
)
$
(731,492
)
Weighted average shares outstanding :
Basic
27,541,491
27,541,491
27,541,491
27,541,491
Diluted
27,541,491
27,541,491
27,541,491
27,541,491
Earnings (loss) per share attributed to Shiner common stockholders:
Basic
$
0.03
$
(0.12
)
$
0.00
$
(0.06
)
Diluted
$
0.03
$
(0.12
)
$
0.00
$
(0.06
)
Management Discussion and Analysis
Revenues
Revenues for the three months ended September 30, 2014 decreased $4.1 million (or 17.2%), to $20.0 million, compared to $24.2 million in the 2013 period. The overall decrease in revenue during the third quarter of 2014, compared to the same quarter in 2013 was primarily attributable to decreased revenues generated from the sale of BOPP tobacco and advanced film as a result of Typhoon Rammasun that struck Hainan province on July 18, 2014. The decrease was partially offset by an increase in revenues generated from the sale of coated film, water-based latex and color printing. In the third quarter of 2014, revenue from coated film increased $1.1 million (or 16.0%) to $8.4 million, up from $7.2 million; revenue from BOPP tobacco decreased $5.5 million (or 37.3%) to $9.2 million, down from $14.8 million; revenue from color printing decreased $46,597 (or 6.3%) to $0.7 million, down from $0.7 million; revenue from water-based latex decreased $51,497 (or 21.1%) to $0.2 million, from $0.2 million; and revenue from advanced film increased $0.3 million (or 24.9%) to $1.5 million, from $1.2 million. Our domestic (China Mainland) sales increased as a percentage of total sales from 60.62% in the third quarter of 2013, to 87.22% in the third quarter of 2014.
Net Income (Loss)
For the three months ended September 30, 2014, we generated a net income of $0.9 million, representing an increase of $3.9 million (or 321%), from a net loss of $3.4 million during the 2013 period. The change in net loss is due to the factors explained above.
Comments & Business Outlook
Three Months Ended June 30,
Six Months Ended June 30,
2014
2013
2014
2013
Net revenue
$
24,199,071
$
17,950,297
$
49,463,851
$
31,793,826
Cost of goods sold
22,801,060
16,127,248
43,846,910
29,057,338
Gross profit
1,398,011
1,823,049
5,616,941
2,736,488
Operating expenses:
Selling
1,308,378
769,904
2,273,683
1,435,329
General and administrative
2,256,241
1,497,585
3,572,599
2,928,678
Total operating expenses
3,564,619
2,267,489
5,846,282
4,364,007
Loss from operations
(2,166,608
)
(444,440
)
(229,341
)
(1,627,519
)
Non-operating income (expense):
Other income, net
1,365,602
3,572,108
659,424
4,579,548
Interest income
797,413
14,411
804,064
75,761
Interest expense
(1,214,307
)
(512,850
)
(1,752,349
)
(887,006
)
Exchange gain (loss)
629
(41,011
)
(3,401
)
(79,071
)
Total non-operating income (expense)
949,337
3,032,658
(292,262
)
3,689,232
Income (loss) before income tax
(1,217,271
)
2,588,218
(521,603
)
2,061,713
Income tax expense
20,587
284,684
313,929
284,684
Net income (loss)
(1,237,858
)
2,303,534
(835,532
)
1,777,029
Net (income) loss attributed to noncontrolling interest
(5,555
)
7,137
(2,356
)
7,152
Net income (loss) attributed to Shiner
$
(1,232,303
)
$
2,296,397
$
(833,176
)
$
1,769,877
Comprehensive income (loss):
Net income (loss)
$
(1,237,858
)
$
2,303,534
$
(835,532
)
$
1,777,029
Foreign currency translation gain (loss)
30,479
517,918
(258,949
)
706,709
Comprehensive income (loss):
$
(1,207,379
)
$
2,821,452
$
(1,094,481
)
$
2,483,738
Weighted average shares outstanding:
Basic
27,541,491
27,541,491
27,541,491
27,541,491
Diluted
27,541,491
27,541,491
27,541,491
27,541,491
Earnings (loss) per share attributed to Shiner common stockholders:
Basic
$
(0.04
)
$
0.08
$
(0.03
)
$
0.06
Diluted
$
(0.04
)
$
0.08
$
(0.03
)
$
0.06
Management Discussion and Analysis
Revenues
Revenues for the three months ended June 30, 2014 increased $6.2 million (or 34.8%), to $24.2 million, compared to $17.9million in the 2013 period. The increase was primarily attributable to increased revenues generated from the sale of coated film, BOPP tobacco, coated film, and color printing, which, was partially offset by a small decrease in revenues generated from the advanced film and sale of water-based index. In the second quarter of 2014, revenue from coated film increased $5.2 million (or 110.7%) to $9.9 million, up from $4.7 million; revenue from BOPP tobacco increased $1.1 million (or 10.5%) to $11.2 million, up from $10.1 million; revenue from color printing increased $0.1 (10.1%) million to $1.3 million, up from $1.2 million; revenue from water-based latex decreased $0.12 million (or 38.0%) to $0.1 million, from $0.2 million; and revenue from advanced film decreased $0.52 million (or 3.0%) to $1.73 million, from $1.68 million. In the second quarter of 2014, our domestic (China Mainland) sales increased as a percentage of total sales from 83.8% in the second quarter of 2013 to 87.9% in the second quarter of 2014.
For the three months ended June 30, 2014, we generated a net loss of $1.2 million, representing a decrease of $3.5 million (or 153.7%) from a net income of $2.3 million during the 2013 period. The change in net loss is due to the factors explained above.
Comments & Business Outlook
SHINER INTERNATIONAL, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF OPERATIONS AND OTHER COMPREHENSIVE INCOME (LOSS)
2013
2012
Net revenue $
85,641,394
$
72,036,187
Cost of goods sold
77,016,733
67,397,899
Gross profit
8,624,661
4,638,288
Operating expenses:
Selling
2,757,835
2,648,251
General and administrative
6,836,517
6,248,043
Impairment of intangible assets
-
3,819,214
Loss on write off of assets
-
2,106,379
Total operating expenses
9,594,352
14,821,887
Loss from operations
(969,691
)
(10,183,599
)
Non-operating income (expense):
Other income, net
839,115
1,651,176
Interest income
243,686
40,877
Interest expense
(1,752,069
)
(1,464,104
)
Exchange loss
(132,790
)
(55,588
)
Total non-operating income (expense)
(802,058
)
172,361
Loss before income tax
(1,771,749
)
(10,011,238
)
Income tax expense
414,693
546,057
Net loss
(2,186,442
)
(10,557,295
)
Net loss attributed to noncontrolling interest
(503,578
)
(1,496,446
)
Net loss attributed to Shiner $
(1,682,864
)
$
(9,060,849
)
Comprehensive loss:
Net loss
$
(2,186,442
)
$
(10,557,295
)
Foreign currency translation gain
1,065,006
332,294
Comprehensive loss $
(1,121,436
)
$
(10,225,001
)
Weighted average shares outstanding :
Basic
27,541,491
27,541,491
Diluted
27,541,491
27,541,491
Loss per share attributed to Shiner common stockholders:
Basic
$
(0.06
)
$
(0.33
)
Diluted
$
(0.06
)
$
(0.33
)
Management Discussion and Analysis
Revenues
Revenues in 2013 increased $13.6 million (or 18.9%), to $85.6 million, compared to $72.0 million in 2012. The increase was primarily attributable to an increase in revenues generated from BOPP tobacco film, coated film, color printing and water based latex, partially offset by a decrease in advanced film. In 2013, there was a $5.4 million (or 12.2%) increase in sales from BOPP tobacco film, a $7.5 million (or 44.6%) increase in sales from coated film, a $0.44 million (or 122.0%) increase in water-based latex, a $0.74 million (or 22.4%) increase in color printing and a $0.55 million (or 8.2%) decrease in advanced film compared to 2012. In 2013, our domestic (China Mainland) sales increased slightly compared to 2012. In 2013 and 2012, sales generated domestically accounted for 86.3% and 85.0%, respectively, of our total revenues, and sales generated internationally from selling our advanced film, coated film, and color printing accounted for 14.1% and 15%, respectively.
Net Loss
In 2013, we incurred a net loss of $1.7 million, representing a decrease in net loss of $7.4 million (or 81.4%) from a net loss of $9.1 million in 2012. The change in net loss was principally due to other income recognized in 2013 and the absence of a loss on write off of assets and impairment of fixed assets in 2013, as explained above.
Comments & Business Outlook
SHINER INTERNATIONAL, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF OPERATIONS AND OTHER COMPREHENSIVE LOSS
Three Months Ended September 30,
Nine Months Ended September 30,
2013
2012
2013
2012
Net revenue
$
24,155,629
$
16,706,608
$
55,949,455
$
50,478,117
Cost of goods sold
22,433,178
15,257,456
51,490,516
46,370,015
Gross profit
1,722,451
1,449,152
4,458,939
4,108,102
Operating expenses:
Selling
511,134
619,959
1,946,463
1,851,990
General and administrative
2,811,940
1,899,924
5,740,618
4,933,369
Loss on sale and write off of assets
-
2,106,379
-
2,106,379
Total operating expenses
3,323,074
4,626,262
7,687,081
8,891,738
Loss from operations
(1,600,623
)
(3,177,110
)
(3,228,142
)
(4,783,636
)
Non-operating income (expense):
Other income (expense), net
(1,224,348
)
86,140
3,355,200
279,669
Interest income
64,849
16,842
140,610
35,236
Interest expense
(356,454
)
(470,722
)
(1,243,460
)
(1,082,587
)
Exchange loss
(29,250
)
(12,435
)
(108,321
)
(22,083
)
Total non-operating income (expense)
(1,545,203
)
(380,175
)
2,144,029
(789,765
)
Loss before income tax
(3,145,826
)
(3,557,285
)
(1,084,113
)
(5,573,401
)
Income tax expense (benefit)
241,689
(8,038
)
526,373
7,683
Net loss
(3,387,515
)
(3,549,247
)
(1,610,486
)
(5,581,084
)
Net income (loss) attributed to noncontrolling interest
8,575
(17,950
)
15,727
(80,977
)
Net loss attributed to Shiner
$
(3,396,090
)
$
(3,531,297
)
$
(1,626,213
)
$
(5,500,107
)
Comprehensive loss:
Net loss
$
(3,387,515
)
$
(3,549,247
)
$
(1,610,486
)
$
(5,581,084
)
Foreign currency translation gain
172,285
(84,620
)
878,994
222,466
Comprehensive loss
$
(3,215,230
)
$
(3,633,867
)
$
(731,492
)
$
(5,358,618
)
Weighted average shares outstanding:
Basic
27,541,491
27,541,491
27,541,491
27,541,491
Diluted
27,541,491
27,541,491
27,541,491
27,541,491
Loss per share attributed to Shiner common stockholders:
Basic
$
(0.12
)
$
(0.13
)
$
(0.06
)
$
(0.20
)
Diluted
$
(0.12
)
$
(0.13
)
$
(0.06
)
$
(0.20
)
Comments & Business Outlook
SHINER INTERNATIONAL, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF OPERATIONS AND OTHER COMPREHENSIVE INCOME (LOSS) (Unaudited)
Three Months Ended June 30,
Six Months Ended June 30,
2013
2012
2013
2012
Net revenue $
21,143,516
$
16,401,485
$
34,987,045
$
33,771,509
Cost of goods sold
16,127,248
15,913,476
29,057,338
31,112,559
Gross profit
5,016,268
488,009
5,929,707
2,658,950
Operating expenses:
Selling
769,904
577,500
1,435,329
1,232,031
General and administrative
1,497,585
1,386,968
2,928,678
3,033,445
Total operating expenses
2,267,489
1,964,468
4,364,007
4,265,476
Income (loss) from operations
2,748,779
(1,476,459
)
1,565,700
(1,606,526
)
Non-operating income (expense):
Other income (expense), net
378,889
294,712
1,386,329
193,529
Interest income
14,411
9,565
75,761
18,394
Interest expense
(512,850
)
(323,196
)
(887,006
)
(611,865
)
Exchange loss
(41,011
)
(3,775
)
(79,071
)
(9,648
)
Total non-operating income (expense)
(160,561
)
(22,694
)
496,013
(409,590
)
Income (loss) before income tax
2,588,218
(1,499,153
)
2,061,713
(2,016,116
)
Income tax expense (benefit)
284,684
(63,222
)
284,684
15,721
Net income (loss)
2,303,534
(1,435,931
)
1,777,029
(2,031,837
)
Net income (loss) attributed to noncontrolling
interest
7,137
(21,641
)
7,152
(63,027
)
Net income (loss) attributed to Shiner $
2,296,397
$
(1,414,290
)
$
1,769,877
$
(1,968,810
)
Comprehensive income (loss):
Net income (loss)
$
2,303,534
$
(1,435,931
)
$
1,777,029
$
(2,031,837
)
Foreign currency translation gain
517,918
28,762
706,709
307,086
Comprehensive income (loss) $
2,821,452
$
(1,407,169
)
$
2,483,738
$
(1,724,751
)
Weighted average shares outstanding:
Basic
27,541,491
27,541,491
27,541,491
27,541,491
Diluted
27,541,491
27,541,491
27,541,491
27,541,491
Income (loss) per share attributed to Shiner common
stockholders:
Basic
$
0.08
$
(0.05
)
$
0.06
$
(0.07
)
Diluted
$
0.08
$
(0.05
)
$
0.06
$
(0.07
)
Comments & Business Outlook
SHINER INTERNATIONAL, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF OPERATIONS AND OTHER COMPREHENSIVE LOSS THREE MONTHS ENDED MARCH 31, 2013 AND 2012 (Unaudited)
2013
2012
Net revenue
$
13,843,529
$
17,370,024
Cost of goods sold
12,930,090
15,199,083
Gross profit
913,439
2,170,941
Operating expenses:
Selling
665,425
654,531
General and administrative
1,431,093
1,646,477
Total operating expenses
2,096,518
2,301,008
Loss from operations
(1,183,079
)
(130,067
)
Non-operating income (expense):
Other income (expense), net
1,007,440
(101,183
)
Interest income
61,350
8,829
Interest expense
(374,156
)
(288,669
)
Exchange loss
(38,060
)
(5,873
)
Total non-operating income (expense)
656,574
(386,896
)
Loss before income tax
(526,505
)
(516,963
)
Income tax expense
-
78,943
Net loss
(526,505
)
(595,906
)
Net income (loss) attributed to noncontrolling interest
15
(41,386
)
Net loss attributed to Shiner
$
(526,520
)
$
(554,520
)
Comprehensive loss:
Net loss
$
(526,505
)
$
(595,906
)
Foreign currency translation gain
188,791
278,324
Comprehensive loss
$
(337,714
)
$
(317,582
)
Weighted average shares outstanding:
Basic
27,541,491
27,541,491
Diluted
27,541,491
27,541,491
Loss per share attributed to Shiner common stockholders:
Basic
$
(0.02
)
$
(0.02
)
Diluted
$
(0.02
)
$
(0.02
)
Investor Alert
HAIKOU, China, September 3, 2012 /PRNewswire / -- Shiner International, Inc. (Nasdaq: BEST) ("Shiner" or the "Company"), an emerging global supplier of packaging solutions for food, tobacco, and consumer products, announced today that it received a notification letter from The NASDAQ Stock Market LLC on August 28, 2012 informing the Company of its decision to delist the Company from the Nasdaq Stock Market. The letter stated that unless the Company requests an appeal of the determination to delist the Company, trading of the Company's common stock will be suspended at the opening of business on September 6, 2012 , and a Form 25-NSE will be filed with the Securities and Exchange Commission, which will remove the Company's securities from listing and registration on the Nasdaq Stock Market.
The August 28 letter was the third letter that the Company received from Nasdaq with regard to the Company's failure to meet Nasdaq's continued listing requirement to maintain the close bid price of its common stock at $1.00 per share.
Previously, on September 1, 2011 , Nasdaq notified the Company that for 30 consecutive business days the bid price of the Company's common stock had closed below $1.00 per share, the minimum closing bid price required by the continued listing requirements set forth in Listing Rule 5450(a)(1), and that, pursuant to Listing Rule 5810(c)(3)(A), Shiner had 180 calendar days, or until February 28, 2012 , to regain compliance with the minimum bid price requirement. Subsequently, on February 29, 2012 , the Company received a second letter from NASDAQ notifying the Company that it had not regained compliance during the initial 180-day grace period, but that NASDAQ was granting the Company an additional 180-day grace period, or until August 27, 2012 , to regain compliance.
The August 28 letter stated that the Company may appeal Nasdaq's determination to the panel, pursuant to the procedures set forth in the Nasdaq Listing Rule 5800 Series. A hearing request by the Company will stay the suspension of the Company's securities and the filing of the Form 25-NSE pending the panel's decision. The request for a hearing must be submitted no later than 4:00 p.m. Eastern Time on September 4, 2012. The Company is in the process of determining whether it will appeal Nasdaq's decision to delist the Company.
Comments & Business Outlook
Second Quarter of 2012
Total revenue for the three months ended June 30, 2012 were $16.4 million , a decrease of $1.5 million (or 8.2%) compared to total revenue of $17.9 million for the same quarter ended June 30, 2011.
Shiner's gross profit for the three months ended June 30, 2012 was $0.5 million , the gross profit margin decreased to 3.0% compared to 14.1% of total revenue for the corresponding period in 2011. The decrease in gross profit margin was primarily a consequence of increased labor costs and depreciation of the new property.
Operating loss for the three months ended June 30, 2012 was $(1.5) million compared to operating income of $1.3 million for the same quarter ended June 30, 2011. Selling, general and administrative ("SG&A") expenses increased by 61.6%, or $0.7 million, to $2 million for 2012 compared to $1.2 million for the corresponding period in 2011. The increase in "SG&A" expenses was mainly due to a $0.2 million increase in R&D expense and a $0.2 million increase in for marketing expense.
Shiner reported net income of $(1.4) million for the three months ended June 30, 2012, compared to $0.8 million in the same period of 2011.
Earnings per share for the quarter were $(0.05) , compared to earnings of $0.03 per share for the same period of 2011.
Investor Alert
HAIKOU, China, June 26, 2012 /PRNewswire-Asia / -- Shiner International, Inc. (Nasdaq: BEST) ("Shiner" or the "Company"), an emerging global supplier of packaging solutions for food, tobacco, and consumer products, announced that on June 22, 2012 China time, it received a letter from Nasdaq Listing Qualifications Department ("Nasdaq") indicating that the Company no longer complies with Nasdaq's independent director and audit committee requirements as set forth in Listing Rule 5605 as a result of the vacancy caused by the resignation of Mr. Brian Cunat as a member of the Company's board of directors and the audit committee. Listing Rule 5605 requires that a majority of the Company's board of directors be comprised of independent members and its audit committee be comprised of three independent members. The letter also indicated that Nasdaq will provide the Company a cure period in accordance with Listing Rules 5605(b)(1)(A) and 5605(c)(4), respectively.
As Shiner previously disclosed with a Form 8-K on June 7, 2012, Mr. Brian Cunat resigned from the Company's board of directors on June 2, 2012. Mr. Brian also served as a member of the Company's audit committee.
The Company is conducting a search for a new director who meets the requirements of Nasdaq and is available for appointment to the Company's board of directors and audit committee within the cure period allowed under the Nasdaq Listing Rules.
Comments & Business Outlook
SHINER INTERNATIONAL, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS AND OTHER COMPREHENSIVE INCOME (LOSS)
FOR THE THREE MONTHS ENDED MARCH 31, 2012 AND 2011
(unaudited)
2012
2011
Net Revenue
$
17,370,024
$
15,906,845
Cost of goods sold
15,199,083
13,539,738
Gross profit
2,170,941
2,367,107
Operating expenses
Selling
654,531
444,676
General and administrative
1,646,477
717,039
Total operating expenses
2,301,008
1,161,715
Income (loss) from operations
(130,067
)
1,205,392
Non-operating income (expense):
Other income, net
(101,183
)
194,611
Interest income
8,829
6,273
Interest expense
(288,669
)
(142,951
)
Exchange (loss)
(5,873
)
(55,795
)
Total non-operating income (expense)
(386,896
)
2,138
Income (loss) before income tax
(516,963
)
1,207,530
Income tax expense
78,943
210,836
Net income (loss)
(595,906
)
996,694
Net loss attributed to noncontrolling interest
(41,386
)
(8,310
)
Net income (loss) attributed to Shiner
$
(554,520
)
$
1,005,004
Comprehensive income (loss)
Net income (loss)
$
(595,906
)
$
996,694
Foreign currency translation gain
278,324
226,514
Comprehensive income (loss)
$
(317,582
)
$
1,223,208
Weighted average shares outstanding :
Basic
27,541,491
27,541,491
Diluted
27,541,491
27,546,675
Earnings (loss) per share attributed to Shiner common stockholders
Basic
$
(0.02
)
$
0.04
Diluted
$
(0.02
)
$
0.04
The decrease in net income was mainly due to increased labor costs, depreciation of our new property, no other income from a former landlord (related to payments received for vacating a leased property early in 2011) , offset by an increase in subsidy income.
Comments & Business Outlook
Fourth Quarter Financial Highlights
Revenues for the fourth quarter of fiscal 2011 increased 28.4% year-over-year to $22.9 million, up from $17.8 million in the fourth quarter of 2010.
Net income for the fourth quarter of 2011 decreased 119.9% year-over-year to $(0.3) million, compared to $1.4 million for the 2010 period.
Gross profit for the 2011 fourth quarter was $3.0 million, up 34.2% from $2.2 million in the same period last year. Gross margin for the fourth quarter of 2011 was 13.1% compared to 12.6% in 2010.
Operating income for the fourth quarter of 2011 was $(0.8) million, compared to $1.0 million for the comparable 2010 period.
Earnings per diluted share was $(0.02) for the fourth quarter of 2011, compared to earnings per diluted share of$0.04 in the same period a year ago.
Mr. Qingtao Xing, Shiner's President and CEO, stated: "We achieved total revenue of $75.3 million in 2011, which increase 29.4% compare to last year, though the net income decreased. Sales revenue for BOPP tobacco film was $38.4 million, a significant increase compare to the same period of 2010. Meanwhile, revenues of advanced film in Southeast Asia have a big breakout, especially in Vietnam market our sales volume exceed 1,000 tons. With respect to coated film, we have attracted some multinational converters such as Marubeni acting as our regional agent to explore our market share through their sales channel and sales network."
Mr. Xing continued, "Our efforts to strengthen our R&D capability over the past 12 months have enabled us to benefit from product quality and brand reputation, which at last convert to company's core competitiveness and market shares. As a result, in 2011 our R&D expense increased a lot, our patents increase to 19 including aUSA patent. We expect to generate more revenues and income through our strong R&D capability in 2012 and beyond".
Operations Outlook
Mr. Xing stated, "In 2012, we will continue to develop new market and expand our market share both in Chinaand abroad with our efforts. We have entered into Philippines Inter-tabac Exhibition to attract more tobacco manufacturers and explore new market in March 2012. With additional 10,000-ton tobacco film production capability, we can provide higher quality product and better packaging solutions to satisfy our customers.？？？
He continued, "By investing in our R&D's innovation and the high-end facility, we expect to achieve better operational performance and financial prospect in 2012."
Investor Alert
HAIKOU, China , March 2, 2012 /PRNewswire-Asia / -- Shiner International, Inc. (Nasdaq: BEST)products, announced today that it received a letter from the listing qualifications department staff of The NASDAQ Stock Market LLC ("NASDAQ"), granting Shiner an additional 180 days, or until August 27, 2012 , to regain compliance with NASDAQ's minimum bid price requirement.
On September 1, 2011 , Shiner received a letter from NASDAQ, notifying the Company that for 30 consecutive business days the bid price of its common stock had closed below $1.00 per share, the minimum closing bid price required by the continued listing requirements set forth in Listing Rule 5450(a)(1), and that, pursuant to Listing Rule 5810(c)(3)(A), Shiner has 180 calendar days, or until February 28, 2012, to regain compliance with the minimum bid price requirement. On February 29, 2012, the Company received a second letter from NASDAQ notifying the Company that it had not regained compliance during the initial 180-day grace period, but that NASDAQ was granting the Company an additional 180-day period to regain compliance with the minimum bid price requirement. NASDAQ's determination was based on the Company having met the continued listing requirement for market value of publicly held shares and all other applicable requirements for initial listing on the NASDAQ Capital Market, with the exception of the bid price requirement, and on the Company's written notice to NASDAQ of its intention to cure the deficiency during the second compliance period by effecting a reverse stock split if necessary. The notice has no effect at this time on the listing of Shiner's common stock, which will continue to trade under the symbol "BEST".
Comments & Business Outlook
Third Quarter 2011 Results
Total revenue for the third quarter of 2011 increased by 20.0% to $18.6 million, up from $15.5 million in the third quarter of 2010.
Gross profit and gross margin for the third quarter of 2011 were $2.1 million and 11.4%, respectively, compared to $3.4 million and 22.1%, respectively, in the same period last year.
Operating income and operating margin for the third quarter of 2011 were $0.3 million and 1.8%, respectively, compared to $1.6 million and 10.5%, respectively, in the third quarter of 2010.
Net income for the third quarter of 2011 decreased 70.7% to $0.4 million, compared to $1.3 million for the third quarter of 2010.
Earnings per diluted share were $0.01 for the third quarter of 2011, compared to earnings per diluted share of $0.05 in the same period a year ago.
Mr. Qingtao Xing, the CEO and President of Shiner stated, "We are pleased by the promising revenue growth in the third quarter of 2011, which we believe is primarily attributable to the diligence of our employees. At the beginning of 2011, the management developed a strategy to increase sales revenue, expand market share and improve our brand influence in order to perform in today's ever-changing market conditions. We believe that our sustained growth in revenue over the last two quarters is a result of this strategy. Although our gross margin and net income decreased in connection with larger price discounts, one of our strategies, the sales volume increased from our existing BOPP tobacco film customers as well as from newly attracted global customers in the coated film sector, including Marubeni Specialty Chemicals Inc. We expect that we will be able to adjust the sale price of our products as market conditions improve or as we gain additional market share."
Mr. Xing went on to say, "In addition, on October 29, 2011, we completed the installation of a new BOPP production line at our Hainan facility, which we expect to be operational in December 2011 after testing and adjustments. We believe that the completion of this new production line will significantly improve our ability to meet increasing demand from our customers and expand our market share."
Investor Alert
On September 1, 2011, Shiner International, Inc. (the "Company")
received a letter from The Nasdaq Stock Market ("NASDAQ") notifying it of its failure to maintain a minimum closing bid price of $1.00 over the then preceding 30 consecutive trading days for its common stock as required by NASDAQ Listing Rule 5550(a)(2) (the "Bid Price Rule"). The letter stated that the Company has until February 28, 2012 to demonstrate compliance by maintaining a minimum closing bid price of at least $1.00 for a minimum of 10 consecutive trading days. The letter was issued in accordance with standard NASDAQ procedures. This notification has no immediate effect on the listing of the Company's common stock at this time. The Company intends to monitor the bid price of its common stock and consider available options if its common stock does not trade at a level likely to result in the Company regaining compliance with the Bid Price Rule by February 28, 2012.
Comments & Business Outlook
Second Quarter 2011 Financial Highlights
Total revenue for the second quarter of 2011 increased by 35.2% to $17.867 million , up from $13.214 million in the second quarter of 2010.
Gross profit and gross margin for the second quarter of 2011 were $2.519 million and 14.1% , respectively, compared to $2.242 million and 16.97%, respectively, in the same period last year.
Operating income and operating margin for the second quarter of 2011 were $1.304 million and 7.3% , respectively, compared to $0.992 million and 7.5%, respectively , in the second quarter of 2010.
Net income for the second quarter of 2011 decreased 20.5% to $0.799 million , compared to $0.939 million for the second quarter of 2010.
Earnings per diluted share were $0.03 for the second quarter of 2011, compared to earnings per diluted share of $0.04 in the same period a year ago.
Management Comments
Mr. Qingtao Xing, the CEO and President of Shiner stated, "We are pleased about our promising growth in the second quarter of 2011, which can be attributed to the hard work of our employees. The sustained growth in revenue resulted from the increased product sales volume, which is being driven by our continuous efforts to develop new customers and expand sales to existing customers based on product performance due to our rigorous quality control system and product monitoring system. From raw materials to product transport, we provided strict oversight step by step to enable good performance. In the second quarter we executed our development strategy to establish a global sales network and expand the reach of the brand to improve market share. Part of this strategy was a larger price discount rate, which is one of the reasons our operating margin decreased. However, we gained a number of global customers through this strategy (the number of customers increased by about 20%) , including Ferrero Rocher in Italy , Nintendo in Japan , Saigon Tobacco Factory in Vietnam and Want Want Group in China . Based on our powerful technology, our R&D team and our packaging industry chain, we can provide customized packaging solutions for our customers to satisfy the demand for diverse packaging.
Comments & Business Outlook
HAIKOU, China , August 1, 2011 /PRNewswire-Asia / -- Shiner International, Inc. (NASDAQ:BEST) ("Shiner" or the "Company"), an emerging global supplier of packaging solutions for food, tobacco, and consumer products, today announced that it has signed a sales order with Want Want China Holdings Limited (SEHK:151) for $2 million for color printing services. Want Want China Holdings Limited is a leading manufacturer and distributor of snack foods and beverages in China and has an extensive nationwide sales and distribution network throughout the PRC.
Qingtao Xing, the CEO of Shiner International commented: "Want Want Group is one of the leading manufacturers in the food industry, and we are delighted to have been selected to working with them. Shiner continues to make inroads into the growing food industry by providing value-added products and services and a one-stop-shop experience. I am pleased to receive this large sales order for color printing services. We value our relationship with Want Want China Holdings Limited and we look forward to expanding the relationship by continuing to provide functional packaging film with moisture and oxygen barrier properties that preserve flavor and aroma and have superior clarity and printability."
Comments & Business Outlook
First Quarter Results :
Shiner reports revenue of $15.9 million and an operating profit of $1,205,392 for the three months ended March 31, 2011, which is an increase of 37.3% in revenue, compared to $11.6 million for the same period in 2010
EPS of $0.04 v. $0.04 for the previous quarter.
Mr. Qingtao Xing, the CEO and President of Shiner stated, "We are excited about our promising growth in the first quarter of 2011. We believe this solid growth is the result of solid and healthy operations. We are also glad to report that the 2011 first quarter revenue from flexible packaging material has increased 53.8% compared to the first quarter of 2010 ."
Acquisitions
HAIKOU, China, May 2, 2011 /PRNewswire-Asia / -- Shiner International, Inc. today announced that it has acquired 100% of the stock of Shimmer Sun Ltd. ("Shimmer") for $3.2 million in cash. The acquisition gives Shiner a 65% controlling interest in Shimmer's subsidiary company, Ningbo Neisuoer Latex Co., Ltd. ("Ningbo Neisuoer"). Ningbo Neisuoer is a recognized leader in the field of specialty water-based coatings, which are used to produce advanced coated films.
Based in Ningbo, the capital of Zhejiang Province, Ningbo Neisuoer was founded in 2007 and employs approximately 35 staff. Its R&D team was issued the only patent for polyvinylidene chloride, a coating polymer widely used in food packaging, in China. Ningbo Neisuoer expects 2011 sales to be approximately 35 million RMB ($5.3 million USD) with a 35% gross margin.
Water-based coatings are more environmentally friendly than oil-based coatings and offer superior moisture-barrier properties for packaging dry foods and other moisture-sensitive products without compromising the efficiency of the packaging production line.
"Ningbo Neisuoer has a solid reputation for producing advanced, high-quality coatings. The synergies between the Company and Ningbo Neisuoer will bring real benefits to our valued customers and demonstrate our continued commitment to technological excellence," stated Qingtao Xing, President and CEO of Shiner. "This acquisition will enable us to lower our raw material costs and further expand our production capacity. Shiner is seeking vertical integration opportunities that help us deliver new and innovative packaging products to better serve our customers worldwide. This acquisition is an important step in that regard."
Investor Presentations
Liquidity Requirements
We intend to meet our liquidity requirements, including capital expenditures related to the purchase of equipment, purchase of raw materials, and the expansion of our business, through cash flow provided by operations, the forgoing credit facility, and funds raised through private placement offerings of our securities .
We anticipate we will have adequate working capital to fund our operations and growth in the foreseeable future.
Comments & Business Outlook
Fourth Quarter Highlights :
Revenues for the fourth quarter of fiscal 2010 increased by 65.5% year-over-year to $17.8 million, up from $10.8 million in the fourth quarter of 2009.
Net income for the fourth quarter of 2010 increased 542.8% year-over-year to $1.0 million, compared to $153,720 for the 2009 period.
Gross profit for the 2010 fourth quarter was $2.2 million, up 48% from $1.5 million in the same period last year. Gross margin for the fourth quarter of 2010 was 12.6% compared to 14.1% in the 2009 period.
Operating income and margin for the fourth quarter of 2010 were $1.0 million and 5.4%, respectively, compared to $79,766 and 0.74%, respectively, for the comparable 2009 period.
Earnings per diluted share were $0.04 for the quarter, compared to earnings per diluted share of $0.01 in the same period a year ago.
Mr. Qingtao Xing, Shiner's President and CEO, stated: "We are very pleased with the strong top- and bottom-line growth we achieved in 2010. For the fiscal year, we exceeded our revenue guidance by approximately $5 million. Sales revenue for flexible packaging materials was $43.5 million, and sales revenue for advanced films totaled $14.2 million. We feel confident that in 2011 we will continue to increase our revenues and improve margins ."
"We are also exploring potential acquisitions and joint ventures with the goal of enhancing our product portfolio and gaining access to new markets. The $3.13 million private placement we completed in December provides us with additional capital to fund potential acquisitions ."
He continued, "By investing in the foundation of our business, we are positioning Shiner for sustained sales growth and profitability. Our ability to deliver customized, cost-efficient packaging solutions gives us a considerable market advantage both domestically and internationally. We are confident of our financial outlook for 2011 ."
Deal Flow
HAIKOU, China, Dec. 29, 2010 /PRNewswire-Asia / -- Shiner International, Inc. today announced the completion of a $3.13 million private placement equity financing. Under the terms of the transaction, a total of 2,608,334 shares of common stock, as well as warrants priced 25% above the current market price. Further details of the financing will be available in a current report on Form 8-K that the Company expects to file with the SEC shortly.
The proceeds of the private placement are expected to be used to effectuate strategic acquisitions, as well as for general corporate and working capital purposes. Investment bank Roth Capital Partners LLC provided financial advisory services to Shiner in conjunction with the financing.
Qingtao Xing, the Chief Executive Officer of Shiner, commented: "We are pleased to receive this vote of confidence from new investors and current investors, many of whom have demonstrated strong support for our Company throughout the years. We believe that the improving financial results that we have delivered over the past few quarters are justification of their support and confirmation of the market's growing demand for our packaging solutions. The financing is intended to help us maintain a greater amount of working capital and allow us to further our strategic growth initiative of seeking out acquisitions that enhance Shiner's leadership position in the food safety packaging industry. We are looking for acquisition opportunities that give us the ability to use or own advanced technologies, to control key raw materials, or to access large customers."
Investor Presentations
On February 17, 2011, at 8:45 a.m., Eastern Time, Qingtao Xing, the Chief Executive Officer of Shiner International, Inc. ("Shiner") will hold a virtual conference presentation for investors. See Exhibit 99.1 for presentation .
Deal Flow
On December 28, 2010, Shiner International, Inc.
entered into one or more Securities Purchase Agreements with a number of accredited investors in connection with a private placement transaction providing for, among other things, the issuance of up to
3,333,333 units with each Unit consisting of one share of the common stock and a warrant to purchase twenty percent (20%) of one (1) share of the Common Stock at an
exercise price of $1.70 per share , at a purchase price of
$1.20 per Unit for an aggregate offering of a minimum of
$3,000,000 and up to a maximum of $4,000,000 . At the closing of the Offering, the Company issued approximately
2.6 million Units and received gross proceeds in the amount of
$3.13 million. As a result of the issuance of the Shares and, assuming exercise of the Warrants and issuance of the shares issuable upon such exercise, Investors shall receive or be entitled to receive an aggregate of
3,130,000 shares of Common Stock.
Comments & Business Outlook
Third Quarter Fiscal 2010 Financial Highlights
Revenues for the third quarter of fiscal year 2010 increased by 79.2% year-over-year to $15.5 million , up from $8.7 million in the third quarter of 2009. Net income for the third quarter increased 338.7% year-over-year to $1.3 million , compared to $0.3 million for the third quarter of 2009. Gross margin for the third quarter was 22.1% based on gross profit of $3.4 million , compared to a 17.3% margin in the same period last year. Operating income and operating margin for the third quarter were $1.6 million and 10.5%, respectively, compared to $0.27 million and 3.1%, respectively , in the third quarter of 2009. Earnings per diluted share were $0.05 for the quarter, compared to earnings per diluted share of $0.01 in the same period a year ago. The Company continues to project revenues of $53 million and net income of $4 million , or $0.17 per diluted share , for 2010.
Operations Outlook
Mr. Qingtao Xing, Shiner's President and CEO, stated: "We are excited to announce such strong results for the third quarter as we build on our success in the first half of the year. Our top and bottom lines have continued to improve, including nearly 340% net income growth since the third quarter of last year. Sales of our three main product lines all showed significant improvement over the same period last year, with particularly robust growth in our coated film and anti-counterfeit film segments, which grew 155% and 104%, respectively, from the third quarter of 2009.
"As we look forward to the end of the year," Mr. Xing said, "We expect earnings to be in line with our previous forecasts and currently estimate fiscal 2010 revenue of $53 million and net income of $4 million . A key driver of our overall growth continues to be stronger demand for advanced packaging under new food safety regulation in China and also constant demand for cost efficient packaging solution internationally. We anticipate opening six sales offices in China and eight more overseas in 2011 to take advantage of emerging opportunities both in China and internationally. Overall, we are encouraged by our strong performance in a difficult macroeconomic environment. Longer-term, we will continue to drive aggressive, international expansion."
Investor Alert
Update
On October 5, 2010, The Nasdaq Stock Market notified Shiner International, Inc. (“Shiner”) that it had regained compliance with Nasdaq Listing Rule 5550(a)(2) because the closing bid price for Shiner’s common stock reached $1.00 or more for 10 consecutive business days. Shiner regained compliance substantially before the March 7, 2011 expiration of the grace period it was given to regain compliance. Shiner previously disclosed its non-compliance with this Nasdaq Listing Rule on a Form 8-K Current Report filed on September 14, 2010.
Investor Alert
On September 8, 2010, Shiner International, Inc.
received a letter from The Nasdaq Stock Market (“Nasdaq”) stating that Nasdaq's listing rules "require listed securities to maintain a minimum bid price of $1.00 per share. Based upon the closing bid price for the last 30 consecutive business days, the Company no longer meets this requirement. " The letter further stated that the listing rules "also provide the Company a grace period of 180 calendar days in which to regain compliance." The grace period extends through March 7, 2011. The letter stated that "[i]f at anytime during this grace period the bid price of the Company's security closes at $1.00 per share or more for a minimum of ten consecutive business days, [Nasdaq] will provide [the Company] written confirmation of compliance and this matter will be closed."
Comments & Business Outlook
Shiner's revenue for the three months ended June 30, 2010 increased 14% on a sequential basis from the quarter ended March 31, 2010 , and increased 65% when compared to the same period in 2009. The year to year increase in revenue related directly to increases in sales across Shiner's main business lines, which included:
136% increase in coated film sales from $2.2 million for the second quarter of 2009 to $5.1 million for the second quarter of 2010. Anti-counterfeit film sales increased 63% to $3.0 million from $1.9 million for the comparable period in 2009. Revenue from BOPP tobacco film sales was $4.0 million for the quarter ended June 30, 2010 , an increase of 25% from the same period in 2009. Revenue from color printing increased 39% to $1.0 million in the second quarter in 2010 from $ 0.8 million during the comparable period in 2009.
Net income of $0.9 million compared to a net loss of $0.3 million in the same period of the prior year. Earnings per share were $0.04 for the second quarter of fiscal 2010 compared to a net loss of $0.01 per share for the second quarter of fiscal 2009. The improvement reflects significantly higher sales volume, increased manufacturing capacity utilization, higher selling prices, and lower raw material costs. Shiner's productivity and cost-cutting actions are essentially tracking according to its business plan.
Operations Outlook
Mr. Xing stated: "We are glad to see the continued positive results throughout the first and second quarter. The strong growth in all business product lines validates our business progress and our effort to improve shareholder value. Our coated film sales increased 136% this quarter compared to the second quarter of 2009, along with a 63% increase in the anti counterfeit film, which contributed to the $1.22 million net income growth for the quarter.
"The primary industries we serve appear to be recovering , led by increased demand for consumer media products, tobacco and cigarettes, and food spending by consumers. We believe the growth for our core business will be driven by the growth in the standard of living and higher wages across Asia , the new food laws that have been passed in China , and the growing need for media companies to protect their products from counterfeiting in China and Southeast Asia .
While there is still uncertainty about the sustainability of the global economic recovery, given our current cost structure and the prospect of improvement in the markets we serve, we believe that we will be well positioned to continue to generate improved earnings performance as sales increase. "Looking ahead to the third quarter," Mr. Xing said. "We expect earnings to be in line with our previous forecasts and currently estimate our third quarter earnings at about $0.04 per share."
Comments & Business Outlook
Mr. Qingtao Xing, Shiner's C.E.O., commented, "We are encouraged by the continued positive trends in revenue in the first quarter; our gross profit was positively impacted by improved product mix toward our higher margin products, anti counterfeit and coated film. The improvement reflects significantly higher sales volume, increased manufacturing capacity utilization, higher realized sales prices, lower raw material costs, and partly offset by fixed cost increases for growth investments. The company's productivity and cost-cutting actions are essentially tracking according to plan. Since the implementation of the Food Safety Law (FSL) in June 2009, we are experiencing an increase of inquiries from food manufacturers. This interest affects our entire breadth of products and we are confident this will lead to an overall improvement in our business. Our Hainan manufacturing facility will be completed in June 2010 and is expected to be fully operational in October. We have purchased a new BOPP line at the cost of approximately $13,200,000. The equipment is expected to be delivered early in the first quarter of 2011, installed in the latter part of the first quarter of 2011 and operational in the second quarter of 2011. With the completion of this facility and the increase in our manufacturing capacity, Shiner will be well positioned to be the prime beneficiary of increased domestic consumption, a growing world economy, and increased market penetration through the recently enacted FSL. We believe that Shiner will continue to improve its revenue and net income and provide significant value to our shareholders ."
GeoBargain Notes
According to analyst estimates, the EPS growth rate for 2008 will not meet the GeoTeam minimum 30% criteria. This is due to dilution issues. However, according to analyst estimates, BEST is expected to meet the EPS 30% Growth criteria for 2009. This situation may cause some short-term stagnation in the stock.
GeoSpecial Notes
BEST qualifies as a GeoBargain.
