China New Borun Corporation (NYSE:BORN)

ALLENTOWN, Pa., Dec. 20, 2018 /PRNewswire/ -- Fuling Global Inc. (NASDAQ: FORK) ("Fuling Global" or the "Company"), a specialized producer and distributor of plastic serviceware, with precision manufacturing facilities in both the U.S. and China, today announced its plan to set up a manufacturing factory (the "Mexico Factory") in Monterrey, Mexico. With capital expenditure budget of $2 million, we expect that the first phase of the Mexico Factory will have an annual design capacity of 10,000 tons and will be primarily used for producing paper straws and paper cups serving the U.S. market. The Company expects to launch commercial production at the Mexico Factory by April 2019.

Earlier this month, the Company signed a building lease with Interpuerto Industrial Park in Monterrey, Mexico and a service agreement with a local shelter service company to help with administrative, accounting, compliance, import/export, human resources, etc., at the Mexico Factory. Factory remodeling is expected to start in January 2019, followed by equipment installation and testing and worker recruitment in March.

"The Mexico Factory is our second overseas expansion besides our Allentown, PA factory in the U.S. and marks another important milestone for the Company. The ongoing U.S.- China trade tensions cast uncertainties for our export business to the U.S. market, our largest market segment that accounted for 85% of our revenues during the first half of 2018. Therefore, the Mexico Factory offers certain attractive benefits for us, including zero tariff on trade between the U.S. and Mexico as well as low labor and transportation costs. We have high hopes for the Mexico Factory and view it as a key step for our continuing global expansion," commented Ms. Guilan Jiang, Chairwoman of Fuling Global.

BEIJING, Oct. 30, 2018 /PRNewswire/ -- China New Borun Corporation (NYSE: BORN; "Borun" or the "Company"), a leading producer and distributor of corn-based edible alcohol in China, today announced its unaudited financial results for the first half year ended June 30, 2018.

First Half Year of 2018 Quick View

Total revenue decreased 12.2% to RMB940.4 million ($142.1 million[1]) from RMB1,071.0 million in the first half year of 2017.
Gross profit decreased 54.1% to RMB65.7 million ($9.9 million) from RMB143.2 million in the first half year of 2017.
Net income decreased 83.1% to RMB10.5 million ($1.6 million) from RMB62.0 million in the first half year of 2017.
Basic and diluted earnings per American Depositary Share ("ADS") were RMB0.41 ($0.06) for the first half year of 2018. Each ADS represents one of the Company's ordinary shares. 

BEIJING, July 13, 2018 /PRNewswire/ -- China New Borun Corporation (NYSE: BORN; "Borun" or the "Company") today announced that Mr. Yuanqin Chen, the company's Chief Financial Officer, has resigned to accept a position with another company, effective as of July 13, 2018. Mr. Chen confirmed that his resignation did not result from a disagreement with the Company on any matter relating to its financial policies or practices, including its internal controls or audit related matters.

The Company's board of directors is proactively seeking Mr. Chen's replacement. Meanwhile, the Company also announced that Ms. Jijuan Wang will act as Chief Financial Officer in the interim. Ms. Wang, who joined Borun since 2010, is now the finance manager of the Company, with more than 12 years' experience in finance and accounting, strategic financial planning and budgeting.

BEIJING, July 12, 2018 /PRNewswire/ -- China New Borun Corporation (BORN) (the "Company"), a leading producer and distributor of corn-based edible alcohol in China, today announced that the special committee of the Board of Directors (the "Special Committee") has recently received a notice from Mr. Jinmiao Wang ("Mr. Wang"), Chief Executive Officer and Chairman of the Board of Directors, and King River Holding Limited ("King River"), a British Virgin Island company and a majority shareholder of the Company, stating that they have withdrawn the non-binding going private proposal (the "Proposal") dated January 10, 2018. The notification stated that Mr. Wang and King River had determined not to proceed with the Proposal. As a result, the Special Committee was dissolved on July 12, 2018.

BEIJING, Feb. 2, 2018 /PRNewswire/ -- China New Borun Corporation (NYSE: BORN) (the "Company"), a leading producer and distributor of corn-based edible alcohol in China, today announced that its Board of Directors (the "Board") has formed a special committee consisting of three independent directors (the "Special Committee") to consider the previously announced non-binding "going-private" proposal (the "Proposal") that the Board received on January 10, 2018 from Mr. Jinmiao Wang, Chief Executive Officer and Chairman of the Board, and King River Holding Limited, a British Virgin Island company and a majority shareholder of the Company.

Messrs. Wen Jiang, Xisheng Lu and Binbin Jiang will serve on the Special Committee, which will be chaired by Mr. Wen Jiang. The Special Committee intends to retain independent legal and financial advisors to assist it in evaluating the Proposal.

The Company cautions its shareholders and others considering trading in its securities that neither the Board nor the Special Committee has made any decision with respect to the Company's response to the Proposal. There can be no assurance that any definitive offer will be made, that any agreement will be executed or that this or any other transaction will be approved or consummated. The Company does not undertake any obligation to provide any updates with respect to this or any other transaction, except as required under applicable law.

BEIJING, Jan. 10, 2018 /PRNewswire/ -- China New Borun Corporation (BORN) (the "Company"), a leading producer and distributor of corn-based edible alcohol in China, today announced that its Board of Directors (the "Board") has received a non-binding proposal letter, dated January 10, 2018, from Mr. Jinmiao Wang ("Mr. Wang"), Chief Executive Officer and Chairman of the Board, and King River Holding Limited ("King River"), a British Virgin Island company and a majority shareholder of the Company, proposing a "going-private" transaction to acquire all of the outstanding ordinary shares of the Company not already owned by Mr. Wang or King River for US$1.67 in cash per American depositary share ("ADS"), or US$1.67 per ordinary share, which represents approximately 32.6% above the average closing price of the Company's ADSs over the last 30 trading days up to and including January 9, 2018. A copy of the proposal letter is attached as Annex A to this press release.

The Board intends to form a special committee consisting of independent directors to consider this proposal. The Company cautions its shareholders and others considering trading in its securities that the Board only recently received the non-binding proposal letter and no decisions have been made with respect to the Company's response to the proposal. There can be no assurance that any definitive offer will be made, that any agreement will be executed or that this or any other transaction will be approved or consummated. The Company does not undertake any obligation to provide any updates with respect to this or any other transaction, except as required under applicable law.

Fourth Quarter 2016 Financial Results

• Total revenue decreased 26.5% to RMB513.5 million ($74.0 million[1]) from RMB699.1 million in the fourth quarter of 2015.
• Basic and diluted earnings per American Depositary Share ("ADS") were RMB0.42 ($0.06) for the quarter ended December 31, 2016. Each ADS represents one of the Company's ordinary shares.

Mr. Jinmiao Wang, Chairman and Chief Executive Officer of Borun, commented on the results, "Reflecting the robust baijiu industry fundamentals, our production facilities were running at 89% capacity in the fourth quarter of 2016, and as such, despite fewer production days due to a short maintenance shut down, we delivered healthy sales volume of 87,400 tons. Driven by our solid volume shipment and production utility, our fourth quarter revenue of RMB513.5 million was in line with our previous total revenue guidance, despite a lower average selling price of edible alcohol and its byproducts. More importantly, our average cost of corn decreased in the fourth quarter of 2016, fueling our gross margin expansion of 360 basis points sequentially to 9.0%.

For 2017, we believe that the demand of edible alcohol remains quite healthy, as baijiu producers are not only selling at higher volumes but also at higher prices. This growth in both consumption volume and selling price of baijiu clearly demonstrates that the industry has fully recovered, forming a solid market foundation for edible alcohol producers in the foreseeable future. And given the completed maintenance and upgrade in the fourth quarter, we are confident that we will continue to operate at high production utilization in the first quarter of 2017."

Third Quarter 2016 Financial Results

• Total revenue decreased 8.9% to RMB602.2 million ($90.2 million[1]) from RMB661.4 million in the third quarter of 2015.
• Basic and diluted earnings per American Depositary Share ("ADS") were RMB0.31 ($0.05) for the quarter ended September 30, 2016. Each ADS represents one of the Company's ordinary shares.

Mr. Jinmiao Wang, Chairman and Chief Executive Officer of Borun, commented on the results, "Driven by solid demand from the baijiu industry, we were able to deliver record sales volume of edible alcohol and exceeded our previous revenue guidance for the third quarter of 2016. However, during the quarter, record-low corn prices caused a sharp over-supply of edible alcohol, which pressured pricing and profitability. As we enter a new harvest season this November, corn prices have stabilized, and we anticipate our profitability will gradually rebound."

"Benefiting from consistently positive quarterly net incomes, our cash flow and balance sheet remain solid, as our cash position increased to almost RMB1 billion at the end of third quarter. This November, we further strengthened our cash position with the issuance of a five-year RMB300 million Corporate Bonds. Reflecting our strong financials, our Corporate Bonds received an investment-grade rating of AA- by one of China's notable rating agencies, and as a result, this year's Corporate Bonds fixed-rate of 6.5% is a noticeable improvement from the 2013 Corporate Bonds fixed-rate of 9.3%. With the proceeds from our Corporate Bonds, we now have cash on hand of almost RMB1.3 billion, or nearly USD200 million, and as such, we are confident about our abilities to execute on our objectives for the remainder of 2016 and our strategic initiatives for 2017," Mr. Wang concluded.

inancial Outlook

Reflecting a sharp year-over-year decrease in ASP for edible alcohol and its by-products, the Company estimates that its revenue for the fourth quarter of 2016 will be in the range of RMB480 million ($71.9 million) to RMB530 million ($79.4 million), a decrease of approximately 24.2% to a decrease of 31.3% over the same quarter of 2015.

This guidance is based on the current market conditions and reflects the Company's current and preliminary estimates of market and operating conditions and customer demand, which are all subject to change.

Conference Call

BEIJING, Nov. 22, 2016 /PRNewswire/ -- China New Borun Corporation (NYSE: BORN) ("Borun" or the "Company"), a leading producer and distributor of corn-based edible alcohol in China, announced today that Shandong Borun Industrial Co., Ltd, one of the Company's wholly owned subsidiaries, had successfully completed a private placement of five-year fixed-rate bonds ("The Bonds") with a principle amount of RMB300 million.

Pursuant to a registered plan submitted with the Shanghai Stock Exchange, The Bonds were issued on November 2, 2016 at face value with a simple interest rate of 6.5% per annum. Guaranteed by China United SME Guarantee Corporation and reflecting the Company's solid financial position and consistently positive annual net income, The Bonds received an investment-grade rating of "AA-" by one of China's notable, independent rating agencies.

Under the terms of The Bonds, the Company will make annual interest payments of RMB19.5 million commencing November 2, 2017. The Company will also pay three annual installments for the principal portion of The Bonds commencing November 2, 2019. The Company expects proceeds from issuance of The Bonds will be used for working capital and capital expenditure purposes.

Fourth Quarter 2015 Financial Results

• Total revenue increased 14.6% to RMB699.1 million ($107.7 million[1]) from RMB610.0 million in the fourth quarter of 2014.
• Basic and diluted earnings per American Depositary Share ("ADS") were RMB2.07 ($0.32) for the quarter ended December 31, 2015. Each ADS represents one of the Company's ordinary shares. 

Mr. Jinmiao Wang, Chairman and Chief Executive Officer of Borun, commented on the results, "We are thrilled with our strong fourth quarter of 2015 financial results, as revenue grew by nearly 15% year-over-year, gross margin expanded by 40 basis points, and net income rose by nearly 300% year-over-year, benefiting from our leadership position and positive government support."

"Demand for edible alcohol remained strong, while corn cost continued to noticeably trend downward, which should support further gross margin expansion opportunities.  We also expect that our capacity expansion for chlorinated polyethylene ("CPE") in the second quarter of 2015 will drive additional revenue growth in 2016. We feel confident about our business and profitability outlook for 2016."

Financial Outlook

Reflecting the sustained solid demand for edible alcohol and its by-products, the Company continues to operate at a high level capacity utilization.  However, this February the Shouguang government conducted a safety check for all the chemical manufacturing facilities in Shouguang, which mandated the Company's Shouguang facility to shut down for an additional two weeks (approximately 15% of quarterly production schedule) after the Chinese New Year.

As such, despite sustained solid industry fundamentals, the Company estimates that its revenue for the first quarter of 2016 will be in the range of RMB510 million ($78.5 million) to RMB540 million ($83.2 million), a decrease of approximately 5.4% to 10.7% over the same quarter of 2015.

This guidance is based on the current market conditions and reflects the Company's current and preliminary estimates of market and operating conditions and customer demand, which are all subject to change.

Second Quarter 2015 Unaudited Financial Results

• Total revenue increased 7.7% to RMB720.6 million ($117.9 million[1]) from RMB668.9 million in the second quarter of 2014.

• Basic and diluted earnings per American Depositary Share ("ADS") were RMB1.48 ($0.24) for the quarter ended June 30, 2015. Each ADS represents one of the Company's ordinary shares.

Mr. Jinmiao Wang, Chairman and Chief Executive Officer of Borun, commented on the results, "We are ecstatic in being able to deliver a strong second quarter of 2015 that significantly exceeded our top line expectations. During the quarter, thebaijiu industry showed improved demand, driven by the mass market; while at the same time, the number of edible alcohol producers had contracted, as many smaller and inefficient edible alcohol producers exited the industry. This enabled Borun to maintain a solid average selling price for edible alcohol at better-than-expected shipment volume, which drove strong revenue and profitability."

"We believe the improved competitive landscape and pricing for edible alcohol will likely sustain, and as we had already proactively upgraded our production facilities and conducted partial maintenance during the first quarter of 2015, we plan a shorter annual maintenance period this third quarter. With our solid market position and the improved fundamentals in the baijiu industry, we anticipate greater profits in 2015," Mr. Wang concluded.

Financial Outlook

The Company estimates that its revenue for the third quarter of 2015 will be in the range of RMB630 million ($103.0 million) to RMB670 million ($109.6 million), an increase of approximately 19.1% to 26.6% over the same quarter of 2014.

This guidance is based on the current market conditions and reflects the Company's current and preliminary estimates of market and operating conditions and customer demand, which are all subject to change.

First Quarter 2015 Financial Results

• Total revenue decreased 8.8% to RMB570.9 million ($93.0 million[1]) from RMB625.7 million in the first quarter of 2014.
• Net income decreased by 59.8% to RMB15.8 million ($2.6 million) in the first quarter of 2015, compared to RMB39.3 million in the same quarter of 2014. In the first quarter of 2015, basic and diluted earnings per share and per ADS were RMB0.61 ($0.10)

Mr. Jinmiao Wang, Chairman and Chief Executive Officer of Borun, commented on the results, "We are glad that our top line beat the high end of our guidance for the first quarter, as we experienced better-than-expected demand for edible alcohol. However, the competitive landscape during the first quarter continued to be very challenging for the mid-to-low end baijiu producers, causing a sequential decline of 2.5% in average selling price ("ASP") for edible alcohol. At the same time, China government's recent move to ease import restrictions on corn caused double-digit percentage decline in the ASP of corn-based by-products.

Recognizing the challenging environment for corn processors, authorities in Heilongjiang province, including Finance Bureau, Food Bureau and Agricultural Development Bank of China, this April, jointly released guidance for subsidies to corn-processing entities with over 100,000 tons of corn capacity. As one of the largest corn processing companies in Heilongjiang province, we are qualified to participate in designated bids to not only purchase corn at favored prices but also potentially to receive RMB200 per ton of corn purchased through such bids and processed by the end of 2015. This subsidy grant coupled with our pre-purchase and storage capability should further enhance our significant cost advantages," Mr. Wang concluded

Financial Outlook

The Company estimates that its revenue for the second quarter of 2015 will be in the range of RMB620 million ($100.9 million) to RMB660 million ($107.5 million), a decrease of approximately 1.3% to a decrease of 7.3% over the same quarter of 2014.

Fourth Quarter 2014 Financial Results

• Total revenue decreased 7.3% to RMB610.0 million ($99.7 million[1]) from RMB657.8 million in the fourth quarter of 2013.
• Basic and diluted earnings per American Depositary Share ("ADS") were RMB0.51 ($0.08) for the quarter ended December 31, 2014. Each ADS represents one of the Company's ordinary shares.

Mr. Jinmiao Wang, Chairman and Chief Executive Officer of Borun, commented on the results, "Due to the weakened macro-economics and the soft demand for the entire edible alcohol industry which pressured average selling price for our edible alcohol and related by-products. Correspondingly, we reduced fourth quarter production volume to preserve profitability and took the opportunity to temporarily shut down in late December in order to fine-tune our production equipment.

Although the challenging conditions may persist in the first half of 2015, we remain committed to continuing our corn pre-sourcing plans, improving production efficiency, and growing CPE revenue. We are proud that despite the tough environment, Borun has consistently delivered positive quarterly net income in each and every quarter over the past five years. We are confident to sustain this impressive earnings consistency." Mr. Wang concluded.

Financial Outlook

The Company estimates that its revenue for the first quarter of 2015 will be in the range of RMB510 million ($83.3 million) to RMB550 million ($89.9 million), a decrease of approximately 18.5% to a decrease of 12.1% over the same quarter of 2014.

Third Quarter 2014 Unaudited Financial Results

• Total revenue increased 2.2% to RMB529.2 million ($86.0 million^[1]) from RMB518.0 million in the third quarter of 2013.
• Basic and diluted earnings per share and per ADS were RMB0.23 ($0.04) vs. last years same quarter of RMB0.42 ($.07)

Mr. Jinmiao Wang, Chairman and Chief Executive Officer of Borun, commented on the results, "We're pleased that this ($third quarter Borun reported revenue in line with our previously-stated guidance and more importantly earned positive net income for the seventeenth consecutive quarter since our IPO in June of 2010. Our ability to consistently earn positive net income was especially rewarding this quarter, as the industry experienced a severe inverse relationship between average selling price for edible alcohol, which declined 1.4% year-over-year, and spot corn prices, which increased 7.5% year-over-year during the period. We were able to temper our gross margin, as we continued to benefit from our advantageous sourcing strategy lower per ton of our corn cost compared to that of the spot price of corn.

We're also very pleased that this third quarter we generated healthy operating cash flows of RMB394.8 million. Furthermore, despite China's weakened macro-economics, we continued to make progress in ramping up our chlorinated polyethylene ("CPE") and foam insulation businesses, as the new businesses grew 15% sequentially and contributed RMB26.8 million, or 5% of total revenue during the quarter. It is encouraging that we will have ample opportunities to further enhance the profitability of these new businesses, as our production of foam insulation, although expanded by over 50% sequentially in the third quarter, is still running at below one third of its designed capacity. Looking ahead, we will continue to ramp up production and offerings of our new CPE and foam insulation businesses, while at the same time, focus our efforts in further lowering cost for our core edible alcohol business. We feel confident that we can sustainably earn positive net income in the foreseeable future."

Financial Outlook

The Company estimates that its revenue for the fourth quarter of 2014 will be in the range of RMB654 million ($106.3 million) to RMB659 million ($107.1 million), a decrease of approximately 0.6% to an increase of 0.2% over the same quarter of 2013.

This guidance is based on the current market conditions and reflects the Company's current and preliminary estimates of market and operating conditions and customer demand, which are all subject to change.

Second Quarter 2014 Unaudited Financial Results

• Total revenue increased 6.4% to RMB668.9 million ($108.7 million[1]) from RMB628.5 million in the second quarter of 2013.
• Earnings Per Share Basic and Diluted RMB0.82 vs. last years comparable quarter of RMB0.99

Mr. Jinmiao Wang, Chairman and Chief Executive Officer of Borun, commented on the results, "Although demand and average selling price for edible alcohol were solid in the first half of the second quarter, the market encountered an unexpected sharp drop nation-wide in demand and average selling price this June. As a result, even though we recorded revenue growth at the high end of our second quarter guidance on better-than-expected volume shipment, our gross profits contracted year-over-year."

"Despite the challenging month of June, we continued to make progress in ramping up our chlorinated polyethylene ("CPE") and foam insulation businesses. During the quarter, we successfully scaled our CPE plant to full production capacity and grew total revenue from CPE and foam insulation by 47% sequentially to RMB23.4 million. It is worth noting that the new business has surpassed its gross breakeven point during the second quarter, and therefore we anticipate incremental positive contributions to profitability from the new business in the months ahead," Mr. Wang concluded.

Financial Outlook

During the third quarters, the Company historically conducts an annual maintenance of its production facilities, which requires a temporary shut down of all production lines for edible alcohol for approximately one month.

Reflecting the annual maintenance period this summer, and lower average selling prices, the Company estimates that its revenue for the third quarter of 2014 will be in the range of RMB520 million ($84.5 million) to RMB540 million ($87.8 million), an increase of approximately 0.4% to 4.2% over the same quarter of 2013.

This guidance is based on the current market conditions and reflects the Company's current and preliminary estimates of market and operating conditions and customer demand, which are all subject to change.

First Quarter 2014 Unaudited Financial Results

• Total revenue increased 38.8% to RMB625.7 million ($101.7 million[1]) from RMB450.7 million in the first quarter of 2013.
• Basic and diluted earnings per American Depositary Share ("ADS") were RMB1.53 ($0.25) for the quarter ended March 31, 2014. Each ADS represents one of the Company's ordinary shares.

Mr. Jinmiao Wang, Chairman and Chief Executive Officer of Borun, commented on the results, "I am delighted that we executed on our plans and delivered very strong first quarter financial results. Driven by greater sales volume and a firm average selling price of our products, revenue grew 39% year-over-year, and gross margin expanded more than 400 basis points to a 24-month high of 14.5%."

Mr. Wang continued, "More encouragingly, demand for edible alcohol from baijiu producers remains solid, and we anticipate to further benefit from the industry's recovering trend for the remainder of 2014. At the same time, our strong sourcing capability enables us to keep corn cost relatively stable, and as such, we are very confident to grow full-year 2014 profits."

Financial Outlook

The Company estimates that its revenue for the second quarter of 2014 will be in the range of RMB640 million ($104.0 million) to RMB670 million ($108.9 million), an increase of approximately 1.8% to 6.6% over the same quarter of 2013.

Fourth Quarter 2013 Financial Results

• Total revenue increased 30.7% to RMB657.8 million ($107.9 million[1]) from RMB503.4 million in the fourth quarter of 2012.
• Basic and diluted earnings per American Depositary Share ("ADS") were RMB1.18 ($0.19) for the quarter ended December 31, 2013. Each ADS represents one of the Company's ordinary shares.

Mr. Jinmiao Wang, Chairman and Chief Executive Officer of Borun, commented on the results, "We completed a solid fourth quarter, with total revenues exceeding the high-end of guidance and profitability expanding to a 12-month high. We also successfully completed initial sales of our new chlorinated polyethylene ("CPE") and foam insulation products, marking a new milestone in our expanded business scope. Despite the challenging market environment over the past two years, we were able to earn positive net income in every single quarter, and as our momentum builds, we believe are well positioned to grow annual revenue, profitability and cash flow in 2014."

Mr. Wang continued, "Heading into 2014, we remain cautiously optimistic on our edible alcohol business, as the baijiu market further rationalizes supply and demand. We will continue to optimize our strong sourcing capability and strive to achieve greater operating leverage in our core business. At the same time, we are excited about ramping up sales and production of our newly-introduced CPE and foam insulation product lines. We're happy the construction of our new plants were completed on budget and practically without any glitches. We anticipate material contributions from the new business beginning in the second half of 2014."

Financial Outlook

The Company estimates that its revenue for the first quarter of 2014 will be in the range of RMB500 million ($82.0 million) to RMB530 million ($86.9 million), an increase of approximately 11% to 18% over the same quarter of 2013.

Third Quarter 2013 Financial Results

• Revenue decreased by 7.4% year-over-year to RMB518.0 million or $84.3 million from RMB559.2 million in the same period of 2012.
• Basic and diluted earnings per share and per ADS were RMB0.42 $0.07 vs. last years RMB1.35 or $0.225

Mr. Jinmiao Wang, Chairman and Chief Executive Officer of Borun, commented on the results, "It is encouraging that China's edible alcohol market has begun to show signs of a modest recovery and the baijiu market also experienced a boom due to the PRC National Holiday. As a result, our sales volume of edible alcohol exceeded expectations, and our third quarter revenue soundly beat the high-end of guidance. As prepayment of corn was completed in the last quarter, we generated outstanding net operating cash flows this quarter, which provide us an excellent cash position to secure adequate corn in the coming harvest season and thereby sustain our competitive advantage. We are optimistic about the market momentum for the edible alcohol industry, and believe we are well positioned to grow revenue and profits in our seasonally peak fourth quarter."

"We are also encouraged by the early positive signs for our newly-completed chlorinated polyethylene and foam insulation plants. The feedback on trial product samples from prospective customers has been very positive, with some prospects rating our products among the best in market. We expect new revenue from this entirely new business line in the fourth quarter. The combination of improving market fundamentals in our core edible alcohol business and early positive momentum in our new business expansion bodes well for China New Borun for the foreseeable future." Mr. Wang concluded.

Financial Outlook

The Company estimates that its revenue for the fourth quarter of 2013 will be in the range of RMB550 million ($89.5 million) to RMB600 million ($97.6 million), an increase of approximately 9.3% to 19.2% over the same quarter of 2012.

Second Quarter 2013 Financial Results

• Total revenue decreased 21.8% to RMB628.5 million ($101.7 million[1]) from RMB803.7 million in the second quarter of 2012.
• Gross profit decreased 38.2% to RMB71.4 million ($11.6 million) from RMB115.5 million in the second quarter of 2012.
• Net income decreased 62.5% to RMB25.5 million ($4.1 million) from RMB68.1 million in the second quarter of 2012.
• Basic and diluted earnings per American Depositary Share ("ADS") were RMB0.99 ($0.16) for the quarter ended June 30, 2013. Each ADS represents one of the Company's ordinary shares.

Mr. Jinmiao Wang, Chairman and Chief Executive Officer of Borun, commented on the results, "We are encouraged that we were able to once again beat top line guidance. Although market conditions remained challenging, we sold more edible alcohol in the second quarter than we did in the last quarter, as our capacity utilization improved to nearly 90%, contributing to gross margin improvement.

"We are excited with the completion of our new chlorinated polyethylene ("CPE") plant at the end of July and expect completion of the foam insulation plant by the end of third quarter, marking a new milestone in our expanded business scope. We have commenced limited trial CPE productions and anticipate accomplishing initial sales by this fourth quarter. Looking ahead, we will continue to forge ahead with our strategy and operations, and we are confident to maintain our leading position in the edible alcohol market, while capturing new market share in the CPE and foam insulation business." Mr. Wang concluded.

First Quarter 2013 Financial Results

• Total revenue decreased 37.5% to RMB450.7 million ($71.9 million[1]) from RMB721.2 million in the first quarter of 2012.
• Gross profit decreased 57.1% to RMB47.1 million ($7.5 million) from RMB109.9 million in the first quarter of 2012.
• Net income decreased 80.0% to RMB12.8 million ($2.0 million) from RMB63.7 million in the first quarter of 2012.
• Basic and diluted earnings per American Depositary Share ("ADS") were RMB0.50 ($0.08) for the quarter ended March 31, 2013. Each ADS represents one of the Company's ordinary shares.

Mr. Jinmiao Wang, Chairman and Chief Executive Officer of Borun, commented on the results, "I am pleased that Borun once again exceeded revenue guidance, remained profitable, and continued to forge ahead with our strategy and operations, despite facing market headwinds and lower demand due to the PRC's challenging macro-economic environment in the first quarter. This April, we were encouraged to witness an improvement in demand for our products, and correspondingly, we have raised our second quarter production volume. With higher production volume, our capacity utilization rate will improve, and given that we have secured adequate corn during the harvest season at favorable price, we believe that Borun will remain profitable during a very challenging environment for the edible alcohol industry."

Mr. Wang added, "During the first quarter, we further optimized our sourcing capacity by using a combination of short-term borrowings and the bond proceeds issued in January to pre-purchase 300,000 tons of corn in the harvest season. We are also diversifying into the promising and complementary foam insulation market. Our construction of the new foam insulation and chlorinated polyethylene plant is, thus far, on schedule and on budget, and we expect to begin trial production by the third quarter of this year. We believe these initiatives will ultimately drive our long-term revenue growth and margin expansion, while at the same time lower our market concentration risks."

Financial Outlook

The Company estimates that its revenue for the second quarter of 2013 will be in the range of RMB550.0 million($87.7 million) to RMB600.0 million ($95.7 million), an increase of 22.0% to 33.1% over the prior quarter and a decrease of approximately 25.3% to 31.6% over the same quarter in 2012.

This guidance is based on the current market conditions and reflects the Company's current and preliminary estimates of market and operating conditions and customer demand, which are all subject to change.

SHOUGUANG, China, April 23, 2013 /PRNewswire/ -- China New Borun Corporation (NYSE: BORN; "Borun" or the "Company"), a leading producer and distributor of corn-based edible alcohol in China, announced today that it has secured sufficient corn to cover its 2013 production needs in the non-harvest season.

The Company has pre-purchased directly from local farmers up to 300,000 tons of corn in the harvest season, funded by the Company's working capital and the Bonds proceeds issued in January 2013. In addition, Borun has also entered into framework agreements with eight granaries in Heilongjiang Province, China to supply approximately 200,000 tons of corn. As a result, the Company has secured up to 500,000 tons of corn in total to fulfill all the Company's estimated production needs during the non-harvest season.

Mr. Jinmiao Wang, Chairman and Chief Executive Officer of Borun, remarked, "The procurement of corn will provide us with sufficient supply at favorable price during the non-harvest season. We are glad that we've expanded our sourcing strength this year by pre-purchasing a large portion of corn directly from local farmers during the harvest season, which will help us to further lower our average corn cost. By eliminating the additional charges from local granaries, we believe that we have gained a significant competitive advantage during the non-harvest season."

Based on preliminary estimates, the Company currently expects that it will exceed its previous 1Q13 forecast ofRMB385.0 million ($61.3 million) to RMB420.0 million ($66.8 million). The Company also currently expects that it will maintain positive net profits for the first quarter of 2013.

Mr. Wang continued, "We're encouraged that our solid execution and strong sourcing capabilities not only helped us to remain profitable in the first quarter, but also strengthened our overall operating stability in 2013. With our superior sourcing capabilities and production efficiencies, we believe we are better positioned than smaller competitors to withstand the current industry challenges."

Second Quarter 2012 Quick View

• Total revenue increased 11.0% to RMB803.7 million ($127.1 million from RMB724.4 million in the second quarter of 2011.
• Gross profit decreased 23.6% to RMB115.5 million ($18.3 million) from RMB151.1 million in the second quarter of 2011.
• Net income decreased 28.9% to RMB68.1 million ($10.8 million) from RMB95.8 million in the second quarter of 2011.
• Diluted earnings per American Depositary Share ("ADS") were RMB2.65 ($0.42) for the quarter ended June 30, 2012. Each ADS represents one of the Company's ordinary shares.

Commenting on the results for the quarter, Mr. Jinmiao Wang, Chairman and Chief Executive Officer of Borun, stated, "We are proud of our record quarterly revenue achieved in the second quarter, with continued growth from all of our key product lines. Our strong top line provides clear evidence of the continued solid demand for our edible alcohol and by-products in China, and driven by our pre-sale success, we continue to immediately sell-out our entire production, gaining greater operating efficiency."

Mr. Wang added, "Our key raw material, corn, continued its price increase trend during this non-harvest season in the second quarter, and the entire edible alcohol industry faced margins pressure. However, even though corn prices may continue to rise in future quarters, we are cautiously optimistic that prices for our main product, edible alcohol, will also pick up for the remainder of 2012, which should mitigate further margin contraction. Additionally, our strategic corn sourcing arrangement provides us with assured supplies at a favorable price throughout the non-harvest season. We believe that these initiatives will position Borun well in the second half of 2012."

Financial Outlook

Reflecting a planned annual maintenance of its production facilities, the Company estimates that its revenue for the third quarter of 2012 will be in the range of RMB670.0 million ($105.9 million) to RMB695.0 million ($109.9 million), an increase of approximately 6.9% to 10.8% over the same quarter of 2011.

First Quarter 2012 Quick View

• Total revenue increased 26.1% to RMB721.2 million ($114.6 million(1)) from RMB571.8 million in the first quarter of 2011.
• Gross profit decreased 13.6% to RMB109.9 million ($17.5 million) from RMB127.1 million in the first quarter of 2011.
• Net income decreased 17.9% to RMB63.7 million ($10.1 million) from RMB77.6 million in the first quarter of 2011.
• Diluted earnings per American Depositary Share ("ADS") were RMB2.48 ($0.39) for the quarter ended March 31, 2012. Each ADS represents one of the Company's ordinary shares.

Commenting on the results for the quarter, Mr. Jinmiao Wang, Chairman and Chief Executive Officer of Borun, stated, "Demand for edible alcohol and our by-products remained strong throughout the quarter, and we continue to operate our facilities at full capacity, making us one of the most efficient producers of edible alcohol in the country. Driven by the strong demand for edible alcohol in China and our effective capacity utilization, our first quarter revenue exceeded our previously stated guidance."

Mr. Wang added, "We are currently in an environment where higher corn prices have resulted in our cost of goods increasing at a faster rate than revenues. This has resulted in pressure on our operating profits. We view these prices as a short-to-medium term aberration and we think that they will normalize over time. In the meantime, while we cannot control the price of corn, we can operate as efficiently as possible in order to mitigate the effect of the high corn prices. Our return on assets and return on equity numbers for the past twelve months are 15.5% and 23.6%, respectively, demonstrating how we are committed to efficiency. At the same time, our business continues to generate healthy cash flows."

Financial Outlook

The Company estimates that its revenue for the second quarter of 2012 will be in the range of RMB735.0 million ($116.8 million) to RMB755.0 million ($120.0 million), an increase of approximately 1.5% to 4.2% over the same quarter in 2011.

SHOUGUANG, China, March 26, 2012 /PRNewswire-Asia/ -- China New Borun Corporation (NYSE: BORN; "Borun" or the "Company"), a leading producer and distributor of corn-based edible alcohol in China, today announced that it has completed the pre-purchase of sufficient corn at locked-in prices to cover its production requirements during the coming non-harvest season.

During the recent harvest season, the Company reserved sufficient corn to be used for later production in the non-harvest season through corn sourcing arrangements with local granaries. As a result, the Company has secured 505,000 tons of corn stored at third-party granaries, and it is estimated that all of Borun's 2012 production plans can be sufficiently fulfilled with the corn already on hand.

Mr. Jinmiao Wang, Chairman and Chief Executive Officer of Borun, remarked, "Having further enhanced our corn purchase and storage capability, we are confident that Borun is well-positioned to use our sourcing advantage to capture more business opportunities in the future. Our ability to lock in attractive prices during the peak harvest season not only provides us with higher cost visibility but also buffers us from potential higher inflation. Our strong relationships with local granaries and our strategic locations in the corn producing regions have helped us achieve this. Together with our successful pre-sales for 2012, we are excited and confident that our assured supply and solid cost visibility will help us continue to operate efficiently and prosper in a cost-rising environment."

Fourth Quarter 2011 Financial Highlights

• Total revenue increased 60.4% to RMB762.0 million ($120.9 million(1)) from RMB475.0 million in the fourth quarter of 2010.
• Gross profit increased 4.0% to RMB120.1 million ($19.1 million) from RMB115.4 million in the fourth quarter of 2010.
• Net income increased 3.6% to RMB72.1 million ($11.5 million) from RMB69.6 million in the fourth quarter of 2010.
• Diluted earnings per American Depositary Share ("ADS") were RMB2.80 ($0.45) for the quarter endedDecember 31, 2011. Each ADS represents one of the Company's ordinary shares.

Commenting on the results for the quarter, Mr. Jinmiao Wang, Chairman and Chief Executive Officer of Borun, stated, "We have seen strong demand for edible alcohol in the fourth quarter of 2011, which has continued into 2012. During the quarter our facilities operated at full capacity, making us one of the most efficient producers of edible alcohol in the country. Driven by higher prices and strong demand for edible alcohol and our strong capacity utilization, our record fourth quarter revenue exceeded our previously stated guidance. External factors, notably continued elevated levels in the price of corn, have resulted in higher costs of goods than we have seen in the past."

Mr. Wang added, "While the higher corn price has resulted in net income increasing at a slower rate than revenues, we are pleased that our production facilities, as well as sales and administration, are operating efficiently. Driven by strong market demand for our edible alcohol and the acquisition of new customers, we have already signed pre-sales contracts for approximately 90% of our total edible alcohol production capacity in 2012. We are also proactively focused on enhancing our ability to pre-purchase corn at lower prices. During the recent peak harvest season, we continued to engage granaries to secure greater quantity of lower-priced corn and store for later use in the non-harvest season."

Continuing, Mr. Wang stated, "In January of 2012 the State Intellectual Property Office awarded a patent to the Company for the Borun Wet Process, our proprietary manufacturing method. We are pleased to receive the patent and believe that it validates our conviction that the Borun Wet Process results in a higher production yield, is environmentally friendlier and is more energy efficient than other corn-based edible alcohol production processes currently used in China. Benefitting from our patented Borun Wet Process, our robust pre-sales for 2012, and our strong corn sourcing ability, we believe that we will be well-positioned to continue to prosper in a cost-rising environment."

Financial Outlook

The Company estimates that its revenue for the first quarter of 2012 will be in the range of RMB680.0 million($107.9 million) to RMB705.0 million ($111.9 million), an increase of approximately 18.9% to 23.3% over the same quarter in 2011.

BEIJING, February 7, 2012 /PRNewswire-Asia/ -- China New Borun Corporation (NYSE: BORN; "Borun" or the "Company"), a leading producer and distributor of corn-based edible alcohol in China, today announces that the Company has promoted Ms. Bing Yu (Ann) to Chief Strategy Officer from her current position as Chief Financial Officer and Mr. Yuanqin Chen (Terence) to Chief Financial Officer from his current position as Vice President for Finance, effective immediately.

Third Quarter 2011 Financial Highlights

• Total revenue increased 50.1% to RMB627.0 million ($98.7 million(1)) from RMB417.7 million in the third quarter of 2010.

• Gross profit increased 10.8% to RMB111.8 million ($17.6 million) from RMB100.9 million in the third quarter of 2010.

• Net income increased 5.0% to RMB67.5 million ($10.6 million) from RMB64.2 million in the third quarter of 2010.

• Diluted earnings per American Depositary Share ("ADS") were RMB2.62 ($0.41) for the quarter ended September 30, 2011 vs. $0.39.  

Commenting on the results for the quarter, Mr. Jinmiao Wang, Chairman and Chief Executive Officer of Borun, stated, "During the third quarter we executed on our plans for continued strong growth. The company successfully brought online increased production capacity for crude corn oil and liquid carbon dioxide in our Shandong facility, and grade-A edible alcohol in our Daqing facility. These projects increase our yield from processing corn and help diversify both our revenue and customer base. They help position us as one of the most modern and efficient producers of edible alcohol in China."

Mr. Wang added, "Demand for edible alcohol remains strong as we saw good increases in sales volumes of edible alcohol. However, the cost of corn, our principal input cost, rose sharply during the quarter, outpacing edible alcohol prices and put pressure on our gross margins. Looking forward to the fourth quarter, our ability to continue to execute on our operating strengths, our sourcing expertise and diversifying our product and customer base should allow us to continue profitable growth."

Financial Outlook

• The Company estimates that its revenue for the fourth quarter will be in the range of RMB720.0 million ($113.3 million) to RMB750.0 million ($118.0 million), an increase of approximately 51.6% to 57.9% over the same quarter in 2010.

• Correspondingly, the Company estimates that its revenue for the full year of 2011 will be in the range of RMB2,643.2 million ($415.9 million) to RMB2,673.2 million ($420.6 million), an increase of approximately 54.2% to 56.0% over the previous year.

Our primary planned capital expenditures for fiscal 2011 are for the expansion of our manufacturing capacity in the PRC. We expect our capital expenditures in 2011 to be approximately ranging from RMB 500 million (US$75.50 million) to RMB 600 million (US$90.60 million) for the expansion of Phase IV at our Daqing facility. We expect to fund the planned expenditures, including our working capital requirements, through cash generated from operations, borrowings through short-term loans, and the proceeds from issuances equity or debt instruments and we believe that such cash generated from these activities will be sufficient for our planned expenditures including our working capital requirements.

First Quarter Results:

• Total revenue increased 47.1% to RMB571.8 million ($87.2 million(1)) from RMB388.8 million in the first quarter of 2010.
• Gross profit increased 46.0% to RMB127.1 million ($19.4 million) from RMB87.1 million in the first quarter of 2010.
• Net income increased 32.8% to RMB77.6 million ($11.8 million) from RMB58.5 million in the first quarter of 2010.
• Diluted earnings per American Depositary Share ("ADS") were RMB3.02 ($0.46) for the quarter ended March 31, 2011. Each ADS represents one of the Company's ordinary shares.

Mr. Jinmiao Wang, Chairman and Chief Executive Officer of Borun, commented, "It is our pleasure to share with you another quarter of strong financial performance.  We solidly executed on all aspects of our business plans, as we flawlessly ramped up production of our new Daqing Phase III facility while maintaining full utilization of our other facilities.  During the quarter we experienced solid revenue growth resulting from both strong demand and price increases for edible alcohol, coupled with expanded capacity."

The Company estimates that its revenue for the second quarter of 2011 will be in the range of RMB690 million ($105.2 million) to RMB710 million ($108.3 million), an increase of approximately 59.5% to 64.2% over the same quarter of 2010.

 

Fourth Quarter Highlights:

• Total revenue increased 24.1% to RMB475.0 million ($71.7 million) from RMB382.7 million in the fourth quarter of 2009.
• Gross profit increased 24.3% to RMB115.4 million ($17.4 million) from RMB92.8 million in the fourth quarter of 2009.
• Net income increased 13.7% to RMB69.6 million ($10.5 million) from RMB61.2 million in the fourth quarter of 2009.
• Diluted earnings per American Depositary Share ("ADS") were RMB2.71 ($0.41) for the quarter ended December 31, 2010 vs. $0.44 in the prior year. Each ADS represents one of the Company's ordinary shares.
• The Company estimates that its revenue for the first quarter of 2011 will be in the range of RMB543 million ($82.0 million) to RMB563 million ($85.0 million), an increase of approximately 39.7 % to 44.8% over the same quarter of 2010.

Mr. Jinmiao Wang, Chairman and Chief Executive Officer of Borun, commented, "We are very pleased to report a strong set of fourth quarter and full year 2010 financial results.  Driven by higher prices for edible alcohol and our strong capacity utilization, we achieved record fourth quarter revenue and profits that exceeded our previously stated guidance. Our consistent growth in revenue for both edible alcohol and by-products, as well as our stable gross margin, again demonstrate the advantages of our business model. With the expanded capacity from our Daqing Phase III, Borun has become the second largest edible alcohol producer in China."

BEIJING, Feb. 17, 2011 /PRNewswire-Asia-FirstCall/ -- China New Borun Corporation today announced that the Company has signed two letters of intent with parties in Sichuan province.  

Under the two pre-sale letters of intent, the Company expects to provide 6,500 tons edible alcohol per month starting from the second quarter of 2011 to its customers in Sichuan province, accounting for over 15% of Borun's expanded total production capacity in 2011. This strategic win helps to further expand the Company's customer base in Sichuan province, the largest Baijiuproduction base in China. With these two newly signed letters of intent, the Company has secured letters of intent totaling over 90% of its total edible alcohol production capacity in 2011.

Mr. Jinmiao Wang, Chairman and Chief Executive Officer of Borun, commented, "We are very pleased with the strong momentum in our pre-sale wins. Riding on the strength of our leading brand and technical superiority, as well as the growing Baijiu market in China, we continue to witness strong demand for edible alcohol.  With these additional wins, we are very confident that we can sell all of our additional capacity when our Phase III plant reaches full production capacity in the coming months."

The Daqing Phase III facility is on schedule to become operational in January 2011, which will expand the Company's total production capacity by 120,000 tons, or 46%, to 380,000 tons. Of the increased 120,000 tons capacity, the Company has already won pre-sale letters of intent totaling 107,000 tons, or 89% of the increased capacity. For the full year of 2011, Borun's Daqing facility and Shouguang facility together have already entered letters of intent with customers to sell a total of 305 thousand tons of edible alcohol, accounting for over 80% of Borun's expanded total production capacity.

Mr. Jinmiao Wang, Chairman and Chief Executive Officer of Borun, commented, "Driven by our strong reputation in the industry and the robust market demand for our edible alcohol, we are very pleased with our exceptional pre-sale success. We also made significant progress with selling into Sichuan province, the largest Baijiu production base in China, as we continue to broaden our customer base. The combination of our pre-sale success and the continued strong market demand for our by-products, including DDGS feed, corn germ, carbon dioxide, and the newly-introduced crude corn oil, provides us with excellent revenue visibility for 2011. As a result, we are excited with our Daqing Phase III expansion, and we are confident that the nearly 50% increase in our total capacity will drive strong revenue and profit growth in 2011."

On September 20, 2010, we issued an alert that we would be comparing China New Borun Adr (NYSE:BORN) SEC statements with those filed in China. China Borun was one of the companies that we pulled financial statements on during our investigatory article we published on August 25, 2010.

BORN has three operating subsidiaries:

• Weifang Great Chemical
• Shandong Borun Industrial
• Daqing Borun Biotechnology

Originally, we actually obtained 2008 and 2009 SAT filings that revealed a significantly different financial picture than what is presented in China Borun 424b4 SEC filing . We sent our findings to the company who was adamant that we had incorrect documents, despite confirming that we had the correct spelling of the company's Mandarin PRC subsidiaries provided by our attorney. Management claimed that SEC filings matched Chinese filings. Giving BORN the benefit of the doubt, we pulled SAT information from a second source. We also pulled SAIC documents. We could not obtain the full financial statement from the SAIC. However, we were able to obtain an annual business performance preview of Weifang Great Chemical Shandong and Borun Industrial filed at the local AIC. The preview includes the revenue, net income, income tax and net income (after tax), total assets and total liability.

Our findings:

1. SAT documents that we pulled from our second source were identical to those from our first batch of documents.
2. SAIC documents are close to SEC documents
3. SAIC numbers are significantly diverge from the SAT numbers. Based on the SAT numbers, Weifang Great and Shandong Borun (the biggest subsidiary) had negative net income and did not pay any income tax. However, from the SAIC numbers, Shandong Borun had three consecutive large positive net incomes from 2007 to 2009 and paid three big amounts of income tax.
4. SAIC documents contain much more detailed information than SAT documents.
5. We have no information on Daqing Borun. 

These revelations certainly create quite a conundrum. How can we explain higher numbers in the SAIC filings? One would think that since SAIC documents are easy to obtain, the company is putting itself as at a high audit risk with the SAT. We postulated that the company may have made sure that SAIC filings matched SEC filings due to recent negative outcomes for companies whose filings do not match. However, our attorney claimed this assumption to be a low risk scenario, but not impossible. If we want to trust SAIC documents, then the only other explanations are that we just do not have accurate SAT documents or that BORN may have participated in tax avoidance. 

Questions to ponder

• Did the auditor even pull the SAT documents?
• Does the tax certificate that China Borun showed auditors match SAT documents? If not, did the auditor know of these alleged discrepancies and just ignore them?

On the positive side, if SAIC documents are accurate, the worst case situation is one of tax avoidance. Knowing that the penalties for income tax avoidance in China are lax, investors may assume that the possibility of cash penalties from company operations would be minimal.

We are aware that BORN restructured its business. BORN has had two re-organizations, one in December of 2008 and another in December of 2009. Could this have impacted the reliability of the SAT information we have obtained? In any event, we believe that China Borun should address these findings and get their ducks in a row before short sellers start sniffing around. We have made numerous attempts to discuss this issue with BORN management and its IR firm, but have not received a meaningful response. Maybe they are "taking care" of things and addressing what they believe is the circulation of inaccurate information.  

At the end of the day exploring financial reporting deficiencies as well as the differences between local filings in China and SEC filings will lead to tighter reporting controls, more transparency for investors and higher stock prices.

To get a copy of the SAIC/SAT information discussed in this article, please register at Geoinvesting.com and send an email request to support@geoinvesting.com.

Disclosure: No position in BORN at the time of the publication of this article.

Second Quarter 2010 Financial Highlights

    -- Total revenue increased 154.5% to RMB432.5 million ($63.7 million(1))
       from RMB169.9 million in the second quarter of 2009.

    -- Gross profit increased 149.9% to RMB102.1 million ($15.0 million) from
       RMB40.9 million in the second quarter of 2009.

    -- Net income increased 154.8% to RMB67.1 million ($9.9 million) from
       RMB26.3 million in the second quarter of 2009.

    -- Diluted earnings per American Depositary Share ("ADS") were RMB3.16
       ($0.46) for the quarter ended June 30, 2010. Each ADS represents one of
       the Company's ordinary shares.

Mr. Jinmiao Wang, Chairman and Chief Executive Officer of Borun, commented, "We are very pleased with our second quarter financial results, which marks our first quarter reporting as a publicly-traded company. Our rapid growth in revenue for both edible alcohol and by-products, as well as our strong operating cash flows, demonstrate the advantages of our business model and our unique competitive position.

"We are also glad to announce significant progress in several of our growth initiatives. We started construction on Phase III of our Daqing facility this quarter, and we expect to complete Phase III on schedule by the end of this year. We have also completed the construction of our liquid carbon dioxide project at the Shouguang facility, which has already generated revenue since July. With the completion of Phase III of our Daqing facility, we estimate we will be the second largest edible alcohol producer in China."

Ms. Ann Yu, Chief Financial Officer of Borun, stated, "We are excited to move forward into the second half of 2010 with a highly flexible financial position. Our cash balance following the initial public offering was approximately RMB 391.2 million ($57.6 million), and we are confident that the combination of our solid cash on hand, growing operating cash flows, and existing credit facility with local banks will provide us enough capital to execute on our immediate expansion plans. Given the strong demand for our products, we anticipate strong sales with respect to our expanded capacity, which could lead to higher revenue and profits in 2011 and beyond."

Financial Outlook

The Company estimates that its revenue for the full year of 2010 will be in the range of RMB1,650 million ($243.0 million) to RMB1,670 million ($245.9 million), an increase of approximately 55.7% to 57.5% over the previous year.

This forecast reflects the Company's current and preliminary view, which is subject to change.