Deer Consumer Products (NASDAQ:DEER)

First Quarter 2012 Results

• Our revenues for the three months ended March 31, 2012, were $49.9 million, an increase of $15.2 million, or 44%, from $34.7 million for the three months ended March 31, 2011.
• First quarter net income was $7.8 million, an increase of 35% from Q1/2011. Fully diluted earnings per share were $0.23, an EPS increase of 35% from Q1/2011.

MANAGEMENT COMMENTS ON 2012 FIRST QUARTER FINANCIAL RESULTS

Bill He, Chairman & CEO of Deer, commented: "Deer is pleased to report record first quarter 2012 financial results. In 2010, Deer entered China's domestic markets with a strong push by putting our "DEER" branded products on the shelves of retail locations across China. In 2012, Deer is continuing to expand its store presence across China while adding in-store promotional staff to further enhance its sales. Deer currently has access to approximately 4,000 retail locations across China and has developed a well-recognized brand by working with various retail channels.

We believe China remains the world's largest and fastest growing consumer retail market and has strong domestic demand for small household appliances. There are approximately 35,000 retail locations across China that Deer could potentially penetrate. Deer has significant growth potential in China."

AFFIRMS 2012 FINANCIAL GUIDANCE

In 2012, Deer anticipates revenues from the high margin China domestic sales will continue. Deer affirms its 2012 revenue guidance of between $270 and $290 million, net income guidance of between $45 million and $47 million, and targets EPS (Earnings per Share) between $1.37 and $1.42.

3-YEAR INSIDER SHARE LOCKUP, TOTAL MANAGEMENT COMMITMENT

As disclosed previously, Deer's entire management team has voluntarily entered into 3-year share lockup agreements, which prohibit them from selling any shares to the general public through at least 2013. The lockup agreements represent approximately 47% of Deer's entire outstanding shares. Deer management's vested interests are aligned with those of Deer's public shareholders. Deer has been led by its original founders since the inception of its operating business 17 years ago.

Full Year 2011 Results

• 2011 revenue was $226.7 million, an increase of $50.9 million, or 28.9%, from $175.8 million in 2010.
• 2011 net income was $39.8 million, an increase of 31% from 2010. Fully diluted earnings per share were $1.18, an EPS increase of 31% from 2010.
• Fourth quarter EPS were $0.39 vs $0.33 in prior year

MANAGEMENT COMMENTS ON 2011 FINANCIAL RESULTS

Bill He, Chairman & CEO of Deer, commented: "Deer is pleased to report record 2011 financial results. In 2010, Deer entered China's domestic markets with a strong push by putting our 'DEER' branded products on the shelves of retail locations across China. In 2011, Deer is continuing to expand its store presence across China while adding in-store promotional staff to further enhance sales. Deer currently has access to approximately 4,000 retail locations across China and has developed a well-recognized brand by working with various retail channels.

"We believe China remains the world's largest and fastest growing consumer retail market and has strong domestic demand for small household appliances. There are approximately 35,000 retail locations across China that Deer could potentially penetrate. Deer has significant growth potential in China."

Deer's shareholders' equity increased to approximately $185.4 million, or $5.52 per share in net assets. Deer had more than $13.9 million in cash and equivalents at the end of the 2011 without any long-term debts. Deer has sufficient cash on hand to meet its liquidity requirements and has no plan to dilute our shareholders.

AFFIRMS 2012 FINANCIAL GUIDANCE

In 2012, Deer anticipates revenues from the high margin China domestic sales will continue to surpass export sales. Deer provides 2012 revenue guidance of between $270 and $290 million, net income guidance of between $45 million and $47 million, and targets EPS (Earnings per Share) between $1.37 and $1.42.

3-YEAR INSIDER SHARE LOCKUP, TOTAL MANAGEMENT COMMITMENT

As disclosed previously, Deer's entire management team has voluntarily entered into 3-year share lockup agreements, which prohibit them from selling any shares to the general public through at least 2013. The lockup agreements represent approximately 47% of Deer's entire outstanding shares. Deer management's vested interests are aligned with those of Deer's public shareholders. Deer has been led by its original founders since the inception of its operating business 17 years ago.

Deer Consumer Products, Inc. is a NASDAQ Global Select Market listed U.S. company with its primary operations in China. Deer has a 17-year operating business as well as a strong balance sheet. Operated by Deer's founders and supported by more than 100 patents, trademarks, copyrights and approximately 1,000 staff, Deer is a leading provider of "DEER" branded consumer products to Chinese consumers and a leading vertically integrated manufacturer of small home and kitchen appliances for global customers. DEER's product lines include a series of small household and kitchen appliances as well as personal care products designed to make modern lifestyles easier and healthier.

Third Quarter 2011 Results

• Q3/2011 revenue of $73.0 million, an increase of 32% from Q3/2010
• Q3/2011 net income of $13.2 million, an increase of 43% from Q3/2010
• Fully diluted earnings per share of $0.39, an EPS increase of 39% from Q3/2010
• Anticipates favorable Chinese domestic consumer market environment for continued growth in 2012
• Board of Directors declares $0.05 per share quarterly dividend for the 4th quarter
• Affirms and potentially exceeds the current 2011 financial guidance

Bill He, Chairman & CEO of Deer, commented: "Deer is pleased to report record third quarter financial results. In 2010, Deer entered China's domestic markets with a strong push by putting our 'DEER' branded products on the shelves of retail locations across China. In 2011, Deer is continuing to expand its store presence across China while adding in-store promotional staff to further enhance sales. Deer currently has access to approximately 3,200 retail locations across China and has developed a well-recognized brand by working with various retail channels.

We believe China remains the world's largest and fastest growing consumer retail market and has strong domestic demand for small household appliances. There are approximately 35,000 retail locations across China that Deer could potentially penetrate. Deer has significant growth potential in China."

FFIRMS 2011 FINANCIAL GUIDANCE

In 2011, Deer anticipates revenues from the high margin China domestic sales to surpass export sales. Deer provides 2011 revenue guidance of between $200 and $220 million, net income guidance of between $35 million and $37 million, and targets EPS (Earnings per Share) between $1.08 and $1.12.

NEW YORK, Sept. 16, 2011 /PRNewswire/ -- Deer Consumer Products, Inc. (Nasdaq: DEER) (website: http://www.deerinc.com), a leading provider of "DEER" branded household consumer products to Chinese consumers and a vertically integrated manufacturer of small household and kitchen appliances for global customers, today announced that Deer is scheduled to pay on October 14, 2011, its regular quarterly cash dividend of $0.05 per share to shareholders of record as of September 30, 2011.

In 2011, Deer has consistently made quarterly cash dividend payments of $0.05 per share to its shareholders. Deer anticipates reporting strong 3rd quarter product sales as it continues to conduct its normal course of business.

EXTORTION ATTEMPTS AND FALSE ALLEGATIONS BY ILLEGAL STOCK SHORT SELLERS

Deer is fully aware of the latest desperate illegal short seller attacks on its stock, including repeated publication of the same misstatements by fictitious figure "Alfred Little" and so-called bloggers called "GeoInvesting". Deer management emphatically and categorically denies the allegations and imputations in these stories which are based on fabricated information credited to sources with false identities and include inaccurate statements regarding China land use rights and Deer's business. The authors of these publications, "Alfred Little" and "GeoInvesting," have failed to reveal their true identities and conflicts of interest to avoid responsibility for their spreading of false statements, continued defamation of Deer and engaging in market manipulation.

In connection with these publications, the entities behind them have approached Deer with questionable offers to cease their "attacks". For example, "Alfred Little" offered to issue retractions of various articles in exchange for Deer dropping its ongoing subpoena and discovery efforts in the Superior Court of the State of New York and "GeoInvesting" offered to provide paid "consulting services" to Deer several months ago. Deer refuses to compromise its vigorous efforts against these entities that the Company believes are operating for the benefit of short sellers.

NEW YORK, Aug. 9, 2011 /PRNewswire/ --

• Q2/2011 revenue of $45.1 million, an increase of 31% from Q2/2010
• Q2/2011 net income of $7.3 million, an increase of 22% from Q2/2010
• Fully diluted earnings per share of $0.22, an EPS increase of 22% from Q2/2010
• Anticipates favorable Chinese domestic consumer market environment for continued growth in 2011
• Board of Directors declares $0.05 per share quarterly dividend for the 3rd quarter  
• Affirms and potentially exceeds the current 2011 financial guidance

Bill He, Chairman & CEO of Deer commented: "Deer is pleased to report record second quarter financial results. In 2010, Deer entered China's domestic markets with a strong push by putting our 'DEER' branded products on the shelves of approximately 3,000 retail locations across China. 'DEER' branded products did especially well in the Guandong Province, Sichuan Province, Shaanxi Province, Zhejiang Province and Shandong Province. In 2011, Deer plans to continue to expand such store presence across China while adding in-store promotional staff to further enhance sales and sell-through. During the second quarter, we experienced strong customer product re-ordering from existing and new customers, as well as various levels of product sell-through. In certain product lines and during Chinese holidays, some of our products sold out completely. We made great efforts to replenish empty shelf space in some markets."

"China remains the world's largest and fastest growing consumer retail market and the most profitable marketplace in the world for small household appliances. There are approximately 35,000 retail locations across China that Deer could potentially penetrate. Deer has significant growth potentials in China for years to come."

"Deer anticipates significant revenue and net income growth for the remainder of 2011. We are comfortable with meeting and potentially exceeding our earnings guidance for 2011."

AFFIRMS 2011 FINANCIAL GUIDANCE

In 2011, Deer anticipates revenues from the high margin China domestic sales to surpass export sales. Deer provides 2011 revenue guidance of between $200 and $220 million, net income guidance of between $35 million and $37 million, and targets EPS (Earnings per Share) between $1.08 and $1.12.

• Q1/2011 revenue of $34.7 million, an increase of 45% from Q1/2010
• Q1/2011 net income of $5.8 million, an increase of 44% from Q1/2010
• Fully diluted earnings per share of $0.17, an EPS increase of 42% from Q1/2010
• Anticipates favorable Chinese domestic consumer market environment for continued growth in 2011
• Board of Directors declares $0.05 per share quarterly dividend for the 2nd quarter  
• Affirms and potentially exceeds the current 2011 financial guidance

Geoteam® Note: 2011 First quarter analyst EPS estimates were $0.16.

Bill He, Chairman & CEO of Deer commented: "Deer is pleased to report record first quarter financial results. In 2010, Deer entered China's domestic markets with a strong push by putting our "DEER" branded products on the shelves of approximately 3,000 retail locations across China. In 2011, Deer plans to continue to expand such store presence across China while adding in-store promotional staff to further enhance sales and sell-through. During the first quarter, we experienced strong customer product re-ordering from existing and new customers, as well as various levels of product sell-through. In certain product lines and during Chinese holidays, some of our products sold out completely. We made great efforts to replenish empty shelf space in some markets."

2ND QUARTER DIVIDEND APPROVED BY THE BOARD OF DIRECTORS

Deer's Board of Directors approved a $0.05 per share quarterly cash dividend for the second quarter from future earnings. The dividend will be paid on July 15, 2011, to shareholders of record at the close of business on June 30, 2011. Declaration and payment of future quarterly dividends will be made at the discretion of the Board of Directors.

AFFIRMS 2011 FINANCIAL GUIDANCE

In 2011, Deer anticipates revenues from the high margin China domestic sales to surpass export sales. Deer provides 2011

• Revenue guidance of between $200 and $220 million
• Net income guidance of between $35 million and $37 million
• EPS targets (Earnings per Share) between $1.08 and $1.12.

3-YEAR INSIDER SHARE LOCKUP, TOTAL MANAGEMENT COMMITMENT

As disclosed previously, Deer's entire management team has voluntarily entered into 3-year share lockup agreements, which prohibit them from selling any shares to the general public through at least 2013. The lockup agreements represent approximately 47% of Deer's entire outstanding shares. Deer management's vested interests are aligned with those of Deer's public shareholders. Deer has been led by its original founders since the inception of its operating business 16 years ago.

NEW YORK, March 21, 2011 /PRNewswire/ -- Deer Consumer Products, Inc. announced today that the Company is not aware of any facts regarding its business operations that may have negatively contributed to Deer's share price decline today.

DEER has noticed dramatically increased naked short activity in DEER's common stock as well as activities of several website bloggers, namely from a person writing under the name of "Alfred Little," a blogger on SeekingAlpha and others.  The Company believes that it is possible that such persons and others may be colluding in efforts to bring down DEER share price through intimidation of research analysts, institutional investors and their broad spreading of fabricated market information and rumors with the goals of market and share manipulation of Deer's common stock and stock options.

Deer also confirms that its filings with the Securities and Exchange Commission, including its latest 8-K regarding its land ownership and its recent 10-K filing, are accurate and comply with the law.

Questions Regarding the True Identity and Intentions of "Alfred Little"

The Company has serious questions regarding the true identity of the person or persons writing under the name "Alfred Little." "Alfred Little's" purported biography on SeekingAlpha stated that he had years of experience in China as well as years of accounting experience at Deloitte. The Company has not been able to verify "Little's" claims thus far and believes that the conduct of "Little," and surrounding circumstances, may fit a pattern common to the general nature of short selling/false rumor schemes highlighted by the SEC as a subject for immediate investigation.  If so, "Little's" claim, and possibly the very identity of the persons behind "Alfred Little," would be open to serious question. The Company intends to investigate whether the recent events may be part of broad manipulative efforts by others, including several hedge funds based in California and elsewhere with the assistance of bloggers.

2010 Year Highlights:

• 2010 revenue of $175.8 million, an increase of 116% from 2009
• 2010 net income of $30.3 million, an increase of 145% from 2009.
• Basic earnings per share of $0.91, fully diluted EPS of$0.90, an EPS increase of 68% from 2009
• Strong Q1/2011 sales growth, anticipates favorable Chinese domestic and global market environment for continued earnings growth in 2011
• Declares quarterly cash dividend of $0.05 per share

GeoTeam® Note: 2010 vs. 2009 fourth quarter was $0.33 vs. $0.23

Management and insiders share lock up through 2013

"The initiation of a cash dividend demonstrates Deer's confidence in our growth potential, and reflects our strong financial position and strong balance sheet without any long-term debts. We believe Deer's dividend yield is in line with those of other global companies in our household appliances industry. The cash dividend allows us to reward our long-term shareholders while maintaining sufficient cash levels to aggressively grow our business in 2011 and beyond. We have sufficient cash on hand to continue to grow our business without diluting our current shareholders," said Bill He, Chairman and CEO of Deer

Mr. He commented: "As anticipated, the strategy for our China domestic market expansion was well executed in 2010, which resulted in significantly higher revenue growth and higher profit margins. Deer believes that our integrated 'production to market' business model and our in-depth understanding of the local Chinese culture and market insights towards China's domestic markets have positioned Deer as an efficient operator of a highly profitable growth company. We capture both manufacturing margins and end user distribution margins. As Deer continues to expand in the high margin China domestic markets, we see tremendous growth momentum well into 2011."

In 2011, Deer anticipates revenues from the high margin China domestic sales to surpass export sales. Deer provides 2011 revenue guidance of between $200 and $220 million, net income guidance of between $35 million and $37 million, and targets EPS (Earnings per Share) between $1.08 and $1.12.

3rd Quarter Financial Highlights:

• Revenues of $55.26 million, an increase of 108% from Q3/09

• Net income of$9.27 million, an increase of 125% from Q3/09, fully diluted EPS (Earnings per Share) of $0.28, an increase of 56% from EPS of $0.18in Q3/09

• Strong balance sheet: $54.4 millionin cash without any long term debts

• Record China domestic sales – high margin China domestic sales increased 708% to 42% of revenues compared to Q3/09

• Expanded gross profit margin to 28.7%, compared to 22.1% in Q3/09

• Expanded operating margin to 21.0%, compared to 16.9% in Q3/09

• Expanded net income margin to 16.8%, compared to 15.5% in Q3/09

• Initiated planning for Deer's 2nd production facility, which is located in China's eastern AnHui Province – positioned for significant China domestic customer demand in 2011

• Sees positive impact to earnings from China's currency appreciation and positive growth momentum from the current global economic environment

Management Comments on 3rd Quarter 2010 Financial Results:

Bill He, Deer's Chairman and CEO, commented: "Deer is pleased to report the best 3rd quarter financial results in our corporate history. During this quarter, we executed our China domestic market expansion strategies successfully, which resulted in higher revenue growth as well as higher profit margins. Deer believes that our integrated 'production to market' model and our in-depth local cultural and market knowledge have made Deer one of the most profitable and efficiently operated companies in the small household appliance industry in the world. We capture both manufacturing margins and end user distribution margins. We see positive earnings growth trend to continue well into 2011."

Raises 2010 Earnings Guidance to $29 Million in Net Income, EPS of $0.87:

Based on the current order fulfillment and product shipments to China domestic and global customers, Deer raises its 2010 earnings guidance to approximately $172 million in revenues, approximately $29 million in net income and Earnings per Share (EPS) of $0.87-$0.88. Deer's previous 2010 guidance was $160 million in revenues, $26 million in net income and EPS of $0.76.

Business Outlook for 2011: Targets Minimum 30% Revenues and Earnings Growth in 2011 from the Raised 2010 levels:

Deer anticipates no less than 30% growth in both revenues and net income in 2011 from the raised 2010 levels, mainly due to anticipated continued revenue growth in China's domestic markets. In 2010, Deer significantly expanded its China domestic market distribution footprints, which positions the Company for further market expansion in 2011. In addition, Deer sees better global market conditions in 2011 as the global economy continues to improve, which would benefit Deer's global market sales.

"Deer's strong financial performance in 2010 has set a positive tone for Deer's continued expansion in 2011. Chinese consumer wealth expansion in a favorable environment of high GDP growth and low inflation has created healthy market demand for Deer's small household appliances products, which directly enhance the lifestyles of China's rising middle class. Deer's strong balance sheet and significant cash position also provide ample strategic M&A opportunities in 2011. In addition, Deer plans to significantly increase our production capacity in 2011 through the opening of our second production facility, in order to stay closer to our China domestic customers as well as expanding distribution outlets. Our second factory should be completed in 2011 and it is strategically located in a region that can service more than 300 million people in one of China's most economically developed areas. Deer looks forward to continuing delivering high earnings growth for our shareholders for years to come," commented Mr. He.

GeoTeam® Note:

Following in CCME foot steps, DEER is the second of our tier one stocks that have come through with solid third financial results that eclipsed analysts estimates:

• Exceeded third quarter 2010 analyst estimates of $0.21

• At $0.30, EPS is expected to exceed fourth 2010 quarter analyst EPS estimates of $0.27

• 2011 EPS guidance $1.13 is above analyst EPS estimates of $0.97 

Deer Consumer Products issued guidance in its most recent power point.

2010 guidance confirmed leading to EPS in line with analyst estimates of $0.77:

• Revenues of $160.0 million.
• Net income of $26.0 million.

2011 guidance implies higher EPS than analyst estimates of $0.97:

• Revenues of $254.4 million.
• Net income of $40.0 million, which implies EPS of $1.18.

• Revenues of $34.45 million, an increase of 125% from Q2/09
• Net income of $6.02 million, an increase of 251% from Q2/09
• Fully diluted EPS (Earnings per Share) of $0.18, an increase of 125% from EPS $0.08 in Q2/09
• Strong balance sheet: $74.3 million in cash (approximately $2.21 per common share in cash) without any long term debts or bank borrowing
• Better than expected China domestic sales - high margin China domestic sales increased 579% to 33% of revenue in Q2/2010
• Expanded gross profit margin to 28.7%, compared to 24.8% in Q2/09
• Expanded operating margin to 20.2%, compared to 14.7% in Q2/09
• Expanded net income margin to 17.5%, compared to 11.2% in Q2/09
• Sees positive impact to earnings from China's currency appreciation and positive growth momentum from the current global economic environment  
• Anticipates record earnings in the second half of 2010.

"The Chinese domestic marketing channels are delivering better than expected results. Consumer wealth expansion with high GDP growth and low inflation has created a favorable market environment for our products, which enhance the lifestyles of ordinary people. Revenue growth has come from multiple distribution venues, including rapidly expanding traditional retail outlets and third party independent dealer networks as well as online sales. Our China growth strategy is a simple and highly practical one: placing our products on the shelves of major retailers and creating product visibility as our initial steps in building awareness towards 'DEER' branded products. Once we reach our critical mass in product presence at some of China's key domestic retailers, Deer intends to launch regional and store-specific marketing campaigns in the 3rd and 4th quarters to further enhance individual store sales. Our strong cash position provides ample marketing opportunities. Deer anticipates continued strong China domestic market sales as well as record earnings in the second half," concluded Bill He, Chairman & CEO of Deer.