Singapore, Feb 17, 2010: Shengtai Pharmaceutical, a leading manufacturer and distributor of high-quality, pharmaceutical grade glucose products in China, announced that its second quarter 2010 revenues were approximately $28.51 million, a 92.7% increase year-over-year compared to the approximately $14.80 million reported in the second quarter of fiscal 2009.

 

Sales of glucose products totaled approximately $13.89 million during the second quarter as it accounted for 48.7% of sales. Cornstarch sales for the quarter totaled approximately $7.00 million or 24.6% of revenues. Sales of other products totaled approximately $7.62 million or 26.7% of revenues. The increase in sales revenue resulted from the increase of our export sales and domestic cornstarch and other products sales. Exporting sales revenue for the three months ended December 31, 2009 increased approximately 307% compared with the corresponding period in 2008.

 

The increase is because with the recovery of the global economic crisis and with the company’s exporting department reorganization in fiscal year 2009, the international demand for its glucose and protein powder products increased compared to the same period last year. Domestic sales for cornstarch and other products for the three months ended December 31, 2009 increased approximately 127% compared with the same period last year. The increase in domestic sales was because of the higher demand for cornstarch and increase in unit sales price for cornstarch.

 

Gross profit for the three months ended December 31, 2009 was approximately $4.47 million compared with approximately $1.99 million the same period last year. The increase in gross profits resulted from the increase in sales compared with the same period in 2008. Gross margin was 15.7%, a rise from 13.5% in the second quarter of fiscal 2009. The reasons for the increase in gross profit margin was because of decreased selling, general, and administrative expenses.

 

Second quarter 2010 net income was approximately $1.05 million or 5 cents per diluted share, compared to second quarter 2009 net loss of $473,887 or 2 cents per diluted share. The increase in net income was primarily due to the increase in its sales, decreased selling, general, and administrative expenses, and increase of other income.

 

"Looking forward, we see increased demand of our products and are confidant about our cash position. The Chinese government's stimulus plan is taking effect. More medical clinics are built or going to be built. The new clinics increased the demand for our pharmaceutical glucose products. We remain our leading position in this field to provide approximately 40% of the China pharmaceutical market share. The oral glucose and the cornstarch market are recovering. Some companies in the cornstarch and oral glucose business did not survive during the world economic crisis while we reserved our cash and other resources. We now have the resources and capabilities to catch the recovered business. The exporting market is recovering as well. Our reorganization of the exporting department last year also contributed to our success. In general, we are very confidant to welcome a profitable and growing fiscal year 2010 and 2011," said Mr. Qingtai Liu, CEO, Shengtai Pharmaceutical.