NEW YORK, March 31 /PRNewswire-Asia/ --
- Revenues of $43.8 million, EPS of $0.17, Anticipates Significant
Earnings Growth in 2009 from Expanding Sales in the Chinese Domestic
Markets
- Revenue increased 31% to $43.8 million, strong sales growth in core
products
- Net income of $3.4 million
- Anticipates significant earnings growth from domestic sales in 2009
Deer Consumer Products, Inc. (OTC Bulletin Board: DCPI)
(Website: http://www.deerinc.com ), a market leader in the design, manufacture and sale of home and kitchen electronic appliances targeting both international and Chinese domestic markets today announced audited 2008 financial results for the fiscal year ended December 31, 2008.
2008 Revenue:
-- Revenue of $43.8 million, an increase of 30.8% compared to 2007
-- Sales of company's proprietary "Deer" branded products reached record
levels due to the company's marketing efforts in its domestic market
-- Overall sales growth was attributed to strong sales in core products,
introduction of new products, and market share growth of its brand name
products in the Chinese domestic markets
2008 Earnings:
-- Net income of $3.4 million
-- Earnings per Share of $0.17 on a fully diluted basis
Management Comments on 2008 Financial Performance and 2009 Outlook:
In 2008, Deer achieved a 30.8% growth in revenues due to increased international and domestic orders. Increased sales attest to the high quality of our products, our marketing strength and highly cooperative relationships that we have maintained with our new and returning customers. In addition to expanding our international sales under various global brands as a key supplier to global chain stores, we have started marketing household kitchen appliances domestically under our own registered "Deer" brand. Sales growth from our own brand has been promising.
Bill He, Deer's Chief Executive Officer commented: "We are pleased with Deer's 2008 financial performance. In 2008, in addition to expanding international sales, we continued to execute on our strategy of broadening distribution channels targeting the Chinese domestic consumer markets. In 2009, we anticipate significant growth from domestic product sales. The Chinese consumers' appetite towards home appliances has been increasing steadily despite the challenging global economy." He also said: "On the capital market front, Deer plans to apply for listing on the NASDAQ stock market in the near future as we believe an Exchange listing would broaden our investor base and better reflect our position as a global market leader in the manufacturing and marketing of home and kitchen electronics."
About Deer Consumer Products, Inc.
Deer Consumer Products, Inc. is a U.S. public company headquartered in China. Supported by more than 103 patents, Deer is a market leader in the design, manufacture and sale of home and kitchen electric appliances targeting the vast Chinese domestic consumer markets as well as customers in more than 40 countries worldwide. Deer's product lines include blenders, juicers, pressure cookers and other home appliances designed to improve home lifestyles in today's fast paced society. With more than 100 global and domestic clients/branded products including Black & Decker, Ariete-Disney, Toastmaster, Magic Bullet, Back to Basics, and Wal-Mart, Deer has enjoyed rapid sales and earnings growth in recent years.
Safe Harbor Statement
All statements in this press release that are not historical are
forward-looking statements made pursuant to the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995. There can be no assurance that actual results will not differ from the company's expectations. Deer's actual results may differ from its projections. Further, preliminary results are subject to normal year-end adjustments. You are cautioned not to place undue reliance on any forward-looking statements in this press release as they reflect Deer's current expectations with respect to future events and are subject to risks and uncertainties that may cause actual results to differ materially from those contemplated. Potential risks and uncertainties include, but are not limited to, the risks described in Deer's filings with the Securities and Exchange Commission.
DEER CONSUMER PRODUCTS, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
AS OF DECEMBER 31, 2008 AND 2007
2008 2007
ASSETS
CURRENT ASSETS:
Cash and cash equivalents $2,782,026 $1,511,545
Restricted cash 200,099 450,385
Accounts receivable, net 8,560,465 3,491,235
Advances to suppliers 5,015,479 2,817,333
Other receivables 489,286 395,180
Short-term investments 29,340 136,647
Due from shareholder -- 1,383,124
Due from related party 331,267 --
Inventories 7,680,851 4,153,304
Other current assets 13,342 628,718
Total current assets 25,102,155 14,967,471
PROPERTY AND EQUIPMENT, net 11,291,202 8,576,102
CONSTRUCTION IN PROGRESS 892,897 302,160
INTANGIBLE ASSETS, net 404,125 387,541
OTHER ASSETS 39,689 42,008
TOTAL ASSETS 37,730,068 24,275,282
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Accounts payable 8,968,088 2,479,056
Other payables 760,632 564,820
Unearned revenue 3,305,966 69,591
Accrued payroll 168,282 134,301
Short-term loans 3,552,841 1,691,431
Due to shareholder -- 756,458
Advances to shareholder -- 509,139
Advances to related party 274,805 --
Notes payable 3,155,348 3,160,059
Tax and welfare payable 1,533,013 896,605
Total current liabilities 21,718,975 10,261,460
LONG-TERM LOAN 733,500 --
TOTAL LIABILITIES 22,452,475 10,261,460
STOCKHOLDERS' EQUITY:
Common Stock, $0.001 par value;
75,000,000 shares authorized;
22,600,000 and 18,050,000
shares issued and outstanding
as of December 31, 2008 and
2007, respectively 22,600 18,050
Additional paid-in capital 9,326,423 9,330,973
Development funds 542,701 343,232
Statutory reserve 1,085,403 686,464
Other comprehensive income 2,345,698 1,303,732
Retained earnings 1,954,768 2,331,371
Total stockholders' equity 15,277,593 14,013,822
TOTAL LIABILITIES AND STOCKHOLDERS'
EQUITY 37,730,068 24,275,282
DEER CONSUMER PRODUCTS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME AND OTHER COMPREHENSIVE INCOME
FOR THE YEARS ENDED DECEMBER 31, 2008 AND 2007
2008 2007
Net Revenue $43,784,935 $33,476,259
Cost of Revenue 34,125,019 26,249,009
Gross profit 9,659,916 7,227,250
Operating expenses
Selling expenses 2,854,946 1,518,482
General and administrative expenses 2,566,634 1,788,025
Total operating expenses 5,421,580 3,306,507
Income from operations 4,238,336 3,920,743
Non-operating income (expense):
Financing costs (247,901) (194)
Interest income 13,870 18,524
Interest expense (310,762) (114,361)
Other income (expense) 40,216 64,698
Realized loss on trading securities (34,873) --
Unrealized gain on trading securities -- 57,043
Foreign exchange gain 959,943 90,707
Total non-operating income (expense) 420,493 116,417
Income before income tax 4,658,829 4,037,160
Income tax 1,302,045 615,568
Net income 3,356,784 3,421,592
Other comprehensive income
Foreign currency translation gain 1,041,966 822,146
Comprehensive Income $4,398,750 $4,243,738
Weighted average shares outstanding:
Basic 19,533,425 18,050,000
Diluted 19,533,425 18,050,000
Earnings per share:
Basic $0.17 $0.19
Diluted $0.17 $0.19
CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE YEARS ENDED DECEMBER 31, 2008 AND 2007
2008 2007
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income $3,356,784 $3,421,592
Adjustments to reconcile net income to
net cash used in operating activities:
Depreciation 1,199,578 795,531
Amortization 18,723 18,509
Loss on disposal of fixed assets 351,257 --
Realized loss on short term
investments 34,873 --
Unrealized loss on short term
investments -- (57,043)
(Increase) / decrease in assets:
Accounts receivable (7,821,066) (2,423,876)
Other receivable 210,696 435,100
Inventories (3,180,080) (549,092)
Due from shareholder 1,454,375 (1,328,793)
Due from related party (325,509) --
Advances to suppliers (1,965,833) (251,437)
Tax rebate receivable 158,989 51,484
Other assets 215,234 (40,357)
Increase / (decrease) in current
liabilities:
Accounts payable 6,205,438 (556,796)
Unearned revenue 3,175,324 (849,077)
Other payables 156,499 499,020
Due to related party (795,427) 726,744
Accrued payroll 24,138 61,536
Tax and welfare payable 563,573 479,845
Net cash provided by operating
activities 3,037,566 432,890
CASH FLOWS FROM INVESTING ACTIVITIES
Acquisition of property and equipment (3,627,873) (2,191,640)
Acquisition of intangible assets (8,319) (162,263)
Construction in process (559,651) 111,835
Changes in restricted cash 276,966 (307,229)
Purchases of short-term investments -- (131,280)
Proceeds from short-term investments 79,984 --
Net cash used in investing activities (3,838,893) (2,680,577)
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from issuance of notes
payable 2,969,781 1,795,227
Proceeds from issuance of
short-term loans 4,176,723 885,108
Payment on notes payable (3,192,128) --
Payment on notes short term loans (2,464,203) --
Change in advance to shareholder,
net (535,367) 424,397
Change in advance to related
party, net 270,028 --
Proceeds from issuance of
long-term note 720,750 --
Net cash provided by financing
activities 1,945,584 3,104,732
Effect of exchange rate changes on
cash and cash equivalents 126,224 75,476
NET INCREASE IN CASH & CASH
EQUIVALENTS 1,270,481 932,521
CASH & CASH EQUIVALENTS, BEGINNING
BALANCE 1,511,545 579,024
CASH & CASH EQUIVALENTS, ENDING
BALANCE $2,782,026 $1,511,545
SUPPLEMENTAL DISCLOSURE OF CASH FLOW
INFORMATION:
Interest paid $310,762 $113,356
Income taxes paid $725,125 $112,743
Settlement of receivable as a deemed
dividend $3,314,979 --
