Synutra International, Inc. Amends August 2005 Current Report on Form 8-K and Annual...

Synutra International, Inc. Amends August 2005 Current Report on Form 8-K and
Annual Report on Form 10-K for the Fiscal Year Ended March 31, 2007

QINGDAO, China and ROCKVILLE, Md., Jan. 15 /Xinhua-PRNewswire/ -- Synutra
International, Inc. (Nasdaq: SYUT; ''Synutra''), one of China's leading
manufacturers of dairy-based nutritional products for infants, children and
adults, today filed amendments to its Current Report on Form 8-K filed on
August 22, 2005 and its Annual Report on Form 10-K for the fiscal year ended
March 31, 2007 with the U.S. Securities and Exchange Commission. As explained
in the Forms 8-K and 10-K, the amendments are the result of certain
deficiencies and errors in Synutra's financial statements identified during
its ongoing assessment process to improve the effectiveness of its disclosure
controls and procedures and internal control over financial reporting.
Synutra previously concluded that the audited consolidated Balance Sheets,
Income Statements and Cash Flow Statements as of and for the calendar years
ended December 31, 2003 and 2004 and unaudited consolidated Balance Sheets,
Income Statements and Cash Flow Statements as of and for the three and six
months ended June 30, 2004 and 2005 of its wholly owned subsidiary, Synutra
Inc. (''Synutra Illinois''), should no longer be relied upon because of errors
in such financial statements. The Current Report on Form 8-K filed today
restates Synutra Illinois' financial statements to (i) reclassify certain
other income as sales revenue and (ii) breakout certain cash and cash
equivalents into cash and restricted cash line items.
Synutra also previously concluded that certain filings made subsequent to
the Form 8-K filed on August 22, 2005, including Synutra's Annual Report on
Form 10-K for the fiscal year ended March 31, 2007 and Amendment No. 1 to the
Annual Report on Form 10-K for the fiscal year ended March 31, 2007, which
presented audited financial statements covering the 12-month periods ended
March 31, 2005, 2006, and 2007 (together, the ''Form 10-K"), should have
presented, but did not present, audited financial statements for the three-
month transition period ended March 31, 2005, unaudited comparative financial
statements for the three months ended March 31, 2004 and audited financial
statements for the 12-month period ended December 31, 2004 rather than audited
financial statements for the 12-month period ended March 31, 2005. Synutra
has amended its Form 10-K to present such periods and provide related
disclosures to the Management's Discussion and Analysis and other items of the
Form 10-K.
During the assessment of its disclosure controls and procedures and
internal control over financial reporting, Synutra also analyzed its financial
position, changes in financial position and results of operations as of the
same dates and for the same periods for which audited consolidated financial
statements have been presented, and determined that the restricted net assets
of Synutra's consolidated subsidiaries not available for distribution to
Synutra as of March 31, 2007 exceeded certain thresholds. Synutra has amended
its Form 10-K to include Schedule I to present its condensed financial
information for the years ended March 31, 2006 and 2007 as part of the
financial statements as required by Articles 12-04(a) and 4-08(e)(3) of
Regulation S-X. Synutra also has added disclosure to the notes to the
financial statements of the Form 10-K to describe its assessment of the
restricted net assets of its consolidated subsidiaries. Finally, Synutra
identified an error in the Cash Flow Statements for the year ended March 31,
2006 in which the depreciation expense amount was misstated. Synutra has
revised the data column for the year ended March 31, 2006 in the Cash Flow
Statements to reflect the correct depreciation amount of that period.
Synutra International, Inc. Chairman and Chief Executive Officer Liang
Zhang commented, ''We continually strive to improve our financial reporting
and to have the utmost transparency in our communications. I believe that the
team that we have in place is a strong one, and I am confident that we have
improved, and will continue to improve, both our financial reporting and our
internal controls over such reporting. Synutra remains focused on capturing
the growth in the infant formula industry in China through successful
strategic execution, and I am optimistic about our prospects as we enter
2008.''
Synutra's SEC filings are available on-line: http://www.synutra.com
About Synutra International, Inc.
Synutra operates eight subsidiaries developing, producing, distributing
and selling dairy-based nutritional products across the People's Republic of
China. It offers its products for infants, children, adults and pregnant women
and nursing mothers under the brand series of ''Super,'' ''U-Smart" and "U-
Strong.'' The Group's extensive sales network covers 24 provinces, 264 cities
and more than 1320 counties throughout China. For more information, please
contact Weiguo Zhang of Synutra, Inc. (301 840 3888, wzhang@synutra.com),
Brian Rafferty of Taylor Rafferty (212 889 4350, synutra@taylor-rafferty.com)
or visit: http://www.synutra.com .
The information contained herein includes forward-looking statements.
These statements relate to future events or to our future financial
performance, and involve known and unknown risks, uncertainties and other
factors that may cause our actual results, levels of activity, performance, or
achievements to be materially different from any future results, levels of
activity, performance or achievements expressed or implied by these forward-
looking statements. You should not place undue reliance on forward-looking
statements since they involve known and unknown risks, uncertainties and other
factors which are, in some cases, beyond our control and which could, and
likely will, materially affect actual results, levels of activity, performance
or achievements. Any forward-looking statement reflects our current views
with respect to future events and is subject to these and other risks,
uncertainties and assumptions relating to our operations, results of
operations, growth strategy and liquidity. We assume no obligation to
publicly update or revise these forward-looking statements for any reason, or
to update the reasons actual results could differ materially from those
anticipated in these forward-looking statements, even if new information
becomes available in the future. The safe harbor for forward-looking
statements contained in the Securities Litigation Reform Act of 1995 protects
companies from liability for their forward-looking statements if they comply
with the requirements of the Act.
For more information, please contact:

Mr. Weiguo Zhang
Synutra, Inc.
Tel: +1-301-840-3888
Email: wzhang@synutra.com

Mr. Brian Rafferty
Taylor Rafferty
Tel: +1-212-889-4350
Email: synutra@taylor-rafferty.com

SOURCE Synutra International, Inc.

Mr. Weiguo Zhang of Synutra, Inc., +1-301-840-3888, or wzhang@synutra.com; or
Mr. Brian Rafferty of Taylor Rafferty, +1-212-889-4350, or
synutra@taylor-rafferty.com, for Synutra