China Green Agriculture, Inc. Reports Third Quarter Fiscal Year 2009 Financial Results

China Green Agriculture, Inc. Reports Third Quarter Fiscal Year 2009 Financial
Results

XI'AN, China, May 11 /PRNewswire-Asia-FirstCall/ -- China Green
Agriculture, Inc. (NYSE Amex: CGA; "China Green Agriculture" or "the
Company"),
a leading producer and distributor of humic acid ("HA") based liquid compound
fertilizer through its wholly owned subsidiary, Shaanxi TechTeam Jinong Humic
Acid Product Co., Ltd. ("Techteam"), today announced its financial results for
the third quarter of fiscal year 2009 ending March 31, 2009.
-- Company Exceeds Third Quarter Revenue and EPS Guidance
-- Third Quarter 2009 Sales Increase 99.4% to $8.8 million, Net Income
increases 132.7% to $3.9 million with EPS of $0.21
-- First Nine Months of FY2009 Sales Increase 60.7% to $24.7 million, Net
Income increases 56.1% to $10 million with EPS of $0.54
-- Company Raises Fiscal Year 2009 Revenue and EPS Guidance to at least
$32.8 million and $0.71, respectively
-- Management to Host Earnings Conference Call on May 12 at 9:00 am ET

Q3 2009 Results
Q3 2009 Q3 2008 CHANGE
Net Sales $8.8 million $4.4 million +99.4%
Gross Profit $5.1 million $2.5 million +106.5%
Net Income $3.9 million $1.7 million +132.7%
EPS (Basic and
Diluted) $0.21 $0.09 +129.6%

Third Quarter 2009 Results
Net sales for the third quarter of fiscal year 2009 totaled $8.8 million,
up 99.4% from $4.4 million in the same quarter of fiscal year 2008. Techteam's
sales of humic acid based liquid compound fertilizers contributed to 77.6% of
our total net sales. For the third quarter of fiscal year 2009, Techteam's net
sales increased $3.3 million, or 95.0%, to $6.9 million from $3.5 million for
the same quarter of fiscal year 2008. The increase was due primarily to 17 new
products introduced to the market during the last 12 months and recent
upgrades to the current production facility which increased annual capacity
from 10,000 metric tons to 15,000 metric tons. Sales volume increased 60.8% to
3,364 tons in the third quarter of fiscal year 2009, versus 2,091 tons in the
same period of 2008. Sales of agricultural products from Jintai, namely
top-grade fruits, vegetables, flowers and colored seedlings increased 116.2%
and accounted for $2.0 million, or 22.4% of total net sales. The increase in
revenue growth from Jintai when compared with previous quarters was primarily
due to the strong sales of our various decorative flowers, mainly butterfly
orchids, big orchids and red leaf flowers during this year's holiday.
Gross profit for the third quarter of fiscal year 2009 totaled $5.1
million, an increase of 106.5% from $2.5 million in the same quarter of 2008.
Gross profit margin was 57.3% for the third quarter of fiscal year 2009, up
from 55.3% in the third quarter of fiscal year 2008.
Operating expenses for the third quarter of fiscal year 2009 were $0.6
million, up from $0.4 million in the same quarter of fiscal year 2008, with
the increase mainly being derived from incremental public company expenses.
Operating expenses were 6.9% of net sales in the third quarter of fiscal year
2009, down from 9.0% of net sales in the corresponding quarter of fiscal year
2008.
Operating income for the third quarter of fiscal year 2009 was $4.5
million, up 116.9% from $2.1 million in the third quarter of fiscal year 2008.
Operating margin was 50.4%, compared to 46.3% in the same quarter of fiscal
year 2008.
Net income for the third quarter of fiscal year 2009 was $3.9 million, or
$0.21 per basic and fully diluted share, up 132.7% compared with net income of
approximately $1.7 million, or $0.09 per basic and fully diluted share, during
the same period in fiscal year 2008. In the third quarter of 2009, the average
weighted shares outstanding were 18.6 million shares versus 18.3 million
shares in the year ago period.
"We are pleased with our financial results which exceeded both our revenue
and EPS guidance for the third quarter of fiscal year 2009", stated Mr. Tao
Li,
Chairman, President and Chief Executive Officer of China Green Agriculture.
"We continue to deliver year-over-year growth in each of our fertilizer
product categories, which is driven by a broader number of distributors across
a larger geographic footprint, while maintaining industry leading margins. We
are confident that the drivers in place, including increasing demand for green
fertilizers supported by consumer food safety and environmental concerns,
along with the desire for higher crop yields, will enable us to deliver
further revenue and earnings growth for our company during 2009."
Nine Months Results
For the nine months of fiscal year 2009, net sales increased 60.7% to
$24.7 million, up from $15.4 million in the corresponding year ago period. For
the nine months of fiscal year 2009, Techteam's net sales, which accounted for
78.6% of total net sales, increased $7.5 million, or 64.0%, to $19.4 million
from $11.9 million for the same period of 2008. This increase was benefited
from new product introductions and improved production capacity. Sales volume
increased 54.4% to 10,799 tons in the nine months of fiscal 2009, versus 6,992
tons in the same period of 2008. Gross profit increased 56.7% to $14.1
million in the nine months of fiscal 2009, versus $9.0 million in the same
period a year ago. Gross margin was 57.1% in the nine months of fiscal 2009
compared to 58.5% during the same period of fiscal year 2008. Operating income
for the first nine months of fiscal 2009 rose 70.9% to $11.9 million compared
to $7.0 million in the same period of fiscal 2008. Net income, was $10.0
million, or $0.54 per basic and fully diluted share, based on 18.6 million
weighted average shares. Net income in the year ago period was $6.4 million,
or $0.48 per basic and fully diluted share, based on 13.5 million weighted
average shares.
Financial Condition
As of March 31, 2009, the Company had $13.6 million in cash and cash
equivalents with working capital of $21.8 million. The Company maintained
short term loans of $3.7 million and shareholders' equity of $28.2 million.
The Company had no long term debt as of March 31, 2009. Accounts receivable
stood at $6.9 million as of March 31, 2009 with trailing twelve month days
sales outstanding of 59.7 compared to $3.6 million as of June 30, 2008 and
corresponding days sales outstanding of 77.8. Inventories totaled $8.3 million
as of March 31, 2009. For the nine months of fiscal 2009, the Company had $1.0
million in cash flows from operating activities, while capital expenditures
amounted to approximately $3.1 million due to the building construction and
equipment purchase for its new facility.
2009 Guidance
China Green Agriculture's third quarter revenue of $8.8 million and EPS of
$0.21 exceeds previously announced guidance for the third quarter of fiscal
year 2009 of $7.7 million to $8.2 million and $0.14 to $0.17, respectively.
Management is increasing its guidance upward for fiscal year 2009 and now
expects revenues of $32.8 million to $33.3 million and EPS of $0.71 to $0.74
per fully diluted share, respectively. Previous revenue and EPS guidance was
$31.6 million to $32.8 million and $0.61 to $0.66 per fully diluted share,
respectively. The Company's upward guidance reflects the anticipated strong
sales from its green fertilizer products in the fourth quarter of 2009.
"We are well positioned to capitalize on the market opportunities within
China's fertilizer and agriculture industry. With a national distribution
network, state-of-the-art research and development, automated production, and
superior after-sales support, we have successfully built one of the premier
organic compound fertilizer producers in China today," stated Mr. Li. "We
believe CGA will continue to benefit by offering high yielding and
environmentally sustainable fertilizers which are paramount to China's
agricultural production capabilities in the face of shrinking arable land,
ongoing consumer food safety concerns and growing population. Supported by a
vertically integrated platform that utilizes 511 distributors to sell our 131
branded products through 27 provinces in China, we have built an organization
with multiple competitive advantages and superior operating metrics, as
evidenced by our third quarter 2009 gross and operating profit margins of
57.3% and 50.4%, respectively. By leveraging our new facility, which will be
on line in August of 2009, we feel China Green Agriculture is well positioned
to gain further market share in China's green fertilizer market, which will
translate into long term revenue and net income growth," Mr. Li concluded.
Conference Call
The Company will conduct a conference call at 9:00am ET on Tuesday, May
12,
2009. Interested participants should call 1-800-688-0796 when calling within
the United States or 1-617-614-4070 when calling internationally. When
prompted by the operator, please mention conference passcode 623 913 35 or
state "China Green Agriculture Third Quarter Conference Call" to join the
call.
Event: China Green Agriculture Third Quarter Conference Call
Date: May 12, 2009
Time: 9:00am ET
US Dial In: 1-800-688-0796
Intl' Dial In: 1-617-614-4070
Passcode: 623 913 35

A playback will be available through Tuesday, May 19th, 2009. To listen,
please call 1-888-286-8010 within the United States or 1-617-801-6888 when
calling internationally. Utilize the pass code 481 589 21 for the replay.
About China Green Agriculture, Inc.
China Green Agriculture, Inc. produces and distributes humic acid ("HA")
based liquid compound fertilizer through its wholly owned subsidiary, Shaanxi
TechTeam Jinong Humic Acid Product Co., Ltd., ("TechTeam"). TechTeam produces
and sells approximately 15,000 metric tons of over 100 different kinds of
fertilizer products per year. All of TechTeam's fertilizer products are
certified by the PRC government as green products and suitable for growing
Grade AA "green" foods, also known as green products that contain little or no
chemical materials, as stated by the China Green Food Research Center.
TechTeam's fertilizers are highly concentrated liquids which require an
application of approximately 120 ml per mu per application. Its average end
user has approximately four mu of land (one mu = .165 acres).
China Green Agriculture currently markets its fertilizer products to
private wholesalers and retailers of agricultural farm products in 27
provinces in the PRC. The leading five provinces by revenue for the three
months ended March 31, 2009 are Shannxi (12.2%), Shandong (10.6%), Anhui
(6.2%), Xinjiang (6.0%) and Henan (5.4%), which in total accounted for 40.5%
of our total fertilizer sales from the sale of our fertilizer products. For
more information, visit http://www.cgagri.com .
Safe Harbor Statement
This press release contains forward-looking statements concerning the
Company's business, products and financial results. The Company's actual
results may differ materially from those anticipated in the forward-looking
statements depending on a number of risk factors including, but not limited
to,
the following: general economic and business conditions, development,
shipment,
market acceptance, additional competition from existing and new competitors,
changes in technology, and various other factors beyond the Company's control.
All forward-looking statements are expressly qualified in their entirety by
this Cautionary Statement and the risk factors detailed in the Company's
reports filed with the Securities and Exchange Commission. China Green
Agriculture undertakes no duty to revise or update any forward-looking
statements to reflect events or circumstances after the date of this release

CHINA GREEN AGRICULTURE INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
AS OF MARCH 31, 2009 AND JUNE 30, 2008
(UNAUDITED)

ASSETS
March 31, 2009 June 30, 2008
Current Assets
Cash and cash equivalents $13,632,961 $16,612,416
Restricted cash 118,318 193,392
Accounts receivable, net 6,866,974 3,590,552
Inventories 8,258,769 3,988,979
Other assets 111,311 128,091
Advances to suppliers 140,347 512,845
Total Current Assets 29,128,680 25,026,275

Plant, Property and Equipment, Net 17,564,935 18,199,456

Construction In Progress 8,184,068 5,115,492

Intangible Assets, Net 1,101,277 1,180,159

Total Assets $55,978,960 $49,521,382

LIABILITIES AND SHAREHOLDERS' EQUITY

Current Liabilities
Accounts payable $1,235,570 $232,417
Unearned revenue 58,935 88,950
Other payables and accrued expenses 481,526 455,228
Registration rights liability -- 506,142
Advances from other unrelated
companies 324,957 344,628
Amount due to related parties 31,157 31,121
Taxes payable 1,470,549 5,878,275
Short term loans 3,681,197 4,201,925
Total Current Liabilities 7,283,892 11,738,686

Common Stock, $.001 par value,
6,313,617 shares subject to
redemption 20,519,255 20,519,255

Commitment -- --

Stockholders' Equity
Preferred Stock, $.001 par value,
20,000,000 shares authorized, Zero
shares issued and outstanding -- --
Common stock, $.001 par value,
780,000,000 shares authorized,
12,281,569 shares issued and
outstanding 12,282 12,068
Additional paid-in capital 2,016,604 1,200,077
Statuary reserve 2,988,308 1,882,797
Retained earnings 20,704,629 11,764,079
Accumulated other comprehensive
income 2,453,990 2,404,419
Total Stockholders' Equity 28,175,813 17,263,442

Total Liabilities and Stockholders'
Equity $55,978,960 $49,521,382

CHINA GREEN AGRICULTURE INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME
FOR THE THREE AND NINE MONTHS ENDED MARCH 31, 2009 AND 2008
(UNAUDITED)

Nine Months Ended March Three Months Ended March
31, 31,
2009 2008 2009 2008

Net sales $24,721,802 $15,382,089 $8,841,675 $4,434,926
Cost of goods sold 10,608,336 6,377,066 3,776,138 1,982,084
Gross profit 14,113,466 9,005,023 5,065,537 2,452,841
Operating expenses
Selling expenses 786,462 614,646 203,925 142,808
General and
administrative
expenses 1,432,514 1,430,762 408,740 256,800
Total operating
expenses 2,218,976 2,045,408 612,665 399,608
Income from
operations 11,894,490 6,959,615 4,452,872 2,053,233
Other income
(expense)
Other
income(expense) 4,862 39,647 207 655
Interest income 306,359 27,224 163,340 11,697
Interest expense (560,257) (284,361) (112,334) (86,761)
Bank charges (1,560) (6,442) (130) (4,939)
Total other income
(expense) (250,596) (223,933) 51,083 (79,348)
Income before income
taxes 11,643,894 6,735,682 4,503,955 1,973,886
Provision for income
taxes 1,597,833 301,841 613,673 301,841
Net income 10,046,061 6,433,842 3,890,282 1,672,045
Other comprehensive
items
Foreign currency
translation gain 49,570 1,511,242 57,891 957,245
Comprehensive income $10,095,631 $7,945,084 $3,948,173 $2,629,290

Basic weighted average
shares outstanding 18,439,569 13,482,590 18,559,206 18,314,017
Basic net earnings per
share $0.54 $0.48 $0.21 $0.09
Diluted weighted average
shares outstanding 18,440,958 13,482,590 18,560,594 18,314,017
Diluted net earnings per
share $0.54 $0.48 $0.21 $0.09

CHINA GREEN AGRICULTURE INC. AND SUBSIDIARIES
STATEMENTS OF CASH FLOWS
FOR THE NINE MONTHS ENDED MARCH 31, 2009 AND 2008
(UNAUDITED)

2009 2008
Cash flows from operating activities
Net income $10,046,061 $6,433,842
Adjustments to reconcile net income
to net cash provided by operating
activities

Share capital contribution - rental
and interest paid by shareholders -- 32,656
Issuance of stock options for
compensation 112,247 --
Depreciation 1,121,989 703,271
Amortization 80,267 78,693
Decrease / (Increase) in current
assets
Accounts receivable (3,269,466) 256,854
Other receivables 12,465 79,100
Inventories (4,261,570) (3,696,399)
Advances to suppliers 372,837 (45,061)
Other assets 6,528 (16,581)
(Decrease) / Increase in current
liabilities
Accounts payable 1,002,165 131,130
Unearned revenue (30,100) 33,561
Tax payables (4,411,497) 1,855,704
Other payables and accrued expenses 199,071 (365,254)
Net cash provided by operating
activities 980,997 5,481,516

Cash flows from investing activities
Acquisition of plant, property, and
equipment (465,648) (4,917,610)
Advances for construction in progress -- (409,841)
Additions to construction in progress (3,059,913) (20,655)
Net cash used in investing activities (3,525,561) (5,348,106)

Cash flows from financing activities
Repayment of loan (525,475) (1,827,836)
Shares issuance cost -- 1,353,952
Proceeds issuance of shares subject
to redemption -- 18,602,720
Restricted cash 75,074 (4,228,641)
(Payments)/proceeds to/from related
parties -- (642,342)
Net cash provided by (used in)
financing activities (450,401) 13,257,854

Effect of exchange rate change on
cash and cash equivalents 15,509 513,415
Net increase (decrease) in cash and
cash equivalents (2,979,455) 13,904,679

Cash and cash equivalents, beginning
balance 16,612,416 81,716
Cash and cash equivalents, ending
balance $13,632,961 $13,986,395

Supplement disclosure of cash flow
information
Interest expense paid $(339,203) $(222,260)
Income taxes paid $(2,734,352) $--

Non Cash Transaction:
Stock issued for settlement of
registration rights liability $704,494 $--

For further information, please contact:

China Green Agriculture, Inc.
Ms. Ying Yang, Chief Financial Officer
Tel: +1-626-623-2575
Email: yangying@techteam.com.cn

HC International, Inc.
Ted Haberfield, Executive VP
Tel: +1-760-755-2716
Email: thaberfield@hcinternational.net
Web: http://www.hcinternational.net

SOURCE China Green Agriculture, Inc.

China Green Agriculture, Inc., Ms. Ying Yang, Chief Financial Officer,
+1-626-623-2575, yangying@techteam.com.cn or HC International, Inc., Ted
Haberfield, Executive VP, +1-760-755-2716, thaberfield@hcinternational.net,
for China Green Agriculture, Inc.