News and Press Releases

Sino Agro Food, Inc. Reports Nine Month Results

Year-Over-Year Nine Month Revenue Doubles to $180.2M

Record Q3 Revenue of $70.7M

Nov 18, 2013

Note: This press release was amended on November 22, 2013. Please click here to view the amended version.

GUANGZHOU, China, Nov. 18, 2013 /PRNewswire/ -- Sino Agro Food, Inc. (OTC BB: SIAF.OB), an emerging integrated, diversified agriculture technology and organic food company ("the Company") with principal operations in the People's Republic of China ("PRC"), is pleased to announce financial results for nine months ending September 30, 2013:

Consolidated Financial Summary (year over year):

Nine months ending

Sept 30, 2013

Sept 30, 2012




$ 89,678,991


Gross Profit

$ 67,036,389

$ 47,324,674


Comprehensive Income

(Sino Agro Food, Inc. + subsidiaries)

$ 51,389,618

$ 38,743,558



Stockholders' Equity

(Sino Agro Food, Inc. + subsidiaries)




Record revenue of $70.7M exceeded the Company's previous quarterly high water mark by over $15M, in line with Company guidance for 2013. Total stockholders' equity increased by $22.7M in the third quarter to $261.9M, or $2.03 per fully diluted share versus $1.95 at the end of the second quarter.

As of September 30, 2013, the Company had unrestricted cash and equivalents of $9,588,415 and working capital of $154,548,532.

Net income from continuing operations for the third quarter totaled $18,752,774 or $.15 per share. Gross margins for the quarter declined due to a reduction in revenue from Consulting and Services of $4.6M in the Fishery Division and $7.2m in the Cattle Farm division.

The Company made some strategic operational decisions mainly relating to resource allocation in Consulting and Services, and embarked upon complementary financial initiatives designed to greatly increase flexibility in both, and to expedite operating cash flow increases. The Company intends to strengthen its growth path as it completes the final year of its five-year plan in 2014.

Mr. Solomon Lee, CEO commented, "I am very pleased with the progress the Company continues to demonstrate, and look forward to attaining greater benchmarks throughout the coming year, in concert with our strategic plan. I would encourage everyone to take the time and review Management's Discussion and Analysis in the Q3 filing. It contains many details on overall performance, and adds clarity and perspective to the Company's methodology behind its stellar growth and development."

On October 2, 2013 the Company submitted application to NASDAQ seeking listing on the exchange. As of November 18, 2013, the application remains pending.

SJAP Achieves Dragon Head Enterprise Status

On October 28, 2013, SJAP's nomination to apply the merit credentials in China to become a certified China Dragon Head Enterprise was approved by the Government Authorities. This is a major achievement and marks a milestone in SJAP's business operations, plans, and prospects. "Dragon Head" designation both validates and promotes SJAP's transformation from purely a producer of whole live cattle to a producer, processor, and marketer of packaged, value added beef products. Such vertical integration presents a significant competitive advantage in the region. In the first quarter of 2014, a multiplier effect will begin to accrue across all financial measures.

"Dragon Head Enterprise" is a prestigious certification granted by the Government to businesses demonstrating corporate social responsibility ("CSR"), pioneering and leadership in business, and high standards of quality and services. It frequently leads to additional governmental grants and other forms of assistance. The Qinghai Province population has a larger percentage of ethnic minorities than most, and thereby businesses receive proportionately higher grants, incentives, assistances and subsidies from the Government. Stemming from its business model, SJAP has been well supported by the Government due to our CSR. The Company expects to receive even greater support from the Government with the approval of its "Dragon Head Enterprise" status.


Again in the third quarter, the Company continued its "farm to plate" concept, expanding and further integrating as it evolves from primarily a food producer to a processor and marketer as well.

Fishery Division Performance

Revenue from the fishery division amounted to $26,704.244 for the three months ended September 30, 2013 compared to $27,088,699 for the three months ended September 30, 2012.

As fewer fish farms were being built during the third quarter 2013, revenue from Consulting and Services decreased by $4,639,114.

However, revenue from the Sales of fish, prawns, and eel increased by $4,254,659 or 27.4% to $19,764,839 in the three months ended September 30, 2013 from $15,510,180 for the quarter ended September 30, 2012.

Jiangmen City A Power Fishery ("Fish Farm 1") is now fully operational, with a designed capacity of 1,200 metric tons per year (its built up area is 9,900 square meters). The configuration of 16 AP RAS tanks is now adapted to accommodate sleepy cod, prawns, and flower pattern eel production.

Enping City A Power Prawn Co. (EBAPCD or "Prawn Farm 1") is the first indoor RAS prawn farm in Asia. On April 22, 2013, the first 500,000 (Mexican White) prawn fingerlings were placed, and as of the date of this quarterly filing, management reports that prawns are meeting growth benchmarks with low mortality rates. During Q3, Prawn Farm 1 harvested 102 MT of marketable sized prawns, in line with its target 2013 sales of 250-300 metric tons.

The designed capacity for Prawn Farm one is 400 MT in 2013; this will double in 2014.

Zhongshan A Power Prawn Co. (ZSAPP or "Prawn Farm 2") Phase I is fully operational. During the third quarter, 2013, ZSAPP sold 258M Mexican White fingerlings at an average price of RMB165/10,000 fingerlings, and over 100M Big Giant Prawn fingerlings at an average price of RMB460/10,000 fingerlings. The design capacity of Phase I is 1.6B fingerling and 400 MT of prawns, increasing to 3.2B fingerlings and 1,200 MT of prawns through Phases II and III.

Phase II construction is scheduled to complete by the end of 2013, and Phase III by end of 2014.

The Fish and Eel Farm ("Fish Farm 2") is currently under construction, in three phases, with a scheduled built up area of 165,000 square meters, targeting an initial designed capacity of 800 MT in 2014.

Plantation Division Performance

Revenue from the plantation division increased by $3,298,774 or 45.59% to $10,534.960 for the three months ended September 30, 2013 from $7,236,186 for the three months ended September 30, 2012. The increase was primarily due to higher production of flowers by 301MT, and by the rise in the wholesale price of fresh flowers from $.13/piece (Q1-Q3, 2012) to $.15 per piece (Q3, 2013).

Jiangmen City Heng Sheng Tai Agriculture Co. Ltd. ("JHST") is a consolidated subsidiary, which cultivates 187 acres of Hylocereus Undatus, or Dragon Fruit Flowers. Past years' problems with disease and weather have been solved and avoided so far this year. During 2013, JHST has completed the revitalization of its HU plantation with new irrigation systems and the addition of staff housing to accommodate more than 40 workers.

In addition, this quarter marks the first for harvesting a second crop, a special Chinese herb called XueYingZi and commonly known as "Immortal Vegetables." Harvests from the trial grown on over 30 MU yielded over 200 MT of crops (inclusive of roots), averaging 6.7 MT/MU from a density of about 1,700 plants. This meets the Company's earlier targets.

Immortal Vegetables were also planted in between each row of HU plants, anticipating that the shelf life of fresh HU flowers would be prolonged. As harvesting progressed, this was evidently not the case. As of September 2013 the Company started trials of other cash crops in between the HU plant rows, with the aim to improve revenues throughout the year.

Beef Division Performance

Revenue from beef division increased by $4,378,970 or 115.66% to $8,164,934 for the three months ended September 30, 2013 compared to $3,785,964 for the three months ended September 30, 2012. The increase was due to improved cattle sales.

Subsequent to the quarter's end, Qinghai Sanjiang A Power Agriculture Co ("SJAP") received the prestigious "Dragon Head Business" status, rewarding work there to date, and portending well for the remaining execution of the unit's five-year plan, and capitalizing results.

Work continues on both constructing new cattle houses and the new abattoir/deboning and packaging facilities. SJAP received its permit April 17, 2013 and construction commenced April 21, 2013. As of the first week in November, the construction of the slaughterhouse complex was about 80% complete. In turn, trial runs of the facilities are scheduled no later than the end of December, targeting phase I operation to commence in the first quarter of 2014.

In China, obtaining a business permit for an abattoir complex is difficult and rare. Accordingly, it will be a very valuable asset. Not only a competitive barrier to market entry, the slaughterhouse, deboning and value added meat processing facilities will make significant contributions to sales growth in 2014. As a primary producer, including revenues from organic fertilizer, bulk livestock feed, concentrated feed, and the sale of live cattle, and after fattening 15-16 month old cattle for 5-6 months, and excluding marketing division revenues, SJAP generates RMB29,940 per head of cattle. As a value added processor, with 10% of the beef sold as value added processed beef products, SJAP expects revenues of RMB81,347 per head, an increase of 171%.

Prices of beef cattle under a year old are increasing faster than older cattle (12% over the first quarter, 2013), providing a leading indicator of mature cattle and beef product prices in the future.

SJAP targets live cattle production of 8,000 head in 2013, split evenly between its own farms and cooperative growers, with targeted growth of 50% in 2014, and with excess capacity in the abattoir complex for additional processing.

Management's Discussion and Analysis section in the 10-Q filed November 18 2013 presents supporting detail for SJAP's business, as well as all other divisions and sub-divisions.

Organic Fertilizer Division Performance

Revenue from organic fertilizer increased by $10,559,333 or 617% to $12,270.019 for the three months ended September 30, 2013 compared to $1,710,686 for the three months ended September 30, 2012. The increase was primarily due to across the board new or raised manufacturing capacities for organic fertilizer and for bulk and concentrated feed at SJAP, as well as pure organic mixed fertilizer ("POMF") at Hunan Shenghua A Power Co. ("HSA").

The Company believes HSA's pure organic fertilizer aligns well with government policy encouraging lake fish farmers to use organic fertilizer versus chemical, providing a very large market.

Cattle Farm Division Performance

Revenue from the cattle farm decreased by $3,531.139 to $4,639,397 for the three months ended September 30, 2013 compared to $8,170,536 for the three months ended September 30, 2012. The decrease was entirely due to zero revenues from consulting and services, as no new cattle farms were being built in the third quarter of 2013. This represented a year over year drop in revenues of $7,194,814. As consulting and services are a high gross profit margin business, this reduced the Company's overall gross profit margins and earnings per share.

Within the division, this decrease was offset by a 268% increase in the sale of live cattle from $1,262,184 to $4,639,397 in the third quarters of 2012 and 2013, respectively.

Corporate Division Performance

Revenue for the three months ended September 30 2013 increased by $8,394,143 compared to $0 for the three months ended September 30, 2012. The increase is due primarily to the increase of sales through trading of imported frozen and fresh seafood for the three months ended September 30 2013.

During the third quarter 2013, the Company's import export sub-division sold twelve 40-foot containers of seafood from various countries (i.e. Russia, Malaysia, Thailand, Chile, Norway). Imports of live mud crabs, flower pattern eels, and other fish from Madagascar totaled 500 metric tons.

As of September 2013, the group is managing six Leonie's restaurants totaling 5,800 square meters (63,800 square feet) with seating capacity for 1,370 persons, either in operation or under construction. As of October 31, 2013 planning or construction of three additional smaller specialized gourmet shops was underway, targeting completion by the end of 2013.

The Company is investigating opportunities for satellite distribution centers serving tier 1, 2, and 3 cities to market its planned production from SJAP, adding to its "Beijing Cattle Farm" in the Central Cattle Market and Facility of Beijing City, which housed 450 head of cattle from Cattle Farm 1 in the third quarter.

Consolidated Results


Revenue increased by $22,357,009 or 46.24% to $70,707,697 for the three months ended September 30, 2013 compared to $48,350,688 for the three months ended September 30, 2012. The increase was primarily due to the natural growth of revenue generated from the organic fertilizer, beef and plantation divisions, and corporate and other operations not commenced in 2012.

The following chart illustrates the changes by business segment from the three months ended September 30, 2012 to three months ended September 30, 2013. (Of note, certain revenues classified in the fishery division in 2012 were reclassified to the corporate division in 2013.)


Cost of Goods




Change ($)

Change (%)

Fishery (CA)



-$   384,455


Plantation (JHST)


$ 7,236,186

$ 3,298,774


Organic Fertilizer (SJAP


$ 1,710,686



Beef (SJAP)

$ 8,164,934

$ 3,785,964

$ 4,378,970


Cattle Farm (MEIJI)

$ 4,639,397

$ 8,529,153

-$ 3,889,756


Corporate/Other (SIAF)

$ 8,394,143


$ 8,394,143







Cost of Goods Sold increased by $21,986,718 or 97.30% to $44,584,572 for the three months ended September 30, 2013 from $22,597,854 for the three months ended September 30, 2012. The increase was primarily due to the Company increasing its scale of operation from continuing operations at its fishery, plantation, organic fertilizer, cattle farm and beef operations for the three months ended September 30, 2013 as compared to the three months ended September 30, 2012

Gross Profit

Gross profit increased by $370,291 or 1.44% to $26,123,125 for the three months ended September 30, 2013 compared to $25,752,834 for the three months ended September 30, 2012. The increase was primarily due to the corresponding increases in revenues from our organic fertilizer, beef, and plantation divisions, offset by decreases corresponding to the decrease in revenues generated from consulting and services segments within the fishery division (by $4,639,114) and within the cattle division (by $7,194,209).

Earnings Call Information

The Company will host an earnings call on November 26, 2013 at 11:00 AM EST to discuss financial results for the third quarter of 2013, with questions and answers. To participate in the conference call please use the following information:

SIAF 2013 Third Quarter Earnings Call Information

Date: November 26, 2013

Time: 11:00 AM, U.S. Eastern Standard Time

Participant Dialing Instructions:

Toll Free Number:

(1-800) 766-1337

Direct Dial Number:

(1-404) 920-6210

Conference Code:  2423733#

An audio replay of the conference call will be made available in the Investor Relations section of the Company's web site.


Financial Tables


Sino Agro Food, Inc. Consolidated Balance Sheets


September 30, 2013


December 31,  2012








Current assets


   Cash and cash equivalents





   Accounts receivable, net of allowance for doubtful accounts









   Cost and estimated earnings in excess of billings on uncompleted contracts




   Deposits and prepaid expenses





   Other receivables





Total current assets





Property and equipment


   Property and equipment, net of accumulated depreciation




   Construction in progress





   Land use rights, net of accumulated amortization




Total property and equipment





Other assets







   Proprietary technologies, net of accumulated amortization




   License rights





Total other assets






Total assets








Current liabilities


   Accounts payable and accrued expenses





   Billings in excess of costs and estimated earnings on uncompleted contracts




   Due to a director





   Dividends payable





   Other payables





   Short term bank loan










Non-current liabilities


    Deferred dividends payable





    Bonds payable



    Long term debts










Commitments and contingencies






Stockholders' equity


   Preferred stock: $0.001 par value


   (10,000,000 shares authorized, 0 share issued and outstanding


       as of  September 30, 2013 and December 31, 2012, respectively)


   Series A preferred stock:  $0.001 par value


$           -


$           -

   (100 shares designated, 100 shares issued and outstanding


       as of  September 30, 2013 and December 31, 2012, respectively)


   Series B convertible preferred stock:  $0.001 par value)




   (10,000,000 shares designated, 7,000,000 and 10,000,000 shares issued  and outstanding)


       as of  September 30, 2013 and December 31, 2012, respectively)


   Series F Non-convertible preferred stock:  $0.001 par value)


   (1,000,000 shares designated, 0 shares issued  and outstanding)




       as of  September 30, 2013 and December 31, 2012, respectively)


   Common stock:  $0.001 par value





   (130,000,000 shares authorized, 128,563,766 and 100,004,850 shares issued and outstanding


       as of  September 30, 2013 and December 31, 2012, respectively)


   Additional paid - in capital





   Retained earnings





   Accumulated other comprehensive income





  Treasury stock 





Total Sino Agro Food, Inc. and subsidiaries stockholders' equity




Non - controlling interest





Total stockholders' equity 





Total liabilities and stockholders' equity








Sino Agro Food, Inc.

Consolidated Statements of Income and Other Comprehensive Income










 months ended


 months ended


 months ended


 months ended


September 30, 2013


September 30, 2012


September 30, 2013


September 30, 2012




















Cost of goods sold










Gross profit










General and administrative expenses








Net income from operations










Other income 


Government grant










Other income










Gain on extinguishment of debts









Interest expense










Net income










Net income  before income taxes









Provision for income taxes










Net income









Less: Net (income) loss attributable 


   to the non - controlling interest








Net income from continuing operations  attributable


 to  Sino Agro Food, Inc. and subsidiaries








Other comprehensive income  (loss)


      Foreign currency translation gain 








Comprehensive income 









Less: other comprehensive (income)  loss attributable 


to the non - controlling interest








Comprehensive income attributable to 


  Sino Agro Food, Inc. and subsidiaries











$   -




$   -



Earnings per share attributable to Sino Agro Food, Inc. 


  and subsidiaries common stockholders:




$          0.15


$          0.27


$          0.43


$          0.51




$          0.15


$          0.25


$          0.40


$          0.47


Weighted average number of shares outstanding:























Sino Agro Food, Inc. Consolidated Statements of Cash Flows


Nine months ended


Nine months ended


September 30, 2013


September 30, 2012






Cash flows from operating activities


    Net income






   Adjustments to reconcile net income to net cash from operations:












      Common stock issued for services





      Gain on extinguishment of debts





      Other amortized expenses





   Changes in operating assets and liabilities:


      Increase in inventories





     Decrease (increase) in cost and estimated earnings in excess of billings on uncompleted contacts




      Increase in accounts  receivable





      Increase in deposits and prepaid expenses





      (Increase) decrease in other receivables





      Increase in due to a director





      Increase in  accounts payable and accrued expenses





      (Decrease) increase in billings in excess of costs and estimated earnings on uncompleted contracts




      Decrease in amount due to related parties





      Decrease in amount due from related parties





      Increase in  other payables





Net cash provided by operating activities





Cash flows from investing activities


   Acquisition of property and equipment





   Acquisition of proprietary technologies





   Acquisition of land use rights





   Business combination of a subsidiary





   Payment for construction in progress





Net cash used in investing activities





Cash flows from financing activities


  Short term bank loan raised





  Short term bank loan repaid




  Non - controlling interest contribution





  Net proceeds of bonds 





  Dividends paid





Net cash (used in) provided by  financing activities






Effects on exchange rate changes on cash





   Increase in cash and cash equivalents






   Cash and cash equivalents, beginning of period





   Cash and cash equivalents, end of period






Supplementary disclosures of cash flow information:


  Cash paid for interest






  Cash paid for income taxes






  Non - cash transactions


 Common stock issued for settlement of debts





 Common stock issued for services and compensation





 Disposal proceeds receivable of sales of subsidiaries, HYT and ZX


$   -



 Transfer construction in progress to property, plant and equipment





 Series B Convertible preferred shares cancelled




$   -



About Sino Agro Food, Inc.

Sino Agro Food, Inc. ("SIAF") ( is an integrated, diversified agricultural technology and organic food company focused on developing, producing and distributing agricultural products in the Peoples Republic of China. The Company addresses the increasing demand of China's rising middle class for gourmet and high-quality food items. Current lines of business include the manufacture and distribution of beef and lamb products, fish products, bioorganic fertilizer, stock feed and cash crops.

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Not a Broker/Dealer or Financial Advisor

Sino Agro Food, Inc. is not a Registered Broker/Dealer or a Financial Advisor, nor does it hold itself out to be a Registered Broker/Dealer or Financial Advisor. All material presented in this press release, on the Company's website or other media is not to be regarded as investment advice and is only for informative purposes. Readers should verify all claims and conduct their own due diligence before investing in Sino Agro Food, Inc.

Investing in small-cap, micro cap and penny stock securities is speculative and carries a high degree of risk.

No Offer of Securities

None of the information featured in this press release constitutes an offer or solicitation to purchase or to sell any securities of Sino Agro Food, Inc.

Forward Looking Statements

This release contains certain "forward-looking statements" relating to the business of SIAF and its subsidiary companies, which can be identified by the use of forward-looking terminology such as "believes, expects" or similar expressions. Such forward-looking statements involve known and unknown risks and uncertainties that may cause actual results to be materially different from those described herein as anticipated, believed, estimated or expected. Certain of these risks and uncertainties are or will be described in greater detail in our filings with the Securities and Exchange Commission. These forward-looking statements are based on SIAF's current expectations and beliefs concerning future developments and their potential effects on SIAF. There can be no assurance that future developments affecting SIAF will be those anticipated by SIAF. These forward-looking statements involve a number of risks, uncertainties (some of which are beyond the control of the Company) or other assumptions that may cause actual results or performance to be materially different from those expressed or implied by such forward-looking statements. SIAF undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as may be required under applicable securities laws.

SOURCE Sino Agro Food, Inc.

For further information: Sino Agro Food, Inc., CEO Mr. Solomon Lee, 86-20-22057860, or Peter Grossman, Investor Relations (US and Europe):