HARBIN, China, April 3 /Xinhua-PRNewswire-FirstCall/ -- China Kangtai Cactus Biotech, Inc. , a vertically integrated grower, developer, manufacturer and marketer of a variety of cactus-based consumer products, today filed 10KSB to the SEC and reported audited results for the year ended December 31, 2006. All results reported are in U.S. dollars.
The Company has achieved an increase in net sales of almost 30%, from $8,002,738 in 2005 to $10,384,655 in 2006. At the same time, costs of sales increased only approximately 15%, from $6,156,184 in 2005 to $7,062,280 in 2006 and selling expenses even decreased approximately 13%, from $242,735 in 2005 to $211,972 in 2006. As a result, net income increased approximately 80%, from $795,491 in 2005 to $1,434,645 in 2006.
Although the audited results reported by the Company reflect a substantial improvement in the Company’s operating results on a year over year basis, they are significantly less than the preliminary un-audited results previously reported by the Company. The major difference in revenue recognition is that the Company previously booked revenue when it delivered its products to retail outlets. Under the new revenue recognition standards used in preparation of the audited financial statements the Company recognizes revenue only when the goods are sold by retail outlets to the end customers. A onetime non- recurring charge of almost $1 million in 2006 relating to the issuance of shares of stock as compensation for services also directly reduced net income by the same amount.
Jinjiang Wang, Chief Executive Officer of China Kangtai Cactus Biotech commented, ''The healthy and significant growth in our year 2006 results attributed to a growing demand for our high quality cactus-based consumer products throughout China, as well as our continuing efforts to improve our production and distribution efficiencies.’'
Wang concluded, ''Our Company remains focused on creating more product categories and lines for distribution and is adopting a new distribution strategy to quickly and more efficiently penetrate new markets in China. With 17 product patents and 15 pending approval, China Kangtai is the dominant company in the cactus-based consumer product sector.”
About China Kangtai Cactus Bio-Tech, Inc.
China Kangtai Cactus Bio-Tech, Inc. is market-leading cactus grower and producer of cactus-related products with over 380 acres of plants and an active R&D group that holds 17 product patents and is seeking another 15 in a variety of product categories. China Kangtai’s high-quality products are sold throughout China in supermarkets, food stores, hotels and restaurants through a growing distribution network that has currently covered 22 provinces and 3 municipalities.
Cautionary Statement Regarding Forward Looking Information
This press release contains forward-looking information about China Kangtai Cactus Bio-tech that is intended to be covered by the safe harbor for forward-looking statements provided by the Private Securities Litigation Reform Act of 1995. Forward-looking statements are statements that are not historical facts. These statements can be identified by the use of forward- looking terminology such as ''believe,’' ''expect,’' ''may,’' ''will,’' ''should,’' ''project,’' ''plan,’' ''seek,’' ''intend,’' or ''anticipate’’ or the negative thereof or comparable terminology, and include discussions of strategy, and statements about industry trends and China Kangtai Cactus Bio- tech future performance, operations and products.
This forward-looking information should be considered only in connection with ''Risk Factors’’ in China Kangtai Cactus Bio-tech’s quarterly report on Form 10KSB filed with the SEC on April 2, 2007, and its other current and periodic reports filed with the SEC. China Kangtai Cactus Bio-tech assumes no obligations to update any forward-looking statements or information set forth in this press release.
For more information, please contact: Ren Hu Vice President China Kangtai Cactus Bio-tech, Inc. Tel: +1-201-887-0415 Email: Arenhu@gmail.com
China Kangtai Cactus Bio-tech, Inc.
CONTACT: Ren Hu, Vice President of China Kangtai Cactus Bio-tech, Inc.,+1-201-887-0415, or Arenhu@gmail.com
