UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 6-K
Report of Foreign Private Issuer
Pursuant to Rule 13a-16 or 15d-16
under the Securities Exchange Act of 1934
For the month of August 2012
Commission File Number: 001-34754
China New Borun Corporation
(Translation of Registrant’s name into English)
Bohai Industrial Park
Yangkou Town
Shouguang, Shandong
People’s Republic of China 262715
(Address of principal executive offices)
Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F:
| x Form 20-F | ¨ Form 40-F |
Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1): ¨
Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7): ¨
Indicate by check mark whether the registrant by furnishing the information contained in this Form is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934:
| ¨ Yes | x No |
If “Yes” is marked, indicate below the file number assigned to the registrant in connection with Rule 12g3-2(b): n/a
China New Borun Announces Second Quarter 2012 Financial Results
On August 6, 2012, China New Borun Corporation (the “Company) issued a press release announcing the second quarter 2012 financial results of the Company. A copy of the press release is filed and attached as Exhibit 99.1 of this Report on Form 6-K.
The information in this Report, including the exhibit, shall not be deemed to be “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liabilities of that Section. It shall not be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, except as shall be expressly set forth by specific reference in such a filing.
Exhibits
99.1 Press Release dated August 6, 2012
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
| China New Borun Corporation | ||
|
| ||
| By: | /s/ Terence Chen | |
| Name: |
Terence Chen
| |
| Title: | Chief Financial Officer | |
Date: August 7, 2012
Exhibit 99.1
China New Borun Announces Second Quarter 2012 Financial Results
2Q12 Revenue Increased 11.0% Year-Over-Year
Beijing, China, August 6, 2012 – China New Borun Corporation (NYSE: BORN; “Borun” or the “Company”), a leading producer and distributor of corn-based edible alcohol in China, today announced unaudited financial results for the second quarter of 2012.
Second Quarter 2012 Quick View
| · | Total revenue increased 11.0% to RMB803.7 million ($127.1 million1) from RMB724.4 million in the second quarter of 2011. |
| · | Gross profit decreased 23.6% to RMB115.5 million ($18.3 million) from RMB151.1 million in the second quarter of 2011. |
| · | Net income decreased 28.9% to RMB68.1 million ($10.8 million) from RMB95.8 million in the second quarter of 2011. |
| · | Diluted earnings per American Depositary Share ("ADS") were RMB2.65 ($0.42) for the quarter ended June 30, 2012. Each ADS represents one of the Company's ordinary shares. |
Commenting on the results for the quarter, Mr. Jinmiao Wang, Chairman and Chief Executive Officer of Borun, stated, “We are proud of our record quarterly revenue achieved in the second quarter, with continued growth from all of our key product lines. Our strong top line provides clear evidence of the continued solid demand for our edible alcohol and by-products in China, and driven by our pre-sale success, we continue to immediately sell-out our entire production, gaining greater operating efficiency.”
Mr. Wang added, “Our key raw material, corn, continued its price increase trend during this non-harvest season in the second quarter, and the entire edible alcohol industry faced margins pressure. However, even though corn prices may continue to rise in future quarters, we are cautiously optimistic that prices for our main product, edible alcohol, will also pick up for the remainder of 2012, which should mitigate further margin contraction. Additionally, our strategic corn sourcing arrangement provides us with assured supplies at a favorable price throughout the non-harvest season. We believe that these initiatives will position Borun well in the second half of 2012.”
Second Quarter 2012 Financial Performance
For the second quarter of 2012, revenue increased by 11.0% year-over-year to RMB803.7 million ($127.1 million) from RMB724.4 million in the same period of 2011. Key factors affecting the Company’s results of operations are as follows:
| · | Revenue from edible alcohol, driven by higher sales volume, increased by 7.3% to RMB562.3 million ($88.9 million) in the second quarter of 2012, compared to RMB523.9 million in the second quarter of 2011. Due to the solid demand for edible alcohol, the sales volume increased by 6.1% year-over-year to 100,111 tons. In the second quarter of 2012, selling price of edible alcohol increased by 1.2% year-over-year to RMB5,617 per ton. |
| Ÿ | Revenue from DDGS Feed increased by 38.5% to RMB165.1 million ($26.1 million) in the second quarter of 2012, compared to RMB119.2 million in the second quarter of 2011, as sales volume increased by 14.1% year-over-year to 85,740 tons. The implementation of crude corn oil production in Shouguang Facility further increased DDGS Feed yield per ton of corn processed. In the second quarter of 2012, selling price of DDGS Feed increased by 21.4% year-over-year to RMB1,926 per ton. |
| · | Revenue from liquid carbon dioxide increased by 4.9% to RMB16.6 million ($2.6 million) in the second quarter of 2012 compared to RMB15.8 million in the second quarter of 2011, driven by higher sales volume during the period, partially offset by a decrease in selling price per ton. In the second quarter of 2012, sales volume increased by 21.2% to 36,307 tons, and selling price decreased by 13.4% year-over-year to RMB457 per ton. |
| · | Revenue from crude corn oil increased by 75.7% to RMB59.7 million ($9.5 million) in the second quarter of 2012, compared to RMB34.0 million in the second quarter of 2011, as sales volume increased by 76.1% year-over-year to 7,754 tons and selling price decreased by 0.3% year-over-year to RMB7,694 per ton. |
During the second quarter of 2012, gross profit decreased by 23.6% to RMB115.5 million ($18.3 million) from RMB151.1 million in the same period of 2011. Gross margin for the second quarter of 2012 decreased to 14.4% from 20.9% in the same period of 2011, primarily due to corn cost increasing at a faster rate than selling price during the second quarter of 2012.
Operating income, despite stable operating expenses, decreased by 25.6% to RMB101.0 million ($16.0 million) in the second quarter of 2012, from RMB135.8 million in the same period of 2011, due to higher cost of goods sold.
Selling expenses were RMB1.2 million ($0.2 million) in the second quarter of 2012, which were stable compared to the same period of 2011.
General and administrative expenses were RMB13.3 million ($2.1 million) in the second quarter of 2012, which were stable compared to RMB14.1 million in the same period of 2011.
Income tax expenses in the second quarter of 2012 were RMB22.7 million ($3.6 million), representing an effective tax rate of 25.0%.
Net income decreased by 28.9% to RMB68.1 million ($10.8 million) in the second quarter of 2012, compared to RMB95.8 million in the same quarter of 2011. In the second quarter of 2012, basic and diluted earnings per share and per ADS were RMB2.65 ($0.42), and the Company had 25.7 million weighted average basic and diluted shares outstanding.
As of June 30, 2012, the Company had cash and bank deposits of RMB180.8 million ($28.6 million), representing a decrease from RMB223.9 million as of December 31, 2011. Cash flows used in operating activities for the quarter ended June 30, 2012 were approximately RMB4.2 million ($0.7 million) due to increased cash payments for corn held in inventory.
Financial Outlook
Reflecting a planned annual maintenance of its production facilities, the Company estimates that its revenue for the third quarter of 2012 will be in the range of RMB670.0 million ($105.9 million) to RMB695.0 million ($109.9 million), an increase of approximately 6.9% to 10.8% over the same quarter of 2011.
This forecast reflects the Company’s current and preliminary view, which is subject to change.
Conference Call
Borun’s management will hold a corresponding earnings conference call and live webcast at 8:00 a.m. E.T on Tuesday, August 7, 2012 (8:00 p.m. Beijing time on Tuesday, August 7, 2012) to discuss the results and highlights from the second quarter of 2012 and answer questions from investors. A webcast of the call will be available at http://ir.chinanewborun.com. Listeners may access the call by dialing:
| United States Toll Free: | 1-866-519-4004 | |
| US Toll/International: | 1-718-354-1231 | |
| Hong Kong Toll Free: | 800-930-346 | |
| Hong Kong Toll: | 852-2475-0994 | |
| China Toll Free: | 800-819-0121 | |
| China Toll Free (Mobile): | 400-620-8038 | |
| Conference ID: | 12463518 |
A replay of the webcast will be accessible through August 14, 2012 on http://ir.chinanewborun.com or by dialing:
| United States toll free: | 1-866-214-5335 | |
| International: | 1-718-354-1232 | |
| Passcode | 12463518 |
About China New Borun Corporation
China New Borun Corporation (NYSE: BORN) is a leading producer and distributor of corn-based edible alcohol in China. Borun’s edible alcohol products are primarily sold as an ingredient to producers of baijiu, a popular grain-based alcoholic beverage that is sold throughout China in retail stores, restaurants and bars. The Company also produces DDGS Feed, liquid carbon dioxide and crude corn oil as by-products of edible alcohol production. China New Borun is based in Shouguang, Shandong Province. Additional information about the company can be found at http://www.chinanewborun.com and in documents filed with the U.S. Securities and Exchange Commission (“SEC”), which are available on the SEC’s website at www.sec.gov.
Forward-looking Statements
All statements included in this press release, other than statements or characterizations of historical fact, are forward-looking statements. These forward-looking statements are based on our current expectations, estimates and projections about our industry, management's beliefs, and certain assumptions made by us, all of which are subject to change. Forward-looking statements can often be identified by words such as "anticipates," "expects," "intends," "plans," "predicts," "believes," "seeks," "estimates," "may," "will," "should," "would," "could," "potential," "continue," "ongoing," similar expressions, and variations or negatives of these words. These forward-looking statements are not guarantees of future results and are subject to risks, uncertainties and assumptions that could cause our actual results to differ materially and adversely from those expressed in any forward-looking statement.
Contact Information
Asia Bridge Capital Limited
Wendy Sun
+86-10-8556-9033
wendy.sun@asiabridgegroup.com
CHINA NEW BORUN CORPORATION
UNAUDITED CONSOLIDATED BALANCE SHEET
| December 31, 2011 | June 30, 2012 | |||||||||||
| RMB | RMB | US$ | ||||||||||
| Assets | ||||||||||||
| Cash | 223,875,750 | 180,849,070 | 28,593,190 | |||||||||
| Trade accounts receivable, net of allowance for doubtful accounts of nil and nil, respectively | 300,023,348 | 304,304,946 | 48,112,215 | |||||||||
| Inventories | 86,205,820 | 208,179,208 | 32,914,229 | |||||||||
| Advance to suppliers | 143,742,755 | 168,397,441 | 26,624,522 | |||||||||
| Other receivables | 12,682,305 | 10,171,348 | 1,608,144 | |||||||||
| Prepaid expenses | 3,957,293 | 2,945,514 | 465,701 | |||||||||
| Total current assets | 770,487,271 | 874,847,527 | 138,318,001 | |||||||||
| Property, plant and equipment, net | 1,127,381,307 | 1,088,892,293 | 172,159,606 | |||||||||
| Land use right, net | 57,583,427 | 57,008,157 | 9,013,290 | |||||||||
| Intangible assets, net | 17,301,257 | 15,388,135 | 2,432,945 | |||||||||
| Total assets | 1,972,753,262 | 2,036,136,112 | 321,923,842 | |||||||||
| Liabilities and shareholders’ equity | ||||||||||||
| Trade accounts payable | 13,200,118 | 17,312,029 | 2,737,123 | |||||||||
| Accrued expenses and other payables | 86,945,695 | 101,468,743 | 16,042,743 | |||||||||
| Income taxes payable | 34,475,778 | 27,924,652 | 4,415,035 | |||||||||
| Short-term borrowings | 508,700,000 | 428,200,000 | 67,700,675 | |||||||||
| Total current liabilities and total liabilities | 643,321,591 | 574,905,424 | 90,895,576 | |||||||||
| Shareholders’ equity | ||||||||||||
| Ordinary share (December 31, 2011 and June 30, 2012: par value of RMB0.0068259, 25,725,000 shares issued and outstanding) | 175,596 | 175,596 | 25,725 | |||||||||
| Additional paid-in capital | 468,132,187 | 468,132,187 | 74,014,164 | |||||||||
| Retained earnings – appropriated | 99,586,852 | 99,586,852 | 15,745,206 | |||||||||
| Retained earnings – unappropriated | 762,010,754 | 893,814,414 | 141,316,766 | |||||||||
| Accumulated other comprehensive loss | (473,718 | ) | (478,361 | ) | (73,595 | ) | ||||||
| Total shareholders’ equity | 1,329,431,671 | 1,461,230,688 | 231,028,266 | |||||||||
| Total liabilities and shareholders’ equity | 1,972,753,262 | 2,036,136,112 | 321,923,842 | |||||||||
CHINA NEW BORUN CORPORATION
UNAUDITED CONSOLIDATED STATEMENTS OF INCOME
| For the three-month period ended, | ||||||||||||||||
| June 30, 2011 | March 31, 2012 | June 30, 2012 | ||||||||||||||
| (RMB) | (RMB) | (RMB) | (US$) | |||||||||||||
| Revenues | 724,369,706 | 721,175,850 | 803,731,107 | 127,074,121 | ||||||||||||
| Cost of goods sold | 573,290,692 | 611,298,467 | 688,256,998 | 108,817,056 | ||||||||||||
| Gross profit | 151,079,014 | 109,877,383 | 115,474,109 | 18,257,065 | ||||||||||||
| Operating expenses: | ||||||||||||||||
| Selling | 1,230,520 | 1,162,789 | 1,153,473 | 182,370 | ||||||||||||
| General and administrative | 14,088,395 | 14,580,533 | 13,333,724 | 2,108,132 | ||||||||||||
| Total operating expenses | 15,318,915 | 15,743,322 | 14,487,197 | 2,290,502 | ||||||||||||
| Operating income | 135,760,099 | 94,134,061 | 100,986,912 | 15,966,563 | ||||||||||||
| Other (income) expenses: | ||||||||||||||||
| Interest income | (199,696 | ) | (319,400 | ) | (373,465 | ) | (59,047 | ) | ||||||||
| Interest expense | 7,852,602 | 9,555,927 | 10,538,792 | 1,666,239 | ||||||||||||
| Others, net | 1,849 | (15,898 | ) | (3,197 | ) | (505 | ) | |||||||||
| Total other expense, net | 7,654,755 | 9,220,629 | 10,162,130 | 1,606,687 | ||||||||||||
| Income before income taxes | 128,105,344 | 84,913,432 | 90,824,782 | 14,359,876 | ||||||||||||
| Income tax expense | 32,340,478 | 21,228,358 | 22,706,196 | 3,589,969 | ||||||||||||
| Net income | 95,764,866 | 63,685,074 | 68,118,586 | 10,769,907 | ||||||||||||
| Earnings per share: | ||||||||||||||||
| Basic and diluted | 3.72 | 2.48 | 2.65 | 0.42 | ||||||||||||
| Weighted average ordinary shares outstanding: | ||||||||||||||||
| Basic and diluted | 25,725,000 | 25,725,000 | 25,725,000 | 25,725,000 | ||||||||||||
CHINA NEW BORUN CORPORATION
UNAUDITED CONSOLIDATED STATEMENTS OF INCOME
| For the six-month period ended, | ||||||||||||
| June 30, 2011 | June 30, 2012 | |||||||||||
| (RMB) | (RMB) | (US$) | ||||||||||
| Revenues | 1,296,181,008 | 1,524,906,957 | 241,095,821 | |||||||||
| Cost of goods sold | 1,017,955,509 | 1,299,555,465 | 205,466,563 | |||||||||
| Gross profit | 278,225,499 | 225,351,492 | 35,629,258 | |||||||||
| Operating expenses: | ||||||||||||
| Selling | 2,389,920 | 2,316,262 | 366,213 | |||||||||
| General and administrative | 28,397,460 | 27,914,257 | 4,413,391 | |||||||||
| Total operating expenses | 30,787,380 | 30,230,519 | 4,779,604 | |||||||||
| Operating income | 247,438,119 | 195,120,973 | 30,849,654 | |||||||||
| Other (income) expenses: | ||||||||||||
| Interest income | (508,893 | ) | (692,865 | ) | (109,546 | ) | ||||||
| Interest expense | 15,900,270 | 20,094,719 | 3,177,081 | |||||||||
| Others, net | 8,181 | (19,095 | ) | (3,019 | ) | |||||||
| Total other expense, net | 15,399,558 | 19,382,759 | 3,064,516 | |||||||||
| Income before income taxes | 232,038,561 | 175,738,214 | 27,785,138 | |||||||||
| Income tax expense | 58,659,552 | 43,934,554 | 6,946,284 | |||||||||
| Net income | 173,379,009 | 131,803,660 | 20,838,854 | |||||||||
| Earnings per share: | ||||||||||||
| Basic and diluted | 6.74 | 5.12 | 0.81 | |||||||||
| Weighted average ordinary shares outstanding: | ||||||||||||
| Basic and diluted | 25,725,000 | 25,725,000 | 25,725,000 | |||||||||