Shiner International Announces Third Quarter Fiscal 2012 Results

HAIKOU, China, Nov. 14, 2012

Revenues for the three months ended September 30, 2012 decreased $1.9 million (or 10.2%), to $16.7 million compared to $18.6 million for the corresponding period in 2011. The decrease was primarily attributable to decreased revenues from coated film, color printing, advanced film and water-based latex, which was partially offset by increase in revenues generated from BOPP tobacco. For the three months ended September 30, 2012, revenue from coated film revenue decreased $3.2 million (or 46.4%) to $3.7 million from $6.9 million for the corresponding period in 2011, and sales from color printing decreased $0.4 million (or 28.7%) to $1.0 million from $1.4 million for the corresponding period in 2011. For the three months ended September 30, 2012, revenue from BOPP tobacco increased $3.2 million (or 45.0%) to $10.3 million from $7.1 million for the corresponding period in 2011; revenue from advanced film decreased $1.4 million (or 46.0%) to $1.6 million from $3.0 million for the corresponding period in 2011; and revenue from water-based latex decreased $0.1 million (or 98.6%) to $0.01 million from $0.1 million for the corresponding period in 2011.

Shiner's gross profit for the three months ended September 30, 2012 was $1.4 million, a profit margin of 8.7%, a decrease of 2.7% from 11.4% for the corresponding period in 2011. The decrease in profit margin was primarily a consequence of an increase in labor costs and depreciation of new property.

Operating loss for the three months ended September 30, 2012 was $3.2 million, compared to operating income of $0.3 million for the corresponding quarter ended September 30, 2011. Selling, general and administrative expenses for the three months ended September 30, 2012 increased by 40.6%, or $0.7 million, to $2.5 million in 2012, compared to $1.8 million for the corresponding period in 2011. General and administrative expenses increased during the 2012 period due to a $0.3 million increase in research and development expenditures and a $0.7 million increase in bad debt allowance, as compared to 2011. There was also a $2.1 million increase in loss on sale and write off of assets during the 2012 period.

Shiner reported net loss of $3.5 million for the three months ended September 30, 2012, compared to a net income of $0.4 million in the corresponding period of 2011. Earnings per share for the quarter were ($0.13), compared to earnings of $0.01 per share for the corresponding period of 2011.

Nine Months Financial Results

Revenue for the first nine months of fiscal year 2012 decreased $1.9 million (or 3.6%), to $50.5 million, compared to $52.4 million in the corresponding period a year ago. Gross profit for the nine months ended September 30, 2012 was $4.1 million, a profit margin of 8.1%, a decrease of 5.3% from 13.4% for the corresponding period in 2011. Operating loss was $4.8 million, down from an operating income of $2.8 million in the first nine months of fiscal year 2011. The Company saw a net loss of $5.5 million for the nine months ended September 30, 2012, representing a decrease of $7.7 million (or 351.4%) from a net income of $2.2 million for the corresponding period in 2011. Fully diluted loss per share was ($0.20), compared to fully diluted income per share of $0.08 for the first nine months of fiscal year 2011.