Zhongpin's Q1 net income surges 37%

Chinese pork processing company Zhongpin Inc. said Friday (May 7) that its net income rose 37% in the first quarter as its sales rose.

For the three months that ended March 31, the company earned US$13.3 million, or 38 cents per share. That compares with US$9.7 million, or 33 cents per share, in the first quarter of 2009. On average, analysts expected earnings of 35 cents per share.

Quarterly revenue was US$204.3 million, up from US$153.8 million. The company said it is continuing its strategy this year of increasing production capacity and building its brand recognition.

In January, the company began production at a chilled and frozen pork plant in Tianjin, and the plant is to reach capacity in the third quarter. It also is building another facility in Tianjin. It also began work in March on expanding capacity by 35% at its chilled-pork plant in Anyang. The project is to be completed by July.

Zhongpin noted that hog and pork prices fell about 10% in the first quarter from the previous quarter because of an outbreak of foot-and-mouth disease in south China.

For 2010, Zhongpin affirmed its forecast for net income of US$52 million to US$57 million, or US$1.49 per share to US$1.64 per share.