Synutra, which owns subsidiaries in China that produce, distribute and sell nutritional products for infants, children and adults, has announced financial results for the third quarter and first nine months of fiscal 2014 ended December 31, 2013.
Net sales increased 14% to $101.0 million for the third quarter of fiscal 2014 from $88.6 million in the second quarter of fiscal 2014. Net sales for the first nine months of fiscal 2014 ended December 31, 2013 increased to $271.8 million from $192.9 million in the prior year period.
"We are pleased with our strong performance in the third quarter as we achieved better-than-expected results in both sales growth and earnings,” said Liang Zhang, chairman and CEO of Synutra. “The sequential increase in our branded powdered formula segment sales benefitted from seasonality effects and the early timing of the Chinese New Year, but more fundamentally, was backed by the successful execution of our Goldmining Strategy and effective marketing efforts for our specialty formula products. Our distributors increased shipment volumes and we effectively managed our gross margin pressure from rising raw material costs."
"In 2013, there were changes in the competitive landscape of China's infant formula market and continued public scrutiny of dairy companies' product quality and marketing conduct,” continued Liang Zhang. “Amidst the new market environment, Synutra differentiated itself in several ways. First, as a provider of safe and nutritious products, we continue to upgrade our production standards to comply with evolving regulations. Over the long term, our French drying facility will provide a sustainable, secure supply of high-quality raw materials. Second, as the only licensed domestic producer of medical-purpose specialty formula, we are uniquely positioned to capitalize on marketing and sales in the medical channel. This advantage has helped us regain our growth momentum. Third, in light of the Chinese government's support of industry consolidation among domestic dairy companies, the strength and quality of our brands have positioned Synutra as a favorable partner for strategic growth opportunities."
