NANPING, China, July 24,
2020 /PRNewswire/ -- Happiness Biotech
Group Limited (the "Company" or Nasdaq: HAPP), an
innovative China-based nutraceutical and dietary supplements
producer, today announced its financial results for the
fiscal year ended March 31,
2020.
FY 2020 Financial Highlights:
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Revenue increased
$1,125,768 or 1.8% to $65,061,95 for the year ended March 31,
2020, as compared with $63,936,185 for the fiscal year ended
March 31, 2019
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Sales from Lucidum
spore powder products for the year ended March 31, 2020 increased
$8,346,748 or 42.0% as compared to the previous fiscal year and
accounted for 43.4% of our total revenue.
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Operating income was
$15,398,717 for the fiscal year ended March 31, 2020,
a decrease of 29.5% from the prior year period.
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The Company reported
$12.69 million of net income attributable to common
shareholders, or $0.53 per basic and diluted share in the
fiscal year ended March 31, 2020, compared to net income
attributable to common shareholders of $18.72 million, or
$0.81 per basic and diluted share, in the comparative
period.
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The revenue increase was primarily due to the increase
in sales of Lucidum spore powder, its related products and other
products, which offset the decrease in sales of Cordyceps mycelia
products, Ejiao solution products, Vitamins and dietary supplements
products and American ginseng products. Our sales from the
Lucidum spore powder products had grown significantly during fiscal
year 2020 due to our development of Lucidum enriched related
products and Lucidum raw material products. Lucidum spore
powder and its related products are our best-selling products line
and the key items of our future development.
Our net income decrease was mainly caused by the increase of
selling expenses. The increased selling expenses was primarily
due to increases in higher allowance costs, advertising costs, and
subsidy to our experience stores to support their continuity of
insufficient business for the prolonged period affected by the
COVID-19.
Mr. Xuezhu Wang, Chief Executive
Officer of Happiness Biotech, commented, "We are pleased to
announce our financial results for the fiscal year ended
March 31, 2020. Although due to
the impacts of COVID-19 pandemic, our experience stores were all
closed in the fourth quarter, and our traditional sales channels
also suffered heavy losses, we still achieved the annual revenue
growth through active online sales efforts and other effective
remedial measures. Although our net profit decreased due to higher
allowance costs, advertising costs, and subsidy to our experience
store operators, we believe they are necessary expenses to sustain
our business development in the long term. After all, even they
were closed in the fourth quarter, the sales of our experience
store in this fiscal year still realized growth. "
Mr. Wang continued to comment, "In the past few months, in
response to the outbreak of the COVID-19 in China, we produced epidemic prevention
products in an effort to leverage our production facility and to
satisfy market needs. With the gradual control of the epidemic
situation in China, the sales from
our experience stores, including our traditional sales channels,
are rapidly recovering. China has
officially resumed cross provincial (district, city) team tourism
on July 14, 2020, which is a great
news to us, after all, most of our experience store customers come
from group touring. In the meanwhile, we built up our experience in
online sales during the fourth quarter and decided to continue to
invest in the online sales channels. Therefore, we plan to set up a
dedicated e-commerce unit and the online sales are expected to
become an important stream of our revenue in the future!"
Fiscal Year 2020 Financial
Results
Revenue
We generated $65,061,953 in revenues
for the fiscal year ended March 31,
2020, representing an increase of $1,125,768 or 1.8%, as compared with $63,936,185 for the fiscal year ended
March 31, 2019.
Cost of Revenues
Total cost of revenues was
$34,642,649 for the fiscal year ended
March 31, 2020, representing an
increase of $2,953,532 or 9.3%,
compared with $31,689,117 for the
fiscal year ended March 31, 2019.
Selling and Marketing Expenses
We incurred
$9,179,160 in selling and marketing
expenses for the fiscal year ended March 31,
2020, representing an increase of $2,887,932 or 45.9%, compared with $6,291,228 for the fiscal year ended March 31, 2019.
Income from operations
Because of the factors
described above, our operating income was $15,398,717 for the fiscal year ended
March 31, 2020, compared with
operating income of $21,842,873 for
the fiscal year ended March 31, 2019,
representing a decrease of $6,444,155
or approximately 29.5%.
Net Income
Our net income for the fiscal year
ended March 31, 2020 was $12,688,035, representing a decrease of
$6,033,944 or 32.2%, compared with
net income of $18,721,979 for the
fiscal year ended March 31, 2019,
which was resulted from the lower operating profit margin and lower
revenue for the first quarter in 2020.
About Happiness Biotech Group Limited
Headquartered in Nanping, China,
Happiness Biotech Group Limited is an innovative China-based nutraceutical and dietary
supplements producer focused on the research, development,
manufacturing and marketing of a variety of products made from
Chinese herbal extracts and other ingredients. The Company's goal
is to provide high-quality products to our consumers. Over the past
14 years, the Company has established a product portfolio
consisting of 32 CFDA registered "Blue-Cap" SKUs of nutraceutical
and dietary supplements products. While the Company's main products
are still nutraceutical and dietary supplements, the Company also
produces epidemic prevention products to satisfy market needs. For
more information, please visit: www.happ.org.cn.
Forward-Looking Statements
This press release contains forward-looking statements as
defined by the Private Securities Litigation Reform Act of 1995.
Forward-looking statements include statements concerning plans,
objectives, goals, strategies, future events or performance, and
underlying assumptions and other statements that are other than
statements of historical facts. When the Company uses words such as
"may, "will, "intend," "should," "believe," "expect," "anticipate,"
"project," "estimate" or similar expressions that do not relate
solely to historical matters, it is making forward-looking
statements. Forward-looking statements are not guarantees of future
performance and involve risks and uncertainties that may cause the
actual results to differ materially from the Company's expectations
discussed in the forward-looking statements. These statements are
subject to uncertainties and risks including, but not limited to,
the following: the Company's goals and strategies; the
Company's future business development; product and service demand
and acceptance; changes in technology; economic conditions;
reputation and brand; the impact of competition and pricing;
government regulations; fluctuations in general economic and
business conditions in China, the
COVID-19 outbreak and its impact on our operations and assumptions
underlying or related to any of the foregoing and other risks
contained in reports filed by the Company with the Securities and
Exchange Commission. For these reasons, among others,
investors are cautioned not to place undue reliance upon any
forward-looking statements in this press release. Additional
factors are discussed in the Company's filings with the U.S.
Securities and Exchange Commission, which are available for review
at www.sec.gov. The Company undertakes no obligation to publicly
revise these forward-looking statements to reflect events or
circumstances that arise after the date hereof.
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SOURCE Happiness Biotech Group Limited