China Health Labs & Diagnostics Ltd. announces new food safety
sales order and delivery on the $11.7 million food safety sales
contract
TSX-V: CHO
OTCQX: CHLBF
www.chinahealthlabs.com
TORONTO,
Jan. 15, 2013 /CNW/ - China Health
Labs & Diagnostics Ltd. ("China Health" or the "Company") (CHO:
TSXV; CHLBF: OTCQX), is pleased to announce that it has entered
into and delivered on a new sales order of RMB 12.4 million ($2.0
million) for 39 food safety rapid test labs, which were
installed in large restaurants and hotels in Beijing. The Company's Type B BK Food Safety
Rapid Test System ("BK-iRT") was also delivered as part of this
food safety rapid test labs installation. The delivery of the food
safety rapid test labs and BK-iRT was completed in December 2012.
The Company also delivered in December 2012 on the sales order of RMB 74.0 million ($11.7
million) for food safety products and its BK-iRT, as
previously announced by the Company on October 3, 2012. The BK-iRT product and other
food safety products are to be used by Beijing's food safety detection units in
monitoring the thousands of food preparation and distribution nodes
in Beijing.
Subsequent to the Company's delivery on the
RMB 74.0 million ($11.7 million) sales order of its food safety and
BK-iRT products, a number of Chinese government officials and food
safety and health institutions toured the Company's facilities to
learn more about the food safety total solutions and products
offered by the Company. They provided positive feedback and this
resulted in the additional sales order of RMB 12.4 million ($2.0
million), which was delivered in December 2012.
The BK-iRT is a compact and mobile food safety
testing solution and can conduct approximately 100 rapid and
accurate types of tests, including testing for physicochemical
residues, veterinary drug residues, biotoxins, heavy metal
residues, prohibited additives, and food additives. The solution
also includes an information management module equipped with a 3G
telecommunication function to transmit and communicate data with a
network of mobile and stationary labs, which allows data sharing,
real-time monitoring and dynamic instructions. Other target markets
for the BK-iRT include food distribution centres and facilities
such as canteens for large organizations, hospitals and
universities.
The Company has continued to expand its presence
in the food safety industry and has delivered products and food
safety labs that could represent revenues of over RMB 86.4 million ($13.7
million) for the fiscal year 2012, representing growth of
approximately 52% for the Company's food safety business sector
compared to the fiscal year 2011 during which the Company had
revenues of $9.0 million. Further,
the Company's gross margins in this sector has increased for fiscal
year 2012 as the BK-iRT is a proprietary product developed and
manufactured in the Company's Beijing facility, whereas sales in prior years
consisted of third party products which generated lower gross
margins. The Company is actively marketing to other large cities
and municipalities in China in
growing its food safety sector outside of Beijing based on the Company's past success in
delivering to the Chinese government effective solutions to address
food safety concerns and also in developing new products to meet
future demands.
About China Health Labs & Diagnostics
Ltd.
China Health, operating in China as the Biochem Group, is a leading
diagnostic lab solution provider for the public healthcare industry
in China. The Company develops and
sells Biochem Group branded and third-party medical diagnostic
products and services to diagnostic facilities in China. Customers include large urban
hospitals, rural hospitals, Chinese defense and rescue operations,
the Beijing government and
third-party distributors.
The Company intends to continue its growth by
focusing its efforts on expanding its sales network in three areas
where it provides proprietary solutions, has limited competition
and which are supported by Chinese government policies and budgets:
BK Clinlab total lab solutions for rural hospitals and clinics,
POCT solutions for military and emergency rescue services, and food
safety solutions for large cities in China. In 2011, China Health increased
its revenues by 35% to $45.6 million,
and increased its installed base of BK Clinlab total solution
diagnostic labs ("BK Clinlabs") from 210 at the start of 2011 to
899 rural hospitals to date. In addition, the Company grew
revenues from its overall total lab solutions business by 99% from
2010, which increased gross margins to 44% in 2011 as compared to
39% in 2010.
Neither TSX Venture Exchange nor its
Regulation Services Provider (as that term is defined in the
policies of the TSX Venture Exchange) accepts responsibility for
the adequacy or accuracy of this release.
FORWARD LOOKING INFORMATION
This press release contains forward-looking
statements and information that are based on the beliefs of
management and reflect China Health's current expectations.
When used in this press release, the words "estimate", "project",
"belief", "anticipate", "intend", "expect", "plan", "predict",
"may" or "should" and the negative of these words or such
variations thereon or comparable terminology are intended to
identify forward-looking statements and information. The
forward-looking statements and information in this press release
includes information relating to the revenue growth for the
Company's food safety business sector, the expansion of the
Company's business through its sales network in areas where it has
proprietary products, limited competition and strong government
support. The forward-looking information is based on certain
assumptions, which could change materially in the future, including
the assumption that the Company will be able to expand its sales
network and business. Such statements and information reflect
the current view of China Health with respect to risks and
uncertainties that may cause actual results to differ materially
from those contemplated in those forward-looking statements and
information. By their nature, forward-looking statements
involve known and unknown risks, uncertainties and other factors
which may cause our actual results, performance or achievements, or
other future events, to be materially different from any future
results, performance or achievements expressed or implied by such
forward-looking statements. Such factors include, among others, the
risk that the Company may not be able to generate the expected
revenue growth, the Company may not be able to expand its business
as expected through its sales network in any of the areas in which
it has proprietary products, limited competition and strong
government support. China Health cautions that the foregoing
list of material factors is not exhaustive. When relying on
China Health's forward-looking statements and information to make
decisions, investors and others should carefully consider the
foregoing factors and other uncertainties and potential
events. China Health has assumed a certain progression, which
may not be realized. It has also assumed that the material
factors referred to above will not cause such forward-looking
statements and information to differ materially from actual results
or events. However, the list of these factors is not
exhaustive and is subject to change and there can be no assurance
that such assumptions will reflect the actual outcome of such items
or factors.
THE FORWARD-LOOKING INFORMATION CONTAINED IN
THIS PRESS RELEASE REPRESENTS THE EXPECTATIONS OF CHINA HEALTH AS OF THE DATE OF THIS PRESS
RELEASE AND, ACCORDINGLY, IS SUBJECT TO CHANGE AFTER SUCH
DATE. READERS SHOULD NOT PLACE UNDUE IMPORTANCE ON
FORWARD-LOOKING INFORMATION AND SHOULD NOT RELY UPON THIS
INFORMATION AS OF ANY OTHER DATE. WHILE CHINA HEALTH MAY ELECT TO, IT DOES NOT
UNDERTAKE TO UPDATE THIS INFORMATION AT ANY PARTICULAR TIME EXCEPT
AS REQUIRED IN ACCORDANCE WITH APPLICABLE LAWS.
SOURCE CHINA HEALTH LABS &
DIAGNOSTICS