Net sales for the quarter increased 56.0 per cent to $8.5 million (€6.9m), up from $5.5 million a year earlier. Net income for the same period was $539,000, compared with a loss of $589,000 in the corresponding quarter. This meant that net sales for the six months increased 32.6 per cent to $16.0 million from $12.0 million in fiscal 2003.
"Results of the second quarter reflect improved sales derived from the company's flour business. In addition, the company is now benefiting from the addition of a new packaging factory in Yantai," said Heng Jing Lu, chief executive officer.
Gross profit for the quarter increased by almost 12 fold to $1.6 million from $133,000 a year ago, while gross profit for the six months climbed to $2.9 million from $980,000 for the same period last year.
Lu said that New Dragon Asia's continued focus on increasing sales within urban areas of China and progress in producing more premium products, which generate higher margins, are important components of its growth strategy.
Lu also highlighted the company's recent announcement that it has received Grade A certification by the China Green Food Development Center, an organisation authorised by the Chinese government to issue the "green" and organic label to food producers. The green food label in China has specific standards and restrictions in terms of environmental considerations and the application of fertilizers and pesticides.
"Our focus on quality, manufacturing capacity and market expansion are fundamental to New Dragon and its current and future success and we intend to capitalize on these strengths in China, as well as in other markets," Lu added.