Business News

China Yingxia International, Inc. Completes Acquisition of Soybean Milk Facility

2008-08-13 07:00:00

    HARBIN, China, Aug. 13 /Xinhua-EMWNews/ -- China Yingxia

International, Inc. (OTC Bulletin Board: CYXI) ("China Yingxia" or "the

Company"), a leading provider in the nutraceutical industry engaged in the

development, manufacture and distribution of nutritional food products,

dietary supplements, and personal care products in the People's Republic of

China ("PRC"), today announced it has completed the acquisition of Shanghai

Jin Ao Food Co., Ltd ("Jin Ao") a soybean milk manufacturer and distributor

based in Shanghai, China. The facilities were acquired from King

International Food Corporation Ltd. ("King"), a Sino-Australian joint

venture. The Company first announced the agreement on March 28, 2008.

    China Yingxia paid the full price of $4.1 million in the first quarter

of 2008. Upon the assignment of the business license to China Yingxia on

June 26, 2008, the Company has finalized the transaction.

    The acquisition entitles the Company to utilize Jin Ao's production

equipment for the production of soybean milk and related products under the

associated brand Kingland, the production technology and know-how, and

marketing and distribution resources.

    "We are excited about the potential of this acquisition to strengthen

our position in the market for health food related products in China.

Scientific research has shown that substituting animal protein with soy

protein can lower blood cholesterol levels and benefit overall health, and

we are committed to focus on research, production, marketing and

distribution of pure soybean- based soy yogurt and soy milk, the two core

products of Jin Ao," said Ms. Yingxia Jiao, Chief Executive Officer of

China Yingxia. "We have been working to complete the closing of the

acquisition and to ensure a smooth integration of Jin Ao into China

Yingxia's operations."

    Jin Ao utilizes advanced automated food processing technology on the

production of soy yogurt and soy milk. The facility currently is producing

approximately 2,000 tons of soybean-based products, but has the capacity to

reach 14,960 tons annually. The Company expects Jin Ao to generate revenue

of $1.6 million during the second half of 2008 with a gross profit of 30%

and a net profit margin of 22%. Sales revenue has increased with a compound

annual growth rate of 26% from 2005 to 2007. Jin Ao currently has 66

employees with 55% of staff engaged in the sales and marketing department.

Jin Ao's current major customers are large metropolitan supermarkets

located throughout China. Its top five customers, which contribute to over

31% of sales, include Carrefour, Metro, and other large international chain

superstores based in China.

    During the second quarter, China Yingxia injected $1.2 million in

working capital to cover marketing expenses and to purchase existing

inventory and production material. Through an aggressive marketing

campaign, the Company expects to ramp up sales and thus better utilize the

facility's annual production capacity of 14,960 tons.

    The Company expects to secure supplies of high quality raw material to

Jin Ao at low cost through contracts with soybean farmers in Heilongjiang

province where the Company is headquartered. In times of high food prices,

access to raw material will provide a competitive advantage.

    Jin Ao is a pioneer in producing pure soybean-based products in China.

The facility's soy milk and soy yogurt products do not contain any dairy,

and are as such better suited for the Chinese market, where an inability to

digest lactose is common. In addition, Jin Ao's production process ensures

full extraction of the vegetable protein contained in soybean, making it a

unique, healthy product.

    ''In connection with the Beijing Olympics, one of our products,

sugar-free soy milk in a one liter container, has been appointed to be one

of the official Olympic products sold at the Metro Supermarket in China.

Our current market is focused in Shanghai and Shenzhen where over 80% of

our revenue is generated. We plan to significantly expand the geographic

distribution of Jin Ao's products across China. With the increasing

standards of living in China, the soy milk market holds enormous growth

potential as more customer segments are drawn towards healthier foods for a

variety of reasons. Jin Ao's already established brand, Kingland, is a well

known, high quality brand in soy protein related health food products,''

said Ms. Yingxia Jiao, Chief Executive Officer of China Yingxia.

    About China Yingxia International, Inc

    China Yingxia International, Inc., through its 100%-owned subsidiary,

Harbin Yingxia Industrial Group Co., Ltd. ('Yingxia'), is primarily engaged

in the development, production and sales of health food products in China.

Yingxia is located in the Province of Heilongjiang, Peoples Republic of

China. Yingxia's products include soybean-based foods and drinks, longgu

golden millet enriched products, organic rice products, cactus-based herbal

supplements, personal care products, Nestle products, and organic rice


    Safe Harbor Statement

    The statements contained herein that are not historical facts are

'forward-looking statements' within the meaning of Section 21E of the

Securities and Exchange Act of 1934, as amended, and the Private Securities

Litigation Reform Act of 1995. Such forward-looking statements may be

identified by, among other things, the use of forward-looking terminology

such as 'believes,' 'expects,' 'may,' 'will,' 'should,' or 'anticipates,'

'expect' or the negative thereof or other variations thereon or comparable

terminology, or by discussions of strategy that involve risks and

uncertainties. In particular, our statements regarding the potential growth

of the markets or forecasting financial results are examples of such

forward-looking statements. The forward-looking statements include risks

and uncertainties, including but not limited to, general economic

conditions and regulatory developments, not within our control. The factors

discussed herein and expressed from time to time in our filings with the

Securities and Exchange Commission could cause actual results and

developments to be materially different from those expressed or implied by

such statements. The forward-looking statements are made only as of the

date of this filing, and we undertake no obligation to publicly update such

forward-looking statements to reflect subsequent events or circumstances.

For more information, please contact: Company Contact: Mr. Ren Hu Chief Financial Officer China Yingxia International, Inc. Tel: +1-201-887-0415 Email: [email protected] Investor Relations Contact: Mr. Crocker Coulson President CCG Investor Relations Tel: +1-646-213-1915 Email: [email protected] Web:

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