Yayi International Inc

CIK:0000789860|SEC Filings

Earnings Per Share

9 Months Ended

Dec. 31, 2011

21. Loss Per Share

Basic earnings (loss) per share are computed on the basis of the weighted average number of shares of common stock outstanding during the period. Diluted earnings (loss) per share is computed on the basis of the weighted average number of shares of common stock plus the effect of dilutive potential common shares outstanding during the period using the if-converted method for the convertible notes and preferred stock and the treasury stock method for warrants and options. The following table sets forth the computation of basic and diluted net loss per share:

	Three months ended			Nine months ended
		December 31,			December 31,

	2011			2010			2011			2010
	(unaudited)			(unaudited)			(unaudited)			(unaudited)

Net (loss) income	$	(1,154,687	)	$	(234,340	)	$	110,480		$	(1,956,735	)
Accretion of preferred stock		(1,963,220	)		-			(5,376,479	)		-
Net loss attributable to common stockholders - basic	$	(3,117,907	)	$	(234,340	)	$	(5,265,999	)	$	(1,956,735	)
Net loss attributable to common stockholders - diluted	$	(3,117,907	)	$	(234,340	)	$	(5,265,999	)	$	(1,956,735	)

Weighted average outstanding shares of common stock		26,454,558			26,454,394			26,454,558			26,433,743
Dilutive effect of warrants		-			-			-			-
Dilutive effect of options		-			-			-			-
Diluted weighted average outstanding shares of common stock		26,454,558			26,454,394			26,454,558			26,433,743

Loss per share:
Basic	$	(0.12	)	$	(0.01	)	$	(0.20	)	$	(0.07	)

Diluted	$	(0.12	)	$	(0.01	)	$	(0.20	)	$	(0.07	)

The computation of diluted loss per share for the three and nine months and December 31, 2011 excludes the following potentially dilutive securities because their inclusion would be anti-dilutive.

	December 31,
	2011		2010
	(unaudited)		(unaudited)
Warrants outstanding		1,427,200		4,414,439
Options outstanding		1,402,736		1,906,392
Series A convertible preferred stock outstanding		15,306,120		15,306,120
Convertible promissory notes outstanding		4,460,000		4,460,000
		22,596,056		26,086,951

For the three and nine months ended December 31, 2011, no convertible preferred stock, convertible notes and warrants were included in the calculation of the Company's diluted loss per share because the company reported net loss from continuing operations attributed to common shareholders.

For the three and nine months ended December 31, 2010, no convertible preferred stock, convertible notes and warrants were included in the calculation of the Company's diluted loss per share because the Company reported net losses from continuing operations.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (USD $)	9 Months Ended
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (USD $)	Dec. 31, 2011	Dec. 31, 2010
Cash flow from operating activities
Net (loss) income	$ 110,480	$ (1,956,735)
Adjustments to reconcile net income to net cash provided by (used in) operating activities:
Depreciation and amortization of livestock	791,130	503,235
Amortization of land use rights	23,392	12,724
Amortization of deferred financing costs	118,428	72,506
Allowance of bad debts	31,128	3,620
Employee stock-based compensation	127,643	1,133,854
Sales return allowance		(45,520)
Change in fair value of derivative liabilities	(1,438,689)	(843,037)
Loss on write down of assets held for sale	623,305
Accretion of debt discount	832,974	426,503
Settlement of registration penalties	124,880
(Increase) decrease in operating assets:
Restricted cash		29,665
Accounts receivable	(1,031,086)	(716,068)
Other receivable	(288,048)	210,722
Inventories	139,378	(1,714,974)
Prepaid expenses	159,786	939
Advances	63,316	422,022
Deferred tax asset and current assets	366,698	(281,850)
Increase (decrease) in operating liability:
Accounts payable	1,234,068	866,248
Advance from customers	39,687	(98,496)
Income and other tax payable	(217,268)	(176,197)
Other payable, bills payable and accrued expenses	(823,076)	142,288
Make good provision payable	(35,808)	293,029
Net cash provided by (used in) operating activities	952,318	(1,715,522)
Cash flows from investing activities
Purchase of property, plant and equipment	(851,808)	(578,270)
Advance for construction of factory and warehouse	(78,759)
Deposit for purchase of machinery and equipment	(73,112)	(723,842)
Proceeds from sale of livestock	56,639	62,973
Purchase and breeding of livestock	(19,915)	(60,392)
Net cash used in investing activities	(966,955)	(1,299,531)
Cash flows from financing activities
Proceeds from short term loans	11,747,751	11,114,894
Repayment of short term loans	(9,670,225)	(9,608,176)
Repayment of long term loans		(30,965)
Net proceeds from issuance of Series A preferred stock		8,031,819
Change in restricted cash	1,021,445	(408,090)
Due (from) to stockholders		(6,026)
Net cash provided by financing activities	3,098,971	9,093,456
Effect of exchange rate changes in cash	449,527	153,780
Net increase in cash and cash equivalents	3,533,861	6,232,183
Cash and cash equivalents, beginning of period	13,360,392	4,727,677
Cash and cash equivalents, end of period	16,894,253	10,959,860
Cash paid during the period
Interest paid	1,230,903	464,016
Income tax paid	803,202	327,710
Supplemental disclosure of non-cash financing and investing activities:
Accretion of preferred stock	5,376,479
Acquisition of property, plant and equipment in other payable	700,291
Non-cash exercise of warrants into common stock		67
Deposits transferred to construction in progress		65,828
Deposits transferred to property, plant and equipment	9,765
Transfer of property, plant and equipment and livestock to assets held for sale	1,871,623
Accrued interest on convertible notes	200,700
Fair value of placement agent warrants in deferred cost financing		$ 231,929

CONDENSED CONSOLIDATED BALANCE SHEETS (USD $)	Dec. 31, 2011	Mar. 31, 2011
Current assets:
Cash and cash equivalents	$ 16,894,253	$ 13,360,392
Restricted cash	408,090	1,412,404
Accounts receivable, net of allowances of $91,699 and $72,036	5,993,752	4,776,780
Other receivable, net of allowances of $59,428 and $43,230	862,149	574,383
Inventories	3,872,826	3,885,481
Prepaid expenses	155,304	309,894
Land use rights - current portion	20,263	19,611
Advances	861,918	900,033
Deferred tax asset		374,124
Deferred financing cost	337,237	159,496
Total current assets	29,405,792	25,772,598
Property, plant and equipment, net	6,619,985	8,063,507
Livestock, net	287,168	563,402
Assets held for sale	1,871,623
Goodwill	299,281	289,643
Land use rights	950,678	942,939
Deposits on property, plant and equipment	19,865,064	19,063,439
Deferred tax asset	46,122	31,225
Deferred financing cost	655,162	867,552
Total assets	60,000,875	55,594,305
Current liabilities:
Short term loans	13,120,881	10,654,328
Accounts payable	2,196,524	884,407
Other payable, bills payable and accrued expenses	2,939,263	3,172,782
Advance from customers	133,215	90,232
Income and other tax payable	1,039,405	1,214,494
Make good provision	169,875
Long term loans - current portion		17,697
Total current liabilities	19,599,163	16,033,940
Long-term liabilities:
Due to stockholders	5,567,772	5,450,233
Derivative liabilities	730,191	1,776,400
Convertible notes, net of discount of $3,025,865 and $3,858,839	5,894,135	5,061,161
Registration penalties and make good provision		473,283
Total Long Term Liabilities	12,192,098	12,761,077
Total liabilities	31,791,261	28,795,017
Commitments and contingencies (Note 18)
PREFERRED STOCK, par value $0.001, 10,000,000 shares authorized, Series A 10% non-cumulative redeemable convertible preferred stock, redemption $9.80 per share plus internal rate of return of 25% from date of issuance to date of redemption, 1,530,612 shares issued and outstanding	21,121,644	15,745,165
STOCKHOLDERS' EQUITY
Common stock, par value $0.001, 100,000,000 shares authorized, 26,454,558 shares issued and outstanding, respectively	26,454	26,454
Additional paid-in capital	2,931,498	5,840,290
Statutory surplus reserve fund	1,442,434	1,142,397
Retained Earnings		2,529,601
Accumulated other comprehensive income	2,687,584	1,515,381
Total stockholders' equity	7,087,970	11,054,123
Total liabilities and stockholders' equity	$ 60,000,875	$ 55,594,305