ZHONGPIN INC.

CIK:0001277092|SEC Filings

EARNINGS PER SHARE

3 Months Ended

Mar. 31, 2013

11.	EARNINGS PER SHARE

The following table sets forth the computation of basic and diluted net earnings per share for the periods indicated:

	Three Months Ended March 31,
	2013		2012
	(Unaudited)		(Unaudited)
Numerator:
Net income attributable to common shares	$	10,609,714	$	12,197,315

Denominator:
Weighted average number of common shares outstanding - basic		37,209,344		37,498,563

Dilutive effect of stock options		69,286		4,456

Weighted average number of common shares outstanding - diluted		37,278,630		37,503,019

Basic earnings per share	$	0.29	$	0.33
Diluted earnings per share	$	0.28	$	0.33

Of the 787,000 options and warrants outstanding at March 31, 2013, 514,000 options were anti-dilutive and therefore excluded from the computation of diluted earnings per share for the three months ended March 31, 2013. 273,000 options and warrants were dilutive and therefore included in the computation of diluted earnings per share for the three months ended March 31, 2013.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (USD $)	3 Months Ended
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (USD $)	Mar. 31, 2013	Mar. 31, 2012
Cash flows from operating activities:
Net income	$ 10,620,652	$ 12,195,155
Adjustments to reconcile net income to net cash used in operations:
Depreciation	5,899,289	5,537,984
Amortization of land use rights	644,802	516,966
Provision for allowance for bad debts	1,889,563	1,657,949
Other income	(88,790)	(129,699)
Deferred subsidy	(21,236)
Stock-based compensation		417,749
Changes in operating assets and liabilities:
Accounts receivable	(37,228,084)	(31,521,161)
Other receivables	(124,907)	(950,981)
Purchase deposits	(218,259)	1,489,444
Prepaid expenses	60,153	75,128
Inventories	3,474,455	(13,251,435)
Allowance receivables		2,160,068
VAT recoverable	(602,931)	(5,225,549)
Other current assets	(2,023)	(118,029)
Deferred charges		1,855
Accounts payable	1,546,201	28,643,061
Other payables	(318,966)	(2,035,430)
Accrued liabilities	933,980	388,216
Taxes payable	(400,248)	373,669
Deposits from customers	(2,614,682)	(3,541,776)
Deposits from customers - Long term portion		(338,991)
Net cash used in operating activities	(16,551,031)	(3,655,807)
Cash flows from investing activities:
Deposits for purchase of land use rights		(10,555,624)
Construction in progress	(5,413,842)	(11,461,585)
Additions to property and equipment	(2,267,416)	(2,585,772)
Additions to land use rights	(21,559)
Proceeds on sale of fixed assets		5,905
Net cash used in investing activities	(7,702,817)	(24,597,076)
Cash flows from financing activities:
Proceeds from (repayment of) bank notes, net	(39,447,085)	9,806,307
Proceeds from short-term bank loans	60,524,010	88,785,573
Repayment of short-term bank loans	(43,003,902)	(49,538,008)
Proceeds from long-term loans	54,790,156	7,926,069
Repayment of long-term loans	(20,549,090)
Proceeds from short-term financial bonds, net of issuance costs	95,181,970
Proceeds from capital lease obligation, net of issuance costs	29,529,346
Repayment of capital lease obligation		(1,498,250)
Repurchase of common stock		(2,812,322)
Increase in restricted cash	4,371,725
Net cash provided by financing activities	141,397,130	52,669,369
Effect of rate changes on cash	730,560	226,450
Increase in cash and cash equivalents	117,873,842	24,642,936
Cash and cash equivalents, beginning of period	176,441,332	135,845,095
Cash and cash equivalents, end of period	294,315,174	160,488,031
Supplemental disclosures of cash flow information:
Cash paid for interest	9,596,014	8,122,027
Cash paid for income taxes	$ 1,199,986	$ 819,660

CONDENSED CONSOLIDATED BALANCE SHEETS (USD $)	Mar. 31, 2013	Dec. 31, 2012
Current assets
Cash and cash equivalents	$ 294,315,174	$ 176,441,332
Restricted cash	105,866,898	109,954,161
Bank notes receivable	102,110,143	72,369,700
Accounts receivable, net of allowance for doubtful accounts of $6,666,258 and $4,775,526	120,800,332	85,167,801
Other receivables, net of allowance for doubtful accounts of $509,084 and $493,484	977,803	865,060
Purchase deposits	7,034,952	6,798,356
Inventories	34,600,019	37,979,226
Prepaid expenses	389,955	449,127
Allowance receivables	958,698	956,166
VAT recoverable	33,410,038	32,719,543
Deferred tax assets	802,297	800,179
Other current assets	699,311	73,413
Total current assets	701,965,620	524,574,064
Long-term investment	478,553	477,289
Property, plant and equipment, net	514,193,986	470,447,775
Deposits for purchase of land use rights	15,389,482	17,285,461
Construction in progress	46,193,135	86,509,865
Land use rights	118,412,570	116,785,769
Other non-current assets	4,452,434	2,554,680
Total assets	1,401,085,780	1,218,634,903
Current liabilities
Short-term loans	246,785,205	228,632,849
Bank notes payable	209,955,495	219,333,386
Long-term loans - current portion	45,303,004	52,183,597
Short-term financial bonds	95,710,571
Capital lease obligation - current portion	7,298,023
Accounts payable	13,498,479	11,918,351
Other payables	23,663,592	24,053,321
Accrued liabilities	19,335,514	18,353,887
Deposits from customers	7,343,501	9,935,877
Tax payable	1,396,404	1,778,724
Deferred subsidy - current portion	84,943	84,852
Total current liabilities	670,374,731	566,274,844
Deferred tax liabilities	745,839	743,869
Long-term loans	143,374,475	101,792,652
Capital lease obligation	24,605,501
Deferred subsidy - long-term portion	2,371,185	2,386,002
Total liabilities	841,471,731	671,197,367
Equity
Common stock: par value $0.001; 100,000,000 authorized; 40,376,182 and 40,376,182 shares issued as of March 31, 2013 and December 31, 2012; and 37,209,344 and 37,209,344 shares outstanding as of March 31, 2013 and December 31, 2012	40,376	40,376
Additional paid in capital	240,063,993	240,063,993
Retained earnings	288,878,462	278,268,748
Treasury stock, at cost: 3,166,838 and 3,166,838 shares at March 31, 2013 and December 31, 2012	(26,225,646)	(26,225,646)
Accumulated other comprehensive income	55,967,484	54,413,960
Total Zhongpin Inc. shareholders' equity	558,724,669	546,561,431
Non-controlling interests	889,380	876,105
Total shareholders' equity	559,614,049	547,437,536
Total liabilities and shareholders' equity	$ 1,401,085,780	$ 1,218,634,903