QINGDAO, China and ROCKVILLE, Md., Jan. 15 /Xinhua-PRNewswire/ -- Synutra International, Inc. (Nasdaq: SYUT; ''Synutra''), one of China's leading manufacturers of dairy-based nutritional products for infants, children and adults, today filed amendments to its Current Report on Form 8-K filed on August 22, 2005 and its Annual Report on Form 10-K for the fiscal year ended March 31, 2007 with the U.S. Securities and Exchange Commission. As explained in the Forms 8-K and 10-K, the amendments are the result of certain deficiencies and errors in Synutra's financial statements identified during its ongoing assessment process to improve the effectiveness of its disclosure controls and procedures and internal control over financial reporting.
Synutra previously concluded that the audited consolidated Balance Sheets, Income Statements and Cash Flow Statements as of and for the calendar years ended December 31, 2003 and 2004 and unaudited consolidated Balance Sheets, Income Statements and Cash Flow Statements as of and for the three and six months ended June 30, 2004 and 2005 of its wholly owned subsidiary, Synutra Inc. (''Synutra Illinois''), should no longer be relied upon because of errors in such financial statements. The Current Report on Form 8-K filed today restates Synutra Illinois' financial statements to (i) reclassify certain other income as sales revenue and (ii) breakout certain cash and cash equivalents into cash and restricted cash line items.
Synutra also previously concluded that certain filings made subsequent to the Form 8-K filed on August 22, 2005, including Synutra's Annual Report on Form 10-K for the fiscal year ended March 31, 2007 and Amendment No. 1 to the Annual Report on Form 10-K for the fiscal year ended March 31, 2007, which presented audited financial statements covering the 12-month periods ended March 31, 2005, 2006, and 2007 (together, the ''Form 10-K"), should have presented, but did not present, audited financial statements for the three- month transition period ended March 31, 2005, unaudited comparative financial statements for the three months ended March 31, 2004 and audited financial statements for the 12-month period ended December 31, 2004 rather than audited financial statements for the 12-month period ended March 31, 2005. Synutra has amended its Form 10-K to present such periods and provide related disclosures to the Management's Discussion and Analysis and other items of the Form 10-K.
During the assessment of its disclosure controls and procedures and internal control over financial reporting, Synutra also analyzed its financial position, changes in financial position and results of operations as of the same dates and for the same periods for which audited consolidated financial statements have been presented, and determined that the restricted net assets of Synutra's consolidated subsidiaries not available for distribution to Synutra as of March 31, 2007 exceeded certain thresholds. Synutra has amended its Form 10-K to include Schedule I to present its condensed financial information for the years ended March 31, 2006 and 2007 as part of the financial statements as required by Articles 12-04(a) and 4-08(e)(3) of Regulation S-X. Synutra also has added disclosure to the notes to the financial statements of the Form 10-K to describe its assessment of the restricted net assets of its consolidated subsidiaries. Finally, Synutra identified an error in the Cash Flow Statements for the year ended March 31, 2006 in which the depreciation expense amount was misstated. Synutra has revised the data column for the year ended March 31, 2006 in the Cash Flow Statements to reflect the correct depreciation amount of that period.
Synutra International, Inc. Chairman and Chief Executive Officer Liang Zhang commented, ''We continually strive to improve our financial reporting and to have the utmost transparency in our communications. I believe that the team that we have in place is a strong one, and I am confident that we have improved, and will continue to improve, both our financial reporting and our internal controls over such reporting. Synutra remains focused on capturing the growth in the infant formula industry in China through successful strategic execution, and I am optimistic about our prospects as we enter 2008.''
Synutra's SEC filings are available on-line: http://www.synutra.com
About Synutra International, Inc.
Synutra operates eight subsidiaries developing, producing, distributing and selling dairy-based nutritional products across the People's Republic of China. It offers its products for infants, children, adults and pregnant women and nursing mothers under the brand series of ''Super,'' ''U-Smart" and "U- Strong.'' The Group's extensive sales network covers 24 provinces, 264 cities and more than 1320 counties throughout China. For more information, please contact Weiguo Zhang of Synutra, Inc. (301 840 3888, firstname.lastname@example.org), Brian Rafferty of Taylor Rafferty (212 889 4350, email@example.com) or visit: http://www.synutra.com .
The information contained herein includes forward-looking statements.
These statements relate to future events or to our future financial
performance, and involve known and unknown risks, uncertainties and other
factors that may cause our actual results, levels of activity, performance,
or achievements to be materially different from any future results, levels
of activity, performance or achievements expressed or implied by these
forward- looking statements. You should not place undue reliance on
forward-looking statements since they involve known and unknown risks,
uncertainties and other factors which are, in some cases, beyond our
control and which could, and likely will, materially affect actual results,
levels of activity, performance or achievements. Any forward-looking
statement reflects our current views with respect to future events and is
subject to these and other risks, uncertainties and assumptions relating to
our operations, results of operations, growth strategy and liquidity. We
assume no obligation to publicly update or revise these forward-looking
statements for any reason, or to update the reasons actual results could
differ materially from those anticipated in these forward-looking
statements, even if new information becomes available in the future. The
safe harbor for forward-looking statements contained in the Securities
Litigation Reform Act of 1995 protects companies from liability for their
forward-looking statements if they comply with the requirements of the Act.
For more information, please contact:
Mr. Weiguo Zhang
Mr. Brian Rafferty
|SOURCE Synutra International, Inc.|
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