The stuff it grows, makes and ships is healthier, and as a result, the company is wealthier. Chinese food and drug merchant China Kangtai Cactus Biotech Inc. (OTCBB: CKGT), announced 31% higher revenues for the fiscal year ended December 31, 2009 -- reaching $26.5 million U.S. from the $20.3-million-U.S. figure registered for 2008.
CKGT is a leading grower, developer, producer, and marketer of cactus-derived products, including nutraceuticals, food, health and energy drinks, as well as beer, wine and liquor, extracts and powders, and animal feed. These products are distributed via a distribution network extending through more than half of China’s provinces.
As the Chinese market continues to develop, consumers are increasingly seeking out uniquely branded packaged food and health products. Although manually planted, cacti are traditionally perceived as being wild plants, hence the Company’s products are viewed as "green and wild" among consumers.
CKGT’s products are rapidly growing in popularity as a result of China’s growing consumer purchasing power and increased media attention on the nutritional and medical benefits of cactus.
But, back to the company’s bottom line; the company’s gross profit shot up 32% to $10.5 million U.S. from $8 million U.S. the year before, and income from operations grew 40% to $9.5 million U.S., from 2008’s $6.8 million U.S.
Much of the strength came from the product line known as Nutraceuticals, that is, food products providing health and medical benefits, including the prevention and treatment of disease.
Revenues from products in that line moved up a respectable 6% to $10.1 million U.S., while beverages revenue increased 73% from $5.4 million in 2008 to $ 9.3 million U.S., or 35% of the total 2009 sales.
Among the nutraceuticals is a revolutionary product known as the Shuxin capsule, refined from the natural cacti, purporting to ward off symptoms of heart disease and stroke. Another, which is a cactus-based protein supplement, claims to have 18 known nutrients to maintain overall well-being, fight fatigue and lower blood pressure.
The news of the explosive growth in revenues and profits sent the stock price of CKGT ahead on April 15, to over the $2.50 mark, on volume topping a quarter-million shares.
On April 15, 2009, the price lagged around 23 cents, before mounting a charge peaking at $3.00 shortly after New Year 2010. As the distribution network powers through China, and as the products find more and more of a market, CKGT’s fortunes could mushroom all the higher in the months and years ahead.
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