American Lorain Corporation (ALN)

[djmarko1019]

Convenience foods sales increased 586.0% year over year!!!!

This is mostly likely due to the fact that more people “on the run” in China therefore create a need for quick convenience food. ALNs sales of ready to eat meals has significantly grown over the last year probably due to their strong distribution agreement with 7-Eleven convenience stores in China. The strong increase in convenience food sales helped to increase net sales 15% to $24.6 million from $21.2million

The Earnings per share of $0.07 would have been much higher if it wasn’t for the additional shares outstanding since the same period a year before. The fact is this companies earnings are still growing year after year. As evidenced by the total net income number up 6% to $1.86 million from $1.76 million.
Here is a snapshot of their financial performance:

First Quarter 2010 Highlights
-- Revenue reaches $24.6 million, up 15.8% from Q1 2009
-- Convenience foods sales increased 586.0% year over year
-- Operating income was $3.3 million, up 10.6% from Q1 2009
-- Net income was $1.86 million, up 6% from Q1 2009
-- Earnings per diluted share was $0.07 based on 26.7 million
diluted weighted average shares outstanding on March 31, 2010.


First Quarter 2010 Results

1Q 2010 1Q 2009 CHANGE
Net Sales $24.6 million $21.2 million +15.8%
Gross Profit $5.7 million $5.2 million +10.9%
Net Income $1.86 million $1.76 million +6.0%
EPS (Diluted) $0.07 $0.07 --

In my opinion this company will be great investment long term as demand for processed food products will continue to grow year after year. As long as people are in a hurry there will be continue be a strong demand for convenience food products. ALN also has a very diverse product line of canned foods, frozen foods, fruits, vegetables, fish and frozen meats. The company is currently trading at a PE of 6 in sector that typically trades around 12. I feel with the strong 1Q numbers this is a good time to accumulate shares as the market starts to realize the fair value and growth potential of ALN.