StockGuru Blog: Dragon International – Reviewing Projections

DRGG – Dragon International Group Corp. Stock Guru Profile DRGG Equity Stock Analysis Report on Dragon International In light of the recent acquisition of the herbal medicinal business by DRGG, which is highly complementary to their existing businesses, it is time to review the company’s projections. DRGG announced in September of 2006 that “they expect to be able to make a number of opportunistic acquisitions over the next two years.” Included in Dragon’s September 2006 forecast were references to “additional acquisitions, anticipated to account for $6.25 million of revenues in 2007, and $10 million of revenues in 2008. Acquisitions are expected to add $600K to net income in 2007, increasing to $1 million of net income in 2008.” In November, just two months later Dragon International announced the purchase of Hainan Jinguang Pharmaceutical Company, Limited (”Jinguang”), a distributor and manufacturer of Chinese herb medicines. Jinguang is located in the Hainan province of China and was founded in 2002. It’s focus is traditional Chinese Li medicine, one of the major traditional Chinese medicinal herbs. Jinguang has developed its own research and development center under GLP standards, a planting farm under GAP standards, manufacturing facilities under GMP standards, and a dedicated salesforce under GSP standards. Over the past 2 years, Jinguang has invested more than US$4 million in building farming and manufacturing facilities, including 110 acres of land and GMP manufacturing facilities. It is expected that Jinguang will generate approximately US$15 million in annual sales in 2007, which is projected to grow to approximately US$29 million in annual revenues in 2008. Jinguang has completed construction of its farming and manufacturing facilities. The addition of Jinguang will diversify DRGG’s business and enhance growth prospects in revenues and earnings for years to come Other Projections Stock Guru will review the September projections again in light of the exceptional increases in revenue experienced at DRGG which include record operating results for the fiscal year ending June 30, 2006: $18.43 million in net revenues, a 63% increase over fiscal year 2005 net revenues of $11.28 million. In addition in September DRGG announced that International trade is expected to account for the largest proportion of Dragon’s revenues, with forecasted revenues of $15 million and $25 million over the next two fiscal years, and net income of $200K and $350K. Manufacturing is projected to produce 2007 revenues of $7.5 million, expanding to $10 million in 2008, while generating net income margins of 8% to 10%. Shanghai Jinkui, anticipated to be Dragon’s highest margin business, is forecast to generate $6.25 million in 2007 revenues, doubling to $12.5 million in 2008. In addition to 100% anticipated growth, Shanghai Jinkui is forecast to generate net income margins of 20% per annum, resulting in a net income of $1.25 million in 2007, and $2.5 million in 2008. Clearly, DRGG is pulling together a group of complementary businesses in one of the fastest growing markets in the world. Dragon International Group Corp (OTCBB: DRGG) is one of China’s leading manufacturers and distributors of specialty paper products and packaging materials. DRGG is operating as a manufacturer and distributor of paper and integrated packaging paper products. DRGG has a distribution network covering east and central China. Dragon and its subsidiaries have cultivated strategic relationships with several of the world’s largest and well-known manufacturers of paper and specialty packaging products. For more information, please visit http://www.drgg.net. Source: Market News Publishing, Inc. and AllAfrica Global Media. (allafrica.com) Contact: DRGG – Dragon International Group Corp. Bldg 14, Suite A09 29 Dongdu Road International Trading Center Ningbo, 315000 China Website: http://www.drgg.net Phone: 86-574-56169308 Fax: 86-0574-56169378 SOURCE: Dragon International Group Corp. About Dragon International Group Corp. Dragon International Group Corp. (OTCBB: DRGG) is one of China’s leading manufacturers and distributors of specialty paper products and packaging materials. DRGG is operating as a manufacturer and distributor of paper and integrated packaging paper products. DRGG has a distribution network covering east and central China. Dragon and its subsidiaries have cultivated strategic relationships with several of the world’s largest and well-known manufacturers of paper and specialty packaging products. For more information, please visit http://www.drgg.net. SafeHarborand Forward Looking Statement: Certain statements set forth in this article constitute “forward-looking statements.” Forward-looking statements include, without limitation, any statement that may predict, forecast, indicate, or imply future results, performance or achievements. Such statements are not guarantees of future performance and are subject to risks and uncertainties that could cause the company’s actual results and financial position to differ materially from those included within the forward-looking statements, including the Company’s ability to obtain sufficient financing to fund both its internal growth opportunities and acquisition strategy. More information about the potential risks and factors that could affect the Company’s business and financial results is included in the Company’s filings, available via the United States Securities and Exchange Commission at http://www.sec.gov/. 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