China Organic Agriculture Announces First Quarter 2010 Financial Results

China Organic Agriculture, Inc. (OTCBB: CNOA), a company headquartered in Liaoning Province in China engaged in the trading and distribution of agricultural products, announced today its financial results for the first quarter ended March 31, 2010.

2010 First Quarter Key Financial Items

• Revenue of $32.4 million represents a decrease from $36.7 million in the first quarter of 2009.
• Gross profit was $8.2 million, compared to $8.4 million in the first quarter of 2009.
• Net income attributable to CNOA shareholders in the first quarter of 2010 was $3.0 million.
• Fully diluted earnings per share in the first quarter of 2010 was $0.04 as compared to $0.05 in the first quarter of 2009.
• On March 23, 2010, the Company acquired 60% of the stock of Changbai Eco-Beverage Co., Ltd. for $10.3 million.

Revenue for the first quarter of 2010 was $32.4 million, representing a decrease from the $36.7 million of revenue recorded in the same period of 2009. This decrease reflects fewer orders in the first quarter of 2010 compared to prior period. The Company attributes this decrease to the uncertainty of the economic environment as having had a negative impact on its trading activity. As the Company acquired Changbai Eco-Beverage Co., Ltd., its new blueberry product segment, on March 23, 2010, its contribution to the Company’s first quarter revenues was limited.

Gross profit for the first quarter of 2010 was $8.2 million, a slight decrease compared to $8.4 million in the same period of 2009. The gross profit margin for the first quarter of 2010 was 25.4% compared to 22.8% in the same period of 2009. This improvement in the gross profit margin largely offset the decline in revenue and was in part attributed to the Company’s decision to more actively trade in beans and soybeans, which have better margins.