Mr. Kim Oishi reports
CHINA HEALTH LABS & DIAGNOSTICS LTD. ANNOUNCES CONTRACT TO SUPPLY 17 MOBILE FOOD SAFETY LABS
China Health Labs & Diagnostics Ltd. has signed an agreement with the Beijing municipal government to supply 17 mobile food safety labs. This order is expected to generate revenue of RMB 34.2 million ($5.3 million). Most of the mobile labs are scheduled to be delivered in the fourth quarter of 2010 with the balance to be delivered in the first quarter of 2011.
The mobile labs will be used in China to conduct spot tests on food stores and distributors to detect the presence of toxic chemicals and bacteria.
In 2008, China Health entered the food safety market by installing 17 food testing labs in major food supermarkets in Beijing. These labs were mandated and paid for by the Beijing municipal government in response to concerns due to the growing number of high profile food safety incidents and the need to improve safety for the Beijing Olympics. During 2009, the Company developed a mobile lab solution based on the need for on-site rapid testing.
"We are very pleased to build on our successful installation of food safety labs in Beijing supermarkets by supplying the mobile labs to the Beijing municipal government. One of our key strengths is working with customers to develop products that meet their needs and can deliver reliable long-term results. This builds strong relationships with our customers, leading to repeat orders and on-going revenues from reagent supply and maintenance," said Wilson Yao, CEO of China Health. "Food safety has become a growing concern in China so municipal governments are allocating more resources and looking for ways to monitor and enforce food safety standards. With Beijing as our key reference, we plan to expand our food safety business to other cities in China." China Health intends to expand its business by focusing its efforts on expanding its sales network to three areas where it has proprietary products, limited competition and strong government support: rural diagnostic medical facilities in China, military and emergency services, and food testing applications.