American Lorain Corporation (NYSE Amex: ALN) is a leading processed foods company operating in the People’s Republic of China. It produces and sells 234 varieties of food products in three main product lines: chestnuts; convenience foods; and frozen, canned and bulk foods. Company management recently reaffirmed its expectations of 25-30% gains in 2010 sales and earnings.

American Lorain is the largest manufacturer of processed chestnut products in China. The Company launched its chestnut business in 1995 and currently produces about 50 high value-added processed chestnut products. ALN’s food products are sold in 26 provinces and administrative regions in China, as well as in 42 countries.

Chestnut products are the Company’s highest margin products, but its sales are seasonal. In an effort to reduce the impact of seasonality on its operations, the Company has steadily increased production of frozen, canned and bulk foods, as well as convenience foods such as meals ready-to-eat. Non-chestnut foods are expected to contribute an increasing portion of ALN’s total sales as Chinese consumers shift consumption toward branded, modern food products.

American Lorain has enhanced its cooperation with supermarkets and restaurant chains to help boost domestic market share. ALN products have successfully entered 115 Wal-Marts, 84 Carrefours and 2,700 other markets and convenience stores. Additionally, a new agreement with two popular restaurant chains in China provides ALN with an opportunity to strengthen its domestic sales.

Company management projects sales and earnings gains of 25-30% in 2010 based on three compelling factors:

• ALN’s strategy of strengthening domestic sales channels through shifting sales to agents will provide a wider distribution for its food products with access to more supermarkets and convenience stores.
• New agreements with popular chain restaurants in China, such as KUNGFU Catering Management Co. and CSC Catering Management Co., will begin adding significant revenue in 2010.
• A nationwide marketing campaign, funded by a recent private placement transaction which raised $12 million, will boost sales, particularly in the convenience food segment.

Disclosure: American Lorain Corporation is a client of RedChip Companies, Inc.  RedChip Companies, Inc., employees and affiliates may have positions and affect transactions in the securities or options of the issuers mentioned herein. For full financial disclosures for all RedChip clients, please visit http://www.redchip.com/disclosures.asp?src=rcv.