Sino AG — Earnings Release 2017

May 15, 2017

Sino Agro Food, Inc. Reports Q1 2017 Results

Sino Agro Food, Inc. Reports Q1 2017 Results

Completes Carve-out of Aquaculture Operations

Revenue Increases 27% to USD 70.6M

EPS of USD .36

May 15, 2017

GUANGZHOU, China-- Sino Agro Food, Inc. (OTCQX: SIAF | OSE: SIAF-ME), a

specialized investment company focused on protein food including seafood and

cattle, is pleased to announce the following quarterly results ending March 31,

2017:

+-------------------------------------------------------+------+------+----+

|(USD M, except per share and margin   data) |Q1 '17|Q1 '16|% |

+-------------------------------------------------------+------+------+----+

|Revenue |70.6 |55.8 |27 |

+-------------------------------------------------------+------+------+----+

|Gross Profit |14.4 |15.0 |(4) |

+-------------------------------------------------------+------+------+----+

|Gross Profit Margin |20.4% |26.9% |(24)|

+-------------------------------------------------------+------+------+----+

|Net Income attributable to SIAF |8.7 |8.6 |1 |

+-------------------------------------------------------+------+------+----+

|Earnings Per Diluted Share (USD) - from continuing |.36 |.25 |44 |

|operations | | | |

+-------------------------------------------------------+------+------+----+

|Earnings Per Diluted Share (USD) - from continuing and |.36 |.39 |(8) |

|                                                       | | | |

|      discontinued operations | | | |

+-------------------------------------------------------+------+------+----+

Key Points

Summary Financials

Results reflect the carve-out of aquaculture operations announced March 2.

Income from Sino Agro's 36.6% interest in the carved-out company, Tri-Way

Industries Ltd. is reported as "income from unconsolidated equity investee." Net

income from the sale of goods for 2016 from the former aquaculture business

segment is reported as "net income from discontinued operations."

· Quarterly revenue from continuing operations increased by 27% year over year

to USD 70.6M (55.8). Revenue from the sale of goods increased by USD 14.8M, or

35%, to USD 57.4M (42.6), while revenue from project development of USD 13.2M

remained steady when compared to Q1 2016 (13.1).

· Gross profit from the sale of goods for Q1, 2017 declined 12% to USD 10.0M

(11.4), while the gross profit from project development increased 22% to USD

4.4M (3.6).

· Net income attributable to SIAF stockholders increased by 1% to USD 8.7

(8.6, with fully diluted earnings per share of USD .36.

· As of March 31 2017, the Company had net working capital of USD 302.2M.

· Stockholders' equity increased by USD 9.7M to USD 614.4M or USD 24.78 per

share, based on the weighted average number of fully diluted outstanding shares

in the quarter.

Core Businesses and Outlook

SIAF believes that its Carve-out spinoff ("COSO") strategy to restructure its

businesses into standalone companies while retaining significant equity stakes

in each one will:

· Create well capitalized endeavors receiving peer group valuations on

suitable exchanges, and

· Result in higher long-term returns on investments from having spent

resources today to open opportunities provided by the protein food arenas in

China, tomorrow.

The carve-out of aquaculture operations into Tri-Way Industries Inc. Ltd.

provides the blueprint for bringing operations with a proven track record and

credible projections onto the Hong Kong exchange or a main China exchange, with

markers imputing increasing value along the way. For instance, having

substantially completed renovations and modernization at AquaFarm 1 ("AF1"),

AF2, and AF3 before the transaction closing was designed to tailor assets for

easy handover and to jumpstart performance toward an IPO. In addition, the 36.6%

equity stake retained by SIAF is confidently expected to be solidly accretive to

earnings in 2017 when compared to the previous year. Current estimates show an

improvement in realized gross profits upwards of 65% resulting from the new

structure versus the carve-out having not been exercised.

Executing on this strategy comprises the Company's foremost and most beneficial

corporate initiatives throughout 2017 on behalf of its shareholders. Preparing

assets for optimal appreciation, the COSO process will guide the Company's

strategy throughout 2017.

Integrated Cattle (SJAP)

SJAP has three revenue drivers: sale of livestock feed and fertilizer at SJAP;

sale of live cattle; and value added processing at the abattoir of SJAP's wholly

owned subsidiary, Qinghai Zhong He Meat Products ("QZH").

Overall Q1 2017 revenue from the sector decreased year over year by 17% to USD

21.8M (26.3M) contributing to a 50% decrease in gross profits to USD 4.2M

(8.3M). The value added component accounted for 88% of the gross profit decline.

All three components were affected to various degrees by unstable market

conditions, with the biggest factors being margin pressure on imported beef due

to increased competition from more exports entering the China market.

These external factors are volatile, with pricing and demand fluctuating quarter

to quarter. Into these headwinds in Q1 2017, SJAP did manage a positive blended

gross profit margin of 19% (31.5%).

The Company had initiated plans to increase overall profitability, primarily

upgrading its line of cattle directing toward the high-end market and adding to

its range of value added products, including canned beef products. These

operational enhancements were part of the efforts to prepare SJAP for maximum

valuation while the company concurrently used the aquaculture COSO strategy as a

blueprint for SJAP - including sourcing capital needs through third parties and

targeting a listing on the NEEQ ("Third Board") of the Shanghai stock exchange

some time in 2018. Now, because of additional more sweeping plans resulting from

an understanding with the Xining government, SIAF intends to list SJAP on the

main board in either Shanghai or Shenzhen.

During Q1 the Xining government engaged SJAP in discussions aimed to help the

cattle and beef industry and promote economic development in the district, which

boasts annual production of over four million head of cattle. SJAP was selected

as the lead company to coordinate and carry out regional plans over time. While

adhering to its original company specific plan, the main features of this

overarching coordinated plan include:

· Through a Joint-Use Agreement with the District Government, concentrating

and centralizing all slaughterhouse operations in the Xining District to SJAP's

facility by funneling existing abattoir companies to one location.

· Creating a main cattle and meat center for wholesaling, cold storage, down

-stream distribution, processing of value-added products, and other logistics,

trade, and support activities. SJAP has been chosen to become one of the leading

companies operating such a business.

· The government intends to provide SJAP with additional commercially and

industrially zoned land adjacent to its existing site. This will increase SJAP's

valuable "land bank" by 170%.

· The government will also provide SJAP additional land at a second location

to move its existing operations, apart from value added processing.

· SJAP will expand the co-operative farming model to mold local growers and

farmers into a united team with the aim of helping all farmers out of poverty by

the end of 2018.

· The government has agreed to support SJAP in an effort to procure a listing

on the main stock exchange board either in Shanghai or Shenzhen. SJAP believes

the government's support will facilitate a successful listing effort and that

the main board offers many advantages, likely including a higher valuation. If

listed, the company shares will be designated as "domestically listed foreign

investment shares," enabling foreign investors to trade shares globally.

SIAF and SJAP are honored by the government's recognition and excited by the

prospects it bestows. SIAF has invited a main board listed company to join the

SJAP team to help promote these goals, including procuring project financing.

Project Development -- Capital Award (CA)

Capital Award remains a wholly owned subsidiary after the carve-out transaction.

It will no longer earn revenue derived from the sale of goods. It will be the

turnkey provider of development services for Tri-Way in China, although not

necessarily limited to Tri-Way or China. CA will also derive revenue in the

future from license fees for its A-Power Recirculating Aquaculture System

technology.

Q1 revenue increased slightly year over year by USD 63,000 to USD 13.2M (13.1M).

Cost of goods decreased by USD 728,000, driving a 22% increase in Y-O-Y gross

profit to USD 4.4M (3.6M). Margins vary quarter to quarter, depending on the

type of work performed.

Discontinued Operations (Aquaculture sale of goods)

In early March, the Company announced the successful carve-out of its interests

in aquaculture assets:

· The carve-out now holds SIAF's previously held assets, namely AF1; and

acquired assets from their respective owners/investors, including SIAF, namely

AF 2, 3, 4, and 5; as well as rights to technology licensed from Capital Award a

wholly owned subsidiary of SIAF

· SIAF holds an equity interest of 36.6% in the carved-out, separate Hong Kong

domiciled corporation, Tri-Way Industries, Ltd.

· The certified fair value of SIAF's equity interest is $124.7M (36.6% of

$340.5M). SIAF booked a revised, audited deemed gain on sale of $56.9M in

relation to the transaction.

In the future Tri-Way will provide periodic updates on its progress and

development. SIAF, as a major stakeholder in Tri-way, will also provide periodic

updates of milestones and markers related to both production and strategic

progress, either as web updates or standalone press releases. Quarterly results

will provide a breakdown of production volumes and prospects for each AquaFarm

operation, as they materialize.

Seafood and Meat Trading

Quarterly revenue increased by 261% Y-O-Y to USD $23.1M (6.4M). The increase was

primarily due to scaling the business toward capacity and sourcing seafood from

multiple countries instead of solely from Madagascar, as in the past.

Gross profit grew 173% to USD 2.6M (.9M) for the quarter ended March 31, 2017,

generating a blended gross margin of 11%. While accounting for 32% of total

revenue, both the revenue and gross profit for seafood each grew 399% Y-O-Y.

Increased competition in beef imports caused the cost of goods rate to increase

slightly more than the rate of revenue.

The import Trading business continues to be a reliable and growing operation.

Carve-out Exercises

The Company firmly believes that the sum of its parts is worth considerably more

than the market's value of the whole. Accordingly, it has undertaken efforts to

carve out its major businesses, establishing each as a standalone corporate

entity. These carve-out enterprises will seek to establish value within the same

financial measures afforded peer group companies, establishing step-wise

increasing valuations in part through private placement prior to applying to

higher valued market exchanges for IPO.

Major milestones reached in the process will reflect progress, imputed value,

and liquidity; completing the aquaculture carve-out was the first.

Upcoming steps are as follows:

· Tri-Way has begun work with its appointed Hong Kong based Corporate Service

Company ("HKCS") to issue and allocate Tri-Way shares in bookkeeping form to

respective owners including SIAF's 36.6% interest and the remaining 63,4% among

approximately 50 original investors/partners. As of April 27,2017 HKSC records

reflected 36.6M shares of Tri-Way having been allocated to the Company, the

issuance of which is anticipated to completed at the end of May.

· Upon completion, HKCS will file corresponding documents to the Hong Kong

Company Register noting paid up capital estimated at USD 340M and total

outstanding shares of 100M at a par value of HKD 1 each. This submission of

corresponding documents will occur 10 days after share issuance.

· Concurrently, SIAF is working with U.S. attorneys preparing required

documentation for submission to the SEC in preparation for the distribution of a

dividend in the form of Tri-Way shares, totaling 18.3% of Tri-Ways equity

shares. Broadridge Solutions, the Company's transfer agent in the U.S. will

distribute the dividend in book entry form pending SEC and FINRA approvals,

targeting completion by the end of July.

· Tri-Way and its investment banker are preparing presentation with attendant

legal and accounting materials to initiate a Private Placement Program including

road shows, PR/IR programs, and readiness for due diligence processes by

interested investors. Completion is targeted to commence mid-July.

· At the same time, apart from equity financing, Tri-Way is working with

several other reputable investment banks to secure alternative or complementary

debt financing. One bank completed its due diligence last month presenting the

possibility of securing a loan facility in May; others have started the process

in May.

· With respect to the facility offer of USD 36.3M granted by a local bank to

JFD China, this facility is purposed for working capital to be utilized after

new facilities have been developed, and their respective operational costs

warrant a drawdown on the LOC

These steps and others to follow provide the blueprint for later COSO

candidates, with SJAP on deck.

Share Count

The total issued and outstanding share count ("TIO") as of December 31, 2016 was

22,726,859. As of May 13, 2017, TIO share count is 23,994,199. The additional

shares were utilized to secure/underwrite a loan on behalf of Tri-Way from a

third party lender.

The figure includes shares issued as collateral for credit loan facilities and

other debt. At any given time, there are a variable number of such shares within

the total issued and outstanding. It important to note that subject to some

customary provisions, these shares must be returned to SIAF upon debt repayment.

A commonality would be these shares likened to a lien on property in the sense

that neither dilutes equity. These shares do not carry voting rights, nor are

they eligible for dividend disbursements. For example, these shares would not be

eligible for Tri-Way shares once a dividend is declared.

The Company is rather confident that Tri-Way will be successful in its

fundraising program to self-finance its CapEx requirements. As well, SJAP has

been making progress toward self-funding. As such, both Tri-Way and SJAP soon

will no longer be as dependent on SIAF to provide bridge financing. Thus, the

Company should be positioned to repurchase both collateral shares from its

lenders as well as from the market to help improve overall share value in the

near future.

CEO Commentary

Sino Agro Food's Chairman and CEO Solomon Lee addressed the quarter and 2017

corporate strategies:

"We entered 2017 with strong momentum, having undertaken a series of initiatives

in 2016 to position our operations to continue growth trajectories while making

significant progress on our strategic plan to restructure the business and

maximize value for shareholders. During the quarter, we announced the successful

completion of the carve-out of our aquaculture operations into Tri-Way

Industries Ltd., a Hong Kong domiciled corporation. An independent valuation

determined that the certified fair value of the transacted assets to be USD

340.6M. Sino Agro Food, "the parent," holds a 36.6% equity interest equating to

USD 124.7M, or USD 5.03 per share SIAF share, based on the weighted average

number of fully diluted outstanding shares in the quarter.

"The Company has long believed that its embedded businesses are undervalued in

the current structure and as traded on the current exchanges. The carve-out was

a major step in our Carve-out/Spinoff ("COSO") strategy designed to accomplish

several significant, related objectives:

· Foremost, the COSO strategy aims to demonstrate increasing valuations backed

by third party assessment, third party investment, and new exchange trading,

where the assets are expected to be valued commensurate with "pure play" peers.

The carve-out valuation already resulted in a deemed gain on sale of $56.9M.

Further stepped up valuations are targeted through pre-IPO investment(s) and

ultimately an IPO.

· The new organization for the aquaculture business will support accelerated

growth due to its streamlined business structure. Furthermore, it is now better

suited for infusions of working and development capital. The transferred assets

have recently undergone renovations and modernizations to improve their

interoperability and to prime them to increase production growth rate targets.

· Retain a substantial interest in the self-sufficient spun off companies

which are expected to generate sufficient cash to self-fund capital expenditures

after the initial debt and/or equity financing(s), while also distributing

dividend shares to SIAF shareholders.

· After maturing businesses and demonstrating scalability, and COSO steps are

realized, SIAF, "the parent," is expected to become a more streamlined and

flexible company. As development capital expenditures become the responsibility

of the "children" companies, SIAF expects to increase free cash flow with the

intent to distribute it in the form of cash dividends and/or a share buyback

program.

"Our primary objectives for 2017 are to increase returns from our aquaculture

investment at a larger scale; likewise, for other business segments as the right

opportunities surface. We are now in a strong position to capitalize on the new

capacity developed in 2015 and 2016, and look forward to moving toward

actualizing properly appreciated IPO valuations.

"Although the COSO strategy is an inherently long and complex process, we are

proud of our accomplishments to date in the aquaculture business, and are

encouraged by the current timeline for progress as outlined in the "Carve-out"

section above. Discussions with our advisors and investment banker support this

milestone path; likewise, they reinforce our firm belief that the sum of our

business parts is worth considerably more than the market's value of the whole.

I am very confident that the strategy will succeed in unlocking substantial

value for our shareholders, as steps along the way are designed to evidence.

"Buoyed by encouragement to date, your management team remains committed to

fulfilling the COSO strategy, starting with the aquaculture business. At the

same time, the team is further encouraged to manage and grow all businesses

efficiently. The beef business (SJAP) is facing unstable markets as noted

earlier in this release. In a very real sense, these challenges have presented

an opportunity to collaborate with the provincial government to develop a plan

that from our perspective will better position SJAP as a major player in the

China beef market, culminating with a listing on the main board in China, either

in Shanghai or Shenzhen.

"This was a strong start to the year and we will continue to execute against our

strategic plan to reach the milestones outlined above during this pivotal time

in the Company's evolution."

Q1 2017 Interim Report

For detailed segment operational performance and developments, please take the

time to read our latest 10-Q filing, or refer to the Q1 2017 Interim

Report (http://sinoagrofood.investorroom.com/download/Sino-Agro-Food_Q2-2016

-Interim-Report.pdf) posted to the Company website at

http://sinoagrofood.investorroom.com/download/Sino-Agro-Food_FQ1-2017-Interim

-Report.pdf

Earnings Call Information

The Company will host an earnings call on Friday, June 9, 2017 at 10:00 AM

EDT/4:00 PM CET to discuss quarterly financial results.

Please submit questions by email to info@sinoagrofood.com. These will be

organized and answered with questions submitted during the call, followed by

live calls from institutional investors and/or analysts.

To listen to the conference call please use the following information:

+--------------------+-------------------------------+

|SIAF Q1 2017 Results |

|Call Information |

+--------------------+-------------------------------+

|Date: June 9, 2017 |Time: 10:00 AM, EDT/4:00 PM CET|

+--------------------+-------------------------------+

|Participant Dialing |

|Instructions: |

+--------------------+-------------------------------+

|SE:       +46 8 5059|UK:       +44 203 139 48 30 |

|63 06 | |

+--------------------+-------------------------------+

|NO:       +47 23 50 |CN:       +86 400 681 54 21 |

|05 59 | |

+--------------------+-------------------------------+

|US:       + 1 (866) | |

|928-7517 | |

+--------------------+-------------------------------+

|Conference   |

|Pincode99818813#     |

| The earnings call |

|will also be   |

|available over the |

|web.To   access, |

|click the following |

|link: Sino Agro Q1 |

|2017   Earnings Call |

| (https://tv.streamfab |

|riken.com/sino-agro |

|-food-q1-2017) |

+--------------------+-------------------------------+

Peter Grossman

Investor Relations

+1 (775) 901-0344

info@sinoagrofood.com

Nordic Countries

+46 (0) 760 495 885

se-info@sinoagrofood.com (erik.ahl@sinoagrofood.com)

Todd Fromer / Elizabeth Barker

1 (212) 896-1215 / 212-896-1203

SIAF@kcsa.com

About Sino Agro Food, Inc.

SIAF is a specialized investment company focused on protein food. The Company

produces, distributes, markets, and sells sustainable seafood and beef to the

rapidly growing middle class in China. Activities also include production of

organic fertilizer and produce. SIAF is a global leader in developing land based

recirculating aquaculture systems ("RAS"), and with its partners is the world's

largest producer of sustainable RAS prawns.

Founded in 2006 and headquartered in Guangzhou, the Company had over 550

employees and revenue of USD 343 million in 2016. Operations are located in

Guangdong, Qinghai, and Hunan provinces, and in Shanghai.  Sino Agro Food is a

public company listed on OTCQX U.S. Premier in the United States and on the Oslo

Børs' Merkur Market in Norway.

News and updates about Sino Agro Food, Inc., including key information, are

published on the Company's website (http://www.sinoagrofood.com), the Company's

Facebook page (https://www.facebook.com/SinoAgroFoodInc), and on twitter

@SinoAgroFood.

Forward Looking Statements

This release may contain forward-looking statements relating to the business of

SIAF and its subsidiary companies. All statements other than historical facts

are forward-looking statements, which can be identified by the use of forward

-looking terminology such as "believes," "expects" or similar expressions. These

statements involve risks and uncertainties that may cause actual results to

differ materially from those anticipated, believed, estimated or expected. These

risks and uncertainties are described in detail in our filings with the

Securities and Exchange Commission. Forward-looking statements are based on

SIAF's current expectations and beliefs concerning future developments and their

potential effects on SIAF. There is no assurance that future developments

affecting SIAF will be those anticipated by SIAF. SIAF undertakes no obligation

to publicly update or revise any forward-looking statements, whether as a result

of new information, future events or otherwise, except as required under

applicable securities laws.