BiostarPharmaceuticals,Inc. Announces Its Quarterly Results for Three Months Ended September 30, 2015
XIANYANG, China, Nov. 23, 2015 /PRNewswire/ -Biostar Pharmaceuticals, Inc. (NASDAQ: BSPM) ("Biostar" or "the Company"), a PRC-based manufacturer and marketer of pharmaceutical and health supplement products in China for a variety of diseases and conditions, today announced its financial results for the third quarter ended September 30, 2015.
During the fiscal third quarter of 2015, the Company recognized:
- Net sales of $4.2 million, a decrease of approximately $10 million, or 71.2% as compared to the same period in 2014.
- Gross profit decreased by approximately $6.2 million, or 88.3% for the three months ended September 30, 2015 as compared to the same period in 2014.
- Sales of Shaanxi Weinan Products increased by approximately $0.8 million, or 204.9% as compared to the same period in 2014.
- Net loss of $1.2 million as compared to net income of $0.2 million for the third quarter 2014.
- R&D expenses were approximately $1million, as compared to $0.69 million for same period in 2014.
The Company experienced a material decrease in sales volume of all Aoxing Pharmaceutical Products during the three months ended September 30, 2015. Aoxing Pharmaceutical experienced temporarily suspension in manufacturing to conduct maintenance on its production lines as part of its continued efforts to gain renewal of its GMP certification for its Aoxing Pharmaceutical production lines by January 2016, so that normal production can resume by February 2016. Net sales, and related gross profit both decreased significantly during the quarter ended September 30, 2015, as result of these maintenance efforts.
Mr. Ronghua Wang, Chairman and CEO of Biostar Pharmaceuticals, Inc. commented, "We are in the process of renewing our three GMP certifications and we currently expect the renewal process to be completed by January 2016. In the meantime, we have adopted a series of measures to help our company navigate this process by reducing operating expenses and improving cash management."
*The Company's Condensed Consolidated Balance Sheets, Statement of Operations, and Cash Flows can be found at the end of this press release. Please also refer the Company's Quarterly Report on Form 10-Q filed with the U.S. Securities and Exchange Commission for further information regarding the Company's results of operations.
About Biostar Pharmaceuticals, Inc.
Biostar Pharmaceuticals, Inc., through its wholly owned subsidiary and controlled affiliate in China, develops, manufactures, and markets pharmaceutical and health supplement products for a variety of diseases and conditions. The Company's most popular product is its XinAoxingOleanolic Acid Capsule, an over-the-counter ("OTC") medicine for chronic hepatitis B, a disease affecting approximately 10% of the Chinese population. For more information please visit: http://www.biostarpharmaceuticals.com.
Safe Harbor Relating to the Forward-Looking Statements
Certain statements in this release concerning our future growth prospects are forward-looking statements, within the meaning of Section 27A of the U.S. Securities Act of 1933, as amended, and Section 21E of the U.S. Securities Exchange Act of 1934, as amended, which involve a number of risks and uncertainties that could cause actual results to differ materially from those in such forward-looking statements. The company uses words and phrases such as "guidance," "forecasted," "projects," "is expected," "remain confident," "will" and similar expressions to identify forward-looking statements in this press release, including forward-looking statements. Undue reliance should not be placed on forward-looking information. Forward-looking information is based on current expectations, estimates and projections that involve a number of risks, which could cause actual results to vary and in some instances to differ materially from those anticipated by Biostar and described in the forward-looking information contained in this news release. The risks and uncertainties relating to these statements include, but are not limited to, risks and uncertainties regarding the Company's ability to complete the certification renewal process in the timeframe currently anticipated, its ability to sustain its sales effort going forward, its ability promptly and effectively to return to the normal production levels, its ability to retain existing and retain new customers for its products, its ability to achieve the projected sales through the efforts of the call center, to complete the contemplated clinical trials and capitalize on such opportunities, the Company's ability to recover its sales and revenue following the repair and maintenance for GMP certification renewal, the state of consumer confidence and market demand or the Company's products, success of our investments, risks and uncertainties regarding fluctuations in earnings, our ability to sustain our previous levels of profitability including on account of our ability to manage growth, intense competition, wage increases in China, our ability to attract and retain highly skilled professionals, time and cost overruns on fixed-price, fixed-time frame contracts, client concentration, our ability to successfully complete and integrate potential acquisitions, withdrawal of governmental fiscal incentives, political instability and regional conflicts and legal restrictions on raising capital or acquiring companies outside China. Additional risks that could affect our future operating results are more fully described in our United States Securities and Exchange Commission filings including our most recent Annual Report on Form 10-K for the year ended December 31, 2014, and other subsequent filings. These filings are available at www.sec.gov. We may, from time to time, make additional written and oral forward-looking statements, including statements contained in our filings with the Securities and Exchange Commission and our reports to shareholders. We do not undertake to update any forward-looking statements that may be made from time to time by or on our behalf.
Investor Relations Contact
Please send questions or comments to:
Biostar Pharmaceuticals, Inc.
Investor Relations Coordinator
+86-29-3368-6638
[email protected]
http://www.biostarpharmaceuticals.com
| BIOSTAR PHARMACEUTICALS, INC |
||||||||
| CONDENSED CONSOLIDATED BALANCE SHEETS |
||||||||
| September 30, |
December 31, |
|||||||
| 2015 |
2014 |
|||||||
| (Unaudited) |
||||||||
| ASSETS |
||||||||
| Current Assets |
||||||||
| Cash and cash equivalents |
$ |
111,911 |
$ |
1,685,154 |
||||
| Accounts receivable, net |
29,190,781 |
26,962,078 |
||||||
| Inventories |
632,086 |
673,989 |
||||||
| Deposits and other receivables |
2,009,399 |
4,471,992 |
||||||
| Income tax recoverable |
120,868 |
67,370 |
||||||
| Loan receivables |
9,443,168 |
9,772,464 |
||||||
| Total Current Assets |
41,508,213 |
43,633,047 |
||||||
| Non-current Assets |
||||||||
| Deposits |
10,072,712 |
8,795,218 |
||||||
| Deferred tax assets |
7,390,160 |
7,065,523 |
||||||
| Property and equipment, net |
7,769,903 |
8,483,113 |
||||||
| Intangible assets, net |
11,726,635 |
13,270,330 |
||||||
| Total Non-Current Assets |
36,959,410 |
37,614,184 |
||||||
| Total Assets |
$ |
78,467,623 |
$ |
81,247,231 |
||||
| LIABILITIES AND STOCKHOLDERS' EQUITY |
||||||||
| Current Liabilities |
||||||||
| Accounts and other payables |
$ |
7,502,145 |
$ |
5,001,086 |
||||
| Short-term bank loans |
2,809,342 |
3,094,614 |
||||||
| Value-added tax payable |
48,515 |
432,885 |
||||||
| Warrants liability |
158,631 |
383,295 |
||||||
| Total Current Liabilities |
10,518,633 |
8,911,880 |
||||||
| Commitment and contingencies |
||||||||
| Stockholders' Equity |
||||||||
| Common stock, $0.001 par value, 100,000,000 shares authorized, 15,476,113 shares issued and outstanding as of September 30, 2015 and December 31, 2014 |
15,476 |
15,476 |
||||||
| Additional paid-in capital |
30,303,508 |
30,303,508 |
||||||
| Statutory reserve |
7,354,413 |
7,354,413 |
||||||
| Retained earnings |
26,362,672 |
28,269,956 |
||||||
| Accumulated other comprehensive income |
3,912,921 |
6,391,998 |
||||||
| Total Stockholders' Equity |
67,948,990 |
72,335,351 |
||||||
| Total Liabilities and Stockholders' Equity |
$ |
78,467,623 |
$ |
81,247,231 |
||||
| BIOSTAR PHARMACEUTICALS, INC |
||||||||||||||||
| CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME |
||||||||||||||||
| (Unaudited) |
||||||||||||||||
| Three months ended September 30, |
Nine months ended September 30, |
|||||||||||||||
| 2015 |
2014 |
2015 |
2014 |
|||||||||||||
| Sales, net |
$ |
4,206,550 |
$ |
14,651,054 |
$ |
25,291,531 |
$ |
47,031,072 |
||||||||
| Cost of sales |
3,390,439 |
7,674,053 |
14,955,491 |
23,533,445 |
||||||||||||
| Gross profit |
816,111 |
6,977,001 |
10,336,040 |
23,497,627 |
||||||||||||
| Operating expenses: |
||||||||||||||||
| Advertising expenses |
- |
2,290,277 |
3,838,912 |
6,397,644 |
||||||||||||
| Selling expenses |
835,412 |
2,161,641 |
4,445,443 |
6,633,651 |
||||||||||||
| General and administrative expenses |
682,972 |
1,651,457 |
2,672,351 |
6,360,681 |
||||||||||||
| Impairment loss on accounts receivables |
- |
- |
- |
2,155,357 |
||||||||||||
| Research and development expenses |
998,746 |
690,189 |
3,043,535 |
2,074,621 |
||||||||||||
| Total operating expenses |
2,517,130 |
6,793,564 |
14,000,241 |
23,621,954 |
||||||||||||
| (Loss) income from operations |
(1,701,019) |
183,437 |
(3,664,201) |
(124,327) |
||||||||||||
| Other income (expense) |
||||||||||||||||
| Interest income |
311,569 |
309,634 |
954,594 |
1,043,387 |
||||||||||||
| Interest expense |
- |
- |
(62,290) |
(82,855) |
||||||||||||
| Fair value adjustment on warrants |
144,210 |
(51,612) |
224,664 |
341,550 |
||||||||||||
| Additional compensation received for the disposal of land use rights |
- |
- |
1,099,292 |
|||||||||||||
| Other income (expense) |
546 |
45,469 |
2,065 |
(5,363) |
||||||||||||
| 456,325 |
303,491 |
1,119,033 |
2,396,011 |
|||||||||||||
| (Loss) income before income taxes |
(1,244,694) |
486,928 |
(2,545,168) |
2,271,684 |
||||||||||||
| Provision for income tax (recovery) |
10,059 |
247,361 |
(637,884) |
79,953 |
||||||||||||
| Net (loss) Income |
$ |
(1,254,753) |
$ |
239,567 |
$ |
(1,907,284) |
$ |
2,191,731 |
||||||||
| Foreign currency translation adjustment |
(3,140,062) |
58,895 |
(2,479,077) |
(376,135) |
||||||||||||
| Comprehensive (loss) income |
$ |
(4,394,815) |
$ |
298,462 |
$ |
(4,386,361) |
$ |
1,815,596 |
||||||||
| Net (loss) income per share |
||||||||||||||||
| Basic |
$ |
(0.08) |
$ |
0.02 |
$ |
(0.12) |
$ |
0.15 |
||||||||
| Diluted |
(0.08) |
0.02 |
(0.12) |
0.15 |
||||||||||||
| Weighted average number of common shares outstanding |
||||||||||||||||
| Basic |
15,476,113 |
15,288,613 |
15,476,113 |
14,221,351 |
||||||||||||
| Diluted |
15,476,113 |
15,288,613 |
15,476,113 |
14,223,014 |
||||||||||||
| BIOSTAR PHARMACEUTICALS, INC |
||||||||
| CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS |
||||||||
| (Unaudited) |
||||||||
| Nine Months Ended September 30, |
||||||||
| 2015 |
2014 |
|||||||
| CASH FLOWS FROM OPERATING ACTIVITIES |
||||||||
| Net (loss) income |
$ |
(1,907,284) |
$ |
2,191,731 |
||||
| Adjustments to reconcile net income to net cash used in operating activities: |
||||||||
| Accrued interest income |
(949,582) |
(373,978) |
||||||
| Deferred tax benefit |
(580,367) |
(455,838) |
||||||
| Depreciation and amortization |
1,005,498 |
2,468,737 |
||||||
| Impairment loss on accounts receivable |
- |
2,155,357 |
||||||
| Loss on disposal on property and equipment |
- |
3,274 |
||||||
| Recognition of deferred research and development expenses |
1,014,512 |
1,383,081 |
||||||
| Stock-based compensation |
- |
1,954,650 |
||||||
| Fair value adjustment on warrants |
(224,664) |
(341,550) |
||||||
| Provision for sales discount |
1,478,124 |
- |
||||||
| Changes in operating assets and liabilities: |
||||||||
| Accounts receivable |
(4,696,508) |
(12,064,808) |
||||||
| Inventories |
19,794 |
85,394 |
||||||
| Deposits and other receivables |
2,319,480 |
1,671,704 |
||||||
| Accounts payable and accrued expenses |
2,753,073 |
1,249,789 |
||||||
| Value-added tax payable |
(381,380) |
(342,315) |
||||||
| Income tax payable/recoverable |
(57,517) |
(129,671) |
||||||
| Net cash used in operating activities |
(206,821) |
(544,443) |
||||||
| CASH FLOWS FROM INVESTING ACTIVITIES |
||||||||
| Purchase of property, plant and equipment |
(30,522) |
(484,778) |
||||||
| Sales proceed of property, plant and equipment |
- |
2,929 |
||||||
| Settlement of outstanding receivable from disposal of land use right |
- |
1,561,223 |
||||||
| Deposit paid for intended acquisition |
(1,623,219) |
- |
||||||
| Net cash (used in) provided by investing activities |
(1,653,741) |
1,079,374 |
||||||
| CASH FLOWS FROM FINANCING ACTIVITIES |
||||||||
| (Repayment) Proceeds of bank loans |
(186,670) |
3,254,308 |
||||||
|
Advance from a related party |
- |
70,165 |
||||||
| Proceeds from stock issuance and warrants |
- |
3,862,533 |
||||||
| Net cash (used in) provided by financing activities |
(186,670) |
7,187,006 |
||||||
| Effect of exchange rate changes on cash and cash equivalents |
473,989 |
(2,821) |
||||||
| Net (decrease) increase in cash and cash equivalents |
(1,573,243) |
7,719,116 |
||||||
| Cash and cash equivalents, beginning balance |
1,685,154 |
80,072 |
||||||
| Cash and cash equivalents, ending balance |
$ |
111,911 |
$ |
7,799,188 |
||||
| SUPPLEMENTAL DISCLOSURES: |
||||||||
| Interest received |
$ |
5,012 |
$ |
669,409 |
||||
| Interest payments |
$ |
(59,406) |
$ |
(82,855) |
||||
| Income tax (payments) |
$ |
- |
$ |
(665,463) |
||||
SOURCE Biostar Pharmaceuticals, Inc.
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