Biostar Pharmaceuticals, Inc. Announces Third Quarter 2014 Financial Results
XIANYANG, China, Nov. 14, 2014 /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, 2014.
Highlights for the Third Quarter 2014
- Net sales decreased by approximately $400,000 or 2.4% compared to the same period in 2013
- Gross profit increased slightly by approximately $36,000 or 0.5% for the three months ended September 30, 2014
- Cash, cash equivalents totaled $7.80 million as of September 30, 2014 compared to $80,072 as of December 31, 2013
- Revenue from hospital products grew 76.4% to $3.10 million from $1.76 million compared to the same period of last year.
Mr. Ronghua Wang, Chairman and CEO of Biostar Pharmaceutical, commented, "In the past six months, we launched production of several new drugs which resulted in the revenue increases in from Aoxing new products in this quarter by 253.5%, as compared to the same period last year. Strengthening of the marketing campaign of our new products is intended to capture a larger market share in this industry," he continued. "In addition, the gross margin of Xin Ao Xing Oleanolic Acid Capsule, our flagship drug for the treatment of chronic Hepatitis B virus (HBV), increased to 82.8% from 58.6%."
"In the last three months of 2014, we are in the process of building our sales team to market Biostar's proprietary drug products to hospitals," Chairman Wang continued. "We continue our focus on new drug development and innovative sales and marketing as we believe it contributes to the strength of our Company going forward," he concluded.
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 Xin Aoxing Oleanolic 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 sustain its sales effort going forward, 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 for the gel capsule segment of its business, 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, 2013, 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.
BIOSTAR PHARMACEUTICALS, INC |
|||||||
CONSOLIDATED BALANCE SHEETS |
|||||||
September 30, |
December 31, |
||||||
2014 |
2013 |
||||||
(Unaudited) |
|||||||
ASSETS |
|||||||
Current Assets |
|||||||
Cash and cash equivalents |
$ |
7,799,188 |
$ |
80,072 |
|||
Note receivable |
- |
1,636,072 |
|||||
Accounts receivable, net of allowance for doubtful accounts of $4,590,336 (December, 2013 : $2,454,108) |
29,366,966 |
17,965,082 |
|||||
Inventories |
739,464 |
830,311 |
|||||
Deposits and other receivables |
719,594 |
5,282,574 |
|||||
Income tax recoverables |
501,957 |
374,958 |
|||||
Loan receivables |
10,041,596 |
9,816,433 |
|||||
Total Current Assets |
49,168,765 |
35,985,502 |
|||||
Non-current Assets |
|||||||
Deposits |
3,900,283 |
3,926,573 |
|||||
Deferred tax assets |
3,225,768 |
2,789,175 |
|||||
Property and equipment, net |
7,757,851 |
7,728,700 |
|||||
Intangible assets, net |
14,927,548 |
17,134,494 |
|||||
Total Assets |
$ |
78,980,215 |
$ |
67,564,444 |
|||
LIABILITIES AND STOCKHOLDERS' EQUITY |
|||||||
Current Liabilities |
|||||||
Accounts and other payables |
$ |
5,665,811 |
$ |
4,447,314 |
|||
Short-term bank loans |
3,250,236 |
- |
|||||
Value-added tax payable |
- |
344,191 |
|||||
Total Current Liabilities |
8,916,047 |
4,791,505 |
|||||
Non-current Liability |
|||||||
Warrant liabilities |
619,344 |
- |
|||||
Total Liabilities |
9,535,391 |
4,791,505 |
|||||
Commitment |
|||||||
Stockholders' Equity |
|||||||
Common stock, $0.001 par value, 100,000,000 shares authorized, 15,476,113 and 12,676,113 shares issued and outstanding as at September 30, 2014 and December 31, 2013 |
15,476 |
12,676 |
|||||
Additional paid-in capital |
30,303,508 |
25,748,669 |
|||||
Deferred stock-based compensation |
(66,367) |
(365,017) |
|||||
Statutory reserves |
7,126,432 |
7,126,432 |
|||||
Retained earnings |
25,841,456 |
23,649,725 |
|||||
Accumulated other comprehensive income |
6,224,319 |
6,600,454 |
|||||
Total Stockholders' Equity |
69,444,824 |
62,772,939 |
|||||
Total Liabilities and Stockholders' Equity |
$ |
78,980,215 |
$ |
67,564,444 |
BIOSTAR PHARMACEUTICALS, INC |
|||||||||||||||
CONSOLIDATED STATEMENTS OF OPERATIONS |
|||||||||||||||
AND COMPREHENSIVE INCOME |
|||||||||||||||
(Unaudited) |
|||||||||||||||
Three months ended September 30, |
Nine months ended September 30, |
||||||||||||||
2014 |
2013 |
2014 |
2013 |
||||||||||||
Sales, net |
$ |
14,651,054 |
$ |
15,009,432 |
$ |
47,031,072 |
$ |
41,752,195 |
|||||||
Cost of sales |
7,674,053 |
8,068,096 |
23,533,445 |
21,242,519 |
|||||||||||
Gross profit |
6,977,001 |
6,941,336 |
23,497,627 |
20,509,676 |
|||||||||||
Operating expenses: |
|||||||||||||||
Advertising expenses |
2,290,277 |
931,938 |
6,397,644 |
5,368,890 |
|||||||||||
Selling expenses |
2,161,641 |
2,584,700 |
6,633,651 |
7,403,334 |
|||||||||||
General and administrative expenses |
1,651,457 |
1,867,707 |
8,516,038 |
4,404,273 |
|||||||||||
Research and development expenses |
690,189 |
811,009 |
2,074,621 |
2,412,623 |
|||||||||||
Impairment of intangible assets |
- |
- |
- |
239,203 |
|||||||||||
Total operating expenses |
6,793,564 |
6,195,354 |
23,621,954 |
19,828,323 |
|||||||||||
Income (loss) from operations |
183,437 |
745,982 |
(124,327) |
681,353 |
|||||||||||
Other income (expense) |
|||||||||||||||
Interest income |
309,634 |
348,281 |
960,532 |
1,134,916 |
|||||||||||
Interest expense |
- |
(98,111) |
- |
(293,320) |
|||||||||||
Fair value adjustment on warrants |
(51,612) |
- |
341,550 |
- |
|||||||||||
Other income (expense) |
45,469 |
370 |
1,093,929 |
(1,093) |
|||||||||||
303,491 |
250,540 |
2,396,011 |
840,503 |
||||||||||||
Income before income taxes |
486,928 |
996,522 |
2,271,684 |
1,521,856 |
|||||||||||
Provision for income tax |
247,361 |
608,705 |
79,953 |
1,305,056 |
|||||||||||
Net Income |
239,567 |
387,817 |
$ |
2,191,731 |
$ |
216,800 |
|||||||||
Foreign currency translation adjustment |
58,895 |
1,336,712 |
(376,135) |
1,774,545 |
|||||||||||
Comprehensive income |
$ |
298,462 |
$ |
1,724,529 |
$ |
1,815,596 |
$ |
1,991,345 |
|||||||
Net income per share |
|||||||||||||||
Basic |
$ |
0.02 |
$ |
0.03 |
$ |
0.15 |
$ |
0.02 |
|||||||
Diluted |
0.02 |
0.03 |
0.15 |
0.02 |
|||||||||||
Weighted average number of common shares outstanding |
|||||||||||||||
Basic |
15,288,613 |
12,024,685 |
14,221,351 |
11,197,451 |
|||||||||||
Diluted |
15,288,613 |
12,024,685 |
14,223,014 |
11,197,451 |
BIOSTAR PHARMACEUTICALS, INC |
||||||||
CONSOLIDATED STATEMENTS OF CASH FLOWS |
||||||||
(Unaudited) |
||||||||
Nine Months Ended September 30, |
||||||||
2014 |
2013 |
|||||||
CASH FLOWS FROM OPERATING ACTIVITIES |
||||||||
Net income |
$ |
2,191,731 |
$ |
216,800 |
||||
Adjustments to reconcile net income to net cash provided by operating activities: |
||||||||
Accrued interest |
- |
(1,072,394) |
||||||
Deferred tax expense (benefit) |
(455,838) |
533,637 |
||||||
Depreciation and amortization |
2,468,737 |
2,026,796 |
||||||
Provision for doubtful accounts |
2,155,357 |
- |
||||||
Loss on disposal |
3,274 |
|||||||
Recognition of deferred research and development expenses |
1,383,081 |
2,412,623 |
||||||
Stock-based compensation |
1,954,650 |
613,647 |
||||||
Warrant liability |
(341,550) |
- |
||||||
Impairment of intangible assets |
- |
239,203 |
||||||
Changes in operating assets and liabilities: |
||||||||
Accounts receivable |
(12,064,808) |
9,250,156 |
||||||
Inventories |
85,394 |
(340,375) |
||||||
Deposits and other receivables |
1,297,726 |
482,525 |
||||||
Accounts payable and accrued expenses |
1,249,789 |
(641,335) |
||||||
Value-added tax payable |
(342,315) |
(126,573) |
||||||
Income tax payable/recoverable |
(129,671) |
113,299 |
||||||
Net cash (used in) provided by operating activities |
(544,443) |
13,708,009 |
||||||
CASH FLOWS FROM INVESTING ACTIVITIES |
||||||||
Purchase of property, plant and equipment |
(484,778) |
(978,377) |
||||||
Deposit paid for research and development |
- |
(2,734,306) |
||||||
Sales proceed of property, plant and equipment |
2,929 |
- |
||||||
Settlement of outstanding receivable from disposal of land use right |
1,561,223 |
160,842 |
||||||
Net cash provided by (used in) investing activities |
1,079,374 |
(3,551,841) |
||||||
CASH FLOWS FROM FINANCING ACTIVITIES |
||||||||
Proceed of bank loan |
3,254,308 |
- |
||||||
Advance from (repayment to) a related party |
70,165 |
(1,608,415) |
||||||
Proceeds from stock issuance and warrants |
3,862,533 |
- |
||||||
Net cash provided by (used in) financing activities |
7,187,006 |
(1,608,415) |
||||||
Effect of exchange rate changes on cash and cash equivalents |
(2,821) |
244,400 |
||||||
Net increase in cash and cash equivalents |
7,719,116 |
8,792,153 |
||||||
Cash and cash equivalents, beginning balance |
80,072 |
1,759,078 |
||||||
Cash and cash equivalents, ending balance |
$ |
7,799,188 |
$ |
10,551,231 |
||||
SUPPLEMENTAL DISCLOSURES: |
||||||||
Interest payments |
$ |
(82,855) |
$ |
(189,359) |
||||
Income tax payments |
$ |
(665,463) |
$ |
(658,120) |
||||
Interest received |
$ |
669,409 |
$ |
1,134,916 |
SOURCE Biostar Pharmaceuticals, Inc.
Related Links
http://www.biostarpharmaceuticals.com
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