Biostar Pharmaceuticals,Inc. Announces Its Quarterly and Half Year Results for 2015

Aug 19, 2015, 16:30 ET from Biostar Pharmaceuticals, Inc.

XIANYANG, China, Aug. 19, 2015 /PRNewswire/ --

Financial Highlights for the Three and Six Months ended June 30, 2015

  • $14.2 million and $21.1 million net sales for the three and six months ended June 30, 2015, respectively
  • $5.9 million and $9.5 million in gross profits for the three and six months ended June 30, 2015, respectively
  • $1.0 million and $2.0 million spent on research and development during the three and six months ended June 30, 2015, respectively
  • $0.5 million and $0.6 million net losses for the three and six months ended June 30, 2015, respectively

Biostar Pharmaceuticals, Inc. (BSPM) ("Biostar", "we" or the "Company"), a producer and marketer of pharmaceutical and health supplements to treat a variety of illnesses and ailments, with operations in China, today announced its result of operations for the three and six months ended June 30, 2015.

The Company has spent significant time and resources in the first half of 2015 to repair and maintain its production lines at both of its Aoxing and Weinan subsidiaries. The maintenance efforts led to a temporary decline in production capacity, and, in turn, a decline in the Company's total sales volume as compared to the same period in 2014. Accordingly, the Company's results of operations show a temporary decline in sales revenue during both the three and six months periods ended June 30, 2015.On June 25, 2015, Weinan received renewed GMP certificates from the government. As of the date of this press release, maintenance on Aoxing's and Weinan's production lines has been completed, and production capacity has returned to its normal levels. During the three and six month periods ended June 30, 2015, the Company determined to focus a greater proportion of its production capacity on the manufacturing of prescription drug subcontracted from a hospital; accordingly, sales revenue for hospital products comprised a larger relative proportion of the Company's revenues as a whole. For the three and six month periods ended June 30, 2015, there was a general decrease in the costs of sales which was attributable to the decline in sales revenue caused by the downtime for maintenance and repair of the production lines, as mentioned above; however, because fixed overhead is allocated to cost of sales, the decline was relatively less than the decline in sales. Gross profit for the three and six month periods ended June 30, 2015, when compared to the same period in 2014, experienced decreases of 17.1% and 27.1%, respectively; these decreases in gross profit are directly correlated to the decreases in sales revenues as mentioned above. Operating expenses for the three and six months ended June 30, 2015 as compared to 2014 decreased by 20.4% and 31.8%, respectively. The significant decline was the result of the absence of the one-time impairment loss on accounts receivable that was recognized in 2014. The Company's net losses for the three and six month period ended June 30, 2015 was approximately $0.5 million and $0.7 million, as compared to net income of $1.6 million $1.9 million for the same period in 2014. The decrease from net income earned by the Company in 2014 to incurring net losses in 2015 is directly related to the decreased sales volume as result of decreased production capacity during the downtime incurred for maintenance and repair conducted on production lines.

Mr. Ronghua Wang, Chairman and CEO of Biostar Pharmaceuticals, Inc.noted:"We have finished the maintenance and repairs of our production lines. We are content that our GMP certificates have been renewed. The Company believes that GMP certificates are a testament to our commitment to excellence in quality and safety in the manufacturing of pharmaceutical products. We increased our sales for contracted prescription drug manufacturing to a hospital as we believe our continued co-operation with the hospital will be valuable to our continued growth."

*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 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 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
office@aoxing-group.com
http://www.biostarpharmaceuticals.com

 

 

BIOSTAR PHARMACEUTICALS, INC

CONDENSED CONSOLIDATED BALANCE SHEETS



June 30


December 31,


2015


2014

ASSETS

(Unaudited)










Current Assets






Cash and cash equivalents


$

313,320



$

1,685,154

Accounts receivable, net



28,931,939




26,962,078

Inventories



517,857




673,989

Deposits and other receivables



2,978,567




4,471,992

Income tax recoverable



67,933




67,370

Loan receivables



9,854,158




9,772,464

Total Current Assets



42,663,774




43,633,047









Non-current Assets








Deposits



10,511,102




8,795,218

Deferred tax assets



7,775,117




7,065,523

Property and equipment, net



8,310,684




8,483,113

Intangible assets, net



12,690,199




13,270,330

Total Non-Current Assets



39,287,102




37,614,184









Total Assets


$

81,950,876



$

81,247,231

















LIABILITIES AND STOCKHOLDERS' EQUITY









Current Liabilities








Accounts and other payables


$

5,778,304



$

5,001,086

Short-term bank loans



2,931,612




3,094,614

Value-added tax payable



594,314




432,885

Warrants liability



302,841




383,295

Total Current Liabilities



9,607,071




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
   June 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



27,617,425




28,269,956

Accumulated other comprehensive income



7,052,983




6,391,998

Total Stockholders' Equity



72,343,805




72,335,351









Total Liabilities and Stockholders' Equity


$

81,950,876



$

81,247,231

 

BIOSTAR PHARMACEUTICALS, INC

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

AND COMPREHENSIVE INCOME

(Unaudited)



Three months ended June 30,


Six months ended June 30,



2015



2014



2015



2014

Sales, net

$

14,176,234


$

19,198,854


$

21,084,981


$

32,380,018

Cost of sales


8,237,555



9,931,316



11,565,052



15,859,392

Gross profit


5,938,679



9,267,538



9,519,929



16,520,626













Operating expenses:












Advertising expenses


2,491,577



2,318,826



3,868,741



4,107,367

Selling expenses


2,310,314



2,537,288



3,610,031



4,472,010

General and administrative expenses


1,183,795



1,690,465



1,959,550



3,018,770

Impairment loss on accounts receivable


-



1,576,123



-



3,845,811

Research and development expenses


1,026,177



689,488



2,044,789



1,384,432

Total operating expenses


7,011,863



8,812,190



11,483,111



16,828,390













(Loss) Income from operations


(1,073,184)



455,348



(1,963,182)



(307,764)













Other income (expense)












Interest income


320,680



334,467



643,025



650,898

Interest expense


(1,396)



-



(62,851)



-

Fair value adjustment on warrants


90,321



393,162



80,454



393,162

Additional compensation received for the disposal of land use rights


-



-



-



1,099,292

Other income (expense)


2,080



(4,132)



2,080



(50,832)



411,685



723,497



662,708



2,092,520













(Loss) Income before income taxes


(661,499)



1,178,845



(1,300,474)



1,784,756













Provision for income tax (recovery)


(169,072)



(466,649)



(647,943)



(167,408)













Net (loss) income 

$

(492,427)



1,645,494


$

(652,531)


$

1,952,164













Foreign currency translation adjustment


279,920



98,949



660,985



(435,030)













Comprehensive (loss) income

$

(212,507)


$

1,744,443


$

8,454


$

1,517,134













Net (loss) income per share












    Basic

$

(0.03)


$

0.11


$

(0.04)


$

0.14

    Diluted


(0.03)



0.11



(0.04)



0.14













Weighted average number of common shares outstanding










    Basic


15,476,113



14,326,113



15,476,113



13,678,875

    Diluted


15,476,113



14,326,113



15,476,113



13,681,830

 

BIOSTAR PHARMACEUTICALS, INC

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)









Six Months Ended June 30,



2015



2014

CASH FLOWS FROM OPERATING ACTIVITIES






Net (loss) income


$

(652,531)



$

1,952,164

Adjustments to reconcile net income to net cash provided by operating activities:








Accrued interest income



(318,987)




-

Deferred tax benefit



(647,943)




(741,402)

Depreciation and amortization



977,876




1,591,581

Impairment loss on accounts receivable



-




3,845,811

Loss on disposal



-




3,277

Recognition of deferred research and development expenses



1,022,395




1,384,433

Stock-based compensation



-




199,100

Warrant liability



(80,454)




(393,162)

Provision for sales discounts



1,149,652




-









Changes in operating assets and liabilities:








Accounts receivable



(2,882,616)




(9,059,901)

Inventories



161,123




155,118

Deposits and other receivables



821,318




916,527

Accounts payable and accrued expenses



732,542




1,075,535

Value-added tax payable



157,183




199,615

Income tax payable/recoverable



-




(92,119)

Net cash provided byoperating activities



439,558




1,036,577









CASH FLOWS (USED IN) FROM INVESTING ACTIVITIES








Deposit payment for intended acquisition



(1,635,831)




-

Purchase of property, plant and equipment



(30,760)




(479,792)

Sales proceeds of property, plant and equipment



-




2,932

Settlement of outstanding receivable from the disposal of land use rights



-




1,562,749

Net cash (used in)provided by investing activities



(1,666,591)




1,085,889









CASH FLOWS (USED IN) FROM FINANCING ACTIVITIES



-





(Repayment) Proceeds ofbank loans



(188,121)




3,257,488

Advance from a related party



-




33,944

Proceeds from stock issuance and warrants



-




3,862,533

Net cash (used in) provided by financing activities



(188,121)




7,153,965









Effect of exchange rate changes on cash and cash equivalents



43,320




(15,399)









Net (decrease) increase in cash and cash equivalents



(1,371,834)




9,261,032









Cash and cash equivalents, beginning balance



1,685,154




80,072

Cash and cash equivalents, ending balance


$

313,320



$

9,341,104









SUPPLEMENTAL DISCLOSURES:








Interest received


$

5,015



$

-

Interest (payments)


$

(59,867)



$

-

Income tax (payments)


$

-



$

(526,770)










 

SOURCE Biostar Pharmaceuticals, Inc.



RELATED LINKS

http://www.biostarpharmaceuticals.com