Biostar Pharmaceuticals, Inc. Announces Its Annual Results for The Year Ended December 31, 2015
XIANYANG, China, April 14, 2016 /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 year ended December 31, 2015.
During the fiscal year of 2015, the Company recognized:
- Net sales of $27.1 million, a decrease of approximately $34.3 million, or 55.8% as compared to the year of 2014.
- Gross profit decreased by approximately $19.2 million, or 63.3% as compared to the year 2014.
- Net loss of $25.1 million as compared to net income of $4.8 million for the year 2014.
- Impairment loss on loan receivables of $8.8 million, approximately 32.6% of net sales.
- Impairment loss on intangible assets of $3.0 million.
- R&D expenses of approximately $4 million, as compared to $2.8 million for the year of 2014.
The Company experienced a material decrease in sales volume of all Aoxing Pharmaceutical Products in the year ended December 31, 2015 when compared to the year ended December 31, 2014, as Aoxing Pharmaceutical has temporarily halted production in order to conduct maintenance on its production lines for the purpose of renewing its GMP certificates by the second quarter of 2016. During 2015, the Company reviewed its drug permits and identified certain permits that the Company did not have plans to produce in the foreseeable future; accordingly, the Company has fully impaired the carrying value of those drug permits. Also, the Company has determined the unsecured loans provided to a third party borrower are uncollectible as the borrower has become insolvent, and thus, the Company recognized those receivables as impaired. The interruption in production has materially negatively affected our operating results; as a result, there may be substantial doubt regarding the Company's ability to continue as a going concern. Net sales and related gross profit both decreased significantly in the year of 2015 as result of these maintenance efforts.
*The Company's Consolidated Balance Sheets, Statement of Operations, and Cash Flows can be found on Form 10-K 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 time frame 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, 2015, 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. |
||||||||
| CONSOLIDATED BALANCE SHEETS |
||||||||
| AS OF DECEMBER 31, |
||||||||
| 2015 |
2014 |
|||||||
| ASSETS |
||||||||
| Current Assets |
||||||||
| Cash and cash equivalents |
$ |
38,898 |
$ |
1,685,154 |
||||
| Accounts receivable, net |
15,814,880 |
26,962,078 |
||||||
| Inventories |
234,660 |
673,989 |
||||||
| Deposits and other receivables |
2,591 |
4,471,992 |
||||||
| Income tax recoverable |
76,280 |
67,370 |
||||||
| Loan receivable, net |
- |
9,772,464 |
||||||
| Total Current Assets |
16,167,309 |
43,633,047 |
||||||
| Non-current Assets |
||||||||
| Deposits |
16,099,958 |
8,795,218 |
||||||
| Deferred tax assets, net |
5,406,593 |
7,065,523 |
||||||
| Property and equipment, net |
6,810,933 |
8,483,113 |
||||||
| Intangible assets, net |
6,878,787 |
13,270,330 |
||||||
| Total Non-Current Assets |
35,196,271 |
37,614,184 |
||||||
| Total Assets |
$ |
51,363,580 |
$ |
81,247,231 |
||||
| LIABILITIES AND STOCKHOLDERS' EQUITY |
||||||||
| Current Liabilities |
||||||||
| Accounts and other payables |
$ |
4,153,411 |
$ |
5,001,086 |
||||
| Short-term bank loans |
2,773,199 |
3,094,614 |
||||||
| Valued-added tax payable |
112,629 |
432,885 |
||||||
| Warrants liability |
59,202 |
383,295 |
||||||
| Total Current Liabilities |
7,098,441 |
8,911,880 |
||||||
| Commitment and contingencies |
||||||||
| Stockholders' Equity |
||||||||
| Common stock, $0.001 par value, 100,000,000 shares authorized, |
2,210 |
2,210 |
||||||
| Additional paid-in capital |
30,316,774 |
30,316,774 |
||||||
| Statutory reserve |
7,354,413 |
7,354,413 |
||||||
| Retained earnings |
3,157,394 |
28,269,956 |
||||||
| Accumulated other comprehensive income |
3,434,348 |
6,391,998 |
||||||
| Total Stockholders' Equity |
44,265,139 |
72,335,351 |
||||||
| Total Liabilities and Stockholders' Equity |
$ |
51,363,580 |
$ |
81,247,231 |
||||
| BIOSTAR PHARMACEUTICALS, INC. |
||||||||
| CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME |
||||||||
| FOR THE YEARS ENDED DECEMBER 31, |
||||||||
| 2015 |
2014 |
|||||||
| Sales, net |
$ |
27,129,609 |
$ |
61,416,587 |
||||
| Cost of sales |
16,025,544 |
31,140,225 |
||||||
| Gross profit |
11,104,065 |
30,276,362 |
||||||
| Operating expenses: |
||||||||
| Advertising expenses |
3,803,780 |
8,594,303 |
||||||
| Selling expenses |
4,835,398 |
9,892,447 |
||||||
| General and administrative expenses |
4,648,902 |
7,718,388 |
||||||
| Research and development expenses |
4,020,909 |
2,766,162 |
||||||
| Impairment loss on intangible assets |
2,973,796 |
990,603 |
||||||
| Provision for doubtful accounts receivable |
4,666,730 |
- |
||||||
| Impairment loss on loan receivables |
8,845,999 |
- |
||||||
| Impairment loss on prepaid lease payment |
1,066,115 |
- |
||||||
| Construction in progress written off |
- |
1,627,154 |
||||||
| Total operating expenses |
34,861,629 |
31,589,057 |
||||||
| Loss from operations |
(23,757,564) |
(1,312,695) |
||||||
| Other (expense) income |
||||||||
| Interest income |
8,895 |
1,330,329 |
||||||
| Interest expense |
(283,596) |
(154,547) |
||||||
| Fair value adjustment on warrants |
324,093 |
577,599 |
||||||
| Gain on disposal of intangible assets |
- |
- |
||||||
| Additional compensation received for the disposed land use rights |
- |
1,093,878 |
||||||
| Other (expense) income, net |
(84,544) |
67 |
||||||
| Total other (expense) income, net |
(35,152) |
2,847,326 |
||||||
| (Loss) Income before income taxes |
(23,792,716) |
1,534,631 |
||||||
| Provision for income tax (Income tax benefit) |
1,319,846 |
(3,313,581) |
||||||
| (Loss) Net income |
$ |
(25,112,562) |
$ |
4,848,212 |
||||
| Foreign currency translation adjustment |
(2,957,650) |
(208,456) |
||||||
| Comprehensive (loss) income |
$ |
(28,070,212) |
$ |
4,639,756 |
||||
| (Loss) Earning per share |
||||||||
| Basic |
$ |
(11.4) |
$ |
2.3 |
||||
| Diluted |
$ |
(11.4) |
$ |
2.3 |
||||
| Weighted average number of common shares outstanding |
||||||||
| Basic |
2,210,913 |
2,071,343 |
||||||
| Diluted |
2,210,913 |
2,071,343 |
||||||
| BIOSTAR PHARMACEUTICALS, INC. |
||||||||
| CONSOLIDATED STATEMENTS OF CASH FLOWS |
||||||||
| FOR THE YEARS ENDED DECEMBER 31, |
||||||||
| 2015 |
2014 |
|||||||
| CASH FLOWS FROM OPERATING ACTIVITIES |
||||||||
| Net (loss) income |
$ |
(25,112,562) |
$ |
4,848,212 |
||||
| Adjustments to reconcile net (loss) income to net cash provided by operating activities: |
||||||||
| Deferred income tax expense (benefit) |
1,332,951 |
(4,284,655) |
||||||
| Depreciation and amortization |
2,320,195 |
3,086,188 |
||||||
| Provision for doubtful debts |
4,666,730 |
- |
||||||
| Recognition of deferred research and development expenses |
4,020,909 |
2,766,162 |
||||||
| Impairment loss on intangible assets |
2,973,796 |
990,603 |
||||||
| Impairment loss on loan receivable |
8,845,999 |
- |
||||||
| Impairment loss on prepaid lease payment |
1,066,115 |
- |
||||||
| Construction in progress written off |
- |
1,627,154 |
||||||
| Loss on disposal of property, plant and equipment |
738,834 |
3,275 |
||||||
| Additional compensation received for the disposed land use rights |
- |
(1,093,878) |
||||||
| Stock-based compensation |
- |
2,021,017 |
||||||
| Warrants liability |
(324,093) |
(577,599) |
||||||
| Changes in operating assets and liabilities: |
||||||||
| Accounts receivable |
5,448,178 |
(7,441,446) |
||||||
| Inventories |
420,584 |
152,454 |
||||||
| Deposits and other receivables |
392,425 |
244,270 |
||||||
| Accounts payable and accrued expenses |
(602,958) |
573,102 |
||||||
| Value-added tax payable |
(309,890) |
90,148 |
||||||
| Income tax payable |
- |
305,611 |
||||||
| Net cash provided by operating activities |
5,877,213 |
3,310,618 |
||||||
| CASH FLOWS FROM INVESTING ACTIVITIES |
||||||||
| Purchase of property, plant and equipment |
(59,475) |
(2,869,204) |
||||||
| Proceeds from disposal of property, plant and equipment |
- |
2,929 |
||||||
| Deposit paid for research and development |
- |
(4,067,885) |
||||||
| Deposit paid for intended acquisitions |
(8,122,236) |
(4,881,462) |
||||||
| Proceeds from disposal of two drug approval numbers |
- |
1,390,661 |
||||||
| Receipt from loan receivable |
804,182 |
- |
||||||
| Compensation received for disposed land use rights |
- |
1,546,822 |
||||||
| Net cash used in investing activities |
(7,377,529) |
(8,878,139) |
||||||
| CASH FLOWS FROM FINANCING ACTIVITIES |
||||||||
| Proceeds from short-term bank loans |
- |
3,254,307 |
||||||
| Repayment of short-term bank loans |
(160,836) |
(162,715) |
||||||
| Proceeds from stock issuance and warrants |
- |
3,862,533 |
||||||
| Net cash (used in) provided by financing activities |
(160,836) |
6,954,125 |
||||||
| Effect of exchange rate changes on cash and cash equivalents |
14,896 |
218,478 |
||||||
| Net (decrease) increase in cash and cash equivalents |
(1,646,256) |
1,605,082 |
||||||
| Cash and cash equivalents, beginning balance |
1,685,154 |
80,072 |
||||||
| Cash and cash equivalents, ending balance |
$ |
38,898 |
$ |
1,685,154 |
||||
| SUPPLEMENTAL DISCLOSURES: |
||||||||
| Interest received |
$ |
8,896 |
$ |
1,330,329 |
||||
| Interest paid |
$ |
(133,618) |
$ |
(154,547) |
||||
| Income tax payments |
$ |
- |
$ |
(665,621) |
||||
SOURCE Biostar Pharmaceuticals, Inc.
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