BEIJING, Aug. 14, 2014 /PRNewswire/ -- Sinovac Biotech
Ltd. (NASDAQ: SVA), a leading provider of biopharmaceutical
products in China, announced today
its unaudited second quarter and half year financial results for
the period ended June 30, 2014.
Second Quarter 2014 Financial Highlights
(compared to the second quarter 2013)
- Quarterly sales were $12.1
million, a decrease of 30.7% from $17.5 million in the prior year period. Sales for
the first six months were $25.6
million, a decrease of 6.8% YoY from $27.5 million.
- Gross profit was $9.1 million, a
decrease of 33.3% from $13.6 million
in the prior year period.
- Gross margin was 75.0%, compared to 77.9% in the prior year
period.
- Net loss attributable to common stockholders was $2.2 million, or $(0.04) per basic and diluted share, compared to
net income attributable to common stockholders of $1.3 million, or $0.02 per basic and diluted share, in the second
quarter of 2013.
Mr. Weidong Yin, Chairman,
President and CEO of Sinovac, commented, "While sales were impacted
during the second quarter by short-term challenges from the
external market environment, we are continuing to grow our sales
channels and make strong progress in the development of our
pipeline vaccines."
"In July, we received the first tranche of our RMB 60 million government grant to build a
dedicated facility for the production of the EV71 vaccine, which is
currently under review by the Center for Drug Evaluation. During
the second quarter, we received our clinical trial license for the
pneumococcal polysaccharide vaccine (PPV) from the CFDA and expect
to begin trials later this year."
"Although we experienced decreased sales in the second quarter,
we remain confident in our ability to execute our proven sales and
marketing strategies, and continue to develop new vaccines that are
both effective and safe. We expect these initiatives to
meaningfully contribute to our performance as market conditions
improve." Mr. Yin concluded.
Second Quarter 2014 Business Highlights
Sales Update
Public Tenders Sinovac has been selected by the Beijing
Health Bureau as the sole supplier of inactivated hepatitis A
vaccine in pre-filled syringe dosage to the Expanded Program of
Immunization (EPI) for Beijing.
The tender is valued at approximately RMB 16
million. The vaccines purchased by the Beijing Health Bureau
will be used for the period from 2014 to 2016. The Company expects
to begin delivery in the coming months.
Additionally, Sinovac has also been selected by the Beijing
Centers for Disease Control and Prevention to be a supplier of the
seasonal influenza vaccine to the citizens of Beijing for 2014. The Company expects to begin
delivery in the third quarter of 2014.
International Sales to Mexico Sinovac obtained its
commercialization license for Anflu in Mexico late last year. In early July, the
Company delivered its first order of 150,000 doses of Anflu to
Mexico, as it continues its
efforts in international market expansions.
R&D Update
PPV The Company received clinical trial approval for its
PPV in May. Sinovac has selected a site for the clinical trial and
its draft proposal is currently under expert review. The Company
expects clinical trials to begin by the end of 2014, following
approval by an ethics committee.
Other Operation Updates
Government Grant In April, Sinovac received approval for
a RMB 60 million government grant
from China's Ministry of Finance,
National Development and Reform Commission, Ministry of Industry
and Information Technology, and National Health and Family Planning
Commission for construction of the Company's dedicated EV71 vaccine
production facility. Sinovac received the first RMB 20 million of the grant in July. The
remainder will be provided once construction and approval criteria
are met.
VAT Rate Reduction The value added tax (VAT) rate applied
to the sales of Sinovac's vaccine products has been reduced to 3%
from 6%, as authorized by the Ministry of Finance and State
Administration of Taxation of China. The reduced VAT rate was effective
July 1, 2014, and therefore did not
impact second quarter results. Going forward, the reduced VAT rate
will contribute to an improvement in the profitability of the
Company's vaccines in Chinese market.
Unaudited Financial Results for Second
Quarter 2014
|
|
2014
Q2
|
% of
Sales
|
2013
Q2
|
%of
Sales
|
(In USD'000 except
percentage data)
|
Hepatitis A –
Healive
|
|
5,113
|
42.3%
|
7,021
|
40.2%
|
Hepatitis A&B –
Bilive
|
|
6,439
|
53.3%
|
9,586
|
54.9%
|
Hepatitis
vaccines
|
|
11,552
|
95.6%
|
16,607
|
95.1%
|
Influenza
vaccine
|
|
-
|
-
|
48
|
0.3%
|
Animal
vaccine
|
|
18
|
0.1%
|
65
|
0.4%
|
Mumps
vaccine
|
|
520
|
4.3%
|
732
|
4.2%
|
Regular
sales
|
|
12,090
|
100.0%
|
17,452
|
100.0%
|
H5N1
|
|
-
|
-
|
-
|
-
|
Total
sales
|
|
12,090
|
100.0%
|
17,452
|
100.0%
|
Cost of goods
sold
|
|
3,025
|
25.0%
|
3,861
|
22.1%
|
Gross
profit
|
|
9,065
|
75.0%
|
13,591
|
77.9%
|
In the second quarter 2014, total sales were $12.1 million, a decrease of 30.7% from
$17.5 million during the same period
in 2013. This decrease was primarily due to softer demand in the
private vaccine market. China's
CDCs have been also more conservative in their vaccination
programs. Nevertheless, the Company achieved record sales in the
second quarter of 2013, which resulted in a higher basis for
year-over-year comparison.
Gross profit was $9.1 million in
the second quarter 2014, compared to $13.6
million in the prior year period. Gross margin decreased to
75.0% from 77.9% in the prior year period. The slight decrease in
gross margin is attributable to idle capacity in the Company's
influenza facility during the second quarter, which was charged to
cost of goods sold.
Selling, general and administrative expenses for the second
quarter 2014 were $8.6 million,
compared to $8.8 million in the same
period of 2013.
R&D expenses for the second quarter of 2014 were
$3.3 million, a $1.2 million increase over the same period in
2013. These expenses are primarily related to the continued
advancement of pipeline vaccine candidates, including sIPV, EV71,
PPV, and varicella vaccine.
Net loss attributable to common stockholders for the second
quarter of 2014 was $2.2 million, or
$ (0.04) per basic and diluted share,
compared to a net income attributable to common stockholders of
$1.3 million, or $0.02 per basic and diluted share, in the same
period last year.
Unaudited Financial Results for First Half of
2014
|
|
2014
H1
|
% of
Sales
|
2013
H1
|
% of
Sales
|
(In USD'000 except
percentage data)
|
Hepatitis A –
Healive
|
|
11,552
|
45.1%
|
13,199
|
48.0%
|
Hepatitis A&B –
Bilive
|
|
12,437
|
48.5%
|
12,581
|
45.7%
|
Hepatitis
vaccines
|
|
23,989
|
93.6%
|
25,780
|
93.7%
|
Influenza
vaccine
|
|
61
|
0.2%
|
330
|
1.2%
|
Animal
vaccine
|
|
44
|
0.2%
|
78
|
0.3%
|
Mumps
vaccine
|
|
1,440
|
5.6%
|
1,316
|
4.8%
|
Regular
sales
|
|
25,534
|
99.6%
|
27,504
|
100.0%
|
H5N1
|
|
102
|
0.4%
|
-
|
-
|
Total
sales
|
|
25,636
|
100.0%
|
27,504
|
100.0%
|
Cost of goods
sold
|
|
6,303
|
24.6%
|
6,853
|
24.9%
|
Gross
profit
|
|
19,333
|
75.4%
|
20,651
|
75.1%
|
Total sales for the first half of 2014 were $25.6 million, a decrease of 6.8% from
$27.5 million in the same period of
2013. Sales for the first half of 2014 were impacted by decreased
sales of the Company's hepatitis A vaccine, Healive, as a result of
the challenging environment in the private-pay market.
Gross profit for the first half of 2014 was $19.3 million, a decrease of 6.4% from
$20.7 million in the same period of
2013. Gross margin was 75.4% in the first half of 2014, compared to
75.1% in the same period of 2013.
Selling, general and administrative expenses for the first half
of 2014 were $16.4 million, compared
to $15.9 million for the same period
of 2013.
R&D expenses in the first half of 2014 were $5.0 million, compared to $3.9 million in the same period of 2013. These
expenses are primarily related to the continued advancement of
pipeline vaccine candidates.
Net loss attributable to stockholders in the first half of 2014
was $2.2 million or $(0.04) per basic and diluted share, compared to
a net loss of $0.7 million, or
$(0.01) per basic and diluted share,
in the same period of 2013.
As of June 30, 2014, cash and cash
equivalents totaled $89.6 million,
compared to $107.2 million as of
December 31, 2013. Net cash used in
operating activities was $11.4
million during the first half of 2014. Net cash used in
investing activities was $5.7
million, which was primarily used for payment of property,
plant and equipment for the Company's Changping facility. Net cash
provided by financing activities was $0.9
million during the first half of 2014, including loan
proceeds of $8.9 million and loan
repayment of $8.5 million. As of
June 30, 2014, the Company had
$36.0 million of bank loans due
within one year. Sinovac's cash and cash equivalents position of
$89.6 million is sufficient to meet
both these loan repayment obligations as well as the Company's
operational requirements.
Conference Call Details
Sinovac will host a conference call on Friday, August 15, 2014 at 8:00 a.m. ET (August 15,
2014 at 8:00 p.m. China
Standard Time) to review the Company's financial results and
provide an update on recent corporate developments. To access
the conference call, please dial 1-877-407-9039 (USA) or 1-201-689-8470 (International).
A replay of the call will be available from 11:00 a.m. ET on August
15, 2014 through August 29,
2014. To access the replay, please dial 1-877-870-5176
(USA) or 1-858-384-5517
(International) and reference the replay pin number 13587706.
A live audio webcast of the call will also be available on the
Investor Relations section of the Company's website at
www.sinovac.com. A webcast replay will be available on the
Company's website for 30 days following the call, beginning
August 15, 2014.
About Sinovac
Sinovac Biotech Ltd. is a China-based biopharmaceutical company that
focuses on the research, development, manufacturing, and
commercialization of vaccines that protect against human infectious
diseases. Sinovac's product portfolio includes vaccines against
hepatitis A and B, seasonal influenza, H5N1 pandemic influenza
(avian flu), H1N1 influenza (swine flu), mumps and canine rabies.
In 2009, Sinovac was the first company worldwide to receive
approval for its H1N1 influenza vaccine, which it has supplied to
the Chinese Government's vaccination campaign and stockpiling
program. The Company is also the only supplier of the H5N1 pandemic
influenza vaccine to the government stockpiling program. Sinovac
has filed a new drug application with the China Food & Drug
Administration for its proprietary enterovirus 71 vaccine, having
been proven effective in preventing hand, foot and mouth disease in
infants and children during its Phase III clinical trial. The
Company is currently developing a number of new products including
a Sabin-strain inactivated polio vaccine, pneumococcal
polysaccharides vaccine, pneumococcal conjugate vaccine and
varicella vaccine. Sinovac primarily sells its vaccines in
China, while also exploring growth
opportunities in international markets. The Company has exported
select vaccines to Mexico,
Mongolia, Nepal, and the Philippines, and was recently granted a
license to commercialize its hepatitis A vaccine in Chile. For more information, please visit the
Company's website at www.Sinovac.com .
Contact
Sinovac Biotech Ltd.
Helen Yang / Chris Lee
Tel: +86-10-8279-9659 / 9696
Fax: +86-10-6296-6910
Email: ir@sinovac.com
ICR Inc.
Bill Zima
U.S: 1-646-308-1707
Email: william.zima@icrinc.com
SINOVAC BIOTECH
LTD.
|
|
|
|
Consolidated
Balance sheets
|
|
|
|
As of June 30,
2014 and December 31, 2013
|
|
|
(Expressed in
thousands of U.S. Dollars, except for numbers of shares and per
share data)
|
|
|
|
|
Current
assets
|
December 31,
2013
|
June 30,
2014
|
|
|
|
(Unaudited)
|
|
Cash and cash
equivalents
|
107,242
|
89,634
|
|
Accounts
receivable
|
31,927
|
34,733
|
|
Inventories
|
14,329
|
19,780
|
|
Prepaid expenses and
deposits
|
1,150
|
1,294
|
|
Deferred tax
assets
|
2,602
|
1,981
|
|
Total current
assets
|
157,250
|
147,422
|
|
|
|
|
|
Property, plant and
equipment
|
67,963
|
64,646
|
|
Prepaid land lease
payments
|
10,948
|
10,545
|
|
Long-term
inventories
|
2,781
|
3,893
|
|
Long-term prepaid
expenses
|
154
|
72
|
|
Prepayment for acquisition of equipment
|
708
|
3,169
|
|
Deferred tax
assets
|
117
|
305
|
|
Licenses
|
772
|
553
|
|
Total
assets
|
240,693
|
230,605
|
|
|
|
|
|
Current
liabilities
|
|
|
|
Bank loans and
current portion of long-term
debt
|
16,217
|
35,975
|
|
Loan from a
non-controlling shareholder
|
3,324
|
3,243
|
|
Accounts payable and accrued liabilities
|
28,037
|
24,384
|
|
Income tax
payable
|
246
|
240
|
|
Deferred
revenue
|
875
|
306
|
|
Deferred government
grants
|
458
|
449
|
|
Total current
liabilities
|
49,157
|
64,597
|
|
|
|
|
|
Deferred government
grants
|
4,746
|
4,588
|
|
Long-term
debt
|
32,146
|
11,651
|
|
Deferred
revenue
|
11,005
|
10,639
|
|
Total long term
liabilities
|
47,897
|
26,878
|
|
|
|
|
|
Total
liabilities
|
97,054
|
91,475
|
|
|
|
|
|
Commitments and
contingencies
|
|
|
|
Equity
|
|
|
|
Preferred
stock
|
-
|
-
|
|
Common
stock
|
56
|
56
|
|
Additional paid-in
capital
|
107,393
|
107,868
|
|
Accumulated other
comprehensive income
|
14,141
|
12,039
|
|
Statutory surplus
reserves
|
11,808
|
11,808
|
|
Accumulated
deficit
|
(4,714)
|
(6,958)
|
|
Total
stockholders' equity
|
128,684
|
124,813
|
|
|
|
|
|
Non-controlling
interests
|
14,955
|
14,317
|
|
Total
equity
|
143,639
|
139,130
|
|
Total liabilities
and equity
|
240,693
|
230,605
|
|
SINOVAC
BIOTECH LTD.
|
|
|
|
|
Consolidated
Statements of Comprehensive Income (loss)
|
|
|
|
|
For the three and
six months ended June 30, 2013 and 2014
|
|
|
|
|
(Unaudited)
|
|
|
|
|
(Expressed in
thousands of U.S. Dollars, except for numbers of shares and per
share data)
|
|
|
|
|
|
|
|
|
Three months ended June 30
|
|
Six months ended June 30
|
|
2013
|
2014
|
|
2013
|
2014
|
Sales
|
17,452
|
12,090
|
|
27,504
|
25,636
|
Cost of
sales
|
3,861
|
3,025
|
|
6,853
|
6,303
|
Gross
profit
|
13,591
|
9,065
|
|
20,651
|
19,333
|
|
|
|
|
|
|
Selling,
general and administrative expenses
|
8,786
|
8,589
|
|
15,891
|
16,381
|
Provision for
doubtful accounts
|
604
|
132
|
|
886
|
294
|
Research and
development expenses
|
2,042
|
3,265
|
|
3,889
|
4,967
|
Loss (income)
on disposal and Impairment of property,
plant and equipment
|
-
|
29
|
|
(2)
|
29
|
Total
operating expenses
|
11,432
|
12,015
|
|
20,664
|
21,671
|
Operating
income (loss)
|
2,159
|
(2,950)
|
|
(13)
|
(2,338)
|
|
|
|
|
|
|
Interest and
financing expenses
|
(770)
|
(832)
|
|
(1,433)
|
(1,582)
|
Interest
income
|
583
|
765
|
|
1,024
|
1,545
|
Other income
(expenses) - net
|
(54)
|
71
|
|
7
|
217
|
Income
(loss) before income taxes and non-
controlling interests
|
1,918
|
(2,946)
|
|
(415)
|
(2,158)
|
Income tax
benefit (expense)
|
(4)
|
(76)
|
|
(37)
|
(423)
|
|
|
|
|
|
|
Net Income
(loss)
|
1,914
|
(3,022)
|
|
(452)
|
(2,581)
|
Less: (Income) loss
attributable to the non-controlling interests
|
(595)
|
774
|
|
(237)
|
337
|
Net Income
(loss) attributable to stockholders of Sinovac
|
1,319
|
(2,248)
|
|
(689)
|
(2,244)
|
|
|
|
|
|
|
Other comprehensive income (loss), net of tax of nil
|
|
|
|
|
|
Foreign currency
translation adjustments
|
1,119
|
(319)
|
|
1,353
|
(2,403)
|
Total
comprehensive income (loss)
|
3,033
|
(3,341)
|
|
901
|
(4,984)
|
Less:
comprehensive (income) loss attributable to non-controlling
interests
|
(707)
|
738
|
|
(378)
|
638
|
Comprehensive income (loss) attributable to
stockholders of Sinovac
|
2,326
|
(2,603)
|
|
523
|
(4,346)
|
|
|
|
|
|
|
Weighted
average number of shares of
|
|
|
|
|
|
Basic
|
55,056,191
|
55,663,566
|
|
54,995,674
|
55,625,509
|
Diluted
|
55,522,748
|
55,663,566
|
|
54,995,674
|
55,625,509
|
|
|
|
|
|
|
Earning per
share
|
|
|
|
|
|
Basic
|
0.02
|
(0.04)
|
|
(0.01)
|
(0.04)
|
Diluted
|
0.02
|
(0.04)
|
|
(0.01)
|
(0.04)
|
SINOVAC BIOTECH
LTD.
|
|
|
|
|
|
|
Consolidated
Statements of Cash Flows
|
|
|
|
|
|
|
For the three and
six months ended June 30, 2013 and 2014
|
|
|
|
|
|
|
(Unaudited)
|
|
|
|
|
|
|
(Expressed in
thousands of U.S. Dollars)
|
|
|
|
|
|
|
|
Three months ended
|
|
Six months
ended
|
|
June
30
|
|
June
30
|
|
|
2013
|
|
2014
|
|
|
2013
|
|
2014
|
Cash flows
provided by (used in) operating activities
|
|
|
|
|
|
|
|
|
|
Net income
(loss)
|
$
|
1,914
|
$
|
(3,022)
|
|
$
|
(452)
|
$
|
(2,581)
|
Adjustments to
reconcile net income (loss) to net cash
|
|
|
|
|
|
|
|
|
|
provided by
(used in) operating activities:
|
|
|
|
|
|
|
|
|
|
- deferred
income taxes
|
|
(17)
|
|
58
|
|
|
(15)
|
|
369
|
- stock-based
compensation
|
|
62
|
|
71
|
|
|
138
|
|
143
|
- inventory
provision
|
|
768
|
|
321
|
|
|
768
|
|
542
|
- provision for
doubtful accounts
|
|
604
|
|
132
|
|
|
886
|
|
294
|
- impairment of
equipment and loss on disposal
|
|
-
|
|
29
|
|
|
(3)
|
|
29
|
-
depreciation of property, plant and equipment and amortization of licenses
|
|
1,718
|
|
1,903
|
|
|
3,348
|
|
4,534
|
- amortization of the
prepaid land lease payments
|
|
69
|
|
65
|
|
|
138
|
|
132
|
- accretion
expenses
|
|
34
|
|
28
|
|
|
52
|
|
55
|
Changes
in:
|
|
|
|
|
|
|
|
|
|
- accounts
receivable
|
|
(4,511)
|
|
1,327
|
|
|
(8,288)
|
|
(3,654)
|
-
inventories
|
|
(3,582)
|
|
(4,905)
|
|
|
(6,657)
|
|
(7,784)
|
- prepaid
expenses and deposits
|
|
399
|
|
234
|
|
|
256
|
|
(348)
|
- deferred
revenue
|
|
(162)
|
|
33
|
|
|
(1,229)
|
|
(685)
|
- accounts
payable and accrued liabilities
|
|
(593)
|
|
(1,889)
|
|
|
1,754
|
|
(2,459)
|
|
|
|
|
|
|
|
|
|
|
Net cash used in
operating activities
|
|
(3,297)
|
|
(5,615)
|
|
|
(9,304)
|
|
(11,413)
|
|
|
|
|
|
|
|
|
|
|
Cash flows
provided by (used in) financing activities
|
|
|
|
|
|
|
|
|
|
- Loan
proceeds
|
|
3,305
|
|
3,182
|
|
|
10,785
|
|
8,917
|
- Loan
repayments
|
|
(162)
|
|
(6,084)
|
|
|
(162)
|
|
(8,542)
|
- Proceeds from
issuance of common stock,
|
|
|
|
|
|
|
|
|
|
net of
share issuance costs
|
|
406
|
|
147
|
|
|
417
|
|
252
|
- Proceeds from
shares subscribed
|
|
8
|
|
31
|
|
|
8
|
|
80
|
- Government grants
received
|
|
220
|
|
185
|
|
|
524
|
|
185
|
|
|
|
|
|
|
|
|
|
|
Net cash provided
(used in) by financing activities
|
|
3,777
|
|
(2,539)
|
|
|
11,572
|
|
892
|
|
|
|
|
|
|
|
|
|
|
Cash flows used in
investing activities
|
|
|
|
|
|
|
|
|
|
- Acquisition
of property, plant and equipment
|
|
(508)
|
|
(3,479)
|
|
|
(2,232)
|
|
(5,683)
|
|
|
|
|
|
|
|
|
|
|
Net cash used in
investing activities
|
|
(508)
|
|
(3,479)
|
|
|
(2,232)
|
|
(5,683)
|
|
|
|
|
|
|
|
|
|
|
Exchange gain
(loss) on cash and cash equivalents
|
|
512
|
|
(385)
|
|
|
769
|
|
(1,404)
|
|
|
|
|
|
|
|
|
|
|
Increase
(decrease) in cash and cash equivalents
|
|
484
|
|
(12,018)
|
|
|
805
|
|
(17,608)
|
|
|
|
|
|
|
|
|
|
|
Cash and cash
equivalents, beginning of year
|
|
91,562
|
|
101,652
|
|
|
91,241
|
|
107,242
|
|
|
|
|
|
|
|
|
|
|
Cash and cash
equivalents, end of year
|
$
|
92,046
|
$
|
89,634
|
|
$
|
92,046
|
$
|
89,634
|
SOURCE Sinovac Biotech Ltd.