HAIKOU CITY, China, Aug. 15,
2018 /PRNewswire/ -- China Pharma Holdings, Inc. (NYSE MKT:
CPHI) ("China Pharma," the "Company" or "We"), an NYSE American
listed corporation with a fully-integrated specialty
pharmaceuticals subsidiary based in China, today announced financial results for
the quarter ended June 30, 2018.
Second Quarter Highlights
- Revenue increased8.8% to $3.2million in the second quarter 2018 from
$3.0million in the same period of
2017;
- Gross profit was$0.6 million for each of the three months ended
June 30, 2018 and 2017, respectively.
Gross margin was 18.3% in the second quarter of 2018, compared to
22.2% in the same period of 2017;
- Loss from operations was $0.9million in the second quarter of 2018
compared to $2.1 million in the same
period of 2017, a decrease of $1.2
million;
- Net loss was $1.0 million in the
second quarter of 2018 compared to $2.3
million in the same period of 2017. Loss per common share
was $(0.02) per basic and diluted
share in the second quarter of 2018 compared to$(0.05) per basic
and diluted share in the same period of 2017.
In a statement from Ms. Zhilin
Li, China Pharma's Chairman and CEO, "It is the Company's
top priority to actively and steadily increase sales and it is
encouraging to see increasing revenue in this quarter. Management
will continue to vigorously promote sales through active
participation in recent provincial market openings to receive new
drug tender offers and through further penetration into the
market."Ms. Li continued, "The ongoing generic drug consistency
evaluations and reform of China's
drug production registration and review policies will continue to
have a significant impact on the current performance and future
development of Chinese pharmaceutical manufacturers, including us,
and may gradually change business patterns of the industry. We will
continue to actively adapt to state policy guidance and further
evaluate market conditions for our current existing products,
pipeline products, and competition in the market in order to
optimize our development strategy."
Second Quarter Results
Revenue increased by 8.8% to $3.2
million for the three months ended June 30, 2018, as compared to $3.0 million for the three months ended
June 30, 2017. This increase was
mainly due to market volatility.
Gross profit was $0.6 million for
each of the three months ended June 30,
2018 and 2017. Our gross profit margin in the three months
ended June 30, 2018 was 18.3%
compared to 22.2% in the same period last year. This decrease was
primarily due to an increase in sales of lower margin products
during this period compared to the sales performance in the same
period last year.
Our selling expenses for the three months ended June 30, 2018 were $0.7
million, a decrease of $0.1
million, compared to $0.8
million for the three months ended June 30, 2017. Selling expenses accounted
for 22.5% of the total revenue in the three months ended
June 30, 2018 compared to 27.5% in
the same period last year.
Our general and administrative expenses for the three months
ended June 30, 2018 were $0.4 million, which represented a decrease of
$0.3 million compared to $0.6 million in the same period last year.
General and administrative expenses accounted for 11.1% and 21.0%
of our total revenues in three months ended June 30, 2018 and 2017, respectively.
Net Loss for the three months ended June
30, 2018 was $1.0 million,
compared to net loss of $2.3 million
for the three months ended June 30,
2017.
Six Months Results
Revenue increased by 9.5% to $6.8
million for the six months ended June
30, 2018, as compared to $6.2
million for the six months ended June
30, 2017. This increase was mainly due to market
volatility.
Gross profit for the six months ended June 30, 2018 was $1.6
million, compared to $1.4
million in the same period in 2017. The gross profit margin
in the six months ended June 30, 2018
was 24.1% compared to 22.0% in the same period in 2017. The
increase was mainly due to the increase in sales of higher margin
products in the first half of 2018.
Net loss for the six months ended June
30, 2018 was $1.3 million,
compared to net loss of $3.3 million
in the same period 2017. The decrease in net loss was mainly the
result of increase in revenue and decreased expenses in the six
months ended June 30, 2018.
Financial Condition
As of June 30, 2018, the Company
had cash and cash equivalents of $1.9
million compared to $2.0
million as of December 31,
2017. Working capital increased to $3.4 million as of June
30, 2018 from $3.1 million as
of December 31, 2017; and the current
ratio was both 1.3 times at June 30,
2018 and December 31, 2017,
respectively.
Our net accounts receivable balance was $2.4 million as of June
30, 2018, compared to $2.3
million as of December 31,
2017.
Conference Call
The Company will hold a conference call at 8:30am E.T. on August 15,
2018, to discuss the financial results of the second quarter
2018. Listeners may access the call by dialing 1-866-519-4004 for
domestic callers or 65-671-350-90 for international callers,
Conference ID # 6869537. A recording of the call will be accessible
through August 23, 2018 by dialing
1-855-452-5696 or 61-281-990-299 for international callers,
Conference ID #6869537.
About China Pharma Holdings, Inc.
China Pharma Holdings, Inc. is a specialty pharmaceutical
company that develops, manufactures and markets a diversified
portfolio of products focused on conditions with a high incidence
and high mortality rates in China,
including cardiovascular, CNS, infectious, and digestive diseases.
The Company's cost-effective, high-margin business model is driven
by market demand and supported by new GMP-certified product lines
covering the major dosage forms. In addition, the Company has a
broad and expanding nationwide distribution network across all
major cities and provinces in China. The Company's wholly-owned subsidiary,
Hainan Helpson Medical & Biotechnology Co., Ltd., is located in
Haikou City, Hainan Province. For more information about
China Pharma Holdings, Inc., please visit
www.chinapharmaholdings.com. The Company routinely posts important
information on its website.
Safe Harbor Statement
Certain statements in this press release constitute
forward-looking statements for purposes of the safe harbor
provisions under The Private Securities Litigation Reform Act of
1995. Any statements set forth above that are not historical facts
are forward-looking statements that involve risks and uncertainties
that could cause actual results to differ materially from those in
the forward-looking statements, which may include, but are not
limited to, such factors as the achievability of financial
guidance, success of new product development, unanticipated changes
in product demand, increased competition, downturns in the Chinese
economy, uncompetitive levels of research and development, and
other information detailed from time to time in the Company's
filings and future filings with the United States Securities and
Exchange Commission. The forward-looking statements made herein
speak only as of the date of this press release and the Company
undertakes no duty to update any forward-looking statement to
conform the statement to actual results or changes in the Company's
expectations except as required by applicable law or
regulation.
Contact:
China Pharma Holdings, Inc.
Ms. Diana Na
Huang
Phone: +86-898-6681-1730 (China)
Email: hps@chinapharmaholdings.com
- FINANCIAL TABLES FOLLOW -
CHINA PHARMA
HOLDINGS, INC.
|
CONDENSED
CONSOLIDATED BALANCE SHEETS
|
|
|
|
|
|
|
|
|
June
30,
|
|
December
31,
|
|
|
2018
|
|
2017
|
ASSETS
|
|
(Unaudited)
|
|
(Audited)
|
Current
Assets:
|
|
|
|
|
Cash and cash
equivalents
|
|
$
1,935,527
|
|
$
2,030,214
|
Restricted
cash
|
|
1,626,352
|
|
709,796
|
Banker's
acceptances
|
|
19,612
|
|
39,867
|
Trade accounts
receivable, less allowance for doubtful
|
|
|
|
|
accounts of
$18,238,248 and $18,209,734, respectively
|
|
2,367,188
|
|
2,293,120
|
Other receivables,
less allowance for doubtful
|
|
|
|
|
accounts of $40,069
and $40,010, respectively
|
|
188,177
|
|
162,981
|
Advances to
suppliers
|
|
341,200
|
|
461,307
|
Inventory
|
|
6,377,507
|
|
6,407,155
|
Prepaid
expenses
|
|
221,132
|
|
185,647
|
Total Current
Assets
|
|
13,076,695
|
|
12,290,087
|
|
|
|
|
|
Advances for
purchases of intangible assets
|
|
23,319,133
|
|
23,722,954
|
Property, plant
and equipment, net
|
|
21,584,492
|
|
23,541,003
|
Intangible assets,
net
|
|
327,759
|
|
398,856
|
TOTAL
ASSETS
|
|
$
58,308,079
|
|
$
59,952,900
|
|
|
|
|
|
LIABILITIES AND
STOCKHOLDERS' EQUITY
|
|
|
|
|
Current
Liabilities:
|
|
|
|
|
Trade accounts
payable
|
|
$
1,152,539
|
|
$
1,141,138
|
Accrued
expenses
|
|
195,046
|
|
276,368
|
Other
payables
|
|
2,682,230
|
|
2,858,701
|
Advances from
customers
|
|
586,282
|
|
581,132
|
Other payables -
related parties
|
|
1,354,567
|
|
1,354,567
|
Current portion of
construction loan facility
|
|
2,115,107
|
|
2,305,430
|
Bankers' acceptance
notes payable
|
|
1,626,352
|
|
709,796
|
Total Current
Liabilities
|
|
9,712,123
|
|
9,227,132
|
Non-current
Liabilities:
|
|
|
|
|
Construction loan
facility
|
|
6,798,559
|
|
6,916,291
|
Deferred tax
liability
|
|
772,331
|
|
738,175
|
Total
Liabilities
|
|
17,283,013
|
|
16,881,598
|
Stockholders'
Equity:
|
|
|
|
|
Preferred stock,
$0.001 par value; 5,000,000 shares authorized;
|
|
|
|
|
no shares issued or
outstanding
|
|
-
|
|
-
|
Common stock, $0.001
par value; 95,000,000 shares authorized;
|
|
|
|
|
43,579,557 shares and
43,579,557 shares outstanding, respectively
|
|
43,580
|
|
43,580
|
Additional paid-in
capital
|
|
23,590,204
|
|
23,590,204
|
Retained
earnings
|
|
4,178,280
|
|
5,479,809
|
Accumulated other
comprehensive income
|
|
13,213,002
|
|
13,957,709
|
Total
Stockholders' Equity
|
|
41,025,066
|
|
43,071,302
|
TOTAL LIABILITIES
AND STOCKHOLDERS' EQUITY
|
|
$
58,308,079
|
|
$
59,952,900
|
CHINA PHARMA
HOLDINGS, INC.
|
CONDENSED
CONSOLIDATED STATEMENTS OF OPERATIONS
|
AND COMPREHENSIVE
LOSS
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
For the Three
Months
|
|
For the Six
Months
|
|
|
Ended June
30,
|
|
Ended June
30,
|
|
|
2018
|
|
2017
|
|
2018
|
|
2017
|
Revenue
|
|
$
3,173,711
|
|
$
2,917,180
|
|
$
6,789,395
|
|
$
6,202,383
|
Cost of
revenue
|
|
2,594,230
|
|
2,268,823
|
|
5,156,214
|
|
4,836,173
|
|
|
|
|
|
|
|
|
|
Gross
profit
|
|
579,481
|
|
648,357
|
|
1,633,181
|
|
1,366,210
|
|
|
|
|
|
|
|
|
|
Operating
expenses:
|
|
|
|
|
|
|
|
|
Selling
expenses
|
|
716,220
|
|
803,434
|
|
1,394,550
|
|
1,521,071
|
General and
administrative expenses
|
|
353,143
|
|
611,951
|
|
845,153
|
|
1,028,677
|
Research and
development expenses
|
|
23,674
|
|
21,450
|
|
45,887
|
|
47,510
|
Bad debt
expense
|
|
350,847
|
|
364,989
|
|
352,681
|
|
725,052
|
Impairment of long
term assets
|
|
-
|
|
977,980
|
|
-
|
|
977,980
|
Total operating
expenses
|
|
1,443,884
|
|
2,779,804
|
|
2,638,271
|
|
4,300,290
|
|
|
|
|
|
|
|
|
|
Loss from
operations
|
|
(864,403)
|
|
(2,131,447)
|
|
(1,005,090)
|
|
(2,934,080)
|
|
|
|
|
|
|
|
|
|
Other income
(expense):
|
|
|
|
|
|
|
|
|
Interest
income
|
|
9,524
|
|
16,316
|
|
11,818
|
|
21,349
|
Interest
expense
|
|
(130,580)
|
|
(142,205)
|
|
(259,682)
|
|
(281,169)
|
Net other
expense
|
|
(121,056)
|
|
(125,889)
|
|
(247,864)
|
|
(259,820)
|
|
|
|
|
|
|
|
|
|
Loss before income
taxes
|
|
(985,459)
|
|
(2,257,336)
|
|
(1,252,954)
|
|
(3,193,900)
|
Income tax
expense
|
|
(22,590)
|
|
(30,574)
|
|
(48,575)
|
|
(60,908)
|
Net
loss
|
|
(1,008,049)
|
|
(2,287,910)
|
|
(1,301,529)
|
|
(3,254,808)
|
Other comprehensive
income (loss) - foreign
|
|
|
|
|
|
|
|
|
currency translation
adjustment
|
|
(2,418,783)
|
|
1,008,890
|
|
(744,707)
|
|
1,488,482
|
Comprehensive
loss
|
|
$
(3,426,832)
|
|
$
(1,279,020)
|
|
$
(2,046,236)
|
|
$
(1,766,326)
|
Loss per
share:
|
|
|
|
|
|
|
|
|
Basic and
diluted
|
|
$
(0.02)
|
|
$
(0.05)
|
|
$
(0.03)
|
|
$
(0.07)
|
Weighted average
shares outstanding
|
|
43,579,557
|
|
43,579,557
|
|
43,579,557
|
|
43,579,557
|
CHINA PHARMA
HOLDINGS, INC.
|
CONSOLIDATED
STATEMENTS OF CASH FLOWS
|
(Unaudited)
|
|
|
For the Six
Months
|
|
|
Ended June
30,
|
|
|
2018
|
|
2017
|
Cash Flows from
Operating Activities:
|
|
|
|
|
Net loss
|
|
$
(1,301,529)
|
|
$
(3,254,808)
|
Depreciation and
amortization
|
|
1,714,328
|
|
1,628,380
|
Bad debt
expense
|
|
352,681
|
|
725,052
|
Deferred income
taxes
|
|
48,575
|
|
60,908
|
Inventory write
off
|
|
148,565
|
|
-
|
Impairment of long
term assets
|
|
-
|
|
977,980
|
Changes in assets and
liabilities:
|
|
|
|
|
Trade accounts and
other receivables
|
|
(767,978)
|
|
(6,262)
|
Advances to
suppliers
|
|
113,520
|
|
(9,933)
|
Inventory
|
|
57,850
|
|
439,865
|
Trade accounts
payable
|
|
35,235
|
|
(974,197)
|
Accrued taxes
payable
|
|
(94,416)
|
|
(144,739)
|
Other payables and
accrued expenses
|
|
(157,893)
|
|
(87,949)
|
Advances from
customers
|
|
15,639
|
|
(173,692)
|
Prepaid
expenses
|
|
(40,178)
|
|
45,817
|
Net Cash Provided
by Operating Activities
|
|
124,399
|
|
(773,578)
|
|
|
|
|
|
Cash Flows from
Investing Activities:
|
|
|
|
|
Purchases of
property, plant and equipment
|
|
(29,982)
|
|
(51,808)
|
Net Cash Used in
Investing Activities
|
|
(29,982)
|
|
(51,808)
|
|
|
|
|
|
Cash Flows from
Financing Activity:
|
|
|
|
|
Payments of
construction term loan
|
|
(157,071)
|
|
(145,750)
|
Net Cash Used in
Financing Activity
|
|
(157,071)
|
|
(145,750)
|
|
|
|
|
|
Effect of Exchange
Rate Changes on Cash
|
|
(32,033)
|
|
50,900
|
Net (Decrease)
Increase in Cash and Cash Equivalents
|
|
(94,687)
|
|
(920,236)
|
Cash and Cash
Equivalents at Beginning of Period
|
|
2,030,214
|
|
2,665,802
|
Cash and Cash
Equivalents at End of Period
|
|
$
1,935,527
|
|
$
1,745,566
|
|
|
|
|
|
Supplemental Cash
Flow Information:
|
|
|
|
|
Cash paid for income
taxes
|
|
$
-
|
|
$
-
|
Cash paid for
interest
|
|
$
125,716
|
|
$
410,509
|
|
|
|
|
|
Supplemental
Noncash Investing and Financing Activities:
|
|
|
|
|
Issuance of banker's
acceptances
|
|
$
965,468
|
|
$
1,435,381
|
Accounts receivable
collected with banker's acceptances
|
|
268,630
|
|
227,274
|
Inventory purchased
with banker's acceptances
|
|
288,982
|
|
210,787
|
SOURCE China Pharma Holdings, Inc.