HAIKOU CITY, China, Aug. 14,
2020 /PRNewswire/ -- China Pharma Holdings, Inc. (NYSE
American: 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, 2020.
Second Quarter Highlights
- Revenue increased 46.8% to $3.8
million in the second quarter 2020 from $2.6 million in the same period of 2019;
- Gross margin was 30.5% in the second quarter 2020, compared to
6.4% in the same period of 2019;
- Income from operations was $0.1
million in the second quarter 2020 compared to loss from
operations of $0.8 million in the
same period of 2019, an improvement of approximately $0.8 million;
- Net income was $0.01 million in
the second quarter 2020 compared to net loss of $0.84 million in the same period of 2019.
Earnings per common stock was $0.00
per basic and diluted share in the second quarter 2020, as compared
to loss per common stock of $0.02 per
basic and diluted share in the second quarter of 2019.
- We completed a foreign trade of COVID-19 testers in the second
quarter of 2020. This one-time business contributed approximately
$1.7 million to our revenue for the
three months ended June 30,
2020.
Ms. Zhilin Li, China Pharma's
Chairman and CEO, commented, "The COVID-19 outbreak continued to
have a substantial negative impact on our sales of pharmaceutical
products. Many people try to avoid going to the hospital for fear
of cross-contamination or potential infection. However, the
majority of our existing products are prescription drugs. The
macro-environment has negatively impacted our drug sales in this
period. Fortunately, we completed a one-time foreign trade business
this quarter. Due to the continued spread of COVID-19 in the
international community, COVID-19 testers have become an urgently
needed product in many markets. We have actively leveraged market
information as well as our expertise to complete the order in an
efficient manner." Ms. Li continued, "along with the lasting
efforts to place emphasis on the marketing and sales of our current
exiting pharmaceutical products, we continue to explore in the
field of comprehensive healthcare. Comprehensive healthcare focuses
on people's daily life, aging and disease and pays attention to all
kinds of risk factors and misunderstandings affecting health. We
aim to leverage our expertise in the PRC for the development,
manufacture and commercialization of pharmaceutical and
comprehensive healthcare products for the benefit of human
health."
Second Quarter Results
Revenue increased by 46.8% to $3.8
million for the three months ended June 30, 2020, as compared to $2.6 million for the three months ended
June 30, 2019. This increase was
mainly due to a foreign trade of COVID-19 testers we completed in
the second quarter of 2020. Because of the market demand for
COVID-19 related products, we received an export order for
diagnostic test, which we purchased from a third party. This
one-time business contributed approximately $1.7 million to our revenue for the three months
ended June 30, 2020. This is a
milestone of our continuous efforts to explore various niche
markets, products and regions based on our experiences and
abilities.
For the three months ended June 30,
2020, our cost of revenue was $2.6
million, or 70% of total revenue, comparing to $2.4 million, or 94% of total revenue, for the
same period in 2019. The decrease in cost of revenue was mainly due
to a foreign trade of COVID-19 testers we completed in the second
quarter of 2020.
Gross profit for the three months ended June 30, 2020 was $1.1
million, as compared to $0.2
million during the same period in 2019. Our gross profit
margin in the three months ended June 30,
2020 was 30.5% as compared to 6.4% during the same period in
2019. The increase in our gross profit margin was mainly due to a
foreign trade of COVID-19 testers we completed in the second
quarter of 2020.
Our selling expenses for the three months ended June 30, 2020 and 2019 were $0.7 million and $0.5
million, respectively. Selling expenses accounted for
19.3% of the total revenue in the three months ended June 30, 2020, as compared to 19.7% during the
same period in 2019. Because of adjustments in our sales practices,
and reform of healthcare policies, we reduced number of personnel
and expenses to efficiently support our sales and the collection of
accounts receivable.
Our general and administrative expenses were both $0.3 million for the three months ended
June 30, 2020 and 2019, respectively.
General and administrative expenses accounted for 8.6% and 13.0% of
our total revenues in the three months ended June 30, 2020 and 2019, respectively.
Our operating income for the three months ended June 30, 2020 was $0.1
million, compared to an operating loss of $0.8 million during the same period in 2019.
Net income for the three months ended June 30, 2020 was $0.01
million, or $0.00 per basic
and diluted common share, as compared to net loss of $0.84 million, or $0.02 per basic and diluted common share for the
same period a year ago. The decrease in net loss was mainly the
result of a foreign trade of COVID-19 testers we completed in the
second quarter of 2020.
Six Months Results
Revenue was both $5.5 million for
the six months ended June 30, 2020
and 2019, respectively. The first three months in this year was
impacted by COVID-19 outbreak in
China, however there was one-time
revenue from the selling of COVID-19 testers around $1.7 million, leading the revenue back to prior
year performance.
Gross profit for the six months ended June 30, 2020 was $1.3
million, compared to $0.8
million in the same period in 2019. Our gross profit margin
in the six months ended June 30, 2020
was 24.3% compared to 14.9% in the same period in 2019. The
increase in our gross profit margin was mainly due to a foreign
trade of COVID-19 testers we completed in the second quarter of
2020.
Net loss for the six months ended June
30, 2020 was $0.6 million, as
compared to net loss of $1.3 million
for the six months ended June 30,
2019. The decrease of net loss was mainly due to a foreign
trade of COVID-19 testers we completed in the second quarter of
2020.
Financial Condition
As of June 30, 2020, the Company
had cash and cash equivalents of $1.8
million compared to $1.1
million as of December 31,
2019.
Our net accounts receivable was both $0.6
million as of June 30, 2020
and December 31, 2019,
respectively.
For the six months ended June 30,
2020, cash flow used in operating activities was
$0.2 million, as compared to cash
flow provided by operating activities of $0.2 million for the same period in 2019.
Conference Call
The Company will hold a conference call at 8:30 am E.T. on August 14,
2020 to discuss the results of the second quarter of 2020.
Listeners may access the call by registering via the link
below:
http://apac.directeventreg.com/registration/event/7427437
A replay of the call will be accessible through August 22,
2020 by dialing 1-855-452-5696 or
61-281-990-299 for international callers, Conference ID # 7427437.
About China Pharma Holdings, Inc.
China Pharma Holdings, Inc. is a specialty pharmaceutical
company that develops, manufactures and markets a diversified
portfolio of products, focusing on conditions with high incidence
and high mortality rates in China,
including cardiovascular, CNS, infectious, and digestive diseases.
The Company's cost-effective 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 &
Biotechnique 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. Such risks and uncertainties may
include, but are not limited to: 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.
- FINANCIAL TABLES FOLLOW -
CHINA PHARMA
HOLDINGS, INC.
|
CONDENSED
CONSOLIDATED BALANCE SHEETS
|
(Unaudited)
|
|
|
|
|
|
|
|
June
30,
|
|
December
31,
|
|
|
2020
|
|
2019
|
|
|
|
|
|
ASSETS
|
|
|
|
|
Current
Assets:
|
|
|
|
|
Cash and cash
equivalents
|
|
$
1,813,544
|
|
$
1,074,979
|
Restricted
cash
|
|
222,996
|
|
109,908
|
Banker's
acceptances
|
|
11,251
|
|
45,756
|
Trade accounts
receivable, less allowance for doubtful
|
|
|
|
|
accounts of
$17,342,097 and $17,575,100, respectively
|
|
595,733
|
|
635,371
|
Other receivables,
less allowance for doubtful
|
|
|
|
|
accounts of $23,715
and $22,729, respectively
|
|
86,065
|
|
46,643
|
Advances to
suppliers
|
|
277,900
|
|
404
|
Inventory
|
|
3,852,972
|
|
3,588,824
|
Prepaid
expenses
|
|
397,374
|
|
77,120
|
Total Current
Assets
|
|
7,257,835
|
|
5,579,005
|
|
|
|
|
|
Property, plant
and equipment, net
|
|
15,631,653
|
|
16,313,827
|
Operating lease
right of use asset
|
|
90,289
|
|
136,779
|
Intangible assets,
net
|
|
185,244
|
|
205,611
|
TOTAL
ASSETS
|
|
$
23,165,021
|
|
$
22,235,222
|
|
|
|
|
|
LIABILITIES AND
STOCKHOLDERS' EQUITY
|
|
|
|
|
Current
Liabilities:
|
|
|
|
|
Trade accounts
payable
|
|
$
1,025,098
|
|
$
1,366,330
|
Accrued
expenses
|
|
180,719
|
|
189,880
|
Other
payables
|
|
3,753,356
|
|
3,560,332
|
Advances from
customers
|
|
592,961
|
|
505,398
|
Other payables -
related parties
|
|
2,152,161
|
|
2,071,986
|
Operating lease
liability, current portion
|
|
93,510
|
|
91,306
|
Current portion of
construction loan facility
|
|
2,118,794
|
|
2,150,168
|
Current portion of
lines of credit
|
|
1,200,650
|
|
-
|
Bankers' acceptance
notes payable
|
|
222,996
|
|
109,908
|
Total Current
Liabilities
|
|
11,340,245
|
|
10,045,308
|
Non-current
Liabilities:
|
|
|
|
|
Construction loan
facility
|
|
1,977,541
|
|
2,150,168
|
Lines of credit, net
of current portion
|
|
706,264
|
|
-
|
Operating lease
liability, net of current portion
|
|
-
|
|
48,701
|
Deferred tax
liability
|
|
742,450
|
|
753,444
|
Total
Liabilities
|
|
14,766,500
|
|
12,997,621
|
Commitments and
Contingencies (Note 14)
|
|
|
|
|
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
|
Accumulated
deficit
|
|
(26,620,246)
|
|
(25,972,402)
|
Accumulated other
comprehensive income
|
|
11,384,983
|
|
11,576,219
|
Total
Stockholders' Equity
|
|
8,398,521
|
|
9,237,601
|
TOTAL LIABILITIES
AND STOCKHOLDERS' EQUITY
|
|
$
23,165,021
|
|
$
22,235,222
|
|
|
|
|
|
CHINA PHARMA
HOLDINGS, INC.
|
CONDENSED
CONSOLIDATED STATEMENTS OF OPERATIONS
|
AND COMPREHENSIVE
INCOME (LOSS)
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
For the Three
Months
|
|
For the Six
Months
|
|
|
Ended June
30,
|
|
Ended June
30,
|
|
|
2020
|
|
2019
|
|
2020
|
|
2019
|
|
|
|
|
|
|
|
|
|
Revenue
|
|
$
3,770,723
|
|
$
2,569,408
|
|
$
5,534,678
|
|
$
5,498,681
|
Cost of
revenue
|
|
2,620,925
|
|
2,405,860
|
|
4,190,441
|
|
4,678,603
|
|
|
|
|
|
|
|
|
|
Gross
profit
|
|
1,149,798
|
|
163,548
|
|
1,344,237
|
|
820,078
|
|
|
|
|
|
|
|
|
|
Operating
expenses:
|
|
|
|
|
|
|
|
|
Selling
expenses
|
|
727,642
|
|
505,866
|
|
1,053,737
|
|
984,557
|
General and
administrative expenses
|
|
322,445
|
|
334,550
|
|
711,004
|
|
763,367
|
Research and
development expenses
|
|
30,044
|
|
66,008
|
|
78,863
|
|
135,926
|
Bad debt (benefit)
expense
|
|
(5,318)
|
|
10,092
|
|
24,928
|
|
23,404
|
Total operating
expenses
|
|
1,074,813
|
|
916,516
|
|
1,868,532
|
|
1,907,254
|
|
|
|
|
|
|
|
|
|
Income (loss) from
operations
|
|
74,985
|
|
(752,968)
|
|
(524,295)
|
|
(1,087,176)
|
|
|
|
|
|
|
|
|
|
Other income
(expense):
|
|
|
|
|
|
|
|
|
Interest
income
|
|
1,212
|
|
12,119
|
|
1,598
|
|
15,376
|
Interest
expense
|
|
(63,144)
|
|
(97,254)
|
|
(125,147)
|
|
(184,034)
|
Net other
expense
|
|
(61,932)
|
|
(85,135)
|
|
(123,549)
|
|
(168,658)
|
|
|
|
|
|
|
|
|
|
Income (loss) before
income taxes
|
|
13,053
|
|
(838,103)
|
|
(647,844)
|
|
(1,255,834)
|
Income tax
expense
|
|
-
|
|
-
|
|
-
|
|
-
|
Net income
(loss)
|
|
13,053
|
|
(838,103)
|
|
(647,844)
|
|
(1,255,834)
|
Other comprehensive
income - foreign currency
|
|
|
|
|
|
|
|
|
translation
adjustment
|
|
5,796
|
|
(811,164)
|
|
(191,236)
|
|
24,701
|
Comprehensive
income (loss)
|
|
$
18,849
|
|
$
(1,649,267)
|
|
$
(839,080)
|
|
$
(1,231,133)
|
Earnings (loss)
per share:
|
|
|
|
|
|
|
|
|
Basic and
diluted
|
|
$
0.00
|
|
$
(0.02)
|
|
$
(0.01)
|
|
$
(0.03)
|
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,
|
|
|
2020
|
|
2019
|
|
|
|
|
|
Cash Flows from
Operating Activities:
|
|
|
|
|
Net loss
|
|
$
(647,844)
|
|
$
(1,255,834)
|
Depreciation and
amortization
|
|
1,305,070
|
|
1,575,870
|
Bad debt
expense
|
|
24,928
|
|
23,404
|
Inventory write
off
|
|
-
|
|
111,533
|
Changes in assets and
liabilities:
|
|
|
|
|
Trade accounts and
other receivables
|
|
(305,183)
|
|
(284,126)
|
Advances to
suppliers
|
|
(279,380)
|
|
(10,615)
|
Inventory
|
|
(14,136)
|
|
960,946
|
Trade accounts
payable
|
|
(323,470)
|
|
223,562
|
Accrued taxes
payable
|
|
279,748
|
|
(43,632)
|
Other payables and
accrued expenses
|
|
(79,967)
|
|
(369,547)
|
Change in bankers'
acceptance notes payable
|
|
115,468
|
|
(781,626)
|
Advances from
customers
|
|
95,579
|
|
31,548
|
Prepaid
expenses
|
|
(323,553)
|
|
(31,309)
|
Net Cash (Used in)
Provided by Operating Activities
|
|
(152,740)
|
|
150,174
|
|
|
|
|
|
Cash Flows from
Investing Activities:
|
|
|
|
|
Purchases of property
and equipment
|
|
(840,449)
|
|
(73,538)
|
Net Cash Used in
Investing Activities
|
|
(840,449)
|
|
(73,538)
|
|
|
|
|
|
Cash Flows from
Financing Activities:
|
|
|
|
|
Proceeds from lines
of credit
|
|
1,919,818
|
|
-
|
Payments of
construction term loan
|
|
(142,209)
|
|
(147,475)
|
Proceeds (payments)
of related party payables
|
|
90,551
|
|
(231,252)
|
Net Cash Provided
by) Used in Financing Activities
|
|
1,868,160
|
|
(378,727)
|
|
|
|
|
|
Effect of Exchange
Rate Changes on Cash
|
|
(23,318)
|
|
768
|
Net Increase
(Decrease) in Cash, Cash Equivalents and Restricted
Cash
|
|
851,653
|
|
(301,323)
|
Cash, Cash
Equivalents and Restricted Cash at Beginning of Period
|
|
1,184,887
|
|
2,460,527
|
Cash, Cash
Equivalents and Restricted Cash at End of Period
|
|
$
2,036,540
|
|
$
2,159,204
|
|
|
|
|
|
Cash and Cash
Equivalents
|
|
1,813,544
|
|
1,655,892
|
Restricted
cash
|
|
222,996
|
|
503,312
|
Cash, Cash
Equivalents and Restricted Cash at End of Period
|
|
$
2,036,540
|
|
$
2,159,204
|
|
|
|
|
|
Supplemental Cash
Flow Information:
|
|
|
|
|
Cash paid for income
taxes
|
|
$
-
|
|
$
-
|
Cash paid for
interest
|
|
$
118,374
|
|
$
178,991
|
|
|
|
|
|
Supplemental
Noncash Investing and Financing Activities:
|
|
|
|
|
Issuance of banker's
acceptances
|
|
$
-
|
|
$
-
|
Accounts receivable
collected with banker's acceptances
|
|
270,453
|
|
378,585
|
Inventory purchased
with banker's acceptances
|
|
304,520
|
|
399,455
|
Right-of-use assets
obtained in exchange for operating lease obligations
|
|
-
|
|
233,629
|
View original
content:http://www.prnewswire.com/news-releases/china-pharma-holdings-inc-reports-second-quarter-2020-financial-results-301112379.html
SOURCE China Pharma Holdings, Inc.