BEIJING, Feb. 28, 2018 /PRNewswire/ -- China Biologic
Products Holdings, Inc. (NASDAQ: CBPO, "China Biologic" or the
"Company"), a leading fully integrated plasma-based
biopharmaceutical company in China, today announced its financial results
for the fourth quarter and fiscal year of 2017.
Fourth Quarter 2017 Financial Highlights
- Total sales in the fourth quarter of 2017 increased by
12.2% in RMB terms and 16.1% in USD terms to $90.1 million from $77.6
million in the same quarter of 2016.
- Gross profit increased by 26.7% to $59.3 million from $46.8
million in the same quarter of 2016. Gross margin
increased to 65.8% from 60.3% in the same quarter of 2016.
- Income from operations decreased by 15.5% to
$19.6 million from $23.2 million in the same quarter of 2016.
Operating margin decreased to 21.8% from 29.9% in the same
quarter of 2016.
- Net loss attributable to the Company,
factoring in one-time $40.3 million
income tax charge, was $24.6 million
compared to net income attributable to the Company of $19.4 million in the same quarter of 2016.
Fully diluted loss per share
was $0.86 compared to fully
diluted earnings per share of $0.69
in the same quarter of 2016.
- Non-GAAP adjusted net income attributable to the Company
decreased by 6.8% in RMB terms and 3.7% in USD terms to
$25.9 million from $26.9 million in the same quarter of 2016.
Non-GAAP adjusted earnings per share
decreased to $0.90 from
$0.95 in the same quarter of
2016.
Fiscal Year 2017 Financial Highlights
- Total sales in 2017 increased by 10.5% in RMB terms, or
8.6% in USD terms, to $370.4 million
from $341.2 million in 2016.
- Gross profit increased by 12.8% to $244.9 million from $217.2
million in 2016. Gross margin increased to 66.1% in 2017
from 63.6% in 2016.
- Income from operations decreased by 5.6% to $135.9 million from $144.0
million in 2016. Operating margin decreased to 36.7% in 2017
from 42.1% in 2016.
- Net income attributable to the Company, factoring in
one-time $40.3 million income tax
charge, decreased by 35.2% to $67.9
million from $104.8 million in
2016. Fully diluted net income per share decreased to $2.38 from $3.74 in
2016.
- Non-GAAP adjusted net income attributable to the Company
increased by 13.7% in RMB terms, or 11.4% in USD terms, to
$141.2 million from $126.8 million in 2016. Fully diluted non-GAAP
adjusted net income per share increased to $4.95 from $4.52 in
2016.
Mr. David (Xiaoying) Gao,
Chairman and Chief Executive Officer of China Biologic, commented,
"We managed to meet our revised sales guidance while our profit
fell below expectations due to a more-aggressive-than-expected
implementation of certain government healthcare reform policies in
late 2017. For example, to ensure immediate compliance with the
strict policy of capping the revenue from drug sales to 30% of the
total revenue of a hospital, many regional hospitals reduced
purchases on certain high-unit-price plasma products, which
reflected the collective efforts of regional government agencies to
lower overall medical insurance spending. On the other hand, we are
pleased with the performance of our placenta polypeptide product.
Its sales revenue grew significantly in the fourth quarter of 2017,
reflecting an increased proportion of higher-invoiced shipments due
to the wider implementation of the two-invoice policy. To maintain
our leading market position under the new regulations, we elevated
our marketing and promotional activities, which incurred more
selling expenses and impacted our profit margin."
Mr. Gao continued, "Despite the challenging policy headwinds, we
are pleased with our operational progress. We received the new
Shandong facility's final
production certificate and began full operations at the new
facility in late February. We received the operating permit and
launched trial operations at our Ju County plasma collection
station in Shandong Province in
December 2017 and expect to complete
construction of our Daming plasma collection station and Feicheng
branch plasma collection facility in the first half of 2018. In
addition, in February 2018, we
received approval from Hainan
Province to build a new plasma collection station in
Wenchang City, and we expect to be able to obtain operating permit
to begin commercial operations there before the end of 2018.
"Our product pipeline made great progress as well: our newly
approved fibrinogen products have been commercially launched to the
market, and we completed the clinical trial of Factor IX, for which
we expect to obtain approval to commercially launch this product by
the end of 2018. We closed our acquisition of 80% equity interest
in TianXinFu in early 2018. Integration of its business is
underway, and we plan to utilize its expertise to more deeply
penetrate certain hospital surgical departments with certain
high-end plasma products."
"Looking forward to 2018, we will prioritize our focus on
broadening sales channels and exploring new growth opportunities to
offset potential deceleration of volume growth associated with
ongoing healthcare reform. We remain committed to further investing
in medical marketing to accelerate volume for newly launched
products and in managing public tenders in various local markets to
secure optimized pricing opportunities. Furthermore, we aim to
further increase our profitability by accelerating the commercial
launch time of our various pipeline products to solidify our
leading market position. We remain optimistic about the development
of China's plasma industry over
the long run as the opportunities for our business continue to grow
while simultaneously meeting the needs of underserved patients
across China," concluded Mr.
Gao.
Fourth Quarter 2017 Financial Performance
Total sales in the fourth quarter of 2017 increased by
12.2% in RMB terms, or 16.1% in USD terms, to $90.1 million from $77.6
million in the same quarter of 2016. The increase was
primarily attributable to the increase in the sales of placenta
polypeptide products and certain immunoglobulin products, which was
partly offset by the decrease in the sales of human albumin
products.
Cost of sales remained stable at $30.8 million in the fourth quarter of 2017
compared to the same quarter of 2016. As a percentage of total
sales, cost of sales decreased to 34.2% from 39.7% in the same
quarter of 2016. The decrease in cost of sales as a percentage of
total sales was mainly due to the higher sales price of placenta
polypeptide following the wider implementation of the two-invoice
policy and a greater proportion of sales derived from hyper-immune
products with a higher profit margin.
Gross profit increased by 26.7% to $59.3 million in the fourth quarter of 2017 from
$46.8 million in the same quarter of
2016.
Gross margin was 65.8% and 60.3% in the fourth quarter of
2017 and 2016, respectively.
Total operating expenses in the fourth quarter of 2017
increased by $16.1 million, or 68.2%,
to $39.7 million from $23.6 million in the same quarter of 2016. This
increase mainly consisted of an increase of $12.7 million in selling expenses. More than half
of the increase in selling expenses was related to the sales of
placenta polypeptide products and the remaining was related to the
sales of plasma products. For placenta polypeptide products and
certain hyper-immune products, as certain previous multiple layers
of distribution channels were disqualified due to the two-invoice
regulation, we implemented new sales strategies including using an
internal sales force or engaging third party contract service
organizations to promote our placenta polypeptide products. For
other plasma products, in order to solidify our competitiveness
within distribution channel customers, we incurred more promotion
and marketing costs. As a percentage of total sales, total
operating expenses increased to 44.1% in the fourth quarter of 2017
from 30.4% in the same quarter of 2016.
Income from operations for the fourth quarter of 2017
decreased by 15.5% to $19.6 million
from $23.2 million in the same period
of 2016.
Operating margin decreased to 21.8% in the fourth quarter
of 2017 from 29.9% in the same quarter of 2016.
Income tax expense was $44.7
million for the fourth quarter of 2017 compared to
$4.3 million in the same period of
2016. Income tax expense includes a one-time charge of $40.3 million, which represents management's
estimate of the amount of U.S. corporate income tax based on the
deemed repatriation to the United
States of the Company's accumulated earnings mandated by the
new U.S. income tax law that went into effect on December 22, 2017 (the "U.S. Tax Reform").
Excluding the one-time charge, non-GAAP income tax expense for the
fourth quarter was $4.4 million. The
one-time charge for deemed repatriation will be payable by the
Company over an eight-year period commencing in April 2018. The actual impact of the U.S. Tax
Reform on the Company may differ from management's estimates, and
management may update its judgments based on its review of future
regulations or guidance issued by the U.S. Department of the
Treasury, and specific actions the Company may take in the
future.
Net loss attributable to the Company, factoring in
the one-time $40.3 million income tax
charge, was $24.6 million in the
fourth quarter of 2017 compared to net income attributable to the
Company of $19.4 million in the same
quarter of 2016.
Diluted net loss per share was $0.86 in the fourth quarter of 2017 compared to
diluted net income per share of $0.69
in the same quarter of 2016.
Non-GAAP adjusted net income attributable to the Company
decreased by 6.8% in RMB terms, or 3.7% in USD terms, to
$25.9 million in the fourth quarter
of 2017 from $26.9 million in the
same quarter of 2016.
Non-GAAP net margin decreased to 28.7% in the fourth
quarter of 2017 from 34.7% in the same quarter of 2016.
Non-GAAP adjusted net income per diluted share decreased
to $0.90 in the fourth quarter of
2017 from $0.95 in the same quarter
of 2016.
Non-GAAP adjusted net income and diluted earnings per
share for the fourth quarter of 2017 exclude $8.3 million in non-cash employee share-based
compensation expenses, $40.3 million
in one-time income tax expense as a result of the U.S. Tax Reform,
and $1.9 million in one-time expenses
related to our change of domicile and acquisition of TianXinFu.
Fiscal Year 2017 Financial Performance
Total sales in 2017 increased by 10.5% in RMB terms and
8.6% in USD terms to $370.4 million
from $341.2 million in 2016. The
increase was primarily attributable to the increase in the sales of
placenta polypeptide and certain immunoglobulin products.
During 2017, human albumin and IVIG products remained the
Company's two largest sales contributors, and revenue contribution
from the Company's other products continued to grow. As a
percentage of total sales, sales from human albumin and IVIG
products decreased to 35.8% and 31.7%, respectively, in 2017
compared to 39.2% and 34.6% in 2016.
The sales volume of human albumin products increased by 3.5%
while sales volume of IVIG remained stable for 2017 as a combined
result of enhanced production volumes in Guizhou Taibang and
reduced production volume in Shandong Taibang in connection with
the old facility's production suspension.
The average price for human albumin products decreased by 2.5%
in RMB terms and 4.3% in USD terms in 2017 mainly due to the
combined effect of both a decrease in prices charged to certain
distributors, which reflected intensified market competition, and a
lower sales proportion from the higher-unit-price dosages compared
to 2016. The average price for IVIG products increased by 1.3% in
RMB terms and decreased by 0.8% in USD terms, mainly due to an
increase in price we charged the Company's major distributors.
Revenue from other immunoglobulin products increased by 24.9% in
2017 compared to 2016, reaching 13.5% of total sales as compared to
11.8% of total sales in 2016, mainly due to the increase in both
average sales price and sales volume of human rabies immunoglobulin
products.
Revenue from other plasma products, including human coagulation
factor VIII and human prothrombin complex concentrate, increased by
22.0% in 2017 compared to 2016, representing 5.7% of total sales as
compared to 5.0% of total sales in 2016. This growth reflects the
Company's ongoing medical marketing activities.
Revenue from placenta polypeptide products increased by 52.8% in
2017 compared to 2016, reaching 13.3% of total sales, mainly
attributable to a higher unit selling price following the wider
implementation of the two-invoice policy across China in 2017 as well as an increase of 7.3%
in sales volume.
Cost of sales was $125.5
million in 2017 compared to $124.0
million in 2016. As a percentage of total sales, cost of
sales decreased to 33.9% from 36.4% in 2016 mainly due to the
higher sales price of placenta polypeptide following the wider
implementation of the two-invoice policy and a greater proportion
of sales derived from certain hyper-immune and coagulation products
with a higher profit margin.
Gross profit increased by 12.8% to $244.9 million in 2017 from $217.2 million in 2016.
Gross margin was 66.1% and 63.6% in 2017 and 2016,
respectively.
Total operating expenses in 2017 increased by 48.9% to
$109.0 million from $73.2 million in 2016 mainly due to the increase
of selling expenses as well as the increase of general and
administrative expenses. As a
percentage of total sales, total operating expenses increased to
29.4% in 2017 from 21.5% in 2016.
Selling expenses in 2017 increased by $23.1 million to $34.8
million from $11.7 million in
2016. More than half of the increase was related to the sales of
placenta polypeptide products with the remainder related to the
sales of plasma products. For placenta polypeptide products and
certain hyper-immune products, as certain previous multiple layers
of distribution channels were disqualified due to the two-invoice
regulation, the Company implemented new sales strategies including
using an internal sales force or engaging third party contract
service organizations to promote its placenta polypeptide products.
For other plasma products, in order to solidify its competitiveness
within distribution channel customers, the Company incurred
additional promotion and marketing costs. As a percentage of total
sales, selling expenses accounted for 9.4% in 2017 compared to 3.4%
in 2016.
General and administrative expenses in 2017 increased by
24.2% to $67.7 million compared to
$54.5 million in 2016. As a
percentage of total sales, general and administrative expenses were
18.3% and 16.0% in 2017 and 2016, respectively. The increase in
general and administrative expenses was mainly due to the increase
of share-based compensation expenses of $9.5
million and $1.9 million in
one-time expenses related to the Company's change of domicile and
acquisition of TianXinFu. Excluding the impact of share-based
compensation expenses and the one-time expenses related to the
Company's change of domicile and acquisition of TianXinFu, non-GAAP
general and administrative expenses would have been 8.6% and 8.8%
of total sales in 2017 and 2016, respectively.
Research and development expenses in 2017 decreased by
7.1% to $6.5 million from
$7.0 million in 2016. As a percentage
of total sales, research and development expenses decreased to 1.7%
in 2017 from 2.1% in 2016. During 2017 and 2016, the Company
received government grants totaling $0.4
million and $0.8 million,
respectively, and recognized them as a reduction of research and
development expenses. Excluding this impact, non-GAAP research and
development expenses decreased by $0.9
million in 2017 from 2016, and these non-GAAP expenses as a
percentage of total sales decreased from 2.3% to 1.9%.
Income from operations in 2017 decreased by 5.6% to
$135.9 million from $144.0 million in 2016.
Operating margin was 36.7% in 2017 as compared to 42.1%
in 2016.
Income tax expense in 2017 was $64.2 million compared to $25.1 million in 2016. Income tax expense
includes a one-time charge of $40.3
million in the fourth quarter of 2017, which represents
management's estimate of the amount of U.S. corporate income tax
based on the deemed repatriation to the
United States of the Company's accumulated earnings mandated
by the U.S. Tax Reform. Excluding the one-time charge, non-GAAP
income tax expense for 2017 was $23.9
million, and the non-GAAP effective income tax rate remained
at 16.3% in 2017 as in 2016.
Net income attributable to the Company, factoring
in the one-time $40.3 million income
tax charge, was $67.9 million in
2017 compared to $104.8 million in
2016. Diluted earnings per share for 2017 was $2.38 compared to $3.74 for 2016.
Non-GAAP adjusted net income attributable to the Company
increased by 13.7% in RMB terms and 11.4% in USD terms to
$141.2 million in 2017 from
$126.8 million in 2016.
Non-GAAP net margin increased to 38.1% from 37.2% in
2016.
Non-GAAP adjusted earnings per diluted share increased to
$4.95 in 2017 from $4.52 in 2016.
Non-GAAP adjusted net income and diluted earnings per
share for 2017 exclude $31.1
million in non-cash employee share-based compensation
expenses, $40.3 million in one-time
income tax expense as a result of the U.S. Tax Reform, and
$1.9 million in one-time expenses
related to the Company's change of domicile and acquisition of
TianXinFu.
As of December 31, 2017, the
Company had $219.3 million in cash
and cash equivalents, primarily consisting of cash on hand, demand
deposits, and certificates of deposit with an initial term of three
months or less.
Net cash provided by operating activities for 2017 was
$102.2 million as compared to
$123.3 million for 2016. The decrease
in net cash provided by operating activities was primarily due to
an increase in accounts receivable and inventories, which was
partially offset by an increase in other payables and accrued
liabilities during 2017.
Accounts receivable increased by $39.9
million during 2017 as compared to $11.0 million in 2016. The accounts receivable
turnover days for plasma products increased to 58 days during 2017
from 41 days in 2016, reflecting longer credit terms to hospitals
as a result of the nationwide implementation of healthcare reform
measures and intensified competition in the distribution channel.
Inventories increased by $42.1
million in 2017 as compared to $40.1
million in 2016. This increase was due to an increase of raw
materials during the production suspension at our old Shandong facility, and the increase of
work-in-process and finished goods reflecting the weaker market
demand due to more aggressive-than-expected implementation of
certain government healthcare reform policies.
Net cash used in investing activities for 2017 was
$60.9 million as compared to
$52.5 million for 2016. In 2017, the
Company paid $38.3 million for the
acquisition of property, plant and equipment, intangible assets,
and land use rights and we also made time deposit of $22.7 million. In 2016, the Company paid
$51.0 million for the acquisition of
property, plant and equipment, intangible assets and land use
rights and provided loans of $12.3
million to Xinjiang Deyuan, which was partially offset by a
$10.3 million refund of deposits on
land use rights from the local government.
Net cash used in financing activities for 2017 was
$18.3 million as compared to
$22.1 million for 2016. Net cash used
in financing activities in 2017 mainly consisted of a dividend
payment of $18.8 million made by the
Company's subsidiary to the noncontrolling interest shareholder,
which was partially offset by proceeds of $0.9 million from stock options exercised. Net
cash used in financing activities in 2016 mainly consisted of a
payment of $58.1 million to former
minority shareholders of Guizhou Taibang in connection with their
capital withdrawal from Guizhou Taibang and a dividend of
$7.9 million paid to the minority
shareholder by Shandong Taibang. These were partially offset by the
maturity of a $37.8 million time
deposit as a security for a bank loan, which was fully repaid in
June 2015, and the proceeds of
$3.6 million from stock options
exercised.
Financial Outlook
For the full year of 2018, the Company expects total sales to
grow 18% to 20% in RMB terms and non-GAAP adjusted net income to
grow 16% to 18% in RMB terms over 2017 financial results. These
projections factor in the estimated 2018 financial results of
TianXinFu in which the Company acquired 80% interests at the
beginning of 2018. Excluding the TianXinFu contribution, estimated
sales for 2018 are expected to grow 6% to 8% in RMB terms and
non-GAAP adjusted net income is expected to grow 3% to 4% in RMB
terms over 2017 financial results. The 2018 non-GAAP adjusted net
income projection excludes non-cash employee share-based
compensation expenses and non-cash intangible assets amortization
expense associated with the TianXinFu acquisition.
This guidance does not factor in any potential foreign currency
translation impact. Having previously adopted an exchange rate of
approximately RMB6.76 = $1.00 based on weighted average quarterly
exchange rates in 2017 in translating 2017 financial results, the
Company expects that the total sales and non-GAAP adjusted net
income in USD terms in 2018 could be affected by the foreign
currency translation impact.
This guidance excludes potential acquisitions, and necessarily
assumes no significant adverse product price changes during 2018.
This forecast reflects the Company's current and preliminary views,
which are subject to change.
Conference Call
The Company will host a conference call at 7:30 am Eastern Time on March 1, 2018, which is 8:30 pm Beijing Time on March 1, 2018, to discuss its fourth quarter and
fiscal 2017 results and answer questions from investors. Listeners
may access the call by dialing:
US:
|
1 888 346
8982
|
International:
|
1 412 902
4272
|
Hong Kong:
|
800 905
945
|
China:
|
400 120
1203
|
A telephone replay will be available one hour after the
conclusion of the conference all through March 8, 2018. The dial-in details are:
US:
|
1 877 344
7529
|
International:
|
1 412 317
0088
|
Passcode:
|
10117579
|
A live and archived webcast of the conference call will be
available through the Company's investor relations website at
http://chinabiologic.investorroom.com.
About China Biologic Products Holdings, Inc.
China Biologic Products Holdings, Inc. (NASDAQ: CBPO) is a
leading fully integrated plasma-based biopharmaceutical company in
China. The Company's products are
used as critical therapies during medical emergencies and for the
prevention and treatment of life-threatening diseases and
immune-deficiency related diseases. China Biologic is headquartered
in Beijing and manufactures over
20 different dosage forms of plasma products through its indirect
majority-owned subsidiary, Shandong Taibang Biological Products
Co., Ltd. and its wholly owned subsidiary, Guizhou Taibang
Biological Products Co., Ltd. The Company also has an equity
investment in Xi'an Huitian Blood Products Co., Ltd. The Company
sells its products to hospitals, distributors and other healthcare
facilities in China. For
additional information, please see the Company's website
www.chinabiologic.com.
Non-GAAP Disclosure
This news release contains non-GAAP financial measures that
exclude non-cash compensation expenses related to options and
restricted shares granted to employees and directors under the
Company's 2008 Equity Incentive Plan, a one-time income tax expense
as a result of the U.S. Tax Reform, one-time expenses related to
our change of domicile and acquisition of TianXinFu, and
amortization of acquired intangible assets. To supplement the
Company's consolidated financial statements presented on a GAAP
basis, the Company has provided non-GAAP financial information
excluding the impact of these items in this release. The Company's
management believes that its presentation of non-GAAP financial
measures provides useful supplementary information to and
facilitates additional analysis by investors. A reconciliation of
the adjustments to GAAP results appears in the table accompanying
this news release. This additional non-GAAP information is not
meant to be considered in isolation or as a substitute for GAAP
financials. The non-GAAP financial information that the Company
provides also may differ from the non-GAAP information provided by
other companies.
In addition, as the Company evaluates certain key items of its
financial results on a local currency basis (i.e., in RMB) in
addition to the reporting currency (i.e., in USD), this news
release contains local currency information that eliminates the
impact of fluctuations in foreign currency exchange rates. The
Company believes that, given its operations primarily based in
China, providing local currency
information on such key items enhances the understanding of its
financial results and evaluation of performance in comparison to
prior periods. Changes in local currency percentages are calculated
by comparing financial results denominated in RMB from period to
period.
Safe Harbor Statement
This news release may contain certain "forward-looking
statements" relating to the business of China Biologic Products
Holdings, Inc. and its subsidiaries. All statements, other than
statements of historical fact included herein, are "forward-looking
statements." These forward-looking statements are often identified
by the use of forward-looking terminology such as "intend,"
"believe," "expect," "are expected to," "will," or similar
expressions, and involve known and unknown risks and uncertainties.
Among other things, the Company's plans regarding the construction
and operation of plasma collection stations, the commercial launch
of pipeline products and the integration with TianXinFu, as well as
the management's quotations and forecast of the Company's financial
performance in this news release contain forward-looking
statements. Although the Company believes that the expectations
reflected in these forward-looking statements are reasonable, they
involve assumptions, risks, and uncertainties, and these
expectations may prove to be incorrect.
Investors should not place undue reliance on these
forward-looking statements, which speak only as of the date of this
news release. The Company's actual results could differ materially
from those anticipated in these forward-looking statements as a
result of a variety of factors, including, without limitation,
quality of purchased source plasma, potential delay or failure to
complete construction of new collection facilities, potential
inability to pass government inspection and certification process
for existing and new facilities, potential inability to achieve the
designed collection capacities at the new collection facilities,
potential inability to achieve the expected operating and financial
performance, potential inability to find alternative sources of
plasma, potential inability to increase production at permitted
sites, potential inability to mitigate the financial consequences
of a temporarily reduced raw plasma supply through cost cutting or
other efficiencies, and potential additional regulatory
restrictions on its operations and those additional risks and
uncertainties discussed in the Company's periodic reports that are
filed with the Securities and Exchange Commission and available on
its website (http://www.sec.gov). All forward-looking statements
attributable to the Company or persons acting on its behalf are
expressly qualified in their entirety by these factors. Other than
as required under the securities laws, the Company does not assume
a duty to update these forward-looking statements.
Contact:
China Biologic Products Holdings, Inc.
Mr. Ming Yin
Senior Vice President
Phone: +86-10-6598-3099
Email: ir@chinabiologic.com
ICR Inc.
Mr. Bill Zima
Phone: +86-10-6583-7511 or +1-646-405-5191
E-mail: bill.zima@icrinc.com
CHINA BIOLOGIC
PRODUCTS HOLDINGS, INC. AND SUBSIDIARIES
|
CONSOLIDATED
STATEMENTS OF COMPREHENSIVE INCOME
|
|
|
|
|
|
|
|
|
|
For the Years
Ended
|
|
|
December
31,
|
|
December
31,
|
|
December
31,
|
|
|
2017
|
|
2016
|
|
2015
|
|
|
USD
|
|
USD
|
|
USD
|
Sales
|
|
370,406,840
|
|
341,169,426
|
|
296,457,902
|
Cost of
sales
|
|
125,517,021
|
|
124,034,448
|
|
106,482,626
|
Gross
profit
|
|
244,889,819
|
|
217,134,978
|
|
189,975,276
|
|
|
|
|
|
|
|
Operating
expenses
|
|
|
|
|
|
|
Selling
expenses
|
|
34,843,935
|
|
11,679,242
|
|
9,973,449
|
General and
administrative expenses
|
|
67,683,667
|
|
54,519,122
|
|
41,391,520
|
Research and
development expenses
|
|
6,503,712
|
|
7,021,992
|
|
6,024,368
|
Income from
operations
|
|
135,858,505
|
|
143,914,622
|
|
132,585,939
|
|
|
|
|
|
|
|
Other income
(expenses)
|
|
|
|
|
|
|
Equity in
income/(loss) of an equity method investee
|
|
3,509,071
|
|
2,519,201
|
|
(1,311,278)
|
Interest
income
|
|
7,623,624
|
|
7,815,780
|
|
5,551,105
|
Interest
expense
|
|
(583,432)
|
|
(254,471)
|
|
(1,727,335)
|
Loss from disposal of
a subsidiary
|
|
-
|
|
(75,891)
|
|
-
|
Total other income,
net
|
|
10,549,263
|
|
10,004,619
|
|
2,512,492
|
|
|
|
|
|
|
|
Income before income
tax expense
|
|
146,407,768
|
|
153,919,241
|
|
135,098,431
|
|
|
|
|
|
|
|
Income tax
expense
|
|
64,171,809
|
|
25,125,820
|
|
20,992,913
|
|
|
|
|
|
|
|
Net
income
|
|
82,235,959
|
|
128,793,421
|
|
114,105,518
|
|
|
|
|
|
|
|
Less: Net income
attributable to noncontrolling interest
|
|
14,292,924
|
|
24,014,114
|
|
25,062,815
|
|
|
|
|
|
|
|
Net income
attributable to China Biologic Products Holdings,
Inc.
|
|
67,943,035
|
|
104,779,307
|
|
89,042,703
|
|
|
|
|
|
|
|
Earnings per share of
ordinary share:
|
|
|
|
|
|
|
Basic
|
|
2.40
|
|
3.79
|
|
3.40
|
Diluted
|
|
2.38
|
|
3.74
|
|
3.27
|
Weighted average
shares used in computation:
|
|
|
|
|
|
|
Basic
|
|
27,361,561
|
|
26,848,445
|
|
25,599,153
|
Diluted
|
|
27,605,623
|
|
27,249,144
|
|
26,567,366
|
|
|
|
|
|
|
|
Net
income
|
|
82,235,959
|
|
128,793,421
|
|
114,105,518
|
|
|
|
|
|
|
|
Other comprehensive
income/(losses):
|
|
|
|
|
|
|
Foreign currency
translation adjustment, net of nil income taxes
|
|
36,861,394
|
|
(31,303,262)
|
|
(24,368,360)
|
|
|
|
|
|
|
|
Comprehensive
income
|
|
119,097,353
|
|
97,490,159
|
|
89,737,158
|
|
|
|
|
|
|
|
Less: Comprehensive
income attributable to noncontrolling interest
|
|
17,876,743
|
|
19,026,592
|
|
20,698,249
|
|
|
|
|
|
|
|
Comprehensive income
attributable to China Biologic Products Holdings,
Inc.
|
|
101,220,610
|
|
78,463,567
|
|
69,038,909
|
CHINA BIOLOGIC
PRODUCTS HOLDINGS, INC. AND SUBSIDIARIES
|
CONSOLIDATED
BALANCE SHEETS
|
|
|
|
|
|
|
|
December 31,
2017
|
|
December 31,
2016
|
|
|
USD
|
|
USD
|
ASSETS
|
|
|
|
|
Current
Assets
|
|
|
|
|
Cash and cash
equivalents
|
|
219,336,848
|
|
183,765,533
|
Time
deposits
|
|
22,895,200
|
|
-
|
Accounts receivable,
net of allowance for doubtful accounts
|
|
77,267,275
|
|
33,918,796
|
Loan receivable -
current
|
|
45,912,000
|
|
-
|
Inventories
|
|
209,570,835
|
|
156,412,674
|
Prepayments and other
current assets, net of allowance for doubtful accounts
|
|
18,139,453
|
|
15,320,913
|
Total Current
Assets
|
|
593,121,611
|
|
389,417,916
|
|
|
|
|
|
Loan receivable - non
current
|
|
-
|
|
43,245,000
|
Property, plant and
equipment, net
|
|
166,812,749
|
|
132,091,923
|
Land use rights,
net
|
|
24,853,163
|
|
23,389,384
|
Equity method
investment
|
|
14,903,908
|
|
10,614,755
|
Other non-current
assets
|
|
9,365,986
|
|
6,198,531
|
Total
Assets
|
|
809,057,417
|
|
604,957,509
|
|
|
|
|
|
LIABILITIES AND SHAREHOLDERS'
EQUITY
|
|
|
|
|
Current
Liabilities
|
|
|
|
|
Accounts
payable
|
|
7,548,909
|
|
6,158,601
|
Income tax
payable
|
|
14,258,544
|
|
7,484,366
|
Other payables and
accrued expenses
|
|
75,827,864
|
|
59,798,145
|
Total Current
Liabilities
|
|
97,635,317
|
|
73,441,112
|
|
|
|
|
|
Deferred
income
|
|
3,476,877
|
|
3,755,648
|
Non-current income
tax payable
|
|
37,067,138
|
|
-
|
Other
liabilities
|
|
6,553,088
|
|
6,623,926
|
Total
Liabilities
|
|
144,732,420
|
|
83,820,686
|
|
|
|
|
|
Shareholders' Equity
|
|
|
|
|
Ordinary
share:
|
|
|
|
|
par value
$0.0001;
|
|
|
|
|
100,000,000 shares
authorized;
|
|
|
|
|
29,866,545 and
29,427,609 shares issued at December 31, 2017 and 2016,
respectively;
|
|
|
|
|
27,611,841 and
27,172,905 shares outstanding at December 31, 2017 and 2016,
respectively
|
|
2,987
|
|
2,943
|
Additional paid-in
capital
|
|
140,230,395
|
|
105,459,610
|
Treasury share:
2,254,704 shares at December 31, 2017 and 2016, respectively, at
cost
|
|
(56,425,094)
|
|
(56,425,094)
|
|
|
|
|
|
Retained
earnings
|
|
506,426,436
|
|
438,483,401
|
Accumulated other
comprehensive income/(losses)
|
|
7,957,304
|
|
(25,320,271)
|
Total equity
attributable to China Biologic Products Holdings,
Inc.
|
|
598,192,028
|
|
462,200,589
|
|
|
|
|
|
Noncontrolling
interest
|
|
66,132,969
|
|
58,936,234
|
|
|
|
|
|
Total Shareholders'
Equity
|
|
664,324,997
|
|
521,136,823
|
|
|
|
|
|
Commitments and
contingencies
|
|
-
|
|
-
|
|
|
|
|
|
Total Liabilities and
Shareholders' Equity
|
|
809,057,417
|
|
604,957,509
|
|
|
|
|
|
Note: "Ordinary share" when
used with respect to a date before July 21, 2017 refers to the
common stock of our predecessor, China Biologic Products,
Inc.
|
CHINA BIOLOGIC
PRODUCTS HOLDINGS, INC. AND SUBSIDIARIES
|
CONSOLIDATED
STATEMENTS OF CASH FLOWS
|
|
|
|
|
|
|
|
|
|
For the Years
Ended
|
|
|
December
31,
|
|
December
31,
|
|
December
31,
|
|
|
2017
|
|
2016
|
|
2015
|
|
|
USD
|
|
USD
|
|
USD
|
CASH FLOWS FROM
OPERATING ACTIVITIES:
|
|
|
|
|
|
|
Net
income
|
|
82,235,959
|
|
128,793,421
|
|
114,105,518
|
Adjustments to reconcile net income to
net cash provided
by operating
activities:
|
|
|
|
|
|
|
Depreciation
|
|
11,691,731
|
|
11,962,983
|
|
8,179,376
|
Amortization
|
|
1,216,959
|
|
775,053
|
|
854,364
|
Loss on disposal of
property, plant and equipment
|
|
3,228,845
|
|
293,098
|
|
3,024,830
|
Allowance for
doubtful accounts - accounts receivable, net
|
|
23,783
|
|
123,239
|
|
34,902
|
Allowance for
doubtful accounts - prepayments and other
receivables
|
|
-
|
|
65,341
|
|
788
|
Impairment for other
non-current assets
|
|
-
|
|
1,225,200
|
|
-
|
Write-down of
obsolete inventories
|
|
-
|
|
256,862
|
|
76,587
|
Deferred income tax
benefit
|
|
(3,252,516)
|
|
(3,006,541)
|
|
(170,345)
|
Share-based
compensation
|
|
33,903,283
|
|
24,405,511
|
|
12,114,272
|
Equity in (income)
/loss of an equity method investee
|
|
(3,509,071)
|
|
(2,519,201)
|
|
1,311,278
|
Loss from disposal of
a subsidiary
|
|
-
|
|
75,891
|
|
-
|
Excess tax benefits
from share-based compensation arrangements
|
|
-
|
|
(2,613,831)
|
|
(1,518,702)
|
Change in operating
assets and liabilities:
|
|
|
|
|
|
|
Accounts
receivable
|
|
(39,918,939)
|
|
(10,971,773)
|
|
(7,146,311)
|
Inventories
|
|
(42,078,261)
|
|
(40,077,384)
|
|
(32,095,328)
|
Prepayments and other
current assets
|
|
(1,777,783)
|
|
1,946,800
|
|
879,165
|
Accounts
payable
|
|
977,152
|
|
2,966,885
|
|
5,348,896
|
Income tax
payable
|
|
6,047,808
|
|
6,022,145
|
|
(1,926,093)
|
Other payables and
accrued expenses
|
|
16,821,694
|
|
4,221,669
|
|
6,734,988
|
Deferred
income
|
|
(493,897)
|
|
(686,757)
|
|
(416,185)
|
Non-current income tax
payable
|
|
37,067,138
|
|
-
|
|
-
|
Net cash provided by
operating activities
|
|
102,183,885
|
|
123,258,611
|
|
109,392,000
|
|
|
|
|
|
|
|
CASH FLOWS FROM
INVESTING ACTIVITIES:
|
|
|
|
|
|
|
Payment for time
deposits
|
|
(22,669,000)
|
|
-
|
|
-
|
Payment for property,
plant and equipment
|
|
(37,504,440)
|
|
(49,371,318)
|
|
(38,790,998)
|
Payment for
intangible assets and land use rights
|
|
(786,691)
|
|
(1,635,891)
|
|
(13,500,526)
|
Refund of payments
and deposits related to land use right
|
|
-
|
|
10,297,893
|
|
-
|
Proceeds from
disposal of property, plant and equipment and land use
rights
|
|
64,914
|
|
393,019
|
|
827,020
|
Loans lent to a third
party
|
|
-
|
|
(12,332,718)
|
|
(40,744,167)
|
Proceeds from
disposal of a subsidiary
|
|
-
|
|
128,654
|
|
-
|
Receipt of government
grants related to property and equipment
|
|
-
|
|
-
|
|
2,452,864
|
Net cash used in
investing activities
|
|
(60,895,217)
|
|
(52,520,361)
|
|
(89,755,807)
|
|
|
|
|
|
|
|
CASH FLOWS FROM
FINANCING ACTIVITIES:
|
|
|
|
|
|
|
Proceeds from stock
option exercised
|
|
867,546
|
|
3,558,796
|
|
7,745,978
|
Proceeds from
short-term bank loans
|
|
23,009,280
|
|
-
|
|
15,770,881
|
Repayment of
short-term bank loans
|
|
(23,412,060)
|
|
-
|
|
(47,201,255)
|
Repayment of
long-term bank loans
|
|
-
|
|
-
|
|
(66,300,000)
|
Maturity of deposit
as security for bank loans
|
|
-
|
|
37,756,405
|
|
63,152,258
|
Net proceeds from
reissuance of treasury stock
|
|
-
|
|
-
|
|
80,583,959
|
Excess tax benefits
from share-based compensation arrangements
|
|
-
|
|
2,613,831
|
|
1,518,702
|
Dividend paid by
subsidiaries to noncontrolling interest shareholders
|
|
(18,789,151)
|
|
(7,921,952)
|
|
-
|
Dividend to the trial
court to be held in escrow as to dispute with Jie'an
|
|
-
|
|
-
|
|
(3,690,814)
|
Payment to
noncontrolling interest shareholders in connection with their
capital withdrawal
|
|
-
|
|
(58,091,018)
|
|
-
|
Net cash (used
in)/provided by financing activities
|
|
(18,324,385)
|
|
(22,083,938)
|
|
51,579,709
|
|
|
|
|
|
|
|
EFFECT OF FOREIGN
EXCHANGE RATE CHANGES ON CASH
|
|
12,607,032
|
|
(9,826,672)
|
|
(7,098,233)
|
|
|
|
|
|
|
|
NET INCREASE IN CASH
AND CASH EQUIVALENTS
|
|
35,571,315
|
|
38,827,640
|
|
64,117,669
|
|
|
|
|
|
|
|
Cash and cash
equivalents at beginning of year
|
|
183,765,533
|
|
144,937,893
|
|
80,820,224
|
|
|
|
|
|
|
|
Cash and cash
equivalents at end of year
|
|
219,336,848
|
|
183,765,533
|
|
144,937,893
|
|
|
|
|
|
|
|
Supplemental cash
flow information
|
|
|
|
|
|
|
Cash paid for income
taxes
|
|
24,691,429
|
|
22,210,476
|
|
23,348,371
|
Cash paid for
interest expense
|
|
252,353
|
|
84,664
|
|
1,526,807
|
Noncash investing and
financing activities:
|
|
|
|
|
|
|
Acquisition of
property, plant and equipment included in payables
|
|
7,548,964
|
|
4,912,937
|
|
6,363,392
|
Loan receivable
offset by accounts payable
|
|
-
|
|
5,848,400
|
|
-
|
CHINA BIOLOGIC
PRODUCTS HOLDINGS, INC. AND SUBSIDIARIES
|
|
RECONCILIATION OF
NON-GAAP FINANCIAL MEASURES
|
|
|
|
|
|
|
|
|
|
|
|
For the Three Months
Ended
|
|
|
|
|
December
31,
|
|
December
31,
|
|
|
|
|
2017
|
|
2016
|
|
|
|
|
USD
|
|
USD
|
|
Adjusted Net Income
Attributable to the Company - Non GAAP
|
|
|
25,914,369
|
|
26,860,803
|
|
Diluted EPS - Non
GAAP
|
|
|
0.90
|
|
0.95
|
|
Non-cash employee
stock compensation
|
|
|
(8,396,403)
|
|
(7,423,147)
|
|
Expenses related to
change of domicile and acquisition of TianXinFu
|
|
|
(1,872,012)
|
|
-
|
|
Income tax expense
due to U.S. Tax Reform
|
|
|
(40,290,367)
|
|
-
|
|
Net Income
Attributable to the Company
|
|
|
(24,644,413)
|
|
19,437,656
|
|
Weighted average
number of shares used in computation of Non GAAP diluted
EPS
|
|
|
27,812,319
|
|
27,428,563
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the Years
Ended
|
|
|
|
|
December
31,
|
|
December
31,
|
|
|
|
|
2017
|
|
2016
|
|
|
|
|
USD
|
|
USD
|
|
Adjusted Net Income
Attributable to the Company - Non GAAP
|
|
|
141,214,324
|
|
126,764,923
|
|
Diluted EPS - Non
GAAP
|
|
|
4.95
|
|
4.52
|
|
Non-cash employee
stock compensation
|
|
|
(31,108,910)
|
|
(21,985,616)
|
|
Expenses related to
change of domicile and acquisition of TianXinFu
|
|
|
(1,872,012)
|
|
-
|
|
Income tax expense
due to U.S. Tax Reform
|
|
|
(40,290,367)
|
|
-
|
|
Net Income
Attributable to the Company
|
|
|
67,943,035
|
|
104,779,307
|
|
Weighted average
number of shares used in computation of Non GAAP diluted
EPS
|
|
|
27,605,623
|
|
27,249,144
|
|
|
|
|
|
|
|
|
View original
content:http://www.prnewswire.com/news-releases/china-biologic-reports-financial-results-for-the-fourth-quarter-and-fiscal-year-2017-300605643.html
SOURCE China Biologic Products Holdings, Inc.