HANGZHOU, China, Aug. 15 /PRNewswire-FirstCall/ -- Aida Pharmaceuticals, Inc. , one of mainland China’s leading pharmaceutical companies, today announced its financial results for the second quarter ended June 30, 2006. Full details of the Company’s quarterly financial results are available in the Company’s Form 10-QSB at http://www.sec.gov.
Second Quarter 2006 Financial Highlights: * Revenues for the second quarter ended June 30, 2006 totaled $7,284,888, a 44.8% increase from revenues of $5,031,908 for the quarter ended June 30, 2005 and a sequential increase of 36.6% from revenues of $5,331,827 for the quarter ended March 31, 2006. * Gross profit totaled $3,705,188 in the second quarter of 2006, a decrease of 3.5% versus gross profit of $3,840,364 in the second quarter of 2005, but an increase of 57.8% sequentially versus gross profit of $2,348,713 in the first quarter of 2006. The gross profit margin for the second quarter of 2006 declined to 50.9%, from 76.3% for the second quarter of 2005, but increased from 44.1% in the first quarter of 2006. * Net income totaled $398,888, versus a net loss of $165,897 in the second quarter of 2005 and increased 2,644% versus net income of $14,536 in the first quarter of 2006. The Company reported earnings per share of $0.02 in the second quarter of 2006, versus a loss of $0.01 in the second quarter of 2005 and versus $0.00 in the first quarter of 2006. * Cash and equivalents totaled $5,684,350 and shareholders’ equity totaled $7,240,735 at the end of the second quarter of 2006. Weighted average shares outstanding were 25,000,000 for the second quarter of 2006. Financial Performance:
Revenues in the second quarter of 2006 increased by $2,252,980 or 44.8%, to $7,284,888, versus revenues of $5,031,908 in the second quarter of 2005 and increased sequentially by 36.6% from revenues of $5,331,827 in the first quarter of 2006. Reflecting the Company’s current strategic focus on intense promotion of new Etimicin transfusion and injection products, Etimicin transfusion revenues increased 133.2% quarter-over-quarter and Etimicin injection revenues increased 587% quarter-over-quarter. Etimicin powder revenues decreased 17.7% quarter-over-quarter, reflecting some restructuring in the Company’s salesforce to focus on transfusion and injection products. The decline of 17.7% seen in Etimicin powder sales in the second quarter of 2006 is a marked improvement over the decline of 47.2% in the first quarter of 2006. The company took measures to expand its existing market share and explore new markets for Etimicin powder.
Gross profit in the second quarter of 2006 declined slightly by 3.5%, to $3,705,188, versus $3,840,364 in the second quarter of 2005 but increased 57.8% sequentially versus gross profit of $2,348,713 in the first quarter of 2006. The gross profit margin declined year-over-year to 50.9% in the second quarter of 2006, versus 76.3% in the second quarter of 2005 but increased sequentially from 44.1% in the first quarter of 2006. The year-over-year decrease in the gross margin was attributable to several factors that initially appeared in the first quarter of 2006: 1) a change in the revenue mix, with lower margin Aike products accounting for a larger portion of sales; 2) an increase in the cost of C1a, a precursor of Etimicin raw materials; and 3) a 5% reduction in the price of Etimicin, taken to remain cost competitive with alternative antibiotics. The sequential increase in the gross profit margin in the second quarter of 2006 was due to the large overall increase in revenues sequentially and to the relatively smaller decline in higher margin Etimicin powder sales in the second quarter versus the decline in powder sales seen in the first quarter.
Selling and distribution expenses decreased 35.6% in the second quarter of 2006, primarily reflecting a decline in travel expenses, as the Company’s sales force structure has become more established, following a major ramp-up of selling and distribution channels in 2005.
“Our gross margins are recovering sequentially, our sales costs are declining as our sale force becomes more established and revenues are growing sharply,” said Biao Jin, Aida’s chief executive officer. “To the extent that these trends remain in place, we’re positioned to see strong earnings growth over the near-term. We continue to expect our revenue and earnings growth to average 30% per year over the next five years, as a result of strong growth in Etimicin consumption, along with our pipeline of new drugs for cancer, hepatitis and stroke and our focus on selective acquisitions.”
COMPARATIVE RESULTS For Quarter Ended 6/30/06 6/30/05 3/31/06 Revenue $7,284,888 $5,031,908 $5,331,827 Cost of Goods Sold (3,579,700) (1,191,544) (2,983,114) Gross Profit 3,705,188 3,840,364 2,348,713 Gross profit margin (%) 50.9% 76.3% 44.1% Net Income 398,888 (165,897) 14,536 Income (loss) per share 0.02 (0.01) 0.00 Weighted avg shs outstanding 25,000,000 23,375,000 25,000,000 About Aida Pharmaceuticals:
Aida Pharmaceuticals is a product-focused pharmaceuticals company engaged in the formulation, clinical testing, registration, manufacture, sales and marketing of advanced pharmaceutical and genetic products in mainland China. The Company’s mission is to discover, develop and market meaningful new therapies that improve human health. Aida, in operation since March 1999, is headquartered in Hangzhou, China with manufacturing, distribution and sales points throughout mainland China. Aida is GMP certified in China and ISO9002 certified for quality assurance and ISO14000 certified for ecologically-friendly practices. Aida is now producing and marketing a patented prescription drug in China, etimicin sulfate. It is the first antibiotic developed in China and is regarded as a category “A” drug by the State Food and Drug Administration of China.
Aida Pharmaceuticals, Inc. 31 Dingjiang Road Jianggan District Hangzhou, China 310016 Investor Relations: Equity Performance Group Gary Geraci (617) 723-2373 gary@equityperfgp.com Safe Harbor Statement: Under the Private Securities Litigation Reform Act of 1995:
This press release includes certain “forward-looking statements” within the meaning of the United States Private Securities Litigation Reform Act of 1995. These statements are based on Aida Pharmaceuticals, Inc.'s management’s current expectations and are subject to risks and uncertainties and changes in circumstances. All forward-looking statements included in this press release are based upon information available to Aida Pharmaceuticals, Inc. as of the date of the press release, and it assumes no obligation to update or alter its forward looking statements whether as a result of new information, future events or otherwise. These forward-looking statements may relate to, among other things, plans and timing for the introduction or enhancement of our services and products, statements about future market conditions, supply and demand conditions, and other expectations, intentions and plans contained in this press release that are not historical fact. Further information on risks or other factors that could affect Aida Pharmaceuticals, Inc.'s results of operations is detailed in its filings with the United States Securities and Exchange Commission available at http://www.sec.gov.
Aida Pharmaceuticals, Inc.
CONTACT: Gary Geraci of Equity Performance Group for Aida Pharmaceuticals,+1-617-723-2373, gary@equityperfgp.com
