NEW YORK, Aug. 7 /PRNewswire-Asia-FirstCall/ --
--2Q09 Net Income Attributable to Controlling Interest was $13.2 million or
American Oriental Bioengineering, Inc. , (“the Company” or “AOBO”), a pharmaceutical company dedicated to improving health through the development, manufacture and commercialization of a broad range of prescription and over the counter (“OTC”) products in China, today announced financial results for the second quarter ended June 30, 2009.
Revenue in the second quarter of 2009 increased 20.7% to $71.2 million from $59.0 million in the second quarter of 2008, reflecting continued demand for the Company’s core pharmaceutical and nutraceutical products. Revenue from pharmaceutical products increased 17.4% to $58.4 million from $49.8 million in the prior year’s second quarter. Revenue from prescription pharmaceutical products increased 23.2% to $25.2 million during the second quarter of 2009, reflecting an increase in sales from prescription formulation Jinji and CCXA products, which offset declines in sales of Shuanghuanglian Injection Powder (“SHL”). OTC pharmaceutical products generated $33.3 million in revenue during the second quarter of 2009, up from $29.4 million in the prior year’s period, reflecting continued demand for Boke and GLP products, as a result of marketing efforts and improved recognition of the products. Nutraceutical products generated revenue of approximately $9.5 million in the second quarter of 2009, up 3.3% from $9.2 million in the prior year’s period, reflecting increased sales of new beverage products launched in the beginning of 2009. The Company generated $3.3 million from its distribution business.
Gross profit in the second quarter of 2009 increased 3.9% to $41.6 million from $40.1 million in the second quarter of 2008. Gross margin was 58.4%, compared to 67.9% in the prior year’s period, reflecting continued revenue mix shift to CCXA’s generic product sales, increasing raw material prices and low margin distribution business.
Operating income in the second quarter of 2009 was $18.3 million compared to $18.7 million in the second quarter of 2008. Selling and marketing expenses increased 22.2% to $9.4 million from $7.7 million in the prior year period. The increase primarily reflects marketing and promotional initiatives to support the continuous growth of revenues. Advertising expense was $7.8 million in the second quarter of 2009, compared to $7.5 million in the prior year’s period.
Net income attributable to controlling interest for the second quarter of 2009 was $13.2 million, compared to $13.9 million in the prior year’s period. Excluding $1.4 million of interest expense and $0.2 million of amortized financing costs related to the Company’s outstanding convertible notes, the Company’s net income attributable to controlling interest increased 6.5% to $14.8 million, or $0.17 per diluted share. In the prior year’s second quarter, net income per diluted share was approximately $0.18.
As of June 30, 2009, the Company had $100.7 million in cash and generated approximately $22.9 million of operating cashflow during the second quarter of 2009.
Mr. Tony Liu, Chairman and Chief Executive Officer of American Oriental Bioengineering, commented, “We are pleased with our second quarter performance as we continued to enhance our diversified product portfolio and pursue further vertical integration. Our marketing capabilities, extensive distribution platform, diversified product offering and ongoing rural expansion offset anticipated challenges in SHL sales during the second quarter of 2009. We also made significant progress this quarter optimizing our distribution business, so that we solidify our presence in Tier I and II hospital channels and remain on-track for net income contributions for the full year. We continue to drive revenue growth and consistently generate cash despite the uncertain regulatory environment in China’s healthcare sector, and we are confident in our ability to be a top-five pharmaceutical company in China.”
Conference Call
The Company will hold a conference call at 8:00 am ET on August 7, 2009 to discuss second quarter 2009 results. Listeners may access the call by dialing 1-866-761-0749 or 1-617-614-2707 for international callers, access code: 54060064. A webcast will also be available through AOB’s website at http://www.bioaobo.com . A replay of the call will be available through August 14, 2009. Listeners may access the replay by dialing 1-888-286-8010 or 1-617-801-6888 for international callers, access code: 18519426.
About American Oriental Bioengineering, Inc.
American Oriental Bioengineering, Inc. is a pharmaceutical company dedicated to improving health through the development, manufacture and commercialization of a broad range of prescription and over the counter products in China.
Statements made in this press release are forward-looking and are made pursuant to the safe harbor provisions of the Securities Litigation Reform Act of 1995. Such statements involve risks and uncertainties that may cause actual results to differ materially from those set forth in these statements. The economic, competitive, governmental, technological and other factors identified in the Company’s filings with the Securities and Exchange Commission, including the Form 10-K for the year ended December 31, 2008, may cause actual results or events to differ materially from those described in the forward looking statements in this press release. The Company undertakes no obligation to publicly update or revise any forward-looking statements, whether because of new information, future events, or otherwise.
SOURCE American Oriental Bioengineering, Inc.
CONTACT: Ashley M. Ammon of Integrated Corporate Relations, Inc.,
+1-203-682-8208
Web site: http://www.bioaobo.com/
