During the fiscal year of 2015, the Company recognized:
- Net sales of $27.1 million, a decrease of approximately $34.3 million, or 55.8% as compared to the year of 2014.
- Gross profit decreased by approximately $19.2 million, or 63.3% as compared to the year 2014.
- Net loss of $25.1 million as compared to net income of $4.8 million for the year 2014.
- Impairment loss on loan receivables of $8.8 million, approximately 32.6% of net sales.
- Impairment loss on intangible assets of $3.0 million.
- R&D expenses of approximately $4 million, as compared to $2.8 million for the year of 2014.
The Company experienced a material decrease in sales volume of all Aoxing Pharmaceutical Products in the year ended December 31, 2015 when compared to the year ended December 31, 2014, as Aoxing Pharmaceutical has temporarily halted production in order to conduct maintenance on its production lines for the purpose of renewing its GMP certificates by the second quarter of 2016. During 2015, the Company reviewed its drug permits and identified certain permits that the Company did not have plans to produce in the foreseeable future; accordingly, the Company has fully impaired the carrying value of those drug permits. Also, the Company has determined the unsecured loans provided to a third party borrower are uncollectible as the borrower has become insolvent, and thus, the Company recognized those receivables as impaired. The interruption in production has materially negatively affected our operating results; as a result, there may be substantial doubt regarding the Company's ability to continue as a going concern. Net sales and related gross profit both decreased significantly in the year of 2015 as result of these maintenance efforts.
*The Company's Consolidated Balance Sheets, Statement of Operations, and Cash Flows can be found on Form 10-K filed with the U.S. Securities and Exchange Commission for further information regarding the Company's results of operations.
About Biostar Pharmaceuticals, Inc.
Biostar Pharmaceuticals, Inc., through its wholly owned subsidiary and controlled affiliate in China, develops, manufactures, and markets pharmaceutical and health supplement products for a variety of diseases and conditions. The Company's most popular product is its XinAoxingOleanolic Acid Capsule, an over-the-counter ("OTC") medicine for chronic hepatitis B, a disease affecting approximately 10% of the Chinese population. For more information please visit: http://www.biostarpharmaceuticals.com.
Safe Harbor Relating to the Forward-Looking Statements
Certain statements in this release concerning our future growth prospects are forward-looking statements, within the meaning of Section 27A of the U.S. Securities Act of 1933, as amended, and Section 21E of the U.S. Securities Exchange Act of 1934, as amended, which involve a number of risks and uncertainties that could cause actual results to differ materially from those in such forward-looking statements. The company uses words and phrases such as "guidance," "forecasted," "projects," "is expected," "remain confident," "will" and similar expressions to identify forward-looking statements in this press release, including forward-looking statements. Undue reliance should not be placed on forward-looking information. Forward-looking information is based on current expectations, estimates and projections that involve a number of risks, which could cause actual results to vary and in some instances to differ materially from those anticipated by Biostar and described in the forward-looking information contained in this news release. The risks and uncertainties relating to these statements include, but are not limited to, risks and uncertainties regarding the Company's ability to complete the certification renewal process in the time frame currently anticipated, its ability to sustain its sales effort going forward, its ability promptly and effectively to return to the normal production levels, its ability to retain existing and retain new customers for its products, its ability to achieve the projected sales through the efforts of the call center, to complete the contemplated clinical trials and capitalize on such opportunities, the Company's ability to recover its sales and revenue following the repair and maintenance for GMP certification renewal, the state of consumer confidence and market demand or the Company's products, success of our investments, risks and uncertainties regarding fluctuations in earnings, our ability to sustain our previous levels of profitability including on account of our ability to manage growth, intense competition, wage increases in China, our ability to attract and retain highly skilled professionals, time and cost overruns on fixed-price, fixed-time frame contracts, client concentration, our ability to successfully complete and integrate potential acquisitions, withdrawal of governmental fiscal incentives, political instability and regional conflicts and legal restrictions on raising capital or acquiring companies outside China. Additional risks that could affect our future operating results are more fully described in our United States Securities and Exchange Commission filings including our most recent Annual Report on Form 10-K for the year ended December 31, 2015, and other subsequent filings. These filings are available at www.sec.gov.
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