XIANYANG, China, Aug. 22, 2016 /PRNewswire/ - Biostar Pharmaceuticals, Inc. (NASDAQ: BSPM) ("Biostar" or "the Company"), a PRC-based manufacturer and marketer of pharmaceutical and health supplement products in China for a variety of diseases and conditions, today announced its financial results for the second quarter ended June 30, 2016.
During the fiscal second quarter of 2016, the Company recognized:
- Net sales of $0.6 million, a decrease of approximately $13.6 million, or 95.6% as compared to the same period in 2015.
- Gross profit decreased by approximately $5.6 million, or 95.0% for the three months ended June 30, 2016 as compared to the same period in 2015.
- Sales of Shaanxi Weinan Products increased by approximately $0.4 million, or 302.9% as compared to the same period in 2015.
- Sales and Production of Aoxing Pharmaceutical Products remained temporarily suspended as the Company still working toward renewal of its GMP certificates.
- The Company recorded a provision for doubtful accounts in the amount of $6.3 million during the second quarter. Our results of operations were materially affected by this provision.
- Net loss of $6.9 million as compared to net loss of $0.5 million for the second quarter 2015.
The Company's sales for the three months ended June 30, 2016 was derived from products manufactured by its subsidiary Shaanxi Weinan. Aoxing's manufacturing operations remained temporarily halted as it still awaits the renewal of GMP Certificates; the Company does not have a definitive date of when the GMP renewal certificates will be secured. It is currently using its best efforts to comply with inspections and regulating authorities. To conserve capital as result of diminished sales and related cash flows, the Company has significantly reduced advertising and research activities during the three months ended June 30, 2016. As result of the Company's materially reduced sales, working capital deficit of $2,060,971 and cash balance of $207,110, the Company has determined that there is substantial doubt as to our ability to continue as a going concern. If the Company is unable to renew its GMP certificates and subsequently achieve regular production levels, the Company's results of operations may be materially adversely affected.
*The Company's Condensed Consolidated Balance Sheets, Statement of Operations, and Cash Flows can be found at the end of this press release. Please also refer the Company's Quarterly Report on Form 10-Q 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.
To read full press release, please click here.
