Biostar Pharmaceuticals, Inc. Announces Third Quarter 2013 Financial Results

 Biostar Pharmaceuticals, Inc. Announces Third Quarter 2013 Financial Results

PR Newswire

XIANYANG, China, Nov. 14, 2013

XIANYANG, China, Nov. 14, 2013 /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 of
the third quarter ended September 30, 2013.

SUMMARY FINANCIALS

Third Quarter 2013 Results (unaudited)

(in 000,000 USD)
               Q3 2013  Q3 2012 CHANGE
Net Sales      $15.01   $9.97   +50.1%
Gross Profit   $6.94    $5.24   +32.5%
Net Income     $0.39    -$5.94  -
EPS (Diluted)  $0.03    -$0.63  -



Nine Months 2013 Results (unaudited)

(in 000,000 USD)
              9-Month 2013 9-Month 2012 CHANGE
Net Sales     $41.75       $34.03       +22.7%
Gross Profit  $20.51       $20.65       -0.7%
Net Income    $0.22        -$13.25      -
EPS (Diluted) $0.02        -$1.41       -



Third Quarter 2013 Financial Results

Revenue for the 3rd Quarter of 2013 was $15.01M, representing a substantial
increase ($5.04M) over the same period of the prior year. The factors
positively affected our growth were primarily attributable to 1) an increase
in general sales volume, and 2) revenue generated by several new products.

Cost of Sales for the 3rd Quarter of 2013 increased over the same quarter of
2012 by $3.33M or 70.6% due to an increase in net sales and the introduction
of the new hospital products.

Gross Profits for the 3rd Quarter of 2013 were $6.94M representing an
improvement of approximately $1.7M or 32.5% as compared to the same period in
2012. Increasing sales volume was the primary driver of this encouraging trend
for the company.

Total Operating Expense for the 3rd Quarter of 2013 decreased substantially to
$6.19M in comparison to the prior year's (2012) value of $11.04M on increasing
sales. The decrease is primarily attributable to a lower cost structure in our
advertising as well as general and administrative expense.

Nine Months Results

For the nine months ended September 30, 2013, revenue increased by
approximately 22.7% to $41.75M in comparison to the same period in 2012. Gross
profit was approximately $20.51M for the first nine months of 2013,
representing a decrease of 0.67% from the first nine months of 2012.

Income (Loss) from operations was $0.68M and($14.85)million for the first
nine months of 2013 and 2012, respectively. Net income(Loss)was $0.22M for
the nine months ended September 30, 2013, compared to($13.25M)from the same
period in 2012. Fully diluted earnings (loss) per share were $0.02 compared to
($1.41) for the first nine months of 2013 and 2012 respectively, based on
11.20 million and 9.43 million shares outstanding.

Balance Sheet and Cash Flow

As of September 30, 2013 we had cash and cash equivalents of approximately
$10.55M and working capital of approximately $32.84M and had a current ratio
of 4:1. Our Accounts Receivable balance was approximately $13.08M on September
30, 2013, versus approximately $21.85M at year end of 2012. Accounts
Receivable turnover significantly improved to 97 days for the three months
ended September 30, 2013, as compared to 257 days during the same period in
2012 . The Company's stockholders' equity at of the end the third quarter of
2013 was $61.74M, with total assets of $72.38M versus total liabilities of
$10.64M.

For the first nine months of 2013, the Company generated $13.71M in cash from
operations versus $5.04M cash used in operations for the same period in 2012.

Business Developments

Since our acquisition of Shaanxi Weinan in 2011, and the acquisition of
additional 13 drug approval numbers in the previous quarter, we continue to
diversify our product offerings to consumers under the Shaanxi Weinan Huaren
brand. During the nine months ended September 30, 2013, we introduced 3 new
products. These new products are Yanlixiao capsule (anti-inflammation
capsule), Erlongtong Qiao pill (for treatment of hearing loss), and Danxiang
Rhinitis tablet(or 'fragrant rhinitis tablet').

Under the Aoxing Pharmaceutical brand, during the nine months ended September
30, 2013,we introduced Yiwei particle, a health supplement product to improve
stomach functions. This product was jointly developed with the Fourth
Military Medical University (FMMU) of China. The effectiveness of this
product, in combination with strong market acceptance has resulted in
substantially increased production. Our partnership and cooperation with FMMU
represents positive outlook in the development of the Company.

Meanwhile, following the market disruption in the PRC public sector caused by
the gel capsule events (as previously discussed), consumer and market
confidence appear to be regaining their strength. The Company is experiencing
noticeable improvements and is hopeful for full market recovery of these
markets in the near future.

Ronghua Wang, Chairman of the Company stated, "Thanks to the efforts of our
entire team and the continued support shown in our market channel by both
consumers and our suppliers, for the nine months ended September 30, 2013, the
Company achieved sales revenue of $41.75 million, cash flow from operations of
$13.71 million, and net profits of $0.22 million. We will continue to operate
in accordance with the highest industry standards while working to deliver
high quality products to our customers as well as increasing returns for our
stockholders in terms of earnings and share value."

Conference Call

The Company will host a conference call to discuss its 2013 third quarter
performance at 9:30 a.m. ET on Friday, November 15, 2013. Interested parties
may access the call by dialing + 1-480-629-9808. The conference ID is 4650742.
It is advisable to dial in approximately 5-10 minutes prior to the start of
the call. A playback will be available through November 22, 2013. To listen,
please call 1-858-384-5517 and utilize the pass code 4650742 for the replay.
This call is being web cast by ViaVid Broadcasting and can be accessed at the
following link: http://public.viavid.com/index.php?id=106931

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 Xin Aoxing Oleanolic
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 achieve the
projected sales through the efforts of the call center, to recover its sales
in the gel capsule and related markets, to complete the contemplated clinical
trials and capitalize on such opportunities, the Company's ability to recover
its sales and revenue for the gel capsule segment of its business, 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, 2012, and other subsequent
filings. These filings are available atwww.sec.gov. We may, from time to
time, make additional written and oral forward-looking statements, including
statements contained in our filings with the Securities and Exchange
Commission and our reports to shareholders. We do not undertake to update any
forward-looking statements that may be made from time to time by or on our
behalf.

For more information contact:

                               Chineseinvestors.com Inc
Biostar Pharmaceuticals, Inc.
Ally Gong                      Alice
Tel: +86-29-3368-6638          Tel: +86-4001200987
Email: office@aoxing-group.com Email: info@chinesefn.com 





BIOSTAR PHARMACEUTICALS, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS


                                        September 30, 2013  December 31, 2012
                                        (Unaudited)         (Audited)
ASSETS
Current Assets
Cash and cash equivalents                  $   10,551,231      $  1,759,078
Accounts receivable, net of allowance
for doubtful accounts of $3,743,550            13,076,519         21,851,412
(2012/12/31: $3,645,817)
Inventories - note 2)                          1,214,285          847,135
Deposits and other receivables - note          7,622,649          7,740,673
3)
Income tax recoverable                         157,459            265,007
Loan receivables - note 4)                     10,850,990         9,510,826
Total Current Assets                           43,473,133         41,974,131
Non-current Assets
Deposits - note 3)                             -                  8,718,258
Deferred tax assets - note 7)                  3,224,212          3,665,951
Property and equipment, net - note 2)          7,822,733          6,980,521
Intangible assets, net - note 2)               17,857,951         9,136,439
Total Assets                               $   72,378,029      $  70,475,300
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities
Accounts and other payables                $   5,236,751       $  5,732,329
Short-term bank loans - note 5)                4,882,893          4,755,413
Due to a related party                         -                  1,585,138
Value-added tax payable                        518,466            629,672
Total Current Liabilities                      10,638,110         12,702,552
Commitment and contingencies- note 9)
Stockholders' Equity
Common stock, $0.001 par value,
100,000,000 shares authorized,
12,346,113 and 9,993,549 shares issued         12,346             9,993
and outstanding as at September 30,
2013 and December 31, 2012 - note 6)
Additional paid-in capital                     25,240,249         23,266,776
Statutory reserve - note 8)                    6,737,368          6,737,368
Retained earnings                              23,446,543         23,229,743
Accumulated other comprehensive income         6,303,413          4,528,868
Total Stockholders' Equity                     61,739,919         57,772,748
Total Liabilities and Stockholders'        $   72,378,029      $  70,475,300
Equity







BIOSTAR PHARMACEUTICALS, INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

AND COMPREHENSIVE INCOME

(Unaudited)


                 Three months ended             Nine months ended
                 September 30,                  September 30,
                 2013           2012            2013           2012
Sales, net       $ 15,009,432   $ 9,969,375     $ 41,752,195   $ 34,028,164
Cost of sales      8,068,096      4,729,894       21,242,519     13,379,287
Gross profit       6,941,336      5,239,481       20,509,676     20,648,877
Operating
expenses:
Advertising        931,938        4,077,019       5,368,890      11,295,419
expenses
Selling            2,584,700      1,932,208       7,403,334      7,203,252
expenses
Compensation
paid to            -              -               -              7,904,513
customers
Administrative     -              1,596,174       -              1,596,174
penalty
General and
administrative     1,867,707      2,640,240       4,404,273      5,124,789
expenses
Research and
development        811,009        789,702         2,412,623      2,370,605
expenses
Impairment of
intangible         -              -               239,203        -
assets
Total operating    6,195,354      11,035,343      19,828,323     35,494,752
expenses
Income (Loss)      745,982        (5,795,862)     681,353        (14,845,875)
from operations
Other income
(expense)
Interest income    348,281        55,642          1,134,916      247,342
Interest           (98,111)       (1,059)         (293,320)      (33,193)
expense
Other              370            152             (1,093)        598
                   250,540        54,735          840,503        214,747
Income (Loss)
before income      996,522        (5,741,127)     1,521,856      (14,631,128)
taxes
Provision for
income tax         608,705        198,508         1,305,056      (1,376,356)
(recovery)
Net Income         387,817        (5,939,635)   $ 216,800      $ (13,254,772)
(Loss)
Foreign
currency           1,336,712      (117,289)       1,774,545      180,992
translation
adjustment
Comprehensive    $ 1,724,529    $ (6,056,924)   $ 1,991,345    $ (13,073,780)
Income (Loss)
Net income
(loss) per
share
Basic and        $ 0.03         $ (0.63)        $ 0.02         $ (1.41)
diluted
Weighted
average number
of common
shares
outstanding

                   12,024,685     9,490,506       11,197,451     9,430,532
Basic and
diluted





BIOSTAR PHARMACEUTICALS, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)


                                              Nine months ended September 30,
                                              2013             2012
CASH FLOWS FROM OPERATING ACTIVITIES
Net income (loss)                             $  216,800       $ (13,254,772)
Adjustments to reconcile net income to net
cash provided by operating activities:
Accrued interest                                 (1,072,394)     -
Deferred tax assets                              533,637         (1,705,866)
Depreciation and amortization                    2,026,796       1,368,205
Recognition of deferred research and             2,412,623       2,370,605
development expenses
Stock-based compensation                         613,647         793,633
Credits to accounts receivable as                -               7,904,513
compensation to customers
Allowance for doubtful debts                     -               962,399
Impairment of intangible assets                  239,203         -
Changes in operating assets and liabilities:
Accounts receivable                              9,250,156       (2,547,289)
Inventories                                      (340,375)       392,153
Deposits and other receivables                   482,525         -
Prepaid tax                                      -               (451,121)
Accounts payable and accrued expenses            (641,335)       1,120,998
Value-added tax payable                          (126,573)       (446,986)
Income tax payable/recoverable                   113,299         (1,555,225)
Exchange difference                              -               11,583
Net cash provided by (used in) operating         13,708,009      (5,037,170)
activities
CASH FLOWS FROM INVESTING ACTIVITIES
Purchase of property and equipment               (978,377)       (32,784)
Disposition of property and equipment            -               21,704
Deposit paid for research and development        (2,734,306)     -
Payment for acquisition of Shaanxi Weinan        -               (822,173)
Compensation received for disposed land use      160,842         1,760,341
rights
Net cash (used in) provided by investing         (3,551,841)     927,088
activities
CASH FLOWS FROM FINANCING ACTIVITIES
Repayment of short term loan                     -               (791,176)
Repayment to a related party                     (1,608,415)     -
Net cash (used in) financing activities          (1,608,415)     (791,176)
Effective of exchange rate changes on cash       244,400         49,034
and cash equivalents
Net increase in cash and cash equivalents        8,792,153       (4,852,224)
Cash and cash equivalents, beginning balance     1,759,078       16,971,789
Cash and cash equivalents, ending balance     $  10,551,231    $ 12,119,565
SUPPLEMENTAL DISCLOSURES:
Interest received                             $  1,134,916     $ -
Interest payments                             $  (189,359)     $ -
Income tax payments                           $  (658,120)     $ (2,348,336)



SOURCE Biostar Pharmaceuticals, Inc.

Website: http://www.biostarpharmaceuticals.com
 
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