Aoxing Pharmaceutical Company, Inc. Announces Financial Results for Third Quarter of 2014 Fiscal Year

Aoxing Pharmaceutical Company, Inc. Announces Financial Results for Third 
Quarter of 2014 Fiscal Year 
JERSEY CITY, NJ -- (Marketwired) -- 05/14/14 --  Aoxing
Pharmaceutical Company, Inc.  (NYSE MKT: AXN) ("Aoxing Pharma"), a
specialty pharmaceutical company focusing on research, development,
manufacturing, and distribution of narcotic, pain-management, and
addiction treatment pharmaceuticals, today announced its financial
and operational results for the three and nine month periods ended
March 31, 2014. Complete financial results can be found in the
Quarterly Report on Form 10-Q filed by Aoxing Pharma on May 14, 2014. 
Financial Results:  
Revenues for the three and nine months ended March 31, 2014 were
$2,445,793 and $9,489,708, respectively, representing a 30% and a 22%
increase over the revenues realized in the comparable periods of
fiscal year 2013. The increase in revenue was mainly attributable to
the increase in sales of our main product, Zhongtongan, which is now
being marketed for gynecological and orthopaedic applications in
addition to its core pediatric and stomotological market. Sales of
Zhongtongan accounted for 91% of sales during the quarter ended March
31, 2014.  
Cost of sales for the three and nine months ended March 31, 2014 were
$1,425,630 and $5,464,000, respectively, representing a 101% and a
78% increase over the cost of sales recorded in the comparable
periods of fiscal year 2013. The increase in cost of sales resulted
from a poor harvest at the end of 2013, which dramatically increased
raw material prices. As a result of the increase in raw material
prices, Aoxing Pharma's gross profits for the three and nine months
ended March 31, 2014 fell by 20.7% and 18.3% from the comparable
periods of fiscal 2013.  
Despite the reduction in gross profit, Aoxing Pharma reduced its loss
from operations during the three and nine month periods ended March
31, 2014. Loss from operations of $717,874 during the three months
ended March 31, 2014 was only 31% of the loss from operations
realized in the prior year's third quarter, and loss from operations
of $2,625,798 during the nine months ended March 31, 2014 was only
58% of the loss from operations realized in the comparable period of
fiscal 2013. The primary reason for the reduction in loss from
operations was the elimination of a television advertising program
carried out during fiscal 2013, with resulting reductions in selling
expense of $2,103,722 and $1,541,806 during the three and nine month
periods ending March 31, 2014. 
Net interest expense increased by 71% to $3,524,563 for the nine
months ended March 31, 2014, as the Company's short and long term
debt increased by $9,142,080 from March 31, 2013 to March 31, 2014.
After that deduction, the Company realized a net loss attributable to
the shareholders of Aoxing Pharma of $1,822,137 and $5,882,840 for
the three and nine months ended March 31, 2014, respectively,
representing improvements of 30% and 2% compared to the same periods
of fiscal 2013. 
On March 31, 2014, Aoxing Pharma had $2.4 million in cash on hand and
a working capital deficit of $23,911,146, which represented a
deterioration of $14,099,835 from Aoxing Pharma's working capital
position at June 30, 2013. The primary reasons for the increase in
our working capital deficit were the net loss, which was funded by an
increase in short-term bank loans, and the reclassification of $10.1
million in bank debt from long-term to current liabilities. 
Zhenjiang Yue, our Chairman and CEO, commented, "The Chinese
pharmaceutical market continues to be challenging. I am pleased with
Aoxing Pharma's operating results, highlighted by continued growth in
product sales, as well as by the faith that our lenders have shown in
our business model, as they continue to fund the growth and
development of our Company."  
About Aoxing Pharmaceutical Company, Inc. 
 Aoxing Pharmaceutical
Company, Inc. is a US incorporated specialty pharmaceutical company
with its operations in China, specializing in research, development,
manufacturing and distribution of a variety of narcotics and
pain-management products. Headquartered in Shijiazhuang City, outside
Beijing, Aoxing Pharma has the largest and most advanced
manufacturing facility in China for highly regulated narcotic
medicines. Its facility is one of the few GMP facilities licensed for
the manufacture of narcotic medicines by the China State Food and
Drug Administration (SFDA). Aoxing Pharma has a joint venture
collaboration with Johnson Matthey Plc to produce and market
narcotics and neurological drugs in China. For more information,
please visit: www.aoxingpharma.com.  
Safe Harbor Statement from Aoxing Pharmaceutical Company, Inc.  
Certain 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. All forward-looking statements
included herein are based upon information available to the Company
as of the date hereof and, except as is expressly required by the
federal securities laws, the Company undertakes no obligation to
update or revise any forward-looking statements, whether as a result
of new information, changed circumstances or future events or for any
other reason. To the extent that any statements made here are not
historical, these statements are essentially forward-looking. The
Company uses words and phrases such as "guidance," "forecasted,"
"projects," "is expected," "remain confident," "will" and/or similar
expressions to identify forward-looking statements in this press
release. Undue reliance should not be placed on forward-looking
information. The economic, competitive, governmental, technological
and other risk factors identified in the Company's filings with the
Securities and Exchange Commission, specifically, Item 1A, "Risk
Factors," in the Form 10-K for the year ended June 30, 2013, 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.  
CONTACT: 
Aoxing Pharmaceutical Company:
646-367-1747
investor.relations@aoxingpharma.com 
 
 
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