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Biostar Pharmaceuticals, Inc. Announces First Quarter 2014 Financial Results

 Biostar Pharmaceuticals, Inc. Announces First Quarter 2014 Financial Results

PR Newswire

XIANYANG, China, May 15, 2014

XIANYANG, China, May 15, 2014 /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 first quarter ended March 31, 2014.

Financial highlights

  oNet sales increased 9% year over year to approximately $13.2 million in
    the first quarter
  oGross profit increased by approximately $0.6 million or 8.4% for the three
    months ended March 31, 2014 as compared to the same period last year
  oThe net sales of other Aoxing products increased 18.8% and Weinan products
    including 4 new products increased 42%

             Three Months Ended March 31,
             2014            2013
Sales, net   $  13,181,164   $ 12,091,909
Gross profit $  7,253,088      6,688,890

First Quarter 2014 Financial Results

Revenue for the first quarter of 2014 increased 9.0% to approximately $13.2
million compared to $12.1 million for the first quarter of 2013.The increase
is mainly attributable to the increase in sales volume of other Aoxing
products and Weinan products and the addition of 4 new products at Shaanxi
Weinan. The increase in sales volume is mainly due to the positive image
spread by the hospital using our products. Our sales prices didn't change much
in the first quarter of 2014.

Cost of goods sold for the three months ended March 31, 2014 was approximately
$5.9 million, increased by approximately $0.5 million or 9.7%, compared to the
same period in 2013. This increase is mainly due to the increase in sales
volume of other Aoxing products and Weinan existing products and the addition
of 4 new products at Shaanxi Weinan. The increase in the production workers'
salary also contributed to the increase in the cost of sales.

Gross profit increased by approximately $0.6 million or 8.4% for the three
months ended March 31, 2014, as compared to the same period in 2013. The
overall gross profit margin for the first quarter of 2014 was approximately
55.0%, largely unchanged compared to the same period of 2013 mainly because
the increase in labor cost was offset by the decrease in the cost of sales of
XinAoxing products.

Operating expenses for the three months ended March 31, 2014 were
approximately $8.0 million, an increase of approximately $2.1 million or34.5%
compared to the same period last year. The increase was mainly attributable to
the increase in general and administrative expenses. During the period ended
March 31, 2014, the Company made provision for doubtful accounts of $2.3
million. Advertising expenses and selling expenses decreased approximately
$0.1 million and $0.3 million respectively. As market of our products and
sales channels is becoming more established, and our brands are becoming more
well-known to households, we have been reducing the amount spent on
advertising campaigns and selling activities.

Net income was approximately $0.3 million for the first quarter of 2014, a
decrease of approximately $0.3 million compared to the $0.6 million for the
first quarter of 2013. Diluted earnings per share were $0.02 for the first
quarter of 2014 compared to $0.06 for the first quarter of 2013, based upon
approximately 13.0 million and 10.0 million diluted common shares outstanding,
respectively.

Balance Sheet and Cash Flow

Cash and cash equivalents totaled approximately $7.1 million on March 31,
2014, compared to $0.1 million on December 31, 2013. Accounts receivable
balance was approximately $19.0 million on March 31, 2014, versus
approximately $18.0 million on December 31, 2013. The Company had a current
ratio of 6.0 to 1 and stockholders' equity of approximately $65.5 million,
with total assets of approximately $72.4 million versus total liabilities of
approximately $6.9 million on March 31, 2014.

For the first three months of 2014 the Company generated approximately $3.1
million in cash from operations versus $6.2 million in cash generated from
operations reported for the same period in 2013.

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 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, 2013, 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:

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







BIOSTAR PHARMACEUTICALS, INC
CONSOLIDATED BALANCE SHEETS
                                                 March 31,      December 31,
                                                 2014           2013
                                                 (Unaudited)
ASSETS
Current Assets
Cash and cash equivalents                         $ 7,132,558    $ 80,072
Note receivable                                     1,622,876      1,636,072
Accounts receivable, net                            18,992,045     17,965,082
Inventories                                         732,878        830,311
Deposits and other receivables                      3,164,607      5,282,574
Income tax recoverable                              30,794         374,958
Loan receivables                                    10,049,382     9,816,433
Total Current Assets                                41,725,140     35,985,502
Non-current Assets
Deposits                                            3,894,903      3,926,573
Deferred tax assets                                 2,902,771      2,789,175
Property and equipment, net                         7,527,318      7,728,700
Intangible assets, net                              16,378,191     17,134,494
Total Assets                                      $ 72,428,323   $ 67,564,444
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities
Accounts and other payables                       $ 5,367,568    $ 4,447,314
Due to a related party                              107,677        -
Value-added tax payable                             445,365        344,191
Warrant liabilities                                 960,894        -
Total Current Liabilities                           6,881,504      4,791,505
Commitment and contingencies
Stockholders' Equity
Common stock, $0.001 par value, 100,000,000
shares authorized, 14,326,113 and 12,676,113        14,326         12,676
shares issued and outstanding as at March 31,
2014 and December 31, 2013
Additional paid-in capital                          28,648,658     25,748,669
Deferred stock-based compensation                   (265,467)      (365,017)
Statutory reserve                                   7,126,432      7,126,432
Retained earnings                                   23,956,395     23,649,725
Accumulated other comprehensive income              6,066,475      6,600,454
Total Stockholders' Equity                          65,546,819     62,772,939
Total Liabilities and Stockholders' Equity        $ 72,428,323   $ 67,564,444







BIOSTAR PHARMACEUTICALS, INC
CONSOLIDATED STATEMENTS OF OPERATIONS
AND COMPREHENSIVE (LOSS) INCOME
(Unaudited)
                                                 Three Months Ended March 31,
                                                 2014            2013
Sales, net                                       $  13,181,164   $ 12,091,909
Cost of sales                                       5,928,076      5,403,019
Gross profit                                        7,253,088      6,688,890
Operating expenses:
Advertising expenses                                1,788,541      1,886,681
Selling expenses                                    1,934,722      2,197,346
General and administrative expenses                 3,597,993      1,077,748
Research and development expenses                   694,944        796,001
Total operating expenses                            8,016,200      5,957,776
Income (Loss) from operations                       (763,112)      731,114
Other income (expense)
Interest income                                     316,431        455,231
Interest expense                                    -              (95,688)
Other income                                        1,099,292      -
Other expense                                       (46,700)       (2,098)
                                                    1,369,023      357,445
Income before income taxes                          605,911        1,088,559
Provision for income tax                            299,241        527,585
Net income                                       $  306,670      $ 560,974
Other comprehensive income - foreign currency       (533,979)      437,833
translation adjustment
Comprehensive income (loss)                      $  (227,309)    $ 998,807
Net income per share
Basic                                            $  0.02         $ 0.06
Diluted                                          $  0.02         $ 0.06
Weighted average number of common shares
outstanding
Basic                                               13,024,446     9,993,549
Diluted                                             13,030,643     9,993,549







BIOSTAR PHARMACEUTICALS, INC
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
                                                Three Months Ended March 31,
                                                2014            2013
CASH FLOWS FROM OPERATING ACTIVITIES
Net income                                      $ 306,670       $ 560,974
Adjustments to reconcile net income to net
cash provided by operating activities:
Accrued interest                                  (314,489)       (449,075)
Deferred tax expense (benefit)                    (137,124)       360,387
Depreciation and amortization                     736,124         458,931
Provision for doubtful accounts                   2,269,688       -
Recognition of deferred research and              694,943         796,001
development expenses
Stock-based compensation                          99,550          6,147
Changes in operating assets and liabilities:
Accounts receivable                               (3,450,423)     5,457,403
Inventories                                       91,423          (562,015)
Deposits and other receivables                    1,396,128       (764,161)
Accounts payable and accrued expenses             963,311         507,140
Value-added tax payable                           104,737         (170,796)
Income tax payable/recoverable                    343,723         (21,547)
Net cash provided by operating activities         3,104,261       6,179,389
CASH FLOWS FROM INVESTING ACTIVITIES
Purchase of property, plant and equipment         (1,957)         (4,352)
Net cash (used in) investing activities           (1,957)         (4,352)
CASH FLOWS FROM FINANCING ACTIVITIES
Advance from (repayment to) a related party       107,692         (1,592,002)
Proceeds from stock issuanceand warrants         3,862,533       -
Net cash provided by (used in) financing          3,970,225       (1,592,002)
activities
Effect of exchange rate changes on cash and       (20,044)        115,013
cash equivalents
Net increase in cash and cash equivalents         7,052,486       4,698,048
Cash and cash equivalents, beginning balance      80,072          1,759,078
Cash and cash equivalents, ending balance       $ 7,132,558     $ 6,457,126
SUPPLEMENTAL DISCLOSURES:
Interest received                               $ 1,943         $ 6,945
Interest (payments)                             $ -             $ 93,132
Income tax (payments)                           $ 92,641        $ 188,745

SOURCE Biostar Pharmaceuticals, Inc.
 
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