China Biologic Products (CBPO) Tops Q2 EPS by 19c

China Biologic Products (NASDAQ: CBPO) reported Q2 EPS of $1.06, $0.19 better than the analyst estimate of $0.87. Revenue for the quarter came in at $79.1 million versus the consensus estimate of $71.75 million.

Mr. David (Xiaoying) Gao, Chairman and Chief Executive Officer of China Biologic, commented, "We are pleased to continue delivering robust financial results with high growth on both top and bottom lines for the second quarter of 2015. Specifically, market demand remained strong for our major product offerings, including albumin and IVIG, and our market share increased as a result of our production volume growth outpacing the domestic average and the effectiveness of our sales model. Our direct sales strategy allowed us to maintain price stability. Our penetration strategy for tier-one cities enabled our IVIG sales by volume to continue to grow quickly and reinforced our leadership in China's IVIG market."

Mr. Gao continued, "During the second quarter, we were able to effectively control costs through greater operating efficiency. Our operating margin reached a new high of 50.9%, despite the pressure from increases in plasma collection costs. On the production front, as of the end of the second quarter, nearly half of our outsourced plasma had been put into production at our Guizhou facility. As we previously predicted, a small portion of the finished products made from the purchased plasma will be gradually delivered to the market later this year while the majority will be sold in 2016 and beyond. We believe the purchased plasma will enable us to significantly improve the production utilization rate of our Guizhou facility and better meet the growing demand for plasma products in China. We are pleased to maintain our full year financial forecast; however, we expect our year-over-year third quarter sales growth rate to be lower than the first two quarters of 2015, primarily due to a relatively high volume sold in the third quarter of 2014 after receiving the first batch approval in July 2014 at the upgraded Guizhou facility. We expect our year-over-year fourth quarter sales growth rate to increase over the third quarter as we benefit from the sales of products made from our purchased plasma."

"Finally, in June, we successfully completed a follow-on offering of 3,450,000 shares of common stock, including 805,000 primary shares. With the completion of this offering, we added new strong institutional investors to our shareholder base, further improved our shareholder structure and increased the liquidity of our stock. We have used the proceeds of the offering to repay a USD-denominated loan to mitigate our foreign currency risk and released the RMB deposit used to secure this loan, which will enable us to pursue potential growth opportunities currently under evaluation," Mr. Gao concluded.

For earnings history and earnings-related data on China Biologic Products (CBPO) click here.

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