China Pharma Holdings, Inc. Reports First Quarter 2018 Financial Results

HAIKOU, China, May 15, 2018 /PRNewswire/ -- China Pharma Holdings, Inc. (NYSE MKT: CPHI) ("China Pharma," the "Company" or "We"), an NYSE American listed corporation with a fully-integrated specialty pharmaceuticals subsidiary based in China, today announced financial results for the quarter ended March 31, 2018.

First Quarter Highlights

• Revenue increased 10.1% to $3.6 million in first quarter 2018 from $3.3 million in the same period of 2017;
• Gross margin was 29.1% in first quarter 2018, compared to 21.9% in the same period of 2017;
• Loss from operations was $0.1 million in first quarter 2018 compared to $0.8 million in the same period of 2017, a decrease of $0.7 million;
• Net loss was $0.3 million in first quarter 2018 compared to $1.0 million in the same period of 2017. Loss per common share was $(0.01) per basic and diluted share in first quarter 2018 compared with $(0.02) per basic and diluted share in the same period of 2017.

"Actively and steadily increasing sales remains our top priority in recent quarters. It was encouraging to see increasing revenue in this quarter. Management will continue to vigorously promote sales through active participation in recent provincial market openings to receive new drug tender offers and through further penetration into the market," said Ms. Zhilin Li, China Pharma's Chairman and CEO. Ms. Li continued, "The ongoing generic drug consistency evaluations and reform of China's drug production registration and review policies will continue to have a significant impact on the current performance and future development of Chinese pharmaceutical manufacturers, including us, and may gradually change business patterns of the industry. We will continue to actively adapt to state policy guidance and further evaluate market conditions for our current existing products, pipeline products, and competition in the market in order to optimize our development strategy."

First Quarter Results

Revenue increased by 10.1% to $3.6 million for the three months ended March 31, 2018, as compared to $3.3 million for the three months ended March 31, 2017. This increase was mainly due to change in exchange rate between USD and RMB. Revenue for the three months ended March 31, 2018 was RMB 23.0 million, which represented an increase of 2%, compared to RMB 22.6 million for the same period in 2017.

Gross profit for the three months ended March 31, 2018 was $1.1 million, compared to $0.7 million in the same period in 2017. Our gross profit margin in the three months ended March 31, 2018 was 29.1% compared to 21.9% in the same period in 2017. The increase in our gross profit margin was mainly due to the increase in general selling price of our product package in the first quarter of 2018.

Our selling expenses for the three months ended March 31, 2018 and 2017 were both $0.7 million. Selling expenses accounted for 18.8% of the total revenue in the three months ended March 31, 2018 compared to 21.8% in the same period in 2017. Because of adjustments in our sales practices resulting from healthcare reform policies, we reserve a basic amount of personnel and expenses to support our sales and the collection of accounts receivable.

Our general and administrative expenses for the three months ended March 31, 2018 were $0.5 million, which represented an increase of $0.1 million compared to $0.4 million in the same period in 2017. General and administrative expenses accounted for 13.6% and 12.7% of our total revenues in the three months ended March 31, 2018 and 2017, respectively.

Net Loss for the three months ended March 31, 2018 was $0.3 million, compared to net loss of $1.0 million in the same period a year ago. The decrease in net loss was mainly the result of the increase in gross profit margin.                       

Financial Condition

As of March 31, 2018, the Company had cash and cash equivalents of $2.5 million compared to $2.0 million as of December 31, 2017. Working capital increased to $3.9 million as of March 31, 2018 from $3.1 million as of December 31, 2017; and the current ratio was 1.4 and 1.3 times at March 31, 2018 and December 31, 2017, respectively.

As of March 31, 2018, our net accounts receivable was $2.5 million, compared to $2.3 million as of December 31, 2017.

For the three months ended March 31, 2018, cash flow from operating activities was $0.5 million, as compared to $0.01 million for the same period in 2017.

Conference Call

The Company will hold a conference call at 8:30 am E.T. on May 15, 2018 to discuss the results of first quarter 2018. Listeners may access the call by dialing 1-866-519-4004 or 65-671-350-90 for international callers, Conference ID # 3765759.  A replay of the call will be accessible through May 23, 2018 by dialing 1-855-452-5696 or 61-281-990-299 for international callers, Conference ID # 3765759.

About China Pharma Holdings, Inc.

China Pharma Holdings, Inc. is a specialty pharmaceutical company that develops, manufactures and markets a diversified portfolio of products focused on conditions with a high incidence and high mortality rates in China, including cardiovascular, CNS, infectious, and digestive diseases. The Company's cost-effective, high-margin business model is driven by market demand and supported by new GMP-certified product lines covering the major dosage forms. In addition, the Company has a broad and expanding nationwide distribution network across all major cities and provinces in China. The Company's wholly-owned subsidiary, Hainan Helpson Medical & Biotechnology Co., Ltd., is located in Haikou City, Hainan Province. For more information about China Pharma Holdings, Inc., please visit www.chinapharmaholdings.com. The Company routinely posts important information on its website.

Safe Harbor Statement 

Certain statements in this press release constitute forward-looking statements for purposes of the safe harbor provisions under The Private Securities Litigation Reform Act of 1995. Any statements set forth above that are not historical facts are forward-looking statements that involve risks and uncertainties that could cause actual results to differ materially from those in the forward-looking statements, which may include, but are not limited to, such factors as the achievability of financial guidance, success of new product development, unanticipated changes in product demand, increased competition, downturns in the Chinese economy, uncompetitive levels of research and development, and other information detailed from time to time in the Company's filings and future filings with the United States Securities and Exchange Commission. The forward-looking statements made herein speak only as of the date of this press release and the Company undertakes no duty to update any forward-looking statement to conform the statement to actual results or changes in the Company's expectations except as required by applicable law or regulation.

Contact:

China Pharma Holdings, Inc. Ms. Diana Na Huang Phone: +86-898-6681-1730 (China) Email: [email protected]

 

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SOURCE China Pharma Holdings, Inc.