May 13 2010
BioPharm Asia, Inc. (OTCBB: BFAR), a producer, distributor and retailer of medical products in China, today reported its financial results for the full year ended December 31, 2009. The finalization of these results was delayed due to the February 2010 appointment of Davis Accounting Group P.C. as the Company's auditor.
“Fiscal year 2009 marked a significant milestone for BioPharm Asia which introduced its retail drug store chain business, while achieving significant continued progress in all of its other segments”
Financial Highlights:
- Revenues rose to $124 million, or 36.4%, for the full fiscal year ended December 31, 2009, as compared to $91 million in 2008.
- Gross profit was $38 million, an increase of 41.7%, as compared to last year's level of $27 million.
- Higher sales and cost controls lead to $9 million (or 46.5%) increase in operating income for the fiscal year 2009
- Net income increased to $21 million, compared to $14 million in 2008.
- Fully diluted earnings per share for 2009 increased to $0.41 from $0.29 in 2008.
BioPharm Asia Achieves Strong Financial Results
The Company's revenue increase of $33.1 million during the fiscal year ended December 31, 2009, reflected $22.1 million from the Company's chain of 360 retail drug stores which were launched during the third quarter 2009, together with solid performances from the Company's other segments, which grew $1.2 million (herbal planting), $4.9 million (drug manufacturing), and $4.9 million (distribution).
Gross profit for fiscal year 2009 was $38.4 million, up 41.7% from $27.1 million for 2008. Gross margin as a percentage of revenue increased slightly to 31.0% for fiscal 2009 from 29.9% for 2008. This increase resulted from the Company's negotiating better costs from its suppliers benefiting from the increased volume of its purchases.
Operating expenses for fiscal 2009 totaled $10.7 million, an increase of 30.6% from $8.2 million in 2008. This increase resulted from additional selling and administrative expenses related to the launch of the retail drug stores. As a percentage of sales, operating expenses decreased 0.4 percentage points to 8.6% from the prior year's level of 9.0%
As a result of the improved revenue and moderately increased operating costs, net income for fiscal 2009 was $20.6 million, or $0.41 per share, up 43.4% from $14.4 million in 2008, or $0.29 per share.
"Fiscal year 2009 marked a significant milestone for BioPharm Asia which introduced its retail drug store chain business, while achieving significant continued progress in all of its other segments" said BioPharm Asia's Chief Financial Officer, Mr. Wenzhong Qin. "We consider our 2009 financial results, highlighted by the 36.4% increase in revenues and the 43.1% increase in net income, to be especially noteworthy. As we enter 2010, we continue to focus on our distribution and retail businesses, and believe that we now have the financial resources to continue a strong rate of growth. Furthermore, we anticipate that the Chinese government's New Healthcare Innovation Scheme (NHIS) will continue to expand the pharmaceutical market in China. This plan encourages providing more retail medical products and service, thus providing retailers who possess strong distribution channels a substantial advantage. With our well-established wholesale distribution business and growing network of retail stores, we consider ourselves to be well positioned to benefit from NHIS."
As of December 31, 2009, the Company's cash, and cash equivalents were $11.1 million as compared to $5.9 million as of December 31, 2008. The increase of $5.2 million reflects $25.4 million provided by operating activities, offset in part by $7.4 million used to expand our operations, and a $14.9 million dividend paid to the Company's former shareholders just prior to our reverse merger.