On August 14, 2006 the company China Pharma Holdings, Inc. has announced its financial and operating results for the second quarter of the fiscal year.
The financial results for the three- and six-month periods ended June 30 2005 include the financials of Onny Investment Limited, – China Pharma’s predecessor company, which was incorporated in the British Virgin Islands on January 12, 2005. On June 16, 2005 Onny acquired Hainan Helpson Medical & Biotechnology Co., Ltd. – the main operating unit if China Pharma. On October 19, 2005 reorganization was started by making Onny a wholly-owned subsidiary of China Pharma, and accomplished through the exchange of shares between Onny and China Pharma. Because of these changes, the full results for 2006 cannot be directly comparable with results for the same period of 2005, and were provided in press-release for informational purposes only.
Total revenues for the second quarter of 2006 increased up to $4.0 million, from $0.5 million in the second quarter of 2005, but there is a decline compared to $4.7 million reported in the first quarter of 2006. Operating income for the second quarter was 1.4 million versus $0.1 million for the same period of 2005. Net income was up to $1.8 million from $1.6 million in the first quarter. Second quarter 2006 net income benefited from a bad debt recovery of $0.6 million.
Gross profit for the quarter was $1.9 million, compared to $2.2 million last quarter and $0.2 million in the same period in 2005. Gross margin for the second quarter was 47%, up from 34% in the second quarter in 2005.
Selling expenses, as well as general and administrative expenses increased, mainly due to costs associated with being a public company, and investments made in approximately 50 new hires in the second quarter.
Earnings per share in fiscal 2006 reflect an increase in China Pharma’s average weighted shares outstanding from 85,112 shares in the second quarter of 2005 to 34.7 million shares in the second quarter of 2006.
Total revenues for the six month period were $8.7 million, up from $0.5 million for the same period last year. Net income increased 94% from pro forma net income of $1.8 million for the first half of 2005 to $3.4 million for the first half of 2006. Gross profit and gross margin increased 47% to $4.1 million. Operating income was $3.2 million, compared to $0.1 million last year. Earnings per share were $0.10, versus $1.23 for the first six months in 2005.
Recently the company entered into a new $2 million dollar credit facility which will provide the flexibility to finance its growth.
For fiscal year 2006, China Pharma expects that revenues will be approximately $20 million and net income will be approximately $8 million.
China Pharma Holdings, Inc. is a company manufacturing, developing and marketing generic and brand bio-pharmaceutical products in China that treat a wide range of conditions, including infections, hepatitis, vascular, CNS and other prevailing diseases. A specialty company Helpson Bio-pharmaceutical Co., Ltd is a wholly owned subsidiary of China Pharma Holdings.