Aoxing Pharmaceutical Reports Q2 Fiscal 2017 Financial Results

FOSTER CITY, CA / ACCESSWIRE / February 14, 2017 / Aoxing Pharmaceutical Company, Inc. (NYSE MKT: AXN) today announced that for the second quarter of fiscal year 2017, ended December 31, 2016, the Company reported revenues of $8,009,111, down 2.3% year-over-year from the revenue of $8,195,839 realized during the three months ended December 31, 2015. The Company’s Tilidine product has not yet contributed to sales.

The net loss attributable to the shareholders of Aoxing Pharmaceutical for the three months ended December 31, 2016 was $43,453 (or $0.00 per share), compared to net income of $2,068,635 (or $0.03 per share) for the three months ended December 31, 2015.

Aoxing’s cash balance as of December 31, 2016 was $6,848,691, compared to $6,912,100 as of June 30, 2016, the end of its last fiscal year.

Mr. Zhenjiang Yue, Chairman and CEO of Aoxing Pharma, said, “Although the sales are still under pressure, our key product Zhongtong’an showed some recovery during the quarter. We believe our marketing efforts for products other than Zhongtong’an, including our Tilidine tablets, will contribute more to the revenue as we increase market penetration.”

About the Company

Aoxing Pharmaceutical Company, Inc. is a U.S. incorporated pharmaceutical company with its operations in China, specializing in research, development, manufacturing, and distribution of a variety of narcotics and pain-management products. Headquartered in Shijiazhuang City, outside Beijing, Aoxing Pharma has the largest and most advanced manufacturing facility in China for highly regulated narcotic medicines. Its facility is one of the few GMP facilities licensed for the manufacture of narcotic medicines by the China Food and Drug Administration (“CFDA”). For more information, please visit: www.aoxingpharma.com.

Safe Harbor Statement

This press release contains certain statements that may include “forward-looking statements.” All statements other than statements of historical fact included herein are “forward-looking statements.” These forward-looking statements are often identified by the use of forward-looking terminology such as “believes,” “expects,” or similar expressions, involving known and unknown risks and uncertainties. Although the Company believes that the expectations reflected in these forward-looking statements are reasonable, they do involve assumptions, risks, and uncertainties, and so these expectations may prove to be incorrect. You should not place undue reliance on these forward-looking statements, which speak only as of the date of this press release. The Company’s actual results could differ materially from those anticipated in these forward-looking statements as a result of a variety of factors, including the risk factors discussed in the Company’s periodic reports that are filed with the Securities and Exchange Commission and available on the SEC’s website (http://www.sec.gov). All forward-looking statements attributable to the Company or persons acting on its behalf are expressly qualified in their entirety by these risk factors. Other than as required under the securities laws, the Company does not assume any duty to update these forward-looking statements.

CONTACT:

Aoxing Pharmaceutical Company:
646-367-1747
investor.relations@aoxingpharma.com

AOXING PHARMACEUTICAL CO., INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS

December 31,

June 30,

2016

ASSETS

(Unaudited)

CURRENT ASSETS:

Cash and cash equivalents

$
6,848,691

6,912,100

Accounts receivable, net

12,845,837

10,435,101

Notes receivable, net

792,395

765,317

Inventories, net

2,043,681

2,841,690

Prepaid expenses and other current assets

8,307,919

5,912,555

TOTAL CURRENT ASSETS

30,838,523

26,866,763

LONG-TERM ASSETS:

Property and equipment, net of accumulated depreciation

24,065,526

25,603,734

Deferred income tax

2,002,886

1,878,595

Other intangible assets, net

1,817,553

1,878,299

Investment in joint venture

–

4,200

TOTAL LONG-TERM ASSETS

27,885,965

29,364,828

TOTAL ASSETS

$
58,724,488

56,231,591

LIABILITIES AND SHAREHOLDERS’ EQUITY

CURRENT LIABILITIES:

Short-term borrowings

$
10,519,951

11,070,966

Accounts payable

3,759,101

2,709,819

Loan payable – bank

13,769,373

14,372,630

Current portion of loan payable – related parties

—

13,317

Current portion of loan payable – others

—

15,048

Accrued expenses and other current liabilities

12,462,633

9,633,750

TOTAL CURRENT LIABILITIES

40,511,058

37,815,530

LONG-TERM LIABILITIES:

Loan payable – related parties

12,992

Loan payable – others

86,382

Deferred income

308,563

340,089

TOTAL LONG-TERM LIABILITIES

407,937

340,089

Common stock, par value $0.001, 100,000,000 shares authorized, 76,209,195 shares issued and outstanding on December 31, 2016 and June 30, 2016

76,209

Additional paid in capital

73,642,951

73,629,751

Accumulated deficit

(55,991,118
)

(56,293,745
)

Accumulated other comprehensive income

1,116,743

1,723,740

TOTAL SHAREHOLDERS’ EQUITY OF THE COMPANY

18,844,785

19,135,955

NONCONTROLLING INTEREST IN SUBSIDIARIES

(1,039,292
)

(1,059,983
)

TOTAL EQUITY

17,805,493

18,075,972

TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY

$
58,724,488

56,231,591

AOXING PHARMACEUTICAL CO., INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS AND OTHER COMPREHENSIVE INCOME (LOSS)
(Unaudited)

For the three months ended

For the six months ended

December 31,

2016

2015

2016

2015

SALES

8,009,111

8,195,839

15,578,407

16,940,661

COST OF SALES

1,712,635

1,726,592

3,227,567

3,484,671

GROSS PROFIT

6,296,476

6,469,246

12,350,840

13,455,990

OPERATING EXPENSES:

Research and development expense

76,403

830,105

453,690

1,207,411

General and administrative expenses

2,924,210

511,127

4,200,930

1,455,485

Selling expenses

2,943,455

1,589,866

5,520,821

3,984,212

Depreciation and amortization

119,212

128,126

238,697

259,656

TOTAL OPERATING EXPENSES

6,063,280

3,059,224

10,414,138

6,906,764

INCOME FROM OPERATIONS

233,196

3,410,023

1,936,702

6,549,225

OTHER INCOME (EXPENSE):

Interest expense, net of interest income

(640,399)

(979,906)

(1,296,885)

(1,908,936)

Gain on foreign currency transactions

24,753

83,345

Equity in loss of joint venture, net

(14,474)

(4,134)

(38,765)

Subsidy income

17,294

157,266

17,294

205,027

TOTAL OTHER EXPENSE

(623,053)

(812,362)

(1,283,725)

(1,659,329)

INCOME BEFORE INCOME TAXES

(389,857)

2,597,661

652,977

4,889,897

Income tax expense (benefit)

(356,897)

409,393

294,180

1,353,196

NET INCOME (LOSS)

(32,960)

2,188,268

358,797

3,536,700

Net income attributed to non-controlling interest in subsidiaries

10,493

119,633

56,170

200,129

INCOME ATTRIBUTABLE TO SHAREHOLDERS OF THE COMPANY

(43,453)

2,068,635

302,627

3,336,571

OTHER COMPREHENSIVE LOSS:

Foreign currency translation adjustment

(681,570)

(753,581)

(709,591)

(1,423,572)

COMPREHENSIVE INCOME (LOSS)

(714,530)

1,315,054

(350,793)

1,912,999

Other comprehensive loss attributable to non-controlling interest

(34,078)

(37,679)

(35,480)

(71,179)

COMPREHENSIVE INCOME ATTRIBUTABLE TO THE COMPANY

(680,452)

1,352,733

(315,313)

1,984,178

EARNINGS PER SHARE

Basic and Diluted

(0.00)

0.03

0.00

0.05

WEIGHTED AVERAGE SHARES OUTSTANDING

Basic

76,209,195

73,097,698

76,209,195

71,475,000

Diluted

76,209,195

73,177,698

76,209,195

71,555,000

SOURCE: Aoxing Pharmaceutical Company, Inc.

ReleaseID: 455133

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