Biostar Pharmaceuticals, Inc. Announces Its Annual Results for The Year Ended December 31, 2016

XIANYANG, China, April 13, 2017 /PRNewswire/ - Biostar Pharmaceuticals, Inc. (NASDAQ: BSPM) ("Biostar" or "the Company"), a PRC-based manufacturer and marketer of pharmaceutical and health supplement products in China for a variety of diseases and conditions, today announced its financial results for the year ended December 31, 2016.

During the fiscal year of 2016, the Company recognized:

• Net sales of $2.4 million, a decrease of approximately $24.7 million, or 91.2% as compared to the year 2015.
• Gross profit decreased by approximately $10.2 million, or 91.8% as compared to the year 2015.
• Net loss of $5.7 million as compared to net loss of $25.1 million for the year 2015.
• R&D expenses of approximately $1.1 million, as compared to $4.0 million for the year 2015.

The Company had no sales on all Aoxing Pharmaceutical Products in the year ended December 31, 2016 as Aoxing Pharmaceutical temporarily stopped production to conduct maintenance of its production lines in order to renew its GMP certificates which is expected to be renewed in the first half of 2017 at which time the production will resume. Sales of Shaanxi Weinan's products also decreased substantially during the year ended December 31, 2016 due to replacing production equipment to comply with government's environmental protection requirement. The Company currently anticipates that the production of Shaanxi Weinan products will resume in the first half of 2017. The temporary suspension of production has materially negatively affected the Company's operating results; as a result, there may be substantial doubt regarding the Company's ability to continue as a going concern.   

*The Company's Consolidated Balance Sheets, Statement of Operations, and Cash Flows can be found on Form 10-K filed with the U.S. Securities and Exchange Commission for further information regarding the Company's results of operations.

About Biostar Pharmaceuticals, Inc.

Biostar Pharmaceuticals, Inc., through its wholly owned subsidiary and controlled affiliate in China, develops, manufactures, and markets pharmaceutical and health supplement products for a variety of diseases and conditions.  For more information please visit: http://www.biostarpharmaceuticals.com.

Safe Harbor Relating to the Forward-Looking Statements

Certain statements in this release concerning our future growth prospects are forward-looking statements, within the meaning of Section 27A of the U.S. Securities Act of 1933, as amended, and Section 21E of the U.S. Securities Exchange Act of 1934, as amended, which involve a number of risks and uncertainties that could cause actual results to differ materially from those in such forward-looking statements. The company uses words and phrases such as "guidance," "forecasted," "projects," "is expected," "remain confident," "will" and similar expressions to identify forward-looking statements in this press release, including forward-looking statements. Undue reliance should not be placed on forward-looking information. Forward-looking information is based on current expectations, estimates and projections that involve a number of risks, which could cause actual results to vary and in some instances to differ materially from those anticipated by Biostar and described in the forward-looking information contained in this news release. The risks and uncertainties relating to these statements include, but are not limited to, risks and uncertainties regarding the Company's ability to complete the certification renewal process in the time frame currently anticipated, the Company's ability to resume production as anticipated, its ability to sustain its sales effort going forward, its ability promptly and effectively to return to the normal production levels, its ability to retain existing and retain new customers for its products, its ability to achieve the projected sales through the efforts of the call center, to complete the contemplated clinical trials and capitalize on such opportunities, the Company's ability to recover its sales and revenue following the repair and maintenance for GMP certification renewal, the state of consumer confidence and market demand or the Company's products, success of our investments, risks and uncertainties regarding fluctuations in earnings, our ability to sustain our previous levels of profitability including on account of our ability to manage growth, intense competition, wage increases in China, our ability to attract and retain highly skilled professionals, time and cost overruns on fixed-price, fixed-time frame contracts, client concentration, our ability to successfully complete and integrate potential acquisitions, withdrawal of governmental fiscal incentives, political instability and regional conflicts and legal restrictions on raising capital or acquiring companies outside China. Additional risks that could affect our future operating results are more fully described in our United States Securities and Exchange Commission filings including our most recent Annual Report on Form 10-K for the year ended December 31, 2016, and other subsequent filings. These filings are available at www.sec.gov. We may, from time to time, make additional written and oral forward-looking statements, including statements contained in our filings with the Securities and Exchange Commission and our reports to shareholders. We do not undertake to update any forward-looking statements that may be made from time to time by or on our behalf.

Investor Relations Contact

Please send questions or comments to:

Biostar Pharmaceuticals, Inc.
Investor Relations Coordinator
[phone]
[e-mail]
http://www.biostarpharmaceuticals.com

 

BIOSTAR PHARMACEUTICALS, INC.
CONSOLIDATED BALANCE SHEETS
		AS OF DECEMBER 31,
		2016				2015
ASSETS
Current Assets
Cash and cash equivalents		$	173,290			$	38,898
Accounts receivable, net			6,741,454				15,814,880
Inventories			166,564				234,660
Deposits and other receivables			171,062				2,591
Value-added tax receivable			41,462				-
Income tax recoverable			71,292				76,280
Total Current Assets			7,365,124				16,167,309
Non-current Assets
Deposits			21,148,284				16,099,958
Deferred tax assets, net			2,515,272				5,406,593
Property and equipment, net			5,866,612				6,810,933
Intangible assets, net			5,607,146				6,878,787
Total Non-Current Assets			35,137,314				35,196,271
Total Assets		$	42,502,438			$	51,363,580
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities
Accounts and other payables		$	2,842,142			$	4,153,411
Short-term bank loans			2,325,643				2,773,199
Valued-added tax payable			-				112,629
Warrants liability			455,476				59,202
Total Current Liabilities			5,623,261				7,098,441
Commitment and contingencies
Stockholders' Equity
Common stock, $0.001 par value, 100,000,000 shares authorized, 2,637,188 issued and outstanding as of December 31, 2016 and 2,210,913 shares issued and outstanding as of December 31, 2015			2,637				2,210
Additional paid-in capital			31,382,467				30,316,774
Statutory reserve			7,354,413				7,354,413
(Accumulated deficit) Retained earnings			(2,540,991)				3,157,394
Accumulated other comprehensive income			680,651				3,434,348
Total Stockholders' Equity			36,879,177				44,265,139
Total Liabilities and Stockholders' Equity		$	42,502,438			$	51,363,580

 

BIOSTAR PHARMACEUTICALS, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
AND COMPREHENSIVE INCOME
		FOR THE YEARS ENDED DECEMBER 31,
		2016				2015
Sales, net		$	2,384,492			$	27,129,609
Cost of sales			1,469,318				16,025,544
Gross profit			915,174				11,104,065
Operating expenses:
Advertising expenses			-				3,803,780
Selling expenses			1,169,416				4,835,398
General and administrative expenses			2,431,462				4,648,902
Research and development expenses			1,144,044				4,020,909
Impairment loss on intangible assets			-				2,973,796
(Recovery of)  provision for doubtful accounts receivable			(265,486)				4,666,730
Impairment loss on loan receivables			-				8,845,999
Impairment loss on prepaid lease payment			-				1,066,115
Total operating expenses			4,479,436				34,861,629
Loss from operations			(3,564,262)				(23,757,564)
Other income (expense)
Interest income			1,165				8,895
Interest expense			(206,195)				(283,596)
Fair value adjustment on warrants			227,106				324,093
Other income (expense), net			496,855				(84,544)
Total other income (expense), net			518,931				(35,152)
Loss before income taxes			(3,045,331)				(23,792,716)
Provision for income tax			2,653,054				1,319,846
Net Loss		$	(5,698,385)			$	(25,112,562)
Foreign currency translation adjustment			(2,753,697)				(2,957,650)
Comprehensive loss		$	(8,452,082)			$	(28,070,212)
Loss per share
Basic		$	(2.5)			$	(11.4)
Diluted		$	(2.5)			$	(11.4)
Weighted average number of common shares outstanding
Basic			2,297,336				2,210,913
Diluted			2,297,336				2,210,913

 

BIOSTAR PHARMACEUTICALS, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
		FOR THE YEARS ENDED DECEMBER 31,
		2016				2015
CASH FLOWS FROM OPERATING ACTIVITIES
Net loss		$	(5,698,385)			$	(25,112,562)
Adjustments to reconcile net loss to net cash provided by operating activities:
Deferred income tax expense			2,653,054				1,332,951
Depreciation and amortization			1,142,538				2,320,195
(Recovery of) provision for doubtful accounts			(265,486)				4,666,730
Recognition of deferred research and development expenses			-				4,020,909
Impairment loss on intangible assets			-				2,973,796
Impairment loss on loan receivable			-				8,845,999
Impairment loss on prepaid lease payment			-				1,066,115
Loss on disposal of property, plant and equipment			-				738,834
Warrants liability			(227,106)				(324,093)
Changes in operating assets and liabilities:
Accounts receivable			8,669,935				5,448,178
Inventories			55,148				420,584
Deposits and other receivables			(176,293)				392,425
Accounts payable and accrued expenses			(1,087,350)				(602,958)
Value-added tax payable			(153,390)				(309,890)
Net cash provided by operating activities			4,912,665				5,877,213
CASH FLOWS FROM INVESTING ACTIVITIES
Purchase of property, plant and equipment			-				(59,475)
Deposit paid for intended acquisitions			(6,378,136)				(8,122,236)
Receipt from loan receivable			-				804,182
Net cash used in investing activities			(6,378,136)				(7,377,529)
CASH FLOWS FROM FINANCING ACTIVITIES
Repayment of short-term bank loans			(278,315)				(160,836)
Proceeds from stock issuance and warrants			1,689,500				-
Net cash provided by (used in) financing activities			1,411,185				(160,836)
Effect of exchange rate changes on cash and cash equivalents			188,678				14,896
Net increase (decrease) in cash and cash equivalents			134,392				(1,646,256)
Cash and cash equivalents, beginning balance			38,898				1,685,154
Cash and cash equivalents, ending balance		$	173,290			$	38,898
SUPPLEMENTAL DISCLOSURES:
Interest received		$	1,264			$	8,896
Interest paid		$	(37,807)			$	(133,618)

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SOURCE Biostar Pharmaceuticals, Inc.

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