China Biologic Products Holdings, Inc. (NASDAQ: CBPO, "China Biologic" or the "Company"), a leading fully integrated plasma-based biopharmaceutical company in China, today announced its unaudited financial results for the third quarter of 2017.
Third Quarter 2017 Financial Highlights
Total sales in the third quarter of 2017 increased by 15.1% in both RMB terms and USD terms to $99.6 million from $86.5 million in the same quarter of 2016.
Gross profit increased by 14.0% to $67.1 million from $58.9 million in the same quarter of 2016. Gross margin decreased to 67.4% from 68.1% in the same quarter of 2016.
Income from operations decreased by 4.2% to $38.0 million from $39.7 million in the same quarter of 2016. Operating margin decreased to 38.2% from 45.9% in the same quarter of 2016.
Net income attributable to the Company increased by 11.2% to $31.6 million from $28.4 million in the same quarter of 2016. Diluted earnings per share increased to $1.11 from $1.01 in the same quarter of 2016.
Non-GAAP adjusted net income attributable to the Company increased by 14.8% in both RMB terms and USD terms to $39.4 million from $34.3 million in the same quarter of 2016. Non-GAAP adjusted earnings per share increased to $1.38 from $1.22 in the same quarter of 2016.
Mr. David (Xiaoying) Gao, Chairman and Chief Executive Officer of China Biologic, commented, "We are pleased to report an improved quarter of revenue and profit growth despite some temporary headwinds and market slow down caused by recent healthcare reform in China and intensified market competition. Our growth was supported by our efforts to actively pursue new sales channels and strategic partners, including new distributors and retail pharmacy chains, while deepening our penetration into existing direct sales channels. Sales of albumin and IVIG manufactured in our Shandong facility continued to decline due to the planned production suspension at our Shandong facility for the second phase trial production. Our Guizhou facility received a healthy boost in sales growth for plasma products and experienced a substantial increase in sales of our non-plasma product, placenta polypeptide, which also contributed to our gross margin improvement. As anticipated, the revenue contribution from placenta polypeptide was a result of an expedited nationwide rollout of the two-invoice policy, which allowed us to increase our sales price for placenta polypeptide."
Mr. Gao continued, "We continued to make progress with new facility construction and R&D development. We completed the second phase of production suspension at the old Shandong facility to pursue the new facility's trial production test, and we continue to expect completion of the GMP certificate inspection and commencement of operations at the new site by the end of this year. On the R&D front, we have received the long-awaited final approval of Fibrinogen by the CFDA in early October and aim to commercially launch this product in early 2018."
"In addition to our progress with our internal operational initiatives this quarter, we also recently announced the entry into an agreement to acquire TianXinFu. We look forward to the synergistic value provided by this transaction to solidify our core plasma business leadership in China by enhancing our marketing and sales capability for accelerating the growth of our newly launched and upcoming high margin plasma products," concluded Mr. Gao.
Third Quarter 2017 Financial Performance
Total sales in the third quarter of 2017 increased by 15.1% in both RMB terms and USD terms to $99.6 million from $86.5 million in the same quarter of 2016. The increase was primarily attributable to a sales increase of placenta polypeptide. Sales of IVIG, human rabies immunoglobulin, coagulation factor products and albumin products also increased while sales of human tetanus immunoglobulin decreased.
During the third quarter of 2017, human albumin and IVIG products remained the Company's two largest sales contributors, while the revenue contribution from the Company's other products continu...
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