omniture

China BCT Reports Strong Fourth Quarter and Full Year 2010 Results

2011-04-07 15:24 637

LIUZHOU, China, March 31, 2011 /PRNewswire-Asia/ -- China BCT Pharmacy Group, Inc., (OTC Bulletin Board: CNBI), ("China BCT" or the "Company"), a leading pharmaceutical distributor, retail pharmacy, and manufacturer of pharmaceutical products in Guangxi Province, China, today announced results for the fourth quarter and full year ended December 31, 2010.


Fourth Quarter 2010 Highlights

  • Revenue increased 82.3% year-over-year to $66.8 million
  • Gross profit rose 57.2% year-over-year to $14.1 million
  • Operating income grew 61.3% year-over-year to $9.4 million
  • GAAP net income climbed 83.6% to $7.4 million, or $0.19 per diluted share, from $4.0 million, or $0.13 per diluted share, in the year ago quarter
  • Excluding non-cash items related to change in the fair value of warrant liabilities and share-based compensation expense, non-GAAP adjusted net income was $7.0 million, or $0.18 per diluted share

Full Year 2010 Highlights

  • Revenue increased 47.6% year-over-year to $200.8 million
  • Gross profit rose 37.5% year-over-year to $48.8 million
  • Operating income grew 31.3% year-over-year to $35.4 million
  • GAAP net income climbed 32.4% to $25.7 million, or $0.67 per diluted share, compared to $19.4 million, or $0.61 per diluted share, in 2009
  • Excluding non-cash items related to change in the fair value of warrant liabilities and share-based compensation expense, non-GAAP adjusted net income was $26.4 million, or $0.68 per diluted share.
  • In 2010, the Company acquired and self-opened a total of 105 retail outlets in Guangxi Province, bringing its total store count to 170 as of December 31, 2010.

"We ended 2010 on a positive note, achieving excellent fourth quarter revenue and earnings growth of 82% and 84%, respectively.  During 2010, we significantly expanded our retail footprint within Guangxi Province by adding 105 stores to our portfolio, while continuing to rapidly grow one of the region's leading wholesale distribution networks," commented Mr. Hui Tian Tang, Chairman and Chief Executive Officer of China BCT Pharmacy Group, Inc. "We commenced 2011 with a meaningful capital infusion from Milestone Longcheng, our new strategic partner, enabling us to further penetrate Guangxi's retail pharmacy market and invest in modern logistical infrastructure for our distribution business. We believe we have put together the right business model and team to become Guangxi's dominant retail pharmacy chain and wholesale drug distributor."

Fourth Quarter 2010 Results

Fourth quarter 2010 revenue increased 82.3% to $66.8 million from $36.6 million in the fourth quarter of 2009.

Net sales from the Company's pharmaceutical distribution segment increased 92.3% year-over-year to $50.7 million, or 75.9% of total fourth quarter revenue. Of the $24.3 million increase in pharmaceutical distribution sales, $12.6 million was attributable to higher sales to hospitals and $7.2 million was due to higher sales to clinics and health care centers. During the fourth quarter of 2010, the Company sold a greater quantity and range of products to hospitals compared to the same period in 2009, reflecting increased coverage by China's national insurance plan and the implementation of the country's New Rural Cooperative Medicare plan. Higher year-over-year sales to clinics and health care centers in the fourth quarter of 2010 reflects a ramp-up of new distribution business that the Company won in six cities and townships in 2009 under the Basic Drugs Catalog Plan.

Net sales from the Company's retail pharmacy segment grew 41.6% year-over-year to $12.6 million, or 18.8% of total fourth quarter revenue. This quarter's increase in retail pharmacy revenue was driven by approximately $5.3 million of incremental sales from new stores added after September 30, 2010, partially offset by a 17.6% year-over-year decline in existing store sales. The decline in existing store sales from $8.9 million in fourth quarter 2009 to $7.3 million this quarter reflects lower medi-card sales due to a temporary suspension of the government's insurance computer system for software upgrades, the maturity of existing stores which experienced a peak in sales in 2009, and management's decision to dedicate a greater portion of its resources to external growth initiatives.

Net sales from the Company's pharmaceutical manufacturing segment rose 153.9% year-over-year to $3.5 million, or 5.2% of total fourth quarter revenue. This quarter's manufacturing sales growth was primarily due to increased sales volume of Diphenoxylate and Levodopa which the Company began to export to the India market.

Gross profit grew 57.2% year-over-year to $14.1 million, up from $9.0 million for the same period of 2009. Gross margin declined 3.4 percentage points to 21.1%, as compared to 24.5% in the comparable period last year. The decrease in gross margin in the fourth quarter of 2010 mainly reflects a change in segment mix, with the Company's lower margin wholesale distribution business accounting for 75.9% of total revenue as compared to 72.0% of total revenue in fourth quarter 2009.

Within pharmaceutical distribution, gross margin declined from 19.7% in fourth quarter 2009 to 16.8% this quarter, due to increased sales to retail stores which provide lower margins. Retail pharmacy segment gross margin declined from 31.2% in fourth quarter 2009 to 27.1% this quarter, reflecting the acquisition of retail stores completed in 2010 with inventories valued at market selling price rather than at cost. Pharmaceutical manufacturing segment gross margin decreased from 71.1% in fourth quarter 2009 to 62.6% during this quarter due to market penetration of lower profit products.

Operating expenses increased by 49.3% to $4.7 million, compared to $3.1 million in the same period last year. Administrative expenses increased 55.7% to $2.8 million, or 4.2% of revenue, as compared to $1.8 million, or 4.9% of revenue, in the same period of 2009, primarily due to an increase in the incurrence of public company professional fees and increased share based compensation. Selling expenses rose 45.8% to $1.9 million, compared to $1.3 million in the same period of 2009.

Operating income increased 61.3% to $9.4 million, or 14.2% of revenue, from $5.9 million, or 16.0% of revenue, in the fourth quarter of 2009.

GAAP net income increased 83.6% to $7.4 million, or $0.19 per diluted share, as compared to $4.0 million, or $0.13 per diluted share, in the fourth quarter of 2009. Diluted earnings per share were calculated using weighted average shares of 38,154,340 and 32,055,319 for the quarters ended December 31, 2010 and December 31, 2009, respectively. Excluding a non-cash benefit of $1.0 million related to change in the fair value of warrant liabilities and excluding non-cash share-based compensation expense of $0.6 million, fourth quarter 2010 non-GAAP adjusted net income was $7.0 million, or $0.18 per diluted share. There were no comparable adjustments to net income in the fourth quarter of 2009.

Full Year 2010 Results

The Company's revenue in 2010 was $200.8 million, up 47.6% from $136.1 million the prior year. Pharmaceutical distribution remained the Company's largest segment in 2010 at 72.4% of total sales, compared to 71.4% in 2009. Retail pharmacy represented 22.2% of total Company sales in 2010 as compared to 22.9% in 2009. Pharmaceutical manufacturing accounted for 5.4% of total sales, compared to 5.7% in 2009.

Gross profit was $48.8 million, or 24.3% of revenue, up 37.5% from $35.5 million, or 26.1% of revenue, in 2009. Operating income was $35.4 million, or 17.6% of revenue, up 31.3% from $26.9 million, or 19.8% of revenue, in 2009. Net income increased 32.4% to $25.7 million, or $0.67 per diluted share, compared to $19.4 million, or $0.61 per diluted share, in 2009. Excluding a non-cash benefit of $0.6 million related to change in the fair value of warrant liabilities and excluding non-cash share-based compensation expense of $1.3 million, 2010 non-GAAP adjusted net income was $26.4 million, or $0.68 per diluted share. There were no comparable adjustments to net income in 2009.

Financial Condition

As of December 31, 2010, China BCT had $20.2 million in cash and cash equivalents, $53.2 million in working capital and a current ratio of 1.97. Long-term bank debt was $1.9 million. Stockholders' equity was $83.1 million on December 31, 2010, up 55.6% from $53.4 million at the end of 2009.

The Company generated $15.9 million in cash flow from operating activities for the year ended December 31, 2010, compared to cash flow from operating activities of $6.9 million in 2009. Cash used in investing activities was $9.2 million, compared to cash provided by investing activities of $1.3 million in 2009. For the twelve months ended December 31, 2010, approximately $6.0 million of cash used in investing activities represented payments to acquire retail stores.

Subsequent Events

In January 2011, the Company entered into an agreement with Milestone Longcheng Limited, an investment vehicle for Milestone China Opportunities Fund II, which is managed by Milestone Capital a Private Equity firm, pursuant to which Milestone purchased 9,375,000 shares of the Company's Series A Convertible Preferred Shares for an aggregate purchase price of $30 million. The transaction successfully closed on March 2, 2011.

On February 22, 2011, China BCT launched 17 new retail pharmacies in Guangxi, further expanding its footprint in the region. The new stores primarily are located in well-populated cities, including Liuzhou, Hechi, Hezhou, Guigang, Laibin and Guilin.

China BCT's Form S-1 registration statement filed with the Securities and Exchange Commission ("SEC") was declared effective on March 17, 2011. Pursuant to the statement, a total of 5,630,575 shares have been registered with the SEC, representing approximately 13.98% of the Company's fully diluted shares outstanding as of February 28, 2011.

Business Outlook

"Looking into 2011, we intend to continue to selectively build or acquire retail pharmacies in Guangxi and surrounding regions, while improving the same store sales volume of our existing portfolio. In wholesale distribution, we plan to develop and invest in a state-of-the-art logistics center and secure more profitable exclusive contracts with hospitals in Guangxi. The centralized bidding process under the New Rural Cooperative Medicare Plan for 2011 is expected to close in the second quarter of 2011, and we expect to win double the bids we won last year, further strengthening our organic growth in wholesale distribution. We will continue to vertically integrate our self-manufactured drugs with our wholesale and retail networks to improve China BCT's overall gross margin," Mr. Tang concluded.

Conference Call

China BCT will conduct a conference call at 9:00 a.m. Eastern Time (ET) on Thursday, March 31, 2011, to discuss its fourth quarter and full year 2010 financial results.

The conference call can be accessed by dialing 866-759-2078 (U.S. and Canada callers) or 706-643-0585 (international callers) and entering the conference ID 54292936 approximately five to ten minutes prior to the call. A replay will be available for two weeks starting on Thursday, March 31, 2011 at 11:00 a.m. ET by dialing 800-642-1687 (U.S. and Canada callers) or 706-645-9291 (international callers) and entering the conference replay ID 54292936.

About China BCT

China BCT is engaged in pharmaceutical distribution, pharmacy retailing, and the manufacture of pharmaceuticals products through its subsidiaries Guangxi Liuzhou Baicaotang Medicine Limited, Hefeng Pharmaceutical Co. Limited, and Guangxi Liuzhou Baicaotang Medicine Retail Limited in Guangxi province, China. It operates a large regional retail network in Guangxi province, consisting of 187 directly owned retail stores in Guangxi province and currently over 8,000 products are distributed through the Company's wholesale distribution network. For more information, please visit www.china-bct.com .

Safe Harbor Statement

This press release contains "forward-looking statements" within the meaning of the safe-harbor provisions of the Private Securities Litigation Reform Act of 1995. Such statements involve known and unknown risks, uncertainties and other factors that could cause the actual results of the Company to differ materially from the results expressed or implied by such statements, including: changes from anticipated levels of sales; future international, national or regional economic and competitive conditions; changes in relationships with customers; access to capital; difficulties in developing and marketing new products and services; marketing existing products and services; customer acceptance of existing and new products and services; and other factors detailed in the Company's periodic filings with the Securities and Exchange Commission (http://www.sec.gov). Accordingly, although the Company believes that the expectations reflected in such forward-looking statements are reasonable, there can be no assurance that such expectations will prove to be correct. The Company has no obligation to update the forward-looking information contained in this presentation.

Use of Non-GAAP Financial Information

GAAP results for the three and twelve months ended December 31, 2010 and 2009 include change in fair value of warrant liabilities. To supplement the Company's condensed consolidated financial statements presented on a GAAP basis, the Company has provided non-GAAP financial information excluding the impact of these items in this release, which are non-GAAP net income and non-GAAP diluted earnings per share. The Company's management believes that these non-GAAP measures provide investors with a better understanding of how the results related to the Company's historical performance. The additional adjusted information is not meant to be considered in isolation or as a substitute for GAAP financials. The adjusted financial information that the Company provides also may differ from the adjusted information provided by other companies. Management believes that these adjusted financial measures are useful to investors because they exclude non-cash expenses that management excludes when it internally evaluates the performance of the Company's business and makes operating decisions, including internal budgeting, and performance measurement, as these measures provide a consistent method of comparison to historical periods. As a result, the provision of these adjusted measures allows investors to evaluate the Company's performance using the same methodology and information as that used by the Company's management. Adjusted measures are subject to inherent limitations because they do not include all of the expenses included under GAAP and because they involve the exercise of judgment of which charges are excluded from the adjusted financial measure. However, the Company's management compensates for these limitations by providing the relevant disclosure of the items excluded. A reconciliation of each adjusted measures to the nearest GAAP measure appears in the table below.


 

 

Company Contact:

 

Investor Relations Contact:

 

 

Ms. Shelly Zhang, Chief Financial Officer

 

CCG Investor Relations

 

 

China BCT Pharmacy Group, Inc.

 

Mr. Crocker Coulson, President

 

 

Email: shelly.zhang@china-bct.com

 

Email: crocker.coulson@ccgir.com

 

 

Tel: (86) 772-363-8318

 

Tel: +1-646-213-1915

 

 

Website: www.china-bct.com

 

 

 

 

Mr. Kalle Ahl, CFA, Account Manager

 

 

 

Email: kalle.ahl@ccgir.com

 

 

 

Tel: +1-646-833-3417

 

 

 

Website: www.ccgirasia.com

 

 

 

 

 

 



China BCT Pharmacy Group, Inc.

RECONCILIATION OF NON-GAAP NET INCOME AND DILUTED EPS

 

 

 

Three months ended

 

 

Twelve months ended

 

 

December 31,

 

December 31,

 

 

US$ - thousands, except per share

 

2010

 

 

2009

 

 

2010

 

 

2009

 

 

 

 

 

 

 

 

 

 

 

Net income (GAAP)

 

$7,404

 

 

$4,032

 

 

$25,689

 

 

$19,409

 

 

- Share-based compensation expense

 

596

 

 

0

 

 

1,254

 

 

0

 

 

- Change in fair value of warrant liabilities

 

(1,040)

 

 

0

 

 

(582)

 

 

0

 

 

Adjusted net income (non-GAAP)

 

$6,960

 

 

$4,032

 

 

$26,288

 

 

$19,409

 

 

 

 

 

 

 

 

 

 

 

Per diluted share

 

 

 

 

 

 

 

 

 

- Net income per share (GAAP)

 

$0.19

 

 

$0.13

 

 

$0.66

 

 

$0.61

 

 

- Share-based compensation expense

 

$0.02

 

 

$0.00

 

 

$0.03

 

 

$0.00

 

 

- Change in fair value of warrant liabilities

 

($0.03)

 

 

$0.00

 

 

($0.02)

 

 

$0.00

 

 

- Adjusted net income per share (non-GAAP)

 

$0.18

 

 

$0.13

 

 

$0.68

 

 

$0.61

 

 

Weighted average shares outstanding – '000

 

 

 

 

 

 

 

 

 

-diluted

 

38,154

 

 

32,055

 

 

38,578

 

 

32,013

 

 

 

 

 

 

 

 

 

 

 

 



China BCT Pharmacy Group, Inc.

(Formerly named China Baicaotang Medicine Limited)

Consolidated Statements of Income and Comprehensive Income

(Stated in US Dollars)

 

 

 

Three months ended December 31

 

 

Twelve months ended December 31,

 

 

 

2010

 

2009

 

 

2010

 

2009

 

 

Revenue

 

 

 

 

 

 

 

Sales

 

$66,763,418

 

$36,613,263

 

 

$200,813,260

 

$136,086,708

 

 

Cost of sales

 

52,647,254

 

27,634,419

 

 

151,988,552

 

100,578,769

 

 

Gross profit

 

14,116,164

 

8,978,844

 

 

48,824,708

 

35,507,939

 

 

Operating expenses

 

 

 

 

 

 

 

Administrative expenses

 

2,789,457

 

1,791,001

 

 

8,097,374

 

4,598,800

 

 

Research and development expenses

 

-

 

46,719

 

 

 

99,688

 

 

Selling expenses

 

1,879,058

 

1,288,827

 

 

5,350,258

 

3,865,980

 

 

 

4,668,515

 

3,126,547

 

 

13,477,632

 

8,564,468

 

 

 

 

 

 

 

 

 

Income from operations

 

9,447,649

 

5,852,297

 

 

35,377,076

 

26,943,471

 

 

Interest income

 

4,728

 

(49,802)

 

 

11,651

 

16,100

 

 

Government grants

 

-

 

(41,434)

 

 

-

 

29,320

 

 

Other income

 

25,089

 

107,335

 

 

168,732

 

95,345

 

 

Change in fair value of warrant liabilities

 

1,039,944

 

-

 

 

582,226

 

 

 

Other expenses

 

(259,938)

 

-

 

 

(462,989)

 

 

 

Finance costs

 

(198,522)

 

(322,943)

 

 

(878,390)

 

-1,413,873

 

 

Exchange loss

 

(23,608)

 

-

 

 

(23,608)

 

 

 

  Total non-operating income/(expense)

 

587,693

 

(306,844)

 

 

(602,378)

 

(1,273,108)

 

 

Income before income taxes

 

10,035,342

 

5,545,453

 

 

34,774,698

 

25,670,363

 

 

Income taxes

 

(2,630,897)

 

(1,513,057)

 

 

(9,086,106)

 

-6,261,798

 

 

Net income attributable to China Baicaotang Medicine Limited common stockholders

 

 

 

 

 

 

 

 

7,404,445

 

4,032,396

 

 

$25,688,592

 

$19,408,565

 

 

Other comprehensive income

 

 

 

 

 

 

 

Foreign currency translation adjustments

 

2,318,929

 

32,179

 

 

2,317,595

 

57,322

 

 

Total comprehensive income

 

9,723,374

 

4,064,575

 

 

$28,006,187

 

$19,465,887

 

 

Earnings per share: basic and diluted

 

$0.19

 

$0.13

 

 

$0.61

 

$0.61

 

 

Weighted average number of shares

 

 

 

 

 

 

 

 outstanding: basic

 

38,154,340

 

32,055,319

 

 

38,063,507

 

32,013,943

 

 

Weighted average number of shares

 

 

 

 

 

 

 

 outstanding: diluted

 

38,154,340

 

32,055,319

 

 

38,578,440

 

32,013,943

 

 

 

 

 

 

 

 

 

 



China BCT Pharmacy Group, Inc.

(Formerly named China Baicaotang Medicine Limited)

Consolidated Balance Sheets

(Stated in US Dollars)

 

 

 

 

Year ended December 31,

 

 

 

 

 

2010

 

 

 

2009

 

 

 

ASSETS

 

 

 

 

 

 

 

 

Current assets

 

 

 

 

 

 

 

 

Cash and cash equivalents

 

 

$

 

20,157,112

 

 

 

$

 

13,304,158

 

 

 

Restricted cash

 

 

 

1,334,868

 

 

 

 

1,155,779

 

 

 

Accounts receivable, net

 

 

 

68,664,308

 

 

 

 

35,410,039

 

 

 

Amounts due from related companies

 

 

 

3,784,069

 

 

 

 

4,275,586

 

 

 

Other receivables, prepayments and deposits

 

 

 

3,332,747

 

 

 

 

2,526,398

 

 

 

Inventories

 

 

 

10,776,877

 

 

 

 

8,745,525

 

 

 

Deferred income taxes

 

 

 

207,222

 

 

 

 

60,164

 

 

 

 

 

 

 

 

 

 

 

 

 

Total current assets

 

 

 

108,257,203

 

 

 

 

65,477,649

 

 

 

 

 

 

 

 

 

 

 

 

 

Property, plant and equipment, net

 

 

 

14,605,888

 

 

 

 

12,171,689

 

 

 

Land use rights, net

 

 

 

13,422,048

 

 

 

 

13,979,753

 

 

 

Long term deposits

 

 

 

3,482,200

 

 

 

 

-

 

 

 

Goodwill

 

 

 

560,418

 

 

 

 

107,968

 

 

 

Other intangible assets, net

 

 

 

581,481

 

 

 

 

660,034

 

 

 

Deferred income taxes

 

 

 

629,798

 

 

 

 

663,699

 

 

 

 

 

 

 

 

 

 

 

 

 

TOTAL ASSETS

 

 

$

 

141,539,036

 

 

 

$

 

93,060,792

 

 

 

 

 

 

 

 

 

 

 

 

 

 



China BCT Pharmacy Group, Inc.

(Formerly named China Baicaotang Medicine Limited)

Consolidated Balance Sheets (Cont'd)

(Stated in US Dollars)

 

 

 

 

As of December 31,

 

 

 

 

 

2010

 

 

 

2009

 

 

 

LIABILITIES AND STOCKHOLDERS' EQUITY

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

LIABILITIES

 

 

 

 

 

 

 

 

Current liabilities

 

 

 

 

 

 

 

 

Accounts payable

 

 

$

 

35,497,337

 

 

 

$

 

19,159,212

 

 

 

Bills payable

 

 

 

2,669,752

 

 

 

 

2,239,604

 

 

 

Other payables and accrued expenses

 

 

 

4,856,956

 

 

 

 

3,194,612

 

 

 

Amounts due to directors

 

 

 

190,484

 

 

 

 

1,008,111

 

 

 

Amounts due to related companies

 

 

 

139,219

 

 

 

 

128,579

 

 

 

Income tax payable

 

 

 

2,564,359

 

 

 

 

562,603

 

 

 

Secured bank loans

 

 

 

8,898,218

 

 

 

 

7,136,069

 

 

 

Other loans

 

 

 

162,664

 

 

 

 

2,361,258

 

 

 

Retirement benefit costs

 

 

 

33,412

 

 

 

 

59,158

 

 

 

Total current liabilities

 

 

 

55,012,401

 

 

 

 

35,849,206

 

 

 

 

 

 

 

 

 

 

 

 

 

Secured long-term bank loans

 

 

 

1,941,606

 

 

 

 

3,631,957

 

 

 

Warrant liabilities

 

 

 

1,273,193

 

 

 

 

-

 

 

 

Retirement benefit costs

 

 

 

213,763

 

 

 

 

201,320

 

 

 

 

 

 

 

 

 

 

 

 

 

       TOTAL LIABILITIES

 

 

 

58,440,963

 

 

 

 

39,682,483

 

 

 

COMMITMENTS AND CONTINGENCIES 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

STOCKHOLDERS' EQUITY

 

 

 

 

 

 

 

 

 

 

Preferred stock: $0.001 par value; shares authorized

 

 

 

 

 

 

 

 

 

 

20,000,000; nil outstanding

 

 

 

 

 

 

 

 

 

 

Common stock: $0.001 par value; shares authorized

 

 

 

 

 

 

 

 

 

 

; 150,000,000 and 100,000,000, respectively;

 

 

 

 

 

 

 

 

 

 

shares outstanding: 38,154,340 and 37,089,370,

 

 

 

 

 

 

 

 

 

 

respectively

 

 

 

38,154

 

 

 

 

37,089

 

 

 

Additional paid-in capital

 

 

 

16,633,411

 

 

 

 

14,920,899

 

 

 

Statutory and other reserves

 

 

 

4,585,856

 

 

 

 

2,605,901

 

 

 

Accumulated other comprehensive income

 

 

 

4,427,865

 

 

 

 

2,110,270

 

 

 

Retained earnings

 

 

 

57,412,787

 

 

 

 

33,704,150

 

 

 

 

 

 

 

 

 

 

 

 

 

TOTAL STOCKHOLDERS' EQUITY

 

 

 

83,098,073

 

 

 

 

53,378,309

 

 

 

 

 

 

 

 

 

 

 

 

 

TOTAL LIABILITIES AND STOCKHOLDERS'  EQUITY

 

 

$

 

141,539,036

 

 

 

$

 

93,060,792

 

 

 

 

 

 

 

 

 

 

 

 

 

 



China BCT Pharmacy Group, Inc.

(Formerly named China Baicaotang Medicine Limited)

Consolidated Statements of Cash Flows

(Stated in US Dollars)

 

 

 

 

Year ended December 31,

 

 

 

 

 

2010

 

 

 

2009

 

 

 

 

 

 

 

 

 

 

 

Cash flows from operating activities :

 

 

 

 

 

 

 

 

Net income

 

 

$

 

25,688,592

 

 

 

$

 

19,408,565

 

 

 

Adjustments to reconcile net income to net

 

 

 

 

 

 

 

 

 

 

cash provided by operating activities :

 

 

 

 

 

 

 

 

 

 

Depreciation and amortization

 

 

 

1,188,505

 

 

 

 

1,030,374

 

 

 

Deferred income taxes

 

 

 

(91,463)

 

 

 

 

10,943

 

 

 

Gain on sale of land use right

 

 

 

(44,919)

 

 

 

 

(17,814)

 

 

 

Change in fair value of warrant liabilities

 

 

 

(582,226)

 

 

 

 

-

 

 

 

Share-based compensation expense

 

 

 

1,253,858

 

 

 

 

-

 

 

 

Allowance for doubtful accounts

 

 

 

78,068

 

 

 

 

-

 

 

 

Written off of other receivables

 

 

 

-

 

 

 

 

174,524

 

 

 

Changes in operating assets and liabilities :

 

 

 

 

 

 

 

 

 

 

Accounts receivable

 

 

 

(31,464,010)

 

 

 

 

(14,423,654)

 

 

 

Other receivables, prepayments and deposits

 

 

 

(708,878)

 

 

 

 

(1,447,184)

 

 

 

Inventories

 

 

 

1,273,013

 

 

 

 

(2,318,179)

 

 

 

Accounts payable

 

 

 

15,365,984

 

 

 

 

4,149,091

 

 

 

Bills payable

 

 

 

360,228

 

 

 

 

790,772

 

 

 

Other payables and accrued expenses

 

 

 

1,665,804

 

 

 

 

(35,940)

 

 

 

Income tax payable 

 

 

 

1,938,527

 

 

 

 

(391,796)

 

 

 

Retirement benefit costs

 

 

 

(22,049)

 

 

 

 

(8,959)

 

 

 

 Total Adjustments

 

 

 

(9,799,558

 

 

 

 

(12,487,822)

 

 

 

Net cash flows provided by operating activities

 

 

 

15,889,034

 

 

 

 

6,920,743

 

 

 

 

 

 

 

 

 

 

 

 

 

Cash flows from investing activities :

 

 

 

 

 

 

 

 

 

 

Payments to acquire retail stores

 

 

 

(6,037,743)

 

 

 

 

-

 

 

 

Addition of property, plant and equipment

 

 

 

(450,106)

 

 

 

 

(71,328)

 

 

 

Proceeds received from the RTO

 

 

 

-

 

 

 

 

22,694

 

 

 

Proceeds from sale of land use right

 

 

 

697,495

 

 

 

 

1,391,588

 

 

 

Long term deposits

 

 

 

(3,379,100)

 

 

 

 

-

 

 

 

Net cash flows provided by (used in) investing activities

 

 

$

 

(9,169,454)

 

 

 

$

 

1,342,954

 

 

 

 

 

 

 

 

 

 

 

 

 

 



China BCT Pharmacy Group, Inc.

(Formerly named China Baicaotang Medicine Limited)

Consolidated Statements of Cash Flows (Cont'd)

(Stated in US Dollars)

 

 

 

 

Year ended December 31,

 

 

 

 

 

2010

 

 

 

2009

 

 

 

 

 

 

 

 

 

 

 

Cash flows from financing activities :

 

 

 

 

 

 

 

 

Advance/ repayment activities with related companies, net

 

 

$

 

620,549

 

 

 

$

 

384,379

 

 

 

Restricted cash

 

 

 

(138,823)

 

 

 

 

72,183

 

 

 

Repayments to directors

 

 

 

(830,557)

 

 

 

 

(262,639)

 

 

 

Proceeds from bank loans

 

 

 

8,039,160

 

 

 

 

9,587,885

 

 

 

Repayments of bank loans

 

 

 

(8,329,434)

 

 

 

 

(11,310,190)

 

 

 

Proceeds received from private placement

 

 

 

2,315,138

 

 

 

 

5,306,662

 

 

 

Proceeds from other loans

 

 

 

35,208

 

 

 

 

590,945

 

 

 

Repayments of other loans

 

 

 

(2,238,759)

 

 

 

 

(661,777)

 

 

 

 

 

 

 

 

 

 

 

 

 

Net cash flows provided by (used in) financing activities

 

 

 

(527,518)

 

 

 

 

3,707,448

 

 

 

 

 

 

 

 

 

 

 

 

 

Effect of foreign currency translation on cash

 

 

 

 

 

 

 

 

 

 

  and cash equivalents

 

 

 

660,892

 

 

 

 

67,829

 

 

 

 

 

 

 

 

 

 

 

 

 

Net increase in cash and cash equivalents

 

 

 

6,852,954

 

 

 

 

12,038,974

 

 

 

 

 

 

 

 

 

 

 

 

 

Cash and cash equivalents - beginning of year

 

 

 

13,304,158

 

 

 

 

1,265,184

 

 

 

 

 

 

 

 

 

 

 

 

 

Cash and cash equivalents - end of year

 

 

$

 

20,157,112

 

 

 

$

 

13,304,158

 

 

 

 

 

 

 

 

 

 

 

 

 

Supplemental disclosures for cash flow information :

 

 

 

 

 

 

 

 

 

 

Cash paid for

 

 

 

 

 

 

 

 

 

 

  - Interest

 

 

$

 

951,670

 

 

 

$

 

1,291,082

 

 

 

  - Income taxes

 

 

$

 

7,255,019

 

 

 

$

 

6,642,573

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Source: China BCT Pharmacy Group, Inc.
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