BEIJING, April 18, 2013 /PRNewswire/ -- Sinovac Biotech Ltd. (NASDAQ: SVA), a leading provider of vaccines in China, announced today its unaudited fourth quarter and full year financial results for the period ended December 31, 2012.
Financial Highlights
Recent Business Highlights
Dr. Weidong Yin, Chairman, President and CEO, commented, "2012 was a transformative year for Sinovac as we focused on continuing to advance our vaccine development pipeline. We invested significantly in research and development this year for our lead candidate, our proprietary EV71 vaccine against HFMD. We are well positioned for medium- to long-term growth as this vaccine progresses through the regulatory process and approaches launch."
Dr. Yin continued, "EV71 represents a significant unmet medical need in China with over 2.16 million cases reported in 2012, from which 560 fatalities were reported, Most of serve cases of EV71 infection were seen in children under 5 years old, which totaled approximately 80 million in China. Unfortunately, no EV71-specific treatment and prevention method currently exists. With knowledge of this unmet need, we commenced development of an EV71 vaccine in 2008, and recently concluded the phase III efficacy trial for this candidate. In March 2013, the unblinded top-line results from the phase III clinical trial for the vaccine demonstrated a 95% efficacy rate against HFMD caused by EV71. We expect our EV71 vaccine, once commercialized, will provide a solution to this unmet medical need in China."
Dr. Yin concluded, "I am also very pleased with the 38.6% increase in regular vaccine sales for 2012. Growth was achieved across all three of our market segments: private pay market, public market and international market. Sinovac's core products, inclusive of Healive, Bilive, and Anflu, contributed to our sales growth, with Bilive and Healive sales in the private market in China being the primary contributors to both the rate and magnitude of the sales increase. Our financial results benefited from a successful price increase for both of these products, as well as higher volume. Our well-trained, experienced sales team continues to drive growth in our commercialized vaccine products, but also has taken significant strides to increase efficacy in our sales and marketing infrastructure, positioning us well for future vaccine product launches, such as the EV71 vaccine."
Financial Review for Unaudited Fourth Quarter Ended December 31, 2012
An analysis of sales and gross profit is as follows:
In USD | 2012Q4 | % of Sales | 2011Q4 | % of Sales | Fluctuation % |
Healive-hepatitis A | 10,037,198 | 53.0% | 2,970,802 | 14.1% | 237.9% |
Bilive-hepatitis A&B | 3,784,668 | 20.0% | 605,624 | 2.9% | 524.9% |
Anflu- influenza | 5,091,076 | 26.8% | 3,523,452 | 16.7% | 44.5% |
Core sales | 18,912,942 | 99.8% | 7,099,878 | 33.7% | 166.4% |
Mumps | 23,925 | 0.1% | |||
Rabend (Animal) | 14,634 | 0.1% | |||
Regular Sales | 18,951,501 | 7,099,878 | 166.9% | ||
Panflu.1 -H1N1 | 14,004,653 | 66.2% | |||
Panflu-H5N1 | 38,873 | 0.1% | |||
Total sales | 18,951,501 | 21,143,404 | -10.4% | ||
Cost of Sales | 8,698,009 | 8,031,758 | |||
Gross profit | 10,253,492 | 54.1% | 13,111,646 | 62.0% | -21.8% |
Total revenue for the fourth quarter of 2012 was $19.0 million, a decrease of 10.4% from $21.1 million in the same period of 2011. Fourth quarter 2012 sales of our regular products, Healive, Bilive, Anflu, mumps vaccine and RabEnd, increased by 166.9% to $19.0 million from $7.1 million in the same period of 2011. The significant increase in sales of core products in the fourth quarter was driven by: 1) expansion of Healive to a new territory of Jiangsu Province in the fourth quarter; 2) the successful implementation of a new sales strategy to achieve both volume growth and average selling price increase for hepatitis vaccines; and 3) higher Anflu sales in the fourth quarter compared to other regular years due to a later start of the Anflu sales season in 2012. 2011 sales included recognition of approximately $14 million revenue from Panflu and Panflu.1 vaccines stockpiled by the Chinese government in 2010. These two products are not for regular sales, since they were produced upon government order and subject to the government decision of using the vaccines within its shelf life if there was any flu pandemic caused by H1N1 and/or H5N1. The Company's revenue recognition requirements were not met until the fourth quarter of 2011. And in 2012, there was no revenue recognized for either Panflu or Panflu.1.
Compared with the fourth quarter of 2011, the gross profit margin for the fourth quarter of 2012 decreased from 62.0% to 54.1%. The higher gross margin in the fourth quarter of 2011 was due to the recognition of $14 million revenue from H1N1 vaccine stockpiling, which has a higher gross profit margin than other vaccines.
Selling, general and administrative expenses for the fourth quarter of 2012 were $12.8 million, compared to $5.9 million in the same period of 2011. The increase in SG&A was largely due to an increase in G&A, although both selling expense and general and administration expense increased. The increase of G&A expense was resulted from the increased expenses incurred for validation, commissioning, and trial production for the dedicated production facility for our EV71 vaccine at the Changping site, Beijing, and the preparation for GMP inspection by the government authorities of our existing manufacturing facilities in both the Changping and Shangdi sites in Beijing for compliance with China's 2010 GMP guidelines.
The R&D expense for the fourth quarter of 2012 was $1.3 million, a $1 million decrease from $2.3 million for the same period in 2011, due to lower EV71 clinical trial expense as the trial approaching its end.
Depreciation of property, plant and equipment and amortization of licenses and permits for the fourth quarter of 2012 was $0.5 million, compared to $0.4 million for the same period in 2011.
For the fourth quarter of 2012, an impairment charge of $1.5 million on the long-lived assets including plant and building, machinery and equipments related to the animal vaccine production was made.
Net loss attributable to stockholders for the fourth quarter of 2012 was $5.4 million, or $0.10 per basic and diluted share, compared to a net income of $2.8 million, or $0.05 per basic and diluted share, for the same period in 2011.
Financial Review for Unaudited Full Year Results Ended December 31, 2012
An analysis of sales and gross profit of full year 2012 is as follows:
In USD | 2012 | % of Sales | 2011 | %of Sales | Fluctuation % |
Healive-hepatitis A | 20,141,416 | 41.5% | 14,217,393 | 25.0% | 41.7% |
Bilive-hepatitis A&B | 19,417,940 | 40.0% | 12,721,993 | 22.4% | 52.6% |
Anflu-influenza | 8,943,937 | 18.4% | 8,112,279 | 14.3% | 10.3% |
Core sales | 48,503,293 | 99.9% | 35,051,665 | 61.7% | 38.4% |
Mumps | 23,925 | 0.0% | |||
Rabend (Animal) | 49,482 | 0.1% | |||
Regular Sales | 48,576,700 | 100.0% | 35,051,665 | 61.7% | 38.6% |
Panflu.1 -H1N1 | 14,008,225 | 24.6% | |||
Panflu-H5N1 | 7,782,002 | 13.7% | |||
Total Sales | 48,576,700 | 56,841,892 | 100.0% | -14.5% | |
Cost of goods sold | 19,099,927 | 21,127,410 | |||
Gross profit | 29,476,773 | 60.7% | 35,714,482 | 62.8% | -17.5% |
Total revenue for the fiscal year ended December 31, 2012 was $48.6 million, a decrease of 14.5% from $56.8 million reported in 2011. Excluding the revenue recognized on the government stockpiling of Panflu and Panflu.1 in 2010, sales of our regular products, Healive, Bilive and Anflu, mumps vaccine and RabEnd, increased by 38.6% to $48.6 million in 2012 from $35.1 million in 2011.
Gross profit margin was 60.7% in 2012, a decline from 62.8% in 2011. Excluding the impact to sales and cost of sales in both years by of Panflu and Panflu.1, the gross margin of regular vaccine products increased to 63.7% in 2012 from 57.7% in 2011.
Selling, general and administrative expenses in 2012 were $31.7 million, compared to $22.4 million in 2011. The increase in SG&A was largely due to an increase in G&A, although both selling expense and general and administration expense increased. The increase of G&A expense was due to the increased cost incurred on the validation of the new facilities in Changping site and preparation for new GMP compliance inspection of our existing manufacturing facilities in both Changping and Shangdi sites.
Research and development expenses in 2012 increased to $17.0 million from $9.0 million in 2011. The increase was mainly due to expense incurred in 2012 in connection with the EV71 phase III clinical trial.
Depreciation of property, plant and equipment and amortization of licenses and permits in 2012 was $1.6 million, compared to $1.4 million in 2011. The higher depreciation in 2012 was mainly due to the additional depreciation on property, plant and equipment of the Changping site.
The Company recorded loss on disposal and impairment of property, plant and equipment of $2.2 million as operating expense, in which $1.5 million was for animal vaccine production related assets and $0.5 million was for human vaccine production related assets.
Net loss attributable to stockholders in 2012 was $15.7 million, or $0.29 per basic and diluted share, compared to a net loss of $0.8 million, or $0.02 per basic and diluted share in 2011.
As of December 31, 2012, cash and cash equivalents totaled $90.9 million, compared to $104.3 million as of December 31, 2011. Net cash used in operating activities was $16.6 million in 2012, which primarily resulted from payment made for EV71 clinical trial and validation of the new facilities in Changping, Beijing and new GMP inspection preparation expenses. Net cash used in investing activities was $16.2 million, which primarily resulted from payment for the purchase of property, plant and equipment for the Changping site. Net cash provided by financing activities was $17.3 million in 2012. The Company maintained a strong cash balance despite significant expenditure on the phase III clinical trial of EV71 vaccine candidate and investment in its production facilities. In order to commercialize other pipeline products, the Company may continue to explore new sources of financing when appropriate.
Correction of Unaudited Financials in Prior Quarterly Release
In the second quarter of 2012, the Company assessed there was reasonable assurance that the conditions attached to several government grants were fulfilled and recognized $1.4 million and $1.5 million of government grants as income for the three and six months periods ended June, 30, 2012, respectively. In the fourth quarter of 2012, the Company determined that government grants of $0.98 million (RMB 6.2 million) related to the purchase of equipment that should have been recorded as deferred government grants with the balance applied to reduce depreciation expense of the related equipment over their remaining useful lives. As a result, the amount of government grants recognized as income should be reduced by $0.98 million for the three and six months periods ended June 30, 2012, and $0.98 million for the nine months periods ended September 30, 2012, respectively. The depreciation expense should also be reduced by $11,679 and $11,679 for the three and six months periods ended June 30, 2012, and $36,646 and $46,636 for the three and nine months periods ended September 30, 2012, respectively. Net cash used from operating activities remained unchanged, because the adjustments on net loss, depreciation of property, plant and equipment and amortization of licenses and permits, and the recognized government grant income in operating activities did not affect cash. Corresponding corrections were made for both the unaudited fourth quarter and full year 2012 financial statements. The corrections to earning releases that were issued in the affected quarters in 2012 are presented in the tables below. Investors should no longer rely upon the previously released unaudited financial statements for the periods and any earnings releases or other communications relating to these periods.
Consolidated Statements of Income (Loss) and Comprehensive Income (Loss):
Unaudited Three-month and six-month period ended June 30, 2012
Three months ended 'June 30 2012 | Six months ended 'June 30 2012 | ||||||
Previously Reported | Adjustment | Corrected Report | Previously Reported | Adjustment | Corrected Report | ||
Sales | 9,364,632 | - | 9,364,632 | 15,338,099 | - | 15,338,099 | |
Cost of sales | 1,375,917 | - | 1,375,917 | 3,631,206 | - | 3,631,206 | |
Gross profit | 7,988,715 | - | 7,988,715 | 11,706,893 | - | 11,706,893 | |
Selling, general and administrative expenses | 6,700,526 | - | 6,700,526 | 11,020,815 | - | 11,020,815 | |
Research and development expenses - net of | 4,676,703 | - | 4,676,703 | 12,018,875 | - | 12,018,875 | |
Depreciation of property, plant and equipment | 324,944 | (11,679) | 313,265 | 632,387 | (11,679) | 620,708 | |
Loss of disposal and impairment of property, plant and equipment | 0 | - | 0 | 0 | - | 0 | |
Provision for doubtful debts | - | - | - | - | - | - | |
Government grants recognized in income | (1,386,126) | 981,044 | (405,082) | (1,457,330) | 981,044 | (476,286) | |
Total operating expenses | 10,316,047 | 969,365 | 11,285,412 | 22,214,747 | 969,365 | 23,184,112 | |
Operating income (loss) | (2,327,332) | (969,365) | (3,296,697) | (10,507,854) | (969,365) | (11,477,219) | |
Interest income | 498,856 | - | 498,856 | 1,096,527 | - | 1,096,527 | |
Interest and financing expenses | (232,078) | - | (232,078) | (446,398) | - | (446,398) | |
Other income (Expenses) | 14,635 | - | 14,635 | 132,713 | - | 132,713 | |
Income (loss) before income taxes and non- | (2,045,919) | (969,365) | (3,015,284) | (9,725,012) | (969,365) | (10,694,377) | |
Income tax recovery (expenses) | 797,462 | - | 797,462 | 800,364 | - | 800,364 | |
Consolidated net income (loss) | (1,248,457) | (969,365) | (2,217,822) | (8,924,648) | (969,365) | (9,894,013) | |
Less: income (loss) attributable to non-controlling interests | (326,828) | (260,856) | (587,684) | (2,389,964) | (260,856) | (2,650,820) | |
Net income (loss) attributable to stockholders | (921,629) | (708,509) | (1,630,138) | (6,534,684) | (708,509) | (7,243,193) | |
Net income (loss) | (1,248,457) | (969,365) | (2,217,822) | (8,924,648) | (969,365) | (9,894,013) | |
Other comprehensive income (loss) | |||||||
Foreign currency translation adjustment | (474,801) | 5,067 | (469,734) | 171,982 | 5,067 | 177,049 | |
Total comprehensive income (loss) | (1,723,258) | (964,298) | (2,687,556) | (8,752,666) | (964,298) | (9,716,964) | |
Less: comprehensive income (loss) attributable to non-controlling interests | (373,994) | (259,492) | (633,486) | (2,353,583) | (259,492) | (2,613,075) | |
Comprehensive income(loss) attributable to stockholders | (1,349,264) | (704,806) | (2,054,070) | (6,399,083) | (704,806) | (7,103,889) | |
Basic and diluted earnings (loss) per share | (0.02) | (0.01) | (0.03) | (0.12) | (0.01) | (0.13) | |
Weighted average number of shares | |||||||
of common stock outstanding | |||||||
- Basic | 54,804,498 | 54,804,498 | 54,804,498 | 54,784,801 | 54,784,801 | 54,784,801 | |
- Diluted | 54,804,498 | 54,804,498 | 54,804,498 | 54,784,801 | 54,784,801 | 54,784,801 | |
Unaudited Three-month and six-month period ended September 30, 2012
Three months ended 'September 30 2012 | Nine months ended 'September 30 2012 | ||||||
Previously Reported | Adjustment | Corrected Report | Previously Reported | Adjustment | Corrected Report | ||
Sales | 14,287,100 | - | 14,287,100 | 29,625,199 | - | 29,625,199 | |
Cost of sales | 6,770,712 | - | 6,770,712 | 10,401,918 | - | 10,401,918 | |
Gross profit | 7,516,388 | - | 7,516,388 | 19,223,281 | - | 19,223,281 | |
Selling, general and administrative expenses | 7,844,861 | - | 7,844,861 | 18,865,676 | - | 18,865,676 | |
Research and development expenses - net of | 3,773,625 | - | 3,773,625 | 15,792,500 | - | 15,792,500 | |
Depreciation of property, plant and equipment | 471,242 | (36,646) | 434,596 | 1,103,629 | (46,636) | 1,056,993 | |
Loss of disposal and impairment of property, plant and equipment | - | - | - | - | - | - | |
Provision for doubtful debts | 97,067 | - | 97,067 | 97,067 | - | 97,067 | |
Government grants recognized in income | (78,053) | - | (78,053) | (1,535,383) | 979,355 | (556,028) | |
Total operating expenses | 12,108,742 | (36,646) | 12,072,096 | 34,323,489 | 932,719 | 35,256,208 | |
Operating income (loss) | (4,592,354) | 36,646 | (4,555,708) | (15,100,208) | (932,719) | (16,032,927) | |
Interest income | 464,512 | - | 464,512 | 1,561,039 | 1,561,039 | ||
Interest and financing expenses | 302,846 | - | 302,846 | (143,552) | - | (143,552) | |
Other income (Expenses) | (47,283) | - | (47,283) | 85,430 | 85,430 | ||
Income (loss) before income taxes and non- | (3,872,279) | 36,646 | (3,835,633) | (13,597,291) | (932,719) | (14,530,010) | |
Income tax recovery (expenses) | (5,958) | - | (5,958) | 794,406 | - | 794,406 | |
Consolidated net income (loss) | (3,878,237) | 36,646 | (3,841,591) | (12,802,885) | (932,719) | (13,735,604) | |
Less: income (loss) attributable to non-controlling interests | (849,619) | 9,861 | (839,758) | (3,239,583) | (250,995) | (3,490,578) | |
Net income (loss) attributable to stockholders | (3,028,618) | 26,785 | (3,001,833) | (9,563,302) | (681,724) | (10,245,026) | |
Net income (loss) | (3,878,237) | 36,646 | (3,841,591) | (12,802,885) | (932,719) | (13,735,604) | |
Other comprehensive income (loss) | |||||||
Foreign currency translation adjustment | 890,063 | (11,880) | 878,183 | 1,062,045 | (6,813) | 1,055,232 | |
Total comprehensive income (loss) | (2,988,174) | 24,766 | (2,963,408) | (11,740,840) | (939,532) | (12,680,372) | |
Less: comprehensive income (loss) attributable | (744,732) | 6,664 | (738,068) | (3,098,315) | (252,828) | (3,351,143) | |
Comprehensive income(loss) attributable to stockholders | (2,243,442) | 18,102 | (2,225,340) | (8,642,525) | (686,704) | (9,329,229) | |
Basic and diluted earnings (loss) per share | (0.06) | 0.01 | (0.05) | (0.17) | (0.02) | (0.19) | |
Weighted average number of shares | |||||||
of common stock outstanding | |||||||
- Basic | 55,023,070 | 55,023,070 | 55,023,070 | 54,881,874 | 54,881,874 | 54,881,874 | |
- Diluted | 55,023,070 | 55,023,070 | 55,023,070 | 54,881,874 | 54,881,874 | 54,881,874 | |
Unaudited Consolidated Balance Sheet:
June 30 2012 | September 30 2012 | |||||||
Previously Reported | Adjustment | Corrected Report | Previously Reported | Adjustment | Corrected Report | |||
ASSETS | ||||||||
Current assets | ||||||||
Cash and cash equivalents | 89,440,373 | - | 89,440,373 | 81,962,420 | - | 81,962,420 | ||
Accounts receivable - net | 18,533,886 | - | 18,533,886 | 25,316,304 | - | 25,316,304 | ||
Inventories | 14,226,557 | - | 14,226,557 | 14,099,902 | - | 14,099,902 | ||
Prepaid expenses and deposits | 1,408,762 | - | 1,408,762 | 905,437 | - | 905,437 | ||
Total current assets | 123,609,578 | - | 123,609,578 | 122,284,063 | - | 122,284,063 | ||
Property, plant and equipment | 80,961,440 | - | 80,961,440 | 82,994,261 | - | 82,994,261 | ||
Long-term inventories | 3,974,552 | - | 3,974,552 | 2,227,196 | - | 2,227,196 | ||
Long-term prepaid expenses | 343,374 | - | 343,374 | 311,079 | - | 311,079 | ||
Prepayments for acquisition of equipment | 452,144 | - | 452,144 | 525,972 | - | 525,972 | ||
Deferred tax assets | 353,903 | - | 353,903 | 351,627 | - | 351,627 | ||
Licenses and permits | 1,278,421 | - | 1,278,421 | 1,261,820 | - | 1,261,820 | ||
Total assets | 210,973,412 | - | 210,973,412 | 209,956,018 | - | 209,956,018 | ||
LIABILITIES AND EQUITY | ||||||||
Current liabilities | ||||||||
Loans payable | 4,722,178 | - | 4,722,178 | 4,773,422 | - | 4,773,422 | ||
Accounts payable and accrued liabilities | 28,698,963 | - | 28,698,963 | 27,529,207 | - | 27,529,207 | ||
Income tax payable | 234,156 | - | 234,156 | 236,697 | - | 236,697 | ||
Deferred revenue | 3,794,136 | - | 3,794,136 | 8,108,669 | - | 8,108,669 | ||
Dividends payable | 0 | - | 0 | - | - | - | ||
Deferred government grants | 100,897 | 345,471 | 446,368 | 101,992 | 349,222 | 451,214 | ||
Total current liabilities | 37,550,330 | 345,471 | 37,895,801 | 40,749,987 | 349,222 | 41,099,209 | ||
Deferred government grants | 2,805,528 | 618,827 | 3,424,355 | 2,761,758 | 590,310 | 3,352,068 | ||
Loans payable | 23,330,072 | - | 23,330,072 | 24,670,318 | - | 24,670,318 | ||
Due to related party | 3,167,008 | - | 3,167,008 | 3,201,375 | - | 3,201,375 | ||
Deferred revenue | 6,925,862 | - | 6,925,862 | 4,194,246 | - | 4,194,246 | ||
Total long term liabilities | 36,228,470 | 618,827 | 36,847,297 | 34,827,697 | 590,310 | 35,418,007 | ||
Total liabilities | 73,778,800 | 964,298 | 74,743,098 | 75,577,684 | 939,532 | 76,517,216 | ||
Commitments and contingencies | ||||||||
EQUITY | ||||||||
Preferred stock | - | - | - | - | - | - | ||
Authorized 50,000,000 shares at par value of | - | - | ||||||
$0.001 each Issued and outstanding: nil | - | - | ||||||
Common stock | 55,020 | 55,020 | 55,024 | - | 55,024 | |||
Additional paid-in capital | 106,032,906 | 106,032,906 | 106,204,800 | - | 106,204,800 | |||
Accumulated other comprehensive income | 10,113,926 | 5,067 | 10,118,993 | 10,899,102 | (6,813) | 10,892,289 | ||
Statutory surplus reserves | 11,808,271 | 11,808,271 | 11,808,271 | - | 11,808,271 | |||
Retained earnings(accumulated deficit) | (3,838,457) | (708,509) | (4,546,966) | (6,867,075) | (681,724) | (7,548,799) | ||
Total stockholders' equity | 124,171,666 | (703,442) | 123,468,224 | 122,100,122 | (688,537) | 121,411,585 | ||
Non-controlling interests | 13,022,946 | (260,856) | 12,762,090 | 12,278,212 | (250,995) | 12,027,217 | ||
Total equity | 137,194,612 | (964,298) | 136,230,314 | 134,378,334 | (939,532) | 133,438,802 | ||
Total liabilities and equity | 210,973,412 | - | 210,973,412 | 209,956,018 | - | 209,956,018 | ||
Conference Call Details
The Company will host a conference call on Thursday, April 18, 2013, at 8:00 a.m. EDT (April 18, 2013, at 8:00 p.m. China Standard Time) to review the Company's financial results and provide an update on recent corporate developments.
To access the conference call, please dial 1-877-407-4018 (USA) or 1-201-689-8471 (International). A replay of the call will be available from 11 a.m. EDT on April 18, 2013 to May 2, 2013 at midnight. To access the replay, please dial 1-877-870-5176 (USA) or 1-858-384-5517 (International) and reference the replay pin number 411774.
A live audio webcast of the call will also be available from the investors section on the corporate web site at www.sinovac.com. A webcast replay can be accessed on the corporate website beginning April 18, 2013, and the replay will remain available for 30 days.
Statement Regarding Unaudited Financial Information
The unaudited financial information set forth above is subject to adjustments that may be identified when audit work is performed on the Company's year-end financial statements, which could result in significant differences from this unaudited financial information. The Company expects to file final audited results with the SEC shortly.
About Sinovac
Sinovac Biotech Ltd. is a China-based biopharmaceutical company that focuses on the research, development, manufacturing and commercialization of vaccines that protect against human infectious diseases including hepatitis A and B, seasonal influenza, H5N1 pandemic influenza (avian flu), H1N1 influenza (swine flu) and mumps, as well as animal rabies vaccine for canines. The Company recently concluded the phase III clinical trial for enterovirus 71 (against hand, foot and mouth disease). In 2009, Sinovac was the first company worldwide to receive approval for its H1N1 influenza vaccine, Panflu.1, and has manufactured it for the Chinese Central Government, pursuant to the government-stockpiling program. The Company is also the only supplier of the H5N1 pandemic influenza vaccine to the government-stockpiling program. Sinovac is developing a number of new pipeline vaccines including vaccines for pneumococcal polysaccharides, pneumococcal conjugate, varicella and rubella. Sinovac sells its vaccines mainly in China and exports selected vaccines to Mongolia, Nepal, and the Philippines. Sinovac was also granted a license to commercialize seasonal flu vaccine in Mexico.
Safe Harbor Statement
This announcement contains forward-looking statements. These statements are made under the "safe harbor" provisions of the U.S. Private Securities Litigation Reform Act of 1995. These forward-looking statements can be identified by words or phrases such as "will," "expects," "anticipates," "future," "intends," "plans," "believes," "estimates" and similar statements. Among other things, the business outlook and quotations from management in this press release contain forward-looking statements. Statements that are not historical facts, including statements about Sinovac's beliefs and expectations, are forward-looking statements. Forward-looking statements involve inherent risks and uncertainties. A number of important factors could cause actual results to differ materially from those contained in any forward-looking statement. Sinovac does not undertake any obligation to update any forward-looking statement, except as required under applicable law.
Helen Yang
Sinovac Biotech Ltd.
Tel: +86-10-8279-9871
Fax: +86-10-6296-6910
Email: ir@sinovac.com
Investors:
Stephanie Carrington
The Ruth Group
Tel: +1-646-536-7017
Email: scarrington@theruthgroup.com
Media:
Aaron Estrada
The Ruth Group
Tel: +1-646-536-7028
Email: vaguiar@theruthgroup.com
SINOVAC BIOTECH LTD. | ||||||||
Incorporated in Antigua and Barbuda | ||||||||
Consolidated Statements of Income (Loss) and Comprehensive Income (Loss) | ||||||||
Years ended December 31, 2012 and 2011 | ||||||||
(Unaudited) | Three months ended | Twelve months ended | ||||||
(Expressed in U.S. Dollars) | 31-Dec | 31-Dec | ||||||
2012 | 2011 | 2012 | 2011 | |||||
Sales | $ | 18,951,501 | $ | 21,143,404 | $ | 48,576,700 | $ | 56,841,892 |
Cost of sales-(exclusive of depreciation of land | 8,698,009 | 8,031,758 | 19,099,927 | 21,127,410 | ||||
Gross profit | 10,253,492 | 13,111,646 | 29,476,773 | 35,714,482 | ||||
Selling, general and administrative expenses | 12,819,508 | 5,909,584 | 31,685,185 | 22,372,095 | ||||
Provision for (recovery of) doubtful accounts | -971,287 | -1,661,581 | -874,220 | -166,865 | ||||
Research and development expenses - net of $Nil (2011-$470,827) in government research grants for three months and $125,222 (2010-$686,258) for twelve months. | 1,251,065 | 2,261,688 | 17,043,565 | 9,006,550 | ||||
Depreciation of property, plant and equipment and amortization of licenses and permits | 539,672 | 365,391 | 1,594,976 | 1,436,944 | ||||
Loss of disposal and impairment of property, plant and equipment | 2,190,504 | 259,464 | 2,190,504 | 454,973 | ||||
Government grant recognised as income | 181,486 | -556,169 | -372,853 | -763,677 | ||||
Total operating expenses | 16,010,948 | - | 6,578,377 | 51,267,157 | - | 32,340,020 | ||
Operating income (loss) | -5,757,456 | - | 6,533,269 | -21,790,384 | - | 3,374,462 | ||
Interest and financing expenses -net of $485,317 (2010-$nil) in government grants for three months and $595,883 (2010-$147,520) for twelve months. | -630,824 | 61,756 | -774,376 | -384,560 | ||||
Interest income | 449,745 | 555,375 | 2,010,784 | 1,397,141 | ||||
Other income (expenses) | -162,627 | 122,452 | -77,197 | 279,866 | ||||
Loss on disposal and write down of equipment | ||||||||
Income (loss) before income taxes and non-controlling interests | -6,101,162 | - | 7,272,852 | -20,631,173 | - | 4,666,909 | ||
Income tax recovery (expenses) | 89,491 | -3,009,880 | 883,897 | -5,066,603 | ||||
Consolidated net income (loss) | -6,011,671 | - | 4,262,972 | -19,747,276 | - | -399,694 | ||
Less: income (loss) attributable to non-controlling interests | -577,578 | 1,494,118 | -4,068,156 | 445,002 | ||||
Net income (loss) attributable to stockholders | $ | -5,434,093 | $ | 2,768,854 | $ | -15,679,120 | $ | -844,696 |
Net income (loss) | $ | -6,011,671 | $ | 4,262,972 | $ | -19,747,276 | $ | -399,694 |
Other comprehensive income | ||||||||
Foreign currency translation adjustment | 960,352 | 789,653 | 2,015,584 | 3,639,992 | ||||
Total comprehensive income (loss) | -5,051,319 | 5,052,625 | -17,731,692 | 3,240,298 | ||||
Less: comprehensive income (loss) attributable to non-controlling interests | -488,125 | 1,595,969 | -3,839,268 | 973,562 | ||||
Comprehensive income (loss) attributable to stockholders | $ | -4,563,194 | $ | 3,456,656 | $ | -13,892,424 | $ | 2,266,736 |
Earnings (loss) per share - basic | $ | -0.10 | $ | 0.05 | $ | -0.29 | $ | -0.02 |
- diluted | $ | -0.10 | $ | 0.05 | $ | -0.29 | $ | -0.02 |
Weighted average number of shares of common stock outstanding | ||||||||
- Basic | 55,037,264 | 54,766,428 | 54,926,440 | 54,608,919 | ||||
- Diluted | 55,037,264 | 54,946,194 | 54,926,440 | 54,608,919 | ||||
SINOVAC BIOTECH LTD. | |||||||
Incorporated in Antigua and Barbuda | |||||||
Consolidated Balance Sheets | |||||||
December 31, 2012 and 2011 | |||||||
(Unaudited) | |||||||
(Expressed in U.S. Dollars) | |||||||
December 31, | December 31, | ||||||
2012 | 2011 | ||||||
ASSETS | |||||||
Current assets | |||||||
Cash and cash equivalents | $ | 90,881,970 | $ | 104,286,695 | |||
Accounts receivable - net | 23,440,135 | 17,834,407 | |||||
Inventories | 10,529,476 | 8,113,428 | |||||
Prepaid expenses and deposits | 1,072,076 | 1,804,555 | |||||
Total current assets | 125,923,657 | 132,039,085 | |||||
Property, plant and equipment | 80,083,383 | 75,627,881 | |||||
Long-term inventories | 28,692 | 5,248,237 | |||||
Long-term prepaid expenses | 289,766 | 408,656 | |||||
Prepayments for acquisition of equipment | 483,278 | 828,902 | |||||
Deferred tax assets | 445,589 | 419,114 | |||||
Licenses and permits | 1,149,914 | 1,336,254 | |||||
Total assets | $ | 208,404,279 | $ | 215,908,129 | |||
LIABILITIES AND EQUITY | |||||||
Current liabilities | |||||||
Loans payable | $ | 3,328,590 | $ | 4,713,498 | |||
Accounts payable and accrued liabilities | 25,425,498 | 29,522,495 | |||||
Income tax payable | 238,775 | 3,351,127 | |||||
Deferred revenue | 11,972,155 | 429,416 | |||||
Dividends payable | - | 795,106 | |||||
Deferred government grants | 431,097 | 719,081 | |||||
Total current liabilities | 41,396,115 | 39,530,723 | |||||
Deferred government grants | 4,068,602 | 3,388,913 | |||||
Loans payable | 31,181,235 | 17,321,327 | |||||
Due to related party | 3,230,125 | - | |||||
Deferred revenue | 99,517 | 10,369,695 | |||||
Total long term liabilities | 38,579,479 | 31,079,935 | |||||
Total liabilities | 79,975,594 | 70,610,658 | |||||
Commitments and contingencies | |||||||
EQUITY | |||||||
Preferred stock | - | - | |||||
Authorized 50,000,000 shares at par value of $0.001 each | |||||||
Issued and outstanding: nil | |||||||
Common stock | 55,092 | 54,774 | |||||
Authorized: 100,000,000 shares at par value of $0.001 each | |||||||
Issued and outstanding: 55,091,561 (2011 - 54,773,961) | |||||||
Additional paid-in capital | 106,245,934 | 105,383,346 | |||||
Accumulated other comprehensive income | 11,765,021 | 9,978,325 | |||||
Statutory surplus reserves | 11,808,271 | 11,808,271 | |||||
Retained earnings (accumulated deficit) | -12,982,893 | 2,696,227 | |||||
Total stockholders' equity | 116,891,425 | 129,920,943 | |||||
Non-controlling interests | 11,537,260 | 15,376,528 | |||||
Total equity | 128,428,685 | 145,297,471 | |||||
Total liabilities and equity | $ | 208,404,279 | $ | 215,908,129 | |||
SINOVAC BIOTECH LTD. | |||||||||
Incorporated in Antigua and Barbuda | |||||||||
Consolidated Statements of Cash Flows | |||||||||
Years ended December 31, 2012 and 2011 | |||||||||
(Unaudited) | |||||||||
(Expressed in U.S. Dollars) | |||||||||
Three months ended | Twelve months ended | ||||||||
31-Dec | 31-Dec | ||||||||
2012 | 2011 | 2012 | 2011 | ||||||
Cash flows from (used in) | |||||||||
Net income (loss) | $ | -6,011,671 | 4,262,972 | $ | -19,747,276 | $ | -399,694 | ||
Adjustments to reconcile net income to net cash | |||||||||
provided by operating activities: | |||||||||
- deferred income taxes | -89,491 | 788,472 | -17,204 | 2,845,195 | |||||
- stock-based compensation | -40,878 | 41,909 | 347,226 | 206,301 | |||||
- inventory provision | 2,113,825 | 2,735,822 | 3,479,453 | 4,034,169 | |||||
- Provision for (recovery of) doubtful accounts | -971,287 | -1,661,581 | -874,220 | -166,865 | |||||
Loss of disposal and impairment of property, plant and equipment | 2,184,576 | 259,464 | 2,190,504 | 454,973 | |||||
- research and development expenditures qualified for government grant | -46,242 | -470,827 | -125,222 | -686,258 | |||||
- depreciation of property, plant and equipment | |||||||||
and amortization of licenses and permits | 814,252 | 1,213,428 | 4,487,411 | 4,825,613 | |||||
- deferred government grant recognized in income | 109,340 | -225,035 | -358,230 | -432,543 | |||||
accretion expenses | 49,608 | 86,780 | 234,957 | 377,410 | |||||
Changes in: | |||||||||
- accounts receivable | 3,016,814 | 6,014,109 | -4,285,669 | 5,474,602 | |||||
- inventories | 3,715,070 | -108,988 | -425,853 | -1,915,078 | |||||
- income tax payable | -4,841 | 1,863,729 | -3,129,693 | 1,339,812 | |||||
- prepaid expenses and deposits | -135,558 | -107,276 | 913,084 | -530,715 | |||||
- deferred revenue | -330,322.00 | -1,190,534 | 1,026,283 | -2,695,943 | |||||
- accounts payable and accrued liabilities | 3,451,254 | 3,075,574 | -328,062 | 1,204,647 | |||||
Net cash (used in) | 7,824,449 | 16,578,018 | -16,612,511 | 13,935,626 | |||||
Cash flows from financing activities | |||||||||
- Loan proceeds | 9,489,001 | 7,399,314 | 16,787,057 | 11,391,836 | |||||
- Loan repayment | -4,755,262 | -9,275,502 | -4,755,262 | -10,658,840 | |||||
net of share issuance costs | 108,960 | 6,400 | 508,160 | 748,800 | |||||
- Proceeds from shares subscribed | -26,880.00 | - | 7,520 | 3,360 | |||||
- Dividends paid to non-controlling shareholder | |||||||||
of Sinovac Beijing | -2775 | - | -802,151 | -5,862,676 | |||||
- Government grants received | 2,154,186.00 | 1,585,289 | 2,394,766 | 1,592,925 | |||||
- Repayment from (loan to) non-controlling shareholder of Sinovac Beijing | 11666 | - | 3,397,522 | ||||||
Repayment from (loan to) non-controlling shareholder of Sinovac Dalian | - | - | 3,189,830 | ||||||
Net cash provided by | 6,978,896 | -284,499 | 17,329,920 | 612,927 | |||||
Cash flows used in | |||||||||
- Restricted cash | - | - | - | - | |||||
- Proceeds from disposal of equipment | 5,375 | 4,797 | 5,375 | 122,089 | |||||
- Proceeds from redemption of short-term investments | - | - | 0 | 1,544,759 | |||||
- Purchase of short-term investments | - | - | - | - | |||||
- Prepayments for acquisition of equipment | 254,966 | -467,183 | 254,966 | -467,183 | |||||
- Acquisition of property, plant and equipment | -5,469,802 | -6,346,012 | -16,411,576 | -14,989,876 | |||||
Net cash provided | -5,209,461 | -6,808,398 | -16,151,235 | -13,790,211 | |||||
Exchange gain on cash | 674,334 | 602,319 | 2,029,101 | 1,942,863 | |||||
Increase in cash and | 8,919,550 | 10,087,440 | -13,404,725 | 2,701,205 | |||||
Cash and cash | 81,962,420 | 94,199,255 | 104,286,695 | 101,585,490 | |||||
Cash and cash equivalents, end of | $ | 90,881,970 | $ | 104,286,695 | $ | 90,881,970 | $ | 104,286,695 | |
Supplemental | |||||||||
Cash paid for interest,net of amounts capitalized | $ | 256,256 | $ | 242,504 | $ | 749,500 | $ | 455,851 | |
Cash paid for income taxes | $ | 0 | $ | 167,883 | $ | 2,264,593 | $ | 881,596 | |
Supplemental schedule of non-cash activities: | |||||||||
Acquisition of property, | $ | 3,788,804 | $ | 9,124,751 | $ | 3,788,004 | $ | 9,124,751 | |
