August 13, 2015 /PRNewswire/ -- Sinovac Biotech Ltd. (NASDAQ: SVA), a leading provider of biopharmaceutical products in China, announced today its unaudited second quarter and half year financial results for the period ended June 30, 2015.
Second Quarter 2015 Financial Highlights
(compared to the second quarter of 2014)
Mr. Weidong Yin, Chairman, President and CEO of Sinovac, commented, "I am very pleased to announce our strong sales and profitability during the second quarter. We continue to execute our strategy to drive sales while maintaining tight control over our operating costs. Although the general market environment remains the same as prior quarters, our sales results in the second quarter exemplify our team's ability to adjust to challenging market dynamics."
Mr. Yin continued, "Additionally, we continue to move forward in the approval process for our EV71 vaccine candidate. During July and August, CFDA inspectors have been conducting the site and GMP inspections of our manufacturing facility. The site inspection was completed last week and will be followed by sample testing. Our projected timing for EV71 commercialization remains unchanged. "
Business Update
EV71 vaccine. The China Food and Drug Administration (CFDA) has completed a site inspection and GMP inspection of the Company's EV71 vaccine manufacturing facility, which will be followed by sample testing. Once the results of the inspection are available and the sample vaccine has passed the required testing, the CFDA will conduct a comprehensive review of the vaccine. Upon approval, the CFDA will then issue the new drug certificate, and production and GMP licenses. The Company expects to be able to bring its first commercial batch of the EV71 vaccine to market approximately four months after beginning commercial production. The Company received its site inspection notification in May of 2015.
Unaudited Financial Results for Second Quarter 2015
2015 Q2 |
% of Sales |
2014 Q2 |
% of Sales |
||
(In USD'000 except percentage data) |
|||||
Hepatitis A vaccine- Healive |
8,462 |
45.7% |
5,113 |
42.3% |
|
Hepatitis A&B vaccine - Bilive |
9,216 |
49.8% |
6,439 |
53.3% |
|
Hepatitis vaccines subtotal |
17,678 |
95.5% |
11,552 |
95.6% |
|
Influenza vaccine- Anflu |
526 |
2.8% |
- |
- |
|
Animal Rabies vaccine- Rabend |
18 |
0.1% |
18 |
0.1% |
|
Mumps vaccine |
287 |
1.6% |
520 |
4.3% |
|
Regular sales |
18,509 |
100.0% |
12,090 |
100.0% |
|
H5N1 |
- |
- |
- |
- |
|
Total sales |
18,509 |
100.0% |
12,090 |
100.0% |
|
Cost of goods sold |
3,407 |
18.4% |
3,025 |
25.0% |
|
Gross profit |
15,102 |
81.6% |
9,065 |
75.0% |
In the second quarter of 2015, total sales were $18.5 million, an increase of 53.1% from $12.1 million during the same period of 2014. The sales increase is mainly attributable to increased sales of Healive and Bilive into the private pay market, and supported by increased sales into the public market as well.
Gross profit was $15.1 million in the second quarter of 2015, compared to $9.1 million in the prior year period. Gross margin increased to 81.6% from 75.0% in the prior year period. The gross margin expansion was primarily due to higher average selling prices of the Company's hepatitis vaccines in the private pay market and a lower inventory provision compared to the comparative quarter.
Selling, general and administrative expenses in the second quarter of 2015 were $9.2 million, compared to $8.6 million in the same period of 2014. This increase was mainly due to increased G&A expenses associated with the trial production of the EV71 vaccine for the site inspection.
R&D expenses in the second quarter of 2015 were $2.2 million, compared to $3.3 million in the same period of 2014. This decrease is primarily attributable to an entrance fee incurred after the signing of the licensing agreement of sIPV production technology in the second quarter of 2014 and the purchase of the virus seeds for its sIPV candidate during the same period.
Net income attributable to common shareholders for the second quarter of 2015 was $2.3 million, or $ 0.04 per basic and diluted share, compared to a net loss attributable to common shareholders of $2.2 million, or $(0.04) per basic and diluted share, in the same period last year.
Unaudited Financial Results for First Half of 2015
- (In USD'000 except percentage data) |
2015 H1 |
% of Sales |
2014 H1 |
% of Sales |
|
Hepatitis A vaccine - Healive |
11,385 |
41.0% |
11,552 |
45.1% |
|
Hepatitis A&B vaccine - Bilive |
14,271 |
51.4% |
12,437 |
48.5% |
|
Hepatitis vaccines subtotal |
25,656 |
92.4% |
23,989 |
93.6% |
|
Influenza vaccine - Anflu |
1,112 |
4.0% |
61 |
0.2% |
|
Animal Rabies vaccine - Rabend |
80 |
0.3% |
44 |
0.2% |
|
Mumps vaccine |
930 |
3.3% |
1,440 |
5.6% |
|
Regular sales |
27,778 |
100.0% |
25,534 |
99.6% |
|
H5N1 |
- |
- |
102 |
0.4% |
|
Total sales |
27,778 |
100.0% |
25,636 |
100.0% |
|
Cost of goods sold |
5,841 |
21.0% |
6,303 |
24.6% |
|
Gross profit |
21,937 |
79.0% |
19,333 |
75.4% |
Total sales for the first half of 2015 were $27.8 million, an increase of 8.4% from $25.6 million in the same period of 2014. The increase is primarily due to increased sales of Bilive into the private pay market.
Gross profit in the first half of 2015 was $21.9 million, an increase of 13.5% from $19.3 million in the same period of 2014. Gross margin was 79.0% in the first half of 2015, compared to 75.4% in the same period of 2014.
Selling, general and administrative expenses in the first half of 2015 were $16.1 million, consistent with $16.4 million in the same period of 2014.
R&D expenses in the first half of 2015 were $4.4 million, compared to $5.0 million in the same period of 2014. In the first half of 2015, the R&D expenses incurred by the Company is mainly attributable to the phase III clinical trial on PPV. Instead, in the first half of 2014, a substantial portion of the Company's R&D expenses were related to its sIPV program as explained above.
Net income attributable to common shareholders in the first half of 2015 was $20,000, or $0.00 per basic and diluted share, compared to a net loss of $2.2 million, or $(0.04) per basic and diluted share, in the same period of 2014.
As of June 30, 2015, cash and cash equivalents totaled $64.8 million, compared to $91.5 million as of December 31, 2014. Net cash used in operating activities was $7.8 million in the first half of 2015. Net cash used in investing activities was $2.8 million, which was primarily used for the purchase of property, plant and equipment. Net cash used in financing activities was $16.1 million during the first half of 2015, representing loan proceeds of $12.0 million offset by loan repayments of $28.5 million. As of June 30, 2015, the Company had $32.6 million of bank loans due within one year. When appropriate, the Company will seek new commercial bank loans to finance the commercialization of pipeline products, as well as for other operational purposes.
Conference Call Details
Sinovac will host a conference call on Thursday, August 13, 2015 at 8:00 a.m. ET (August 13, 2015 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 1-877-407-9039 (USA) or 1-201-689-8470 (International). A replay of the call will be available from 11:00 a.m. ET on August 13, 2015 through August 27, 2015. To access the replay, please dial 1-877-870-5176 (USA) or 1-858-384-5517 (International) and reference the replay pin number 13616892.
A live audio webcast of the call will also be available on the Investor Relations section of the Company's website at www.sinovac.com. A webcast replay will be available on the Company's website for 30 days following the call.
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. Sinovac's product portfolio includes vaccines against hepatitis A and B, seasonal influenza, H5N1 pandemic influenza (avian flu), H1N1 influenza (swine flu), mumps and canine rabies. In 2009, Sinovac was the first company worldwide to receive approval for its H1N1 influenza vaccine, which it has supplied to the Chinese Government's vaccination campaign and stockpiling program. The Company is also the only supplier of the H5N1 pandemic influenza vaccine to the government stockpiling program. Sinovac has filed a new drug application with the China Food & Drug Administration for its proprietary enterovirus 71 vaccine, having been proven effective in preventing hand, foot and mouth disease in infants and children during its phase III clinical trial. The Company is currently developing a number of new products including a Sabin-strain inactivated polio vaccine, pneumococcal polysaccharides vaccine, pneumococcal conjugate vaccine and varicella vaccine. Sinovac primarily sells its vaccines in China, while also exploring growth opportunities in international markets. The Company has exported select vaccines to Mexico, Mongolia, Nepal, and the Philippines, and was recently granted a license to commercialize its hepatitis A vaccine in Chile. For more information, please visit the Company's website at www.Sinovac.com .
Contact
Sinovac Biotech Ltd.
Helen Yang
Tel: +86-10-8279-9871
Fax: +86-10-6296-6910
Email: ir@sinovac.com
ICR Inc.
Bill Zima
U.S: +1 (646) 308-1707
Email: william.zima@icrinc.com
Katherine Knight
Phone: +1 (646) 277-1276
Email: katherine.knight@icrinc.com
SINOVAC BIOTECH LTD. |
||
Consolidated Balance sheets |
||
As of June 30, 2015 and December 31, 2014 |
||
(Expressed in thousands of U.S. Dollars, except for numbers of shares and per share data) |
||
Current assets |
June 30, 2015 |
December 31,2014 |
Cash and cash equivalents |
64,756 |
91,518 |
Accounts receivable - net |
44,144 |
40,757 |
Inventories |
23,228 |
18,832 |
Prepaid expenses and deposits |
1,154 |
1,430 |
Deferred tax assets |
1,669 |
2,266 |
Total current assets |
134,951 |
154,803 |
Property, plant and equipment |
67,814 |
68,417 |
Prepaid land lease payments |
10,275 |
10,405 |
Long-term inventories |
2,650 |
2,648 |
Long-term prepaid expenses |
- |
3 |
Prepayments for acquisition of equipment |
1,398 |
1,387 |
Deferred tax assets |
445 |
515 |
Licenses |
176 |
352 |
Total assets |
217,709 |
238,530 |
Current liabilities |
||
Short-term bank loans and current portion of long-term debt |
32,640 |
47,375 |
Loan from a non-controlling shareholder |
2,595 |
2,595 |
Accounts payable and accrued liabilities |
19,565 |
23,237 |
Income tax payable |
750 |
1,101 |
Deferred revenue |
3,893 |
4,996 |
Deferred government grants |
904 |
530 |
Total current liabilities |
60,347 |
79,834 |
Deferred government grants |
6,463 |
7,494 |
Long-term debt |
- |
1,803 |
Deferred revenue |
7,197 |
7,191 |
Other non-current liabilities |
479 |
482 |
Total long term liabilities |
14,139 |
16,970 |
Total liabilities |
74,486 |
96,804 |
Commitments and contingencies |
||
Equity |
||
Preferred stock |
- |
- |
Common stock |
56 |
56 |
Additional paid-in capital |
109,073 |
108,243 |
Accumulated other comprehensive income |
12,065 |
12,022 |
Statutory surplus reserves |
12,627 |
12,627 |
Accumulated deficit |
(6,364) |
(6,384) |
Total shareholders' equity |
127,457 |
126,564 |
Non-controlling interests |
15,766 |
15,162 |
Total equity |
143,223 |
141,726 |
Total liabilities and equity |
217,709 |
238,530 |
SINOVAC BIOTECH LTD. |
||||||
Consolidated Statements of Comprehensive Income (loss) |
||||||
For the three and six months ended June 30, 2015 and 2014 |
||||||
(Unaudited) |
||||||
(Expressed in thousands of U.S. Dollars, except for numbers of shares and per share data) |
||||||
Three months ended June 30 |
Six months ended June 30 |
|||||
2015 |
2014 |
2015 |
2014 |
|||
Sales |
18,509 |
12,090 |
27,778 |
25,636 |
||
Cost of sales |
3,407 |
3,025 |
5,841 |
6,303 |
||
Gross profit |
15,102 |
9,065 |
21,937 |
19,333 |
||
Selling, general and administrative expenses |
9,172 |
8,589 |
16,093 |
16,381 |
||
Provision for doubtful accounts |
173 |
132 |
84 |
294 |
||
Research and development expenses |
2,221 |
3,265 |
4,433 |
4,967 |
||
Loss (gain) on disposal and impairment of property, plant and |
(24) |
29 |
(24) |
29 |
||
Government grants recognized in income |
(437) |
- |
(443) |
- |
||
Total operating expenses |
11,105 |
12,015 |
20,143 |
21,671 |
||
Operating income (loss) |
3,997 |
(2,950) |
1,794 |
(2,338) |
||
Interest and financing expenses |
(421) |
(832) |
(1,009) |
(1,582) |
||
Interest income |
288 |
765 |
715 |
1,545 |
||
Other income |
28 |
71 |
103 |
217 |
||
Income (loss) before income taxes and non-controlling |
3,892 |
(2,946) |
1,603 |
(2,158) |
||
Income tax expense |
(440) |
(76) |
(991) |
(423) |
||
Net Income (loss) |
3,452 |
(3,022) |
612 |
(2,581) |
||
Less: (Income) loss attributable to the non-controlling interests |
(1,181) |
774 |
(592) |
337 |
||
Net Income (loss) attributable to shareholders of |
2,271 |
(2,248) |
20 |
(2,244) |
||
Other comprehensive income (loss), net of tax of nil |
||||||
Foreign currency translation adjustments |
(11) |
(319) |
55 |
(2,403) |
||
Total comprehensive income (loss) |
3,441 |
(3,341) |
667 |
(4,984) |
||
Less: comprehensive (income) loss attributable to non-controlling |
(1,186) |
738 |
(604) |
638 |
||
Comprehensive income (loss) attributable to |
2,255 |
(2,603) |
63 |
(4,346) |
||
Weighted average number of shares of common stock |
||||||
Basic |
56,019,451 |
55,663,566 |
55,974,252 |
55,625,509 |
||
Diluted |
56,187,591 |
55,663,566 |
56,219,495 |
55,625,509 |
||
Earning (loss) per share |
||||||
Basic |
0.04 |
(0.04) |
0.00 |
(0.04) |
||
Diluted |
0.04 |
(0.04) |
0.00 |
(0.04) |
||
SINOVAC BIOTECH LTD. |
||||||||
Consolidated Statements of Cash Flows |
||||||||
For the three and six months ended June 30, 2015 and 2014 |
||||||||
(Unaudited) |
||||||||
(Expressed in thousands of U.S. Dollars) |
||||||||
Three months ended |
Six months ended |
|||||||
June 30 |
June 30 |
|||||||
2015 |
2014 |
2015 |
2014 |
|||||
Cash flows provided by (used in) operating activities |
||||||||
Net income (loss) |
$ |
3,452 |
$ |
(3,022) |
$ |
612 |
$ |
(2,581) |
Adjustments to reconcile net income (loss) to net cash |
||||||||
Used in operating activities: |
||||||||
- deferred income taxes |
165 |
58 |
699 |
369 |
||||
- stock-based compensation |
208 |
71 |
321 |
143 |
||||
- inventory provision |
521 |
321 |
566 |
542 |
||||
- provisionfor doubtful accounts |
173 |
132 |
84 |
294 |
||||
- loss (gain) on disposal and impairment of equipment |
(24) |
29 |
(24) |
29 |
||||
- government grants recognized in income |
(437) |
- |
(443) |
- |
||||
- depreciation of property, plant and equipment and amortization of license |
1,759 |
1,903 |
3,451 |
4,534 |
||||
- amortization of the prepaid land lease payments |
68 |
65 |
137 |
132 |
||||
- accretion expenses |
30 |
28 |
59 |
55 |
||||
Changes in: |
||||||||
- accounts receivable |
(1,770) |
1,327 |
(3,613) |
(3,654) |
||||
- inventories |
(3,544) |
(4,905) |
(5,086) |
(7,784) |
||||
- income tax payable |
(382) |
- |
(382) |
- |
||||
- prepaid expenses and deposits |
(143) |
234 |
521 |
(348) |
||||
- deferred revenue |
(1,104) |
33 |
(1,104) |
(685) |
||||
- accounts payable and accrued liabilities |
1,446 |
(1,889) |
(3,578) |
(2,459) |
||||
Net cash provided by (used in) operating activities |
418 |
(5,615) |
(7,780) |
(11,413) |
||||
Cash flows provided by (used in) financing activities |
||||||||
- Proceeds from bank loans |
11,154 |
3,182 |
11,956 |
8,917 |
||||
- Repayments of bank loans |
(9,138) |
(6,084) |
(28,541) |
(8,542) |
||||
- Proceeds from issuance of common stock, |
||||||||
net of share issuance costs |
237 |
147 |
500 |
252 |
||||
- Proceeds from shares subscribed |
9 |
31 |
9 |
80 |
||||
- Government grants received |
6 |
185 |
9 |
185 |
||||
Net cash provided by (used in) financing activities |
2,268 |
(2,539) |
(16,067) |
892 |
||||
Cash flows used in investing activities |
||||||||
- Acquisition of property, plant and equipment |
(1,064) |
(3,479) |
(2,845) |
(5,683) |
||||
Net cash used in investing activities |
(1,064) |
(3,479) |
(2,845) |
(5,683) |
||||
Exchange gain (loss) on cash and cash equivalents |
64 |
(385) |
(70) |
(1,404) |
||||
Increase (decrease) in cash and cash equivalents |
1,686 |
(12,018) |
(26,762) |
(17,608) |
||||
Cash and cash equivalents, beginning of period |
63,070 |
101,652 |
91,518 |
107,242 |
||||
Cash and cash equivalents, end of period |
$ |
64,756 |
$ |
89,634 |
$ |
64,756 |
$ |
89,634 |
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