The numbers on Q3 are here:
Jiangbo Pharmaceuticals Reports Results for Third Quarter of Fiscal Year 2010
LAIYANG, China, May 17 /PRNewswire-Asia-FirstCall/ -- Jiangbo Pharmaceuticals, Inc. (OTC Bulletin Board: JGBO) ("Jiangbo" or the "Company"), a pharmaceutical company with its principal operations in the People's Republic of China, today announced financial results for the third quarter fiscal year 2010 ended March 31, 2010.
Third Quarter Highlights
-- Revenue was $25.6 million, a slight decrease of 0.6% year-over-year
-- Gross profit was $18.6 million, as compared to $18.9 million, and gross
margin was 72.7%, as compared to 73.4% in the year ago quarter
-- Operating income rose 3.1% to $13.7 million
-- GAAP net income was $15.2 million, or $1.33 per basic share, compared
$8.9 million or $0.86 per basic share a year ago
-- Excluding loss from discontinued operation, non-cash gain or loss
related to the change in fair value of derivative liabilities,
unrealized gain or loss on trading securities, and amortization
expenses for debt discount and financing cost, non-GAAP adjusted net
income was $7.7 million, or $0.50 per diluted share, as compared to
non-GAAP adjusted net income of $10.1 million, or $0.68 per diluted
share.
"Our third quarter operating income returned to growth as a result of strengthened sales effort and improved operational efficiency stemming from our continued cost control efforts," said Jiangbo's Chairman and CEO, Mr. Wubo Cao. "Sales of several of our key products, including Clarithromycin sustained-release and Radix Isatidis, experienced strong year-over-year growth and reflected the recent reinforcement of our sales effort and distribution channels. We continue to evaluate strategic opportunities to cost-effectively market our key products to deliver organic revenue growth in future quarters."
Third Quarter Fiscal Year 2010 Results
Total revenue for the three months ended March 31, 2010 was $25.6 million, compared to $25.7 million for the three months ended March 31, 2009. Sales volume for Clarithromycin sustained-released tablets grew 23.0% year-over-year as a result of the Company's reinforced sales efforts and tighter management of its distribution channels. Similarly, sales volume for Radix Isatidis dispersible tablets rose 44.7% over the prior year quarter. Strong sales growth of these two products was offset by a decline in sales volume for Itopride Hydrochloride granules and Baobaole chewable tablets, which were down 10.8% and 35.9%, respectively. Itopride and Baobaole continued to experience competition from similar products, including some that are included in the National Basic Medical Insurance Catalog. As the sales growth of OTC drugs, such as Baobaole chewable tablets and Radix Isatidis dispersible tablets, require continued support through advertising and promotion, management is evaluating the appropriate investment in TV advertising to drive the sales.
Gross profit in the third quarter was $18.6 million, as compared to $18.6 million in the prior year period. Gross margin decreased to 72.7% from 73.4%, primarily due to changes in the sales of product mix.
Selling, general and administrative expenses were $3.8 million for the three months ended March 31, 2010, down 15.1% from $4.5 million in the prior year period and primarily reflected the Company's more effective cost control efforts. Year-over-year spending reduction stemmed primarily from lower advertising, marketing and promotion, as well as salaries, wages and related benefits.
Research and development expenses totaled $1.1 million, consistent with those in the prior year period. The Company is obligated to make monthly payment to the designated university/institute to support two cooperative research and development agreements which were signed in fiscal 2008.
Income from operations rose 3.1% to $13.7 million from $13.3 million, primarily reflecting lower year-over-year operating expenses.
Other income was $5.0 million, as compared to other expenses of $1.1 million for the three months ended March 31, 2009. The increase was mainly due to an $11.6 million non-cash gain related to the change in the fair value of derivative liabilities, partly offset by $6.6 million interest expenses and non-cash amortization expense related to debt discount and debt issuance costs related to the convertible debentures, as compared to $1.2 million in the third quarter of 2009.
GAAP net income for the three months ended March 31, 2010 was $15.2 million, as compared to $8.9 million in the year ago quarter. Basic earnings per share (EPS) were $1.33, compared with $0.86 a year ago. Diluted EPS assumes the conversion of the Company's convertible notes and is calculated by adding interest expenses to and deducting the unamortized loan issuance costs and debt discount from net income. As a result, the Company recorded earnings of $0.02 per diluted share, as compared to a loss of $1.49 per diluted share in the same quarter last year.
Excluding loss from discontinued operation, non-cash gain or loss related to the change in fair value of derivative liabilities, unrealized gain or loss on trading securities, and amortization expenses for debt discount and financing cost, non-GAAP adjusted net income was $7.7 million, or $0.50 per diluted share, as compared to non-GAAP adjusted net income of $10.0 million, or $0.68 per diluted share a year ago.
