Skystar Bio-Pharmaceutical Reports Second Quarter 2013 Results
Quarterly Revenue of $11.3 Million; Net Income of $3.7 Million; $0.49 Diluted EPS
(firmenpresse) - XI'AN, CHINA -- (Marketwired) -- 08/14/13 -- (NASDAQ: SKBI)a China-based manufacturer and distributor of veterinary medicines, vaccines, micro-organisms and feed additives, today reported unaudited second quarter fiscal year 2013 earnings, for the period ended June 30, 2013.
Revenue of $11.3 million, up 27.8% YoY
Micro-organism products totaled $4.0 million, up 0.7% YoY
Veterinary medicines totaled $6.3 million, up 155.9% YoY
Feed additives totaled $0.5 million, a decrease of 59.4% YoY
Veterinary vaccines totaled $0.5 million, a decrease of 56.5% YoY
Gross margin of 52.6% for the second quarter of fiscal 2013 as compared to 57.8% in the year ago period
Net income of $3.8 million or $0.49 per fully diluted share, compared with net income of $1.7 million or $0.23 per fully diluted share in the year ago period
First half fiscal 2013 revenue increases 0.4% YoY to $16.9 million
Gross margin of 50.7% for the first half of fiscal 2013 as compared to 56.0% in the year ago period
Net income of $4.5 million or $0.59 per fully diluted share, compared with net income of $3.6 million or $0.48 per fully diluted share in the year ago period
Mr. Weibing Lu, Skystar Bio-Pharmaceutical's Chairman and Chief Executive Officer, commented, "Skystar is pleased to report its strongest quarterly results in the last six reporting periods. The results for this quarter were driven by a combination of increased market demand and additional sales and marketing efforts. This allowed us to take advantage of the increased manufacturing capacity as a result of the Huxian and Jingzhou veterinary medication facilities resuming operations."
"Operationally, Skystar continues to receive more product manufacturing permits from the government which has allowed sales of veterinary medications in the current reporting period to grow 156% year over year. Further, we still have additional manufacturing capacity available at the Company's Huxian and Jingzhou veterinary medication facilities. Lastly, Skystar has applied for and is awaiting governmental approval of more product manufacturing permits and plans to utilize each permit as approval is received."
"Stage two of the Company's veterinary vaccine GMP certification is under way and currently on track as planned. Stage two GMP inspection is expected to be completed by the end of third quarter fiscal 2013 and limited production runs will commence shortly thereafter. The vaccine product line is expected to contribute roughly $3-$5 million to Skystar's top line next year. Sales of the Company's feed additives and pro-biotics line are also expected to increase as we move forward with the Company's high selling season. Additionally, Skystar's Kunshan facility is near completion and it is possible that small scale production will launch by the end of the fiscal year."
"Management is very excited to move into its strongest half of the fiscal year and to share its results with investors. Skystar continues to successfully implement its operational strategy, improve its financial performance and expand its footprint with profitability in mind. With 40% of Skystar's forecasted revenues earned in its first half, the Company believes that it is well positioned to make forecasted fiscal guidance for 2013, positioning itself for solid revenue growth and expansion in fiscal 2014," concluded Mr. Lu.
Skystar reported second quarter fiscal year 2013 revenues of $11.3 million as compared to revenues of $8.9 million for the comparable year ago period, an increase of $2.4 million or 27.8%. Overall sales volume increased as we begin to ramp up production and make use of the Company's facilities now that our facilities have resumed partial production.
Cost of revenue, which consists of raw materials, packing material, direct labor, and manufacturing overhead for our four product lines, was $5.4 million for the three months ended June 30, 2013, as compared to $3.7 million for the three months ended June 30, 2012, an increase of $1.6 million or 43.5%, as a result of increased veterinary medication sales.
Gross profit was $6.0 million for the three months ended June 30, 2013, a 16.3% year over year increase as compared to $5.1 million for the three months ended June 30, 2012. Gross margin for the period was 52.6%, compared to 57.8% a year ago due to the majority of revenue during the three months coming from less profitable veterinary medications as we resume the veterinary medication production at Skystar's Huxian facility.
Operating Expenses
Research and development costs totaled $93,000 for the three months ended June 30, 2013 as compared to $331,000 for the three months ended June 30, 2012, a decrease of $238,000 or 71.9%. The decrease was primarily due to newly launched R&D projects of $481,000 undertaken during the second quarter of 2013 to develop vaccine to prevent common fish skin disease which was offset against a government grant for the research.
Selling expenses totaled $629,000 for the three months ended June 30, 2013 as compared to $670,000 for the three months ended June 30, 2012, a decrease of $41,000 or 6.2%. This decrease is mainly due to the drop of sales commission costs as the result of the new commission structure to our sales personnel after the Huxian facility resumed operation.
General and administrative expenses totaled $689,000 for the three months ended June 30, 2013 as compared to $1.8 million for the three months ended June 30, 2012, a decrease of $1.1 million or 62.5%. The higher G&A expense in 2012 was mainly due to the stock based compensation expense of $1 million for the stock grants on May 4, 2012 to the Company's employees and members of the Board of Directors.
Income from operations increased 98.7% or $2.2 million to $4.5 million for second quarter fiscal 2013 as compared to $2.3 million in the comparable fiscal 2012 period.
Net income increased 120.8% year over year to $3.8 million or $0.49 per fully diluted share, as compared to $1.7 million or $0.23 per fully diluted share in the year ago period.
As of June 30, 2013, we had cash of $6.3 million. Our total current assets were $80 million and Skystar's total current liabilities were $21 million which resulted in a net working capital of $59 million.
We currently reiterate our fiscal 2013 guidance to be in the range of $40 million to $45 million for the full year.
The Company will host a conference call on Wednesday August 14, 2013 to discuss its financial results for the fiscal quarter ended June 30, 2013. Skystar's conference call will begin promptly at 6:00 p.m. ET to review fiscal second quarter 2013 financial and operational performance. Mr. Weibing Lu, Skystar's chairman and chief executive officer, will host the call, which will be webcast live.
The webcast will be made available at: .
Telephone access to the conference call will be available in North America by dialing +1 (877) 407-8031 or internationally by dialing +1 (201) 689-8031.
An audio replay of the conference call will be available approximately two hours following the conclusion of the call and for the following 30 day period. To access the replay in North America, dial +1 (877) 660-6853 or, when calling internationally, dial +1 (201) 612-7415, referencing conference ID # 419303. Alternatively you can listen to the replay online at .
To be added to the Company's email distribution for future news releases, please send your request to .
Skystar is a China-based developer and distributor of veterinary healthcare and medical care products. Skystar has four product lines (veterinary medicines, micro-organisms, vaccines and feed additives) and over 284 products. Skystar has formed strategic sales distribution networks covering 29 provinces throughout China. For additional information, please visit .
Certain of the statements made in the press release constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements can be identified by the use of forward-looking terminology such as "believe," "expect," "may," "will," "should," "project," "plan," "seek," "intend," or "anticipate" or the negative thereof or comparable terminology. Such statements typically involve risks and uncertainties, including, among others, the Company's ability to realize the expected sales, to add planned manufacturing capacities, to commercialize on the business and opportunities resulting from additional government permits, and may include financial projections or information regarding the progress of new product development. Actual results could differ materially from the expectations reflected in such forward-looking statements as a result of a variety of factors, including the risks associated with the Company's ability to receive timely certification and related government approvals, effect of changing economic conditions in The People's Republic of China, variations in cash flow, reliance on collaborative retail partners and on new product development, variations in new product development, risks associated with rapid technological change, and the potential of introduced or undetected flaws and defects in products, and other risk factors detailed in reports filed with the Securities and Exchange Commission from time to time.
Scott Cramer
Director - Corporate Development and U.S. Representative
(407) 645-4433
Christopher Chu
(646) 284-9426
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Datum: 14.08.2013 - 19:00 Uhr
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News-ID 287861
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