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Yew Bio-Pharm Group Reports 2016 First Quarter Financial Results

Yew Bio-Pharm Group Reports 2016 First Quarter Financial Results

PR Newswire

HARBIN, China, May 16, 2016 /PRNewswire/ — Yew Bio-Pharm Group, Inc. (“Yew Bio” or the “Company”) (OTCQB: YEWB), a major grower and seller of yew trees, yew raw materials used in the manufacture of traditional Chinese medicine, handicraft products made from yew timber and yew candle made with yew essence oil in China, today reported financial results for the three months ended March 31, 2016.

2016 First Quarter Results

Three Months Ended March 31,

Percentage

2016

2015

Change

Revenues:

TCM Raw Materials

$8,043,465

$957,006

740%

Yew Trees

1,505

698,752

(100)%

Wood ear mushroom

899,189

(100)%

Handicrafts

17,250

87,508

(80)%

Others

558,149

100%

Total Revenues

$8,620,369

$2,642,455

226%

Total revenues for the first quarter of 2016 increased 226% to $8.6 million from $2.6 million a year ago. Sales of TCM raw materials amounted to 93.3% of total revenues; sales of yew trees amounted to 0% of total revenues; sales of handicrafts amounted to 0.2% of total revenues and sales of “Others” segment consisting with the yew candle and dietary supplement amounted to 6.5% of total revenues. We did not make sales of wood ear mushroom in the first quarter of 2016, as this is still a newly introduced product category for the Company, we are still seeking for various customer resources for this segment.

For the 2016 first quarter, gross profit was $1.4 million, or 16.2% of total revenues, compared with $1.5 million, or 55.7% of total revenues for the comparable 2015 quarter. The decrease in the gross profit margin were primarily attributable to the lower gross margin yields of TCM raw materials and “Others” segments.

Operating expenses decreased 33% to $315,900 for the quarter ended March 31, 2016, from $472,066 in the year-ago quarter. The decreasing was primarily attributable to the decreases in compensation and related benefits.

Net income for the three months ended March 31, 2016 increased 9.6% to $1.1 million from $958,390 in the same quarter last year due to the decreases of operating expenses. Earnings per diluted share for the three months ended March 31, 2016 was $0.02, in line with the same period last year.

“Revenue for the first quarter increased 226% compared to last year due to the increase in revenues from TCM raw materials and the “Others” segment which includes the sales of yew candles and dietary supplement with the brand name of “Auri Essence”, and therefore offset the decrease in sales of yew tree, handicraft and wood ear mushroom,” said Mr. Zhiguo Wang, Chairman and Chief Executive Officer of Yew Bio-Pharm Group. “We are pleased with the performance from our traditional business segment of TCM raw material sales which was mainly due to the increase in demand from our related party, Yew Pharmaceutical. They use their own technology advantages to develop new products processed from yew raw materials that lead to the demand increasing of our TCM raw materials.”

“We are also excited about the sales of our newly added dietary supplement product, Auri Essence, which was made from the essence of wood ear mushroom. We launched the product in December, 2015 for the U.S. market, and we already made sales in the first quarter of 2016. Auri Essence is currently listed in several E-Commerce websites which will benefit the product to attract more attentions from customers and improve the terminal sales. We will continue to enrich our product mix and develop more value-added products for the Company. It is also the Company’s long-term strategy to continue to grow through product diversification in the healthcare and dietary supplement industries.”

ABOUT YEW BIO-PHARM GROUP, INC

Yew Bio-Pharm Group, Inc., through its operating entity, Harbin Yew Science and Technology Development Co., Ltd. (HDS), is a major grower and seller of yew trees, yew raw materials used in the manufacture of traditional Chinese medicine (TCM) and products made from yew timber in China. Raw material from the species of yew tree that the Company grows contains taxol, and TCM containing yew raw materials has been approved as a traditional Chinese medicine in China for secondary treatment of certain cancers. The Company uses a patented, accelerated growth technology to speed the growth and maturity and commercialization of yew trees and believes that it is one of the few companies possessing a permit to sell them. Yew Bio-Pharm also recently established a division to focus on organic foods and dietary supplements with the aim of developing new business opportunities in related industries. To learn more, please visitwww.yewbiopharm.com

SAFE HARBOR

This press release forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, as amended, or the Exchange Act. These forward-looking statements involve a number of risks and uncertainties that could cause actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by these forward-looking statements. A number of factors could cause actual results to differ materially from those contained in any forward-looking statement, including but not limited to the following: our ability to collect from our largest customers; our dependence on a small number of customers for raw materials, including a related party; our ability to continue to purchase raw materials at relatively stable prices; our dependence on a small number of customers for our yew trees for reforestation; our ability to market successfully raw materials used in the manufacture of traditional Chinese medicines; and our ability to receive continued preferential tax treatment for the sale of yew trees and potted yew trees. From time to time, these risks, uncertainties and other factors are discussed in the Company’s filings with the U.S. Securities and Exchange Commission, including its most recent annual report on Form 10-K. Yew Bio does not undertake any obligation to update any forward-looking statements as a result of new information, future events or otherwise, except as required under applicable law.

 

Company Contacts:

Henry Pang

Yew Bio-Pharm Group, Inc.

Tel: (626) 401-9588

hpang@yewbiopharm.com

Investor Relations Contacts:

Cami Xue

Chineseinvestors.com, Inc.

Tel: (800) 958-8561

Cami@chinesefn.com

 

(financial tables follow)

 

 

YEW BIO-PHARM GROUP, INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

March 31,
2016

December 31,
2015

(Unaudited)

ASSETS

CURRENT ASSETS:

    Cash

$

236,377

$

681,608

    Restricted cash

305,526

303,511

    Accounts receivable

1,883,627

3,857,968

    Accounts receivable – related party

9,898,335

6,489,495

    Inventories

9,743,447

4,665,549

    Prepaid expenses – related party

411,111

106,370

    Prepaid expenses and other assets

864,319

64,174

    VAT recoverables

801,394

699,258

        Total Current Assets

24,144,136

16,867,933

LONG-TERM ASSETS:

    Long-term inventories, net

11,514,017

12,334,261

    Property and equipment, net

680,607

702,764

    Land use rights and yew forest assets, net

8,931,709

13,906,379

        Total Long-term Assets

21,126,333

26,943,404

        Total Assets

$

45,270,469

$

43,811,337

LIABILITIES AND SHAREHOLDERS’ EQUITY

CURRENT LIABILITIES:

    Accounts payable

$

66,536

$

11,345

    Accounts payable – related party

45,379

41,319

    Accrued expenses and other payables

108,840

124,686

    Notes payable

611,052

607,022

    Taxes payable

20,327

14,261

    Due to related parties

738,132

761,236

    Short-term borrowings

3,101,785

3,081,332

        Total Current Liabilities

4,692,051

4,641,201

        Total Liabilities

4,692,051

4,641,201

SHAREHOLDERS’ EQUITY:

Common Stock ($0.001 par value; 140,000,000 shares authorized; 51,875,000 shares
issued and outstanding at March 31, 2016 and December 31, 2015, respectively)

51,875

51,875

    Additional paid-in capital

9,705,156

9,622,558

    Retained earnings

25,992,432

25,067,733

    Statutory reserves

3,887,851

3,762,288

    Accumulated other comprehensive income – foreign currency translation adjustment

941,104

665,682

        Total Shareholders’ Equity

40,578,418

39,170,136

        Total Liabilities and Shareholders’ Equity

$

45,270,469

$

43,811,337

 

 

YEW BIO-PHARM GROUP, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME

(UNAUDITED)

For the Three Months
Ended March 31,

2016

2015

REVENUES:

    Revenues

$

576,904

$

1,534,654

    Revenues – related party

8,043,465

1,107,801

        Total Revenues

8,620,369

2,642,455

COST OF REVENUES:

    Cost of revenues

627,983

374,045

    Cost of revenues – related party

6,598,904

796,924

        Total Cost of Revenues

7,226,887

1,170,969

GROSS PROFIT

1,393,482

1,471,486

OPERATING EXPENSES:

     Selling

3,252

4,688

     General and administrative

312,648

467,378

        Total Operating Expenses

315,900

472,066

INCOME FROM OPERATIONS

1,077,582

999,420

OTHER INCOME (EXPENSES):

     Interest income (expense)

(27,320)

125

     Other expense

(16)

        Total Other Income (Expenses)

(27,320)

109

INCOME BEFORE PROVISION FOR INCOME TAXES

1,050,262

999,529

PROVISION FOR INCOME TAXES

(41,139)

NET INCOME

$

1,050,262

$

958,390

COMPREHENSIVE INCOME:

      NET INCOME

$

1,050,262

$

958,390

      OTHER COMPREHENSIVE INCOME:

           Unrealized foreign currency translation adjustment

275,422

257,853

      COMPREHENSIVE INCOME

$

1,325,684

$

1,216,243

NET INCOME PER COMMON SHARE:

       Basic

$

0.02

$

0.02

       Diluted

$

0.02

$

0.02

WEIGHTED AVERAGE COMMON SHARES OUTSTANDING:

       Basic

51,875,000

52,125,000

       Diluted

51,875,000

58,225,591

 

 

YEW BIO-PHARM GROUP, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

(UNAUDITED)

For the Three Months
Ended March 31,

2016

2015

CASH FLOWS FROM OPERATING ACTIVITIES:

Net income

$

1,050,262

$

958,390

Adjustments to reconcile net income to net cash used in operating activities:

Depreciation

30,504

37,984

Amortization of land use rights and yew forest assets

4,996,027

381,558

Stock-based compensation

82,598

294,239

Issuance of common stock for professional service

8,383

Changes in operating assets and liabilities:

Accounts receivable

1,980,590

(1,080,615)

Accounts receivable – related party

(3,313,946)

(867,776)

Prepaid expenses and other current assets

(788,609)

(22,281)

Prepaid expenses – related party

(299,778)

5,804

Inventories

(4,091,713)

(1,372,913)

VAT recoverables

(96,129)

Accounts payable

46,080

1,214,805

Accrued expenses and other payables

(16,440)

49,426

Due to related parties

81

Taxes payable

5,927

37,016

NET CASH USED IN OPERATING ACTIVITIES

(414,546)

(355,980)

CASH FLOWS FROM INVESTING ACTIVITIES:

Purchase of property and equipment

(4,261)

(4,617)

NET CASH USED IN INVESTING ACTIVITIES

(4,261)

(4,617)

CASH FLOWS FROM FINANCING ACTIVITIES:

Repayments to related parties

(35,000)

Proceeds from related parties

10,222

1,834

NET CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES

(24,778)

1,834

EFFECT OF EXCHANGE RATE ON CASH AND CASH EQUIVALENTS

(1,646)

525

NET DECREASE IN CASH AND CASH EQUIVALENTS

(445,231)

(358,238)

CASH AND CASH EQUIVALENTS – Beginning of period

681,608

487,940

CASH AND CASH EQUIVALENTS – End of period

$

236,377

$

129,702

SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:

Cash paid for:

Interest

$

26,884

$

Income taxes

$

$

 

 

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SOURCE Yew Bio-Pharm Group, Inc.

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