SHENYANG, China, May 13, 2012 /PRNewswire-Asia/ -- 3SBio Inc. (NASDAQ: SSRX) ("3SBio" or "the Company"), a leading China-based biotechnology company focused on researching, developing, manufacturing and marketing biopharmaceutical products, today announced its unaudited financial results for the first quarter ended March 31, 2012.
First Quarter 2012 Financial Highlights:
First Quarter 2012 Business Highlights Operations
Partnerships and Business Development
Dr. Jing Lou, chief executive officer of 3SBio, commented:
"We are on budget for the first quarter and reiterate our full year guidance of US$99-108 million. While we are concerned about government-mandated price cuts, we are confident that our economies of scale, recognized product quality and reputation for innovative research and development will enable us to continue to adapt to China's evolving health care reforms. We continue to focus on the implementation of the our business objectives for 2012, including continued focus on developing our pipeline products, new business initiatives in the dialysis service segment, seeking international partners to develop Uricase-PEG 20, and leveraging our world-class manufacturing capability to obtain approvals in countries where we can be among the first to introduce quality biosimilars at competitive prices."
Three Months Ended March 31, 2012 Unaudited Financial Results Net revenues. Net revenues increased by 24.5% to RMB147.2 million (US$23.4 million) for the first quarter of 2012 from RMB118.2 million (US$18.1 million) for the same period in 2011. This increase was largely due to continued strong sales of EPIAO and TPIAO which grew by 21.7% and 23.3%, respectively, over the same period in 2011. TPIAO remained 3SBio's second largest revenue contributor in the quarter, accounting for 31.6% of total net revenues. Export sales increased by 80.3% year-on-year to RMB7.6 million (US$1.2 million), and revenues from Iron Sucrose rose 40.6% year-on-year to RMB6.8 million (US$1.1 million).
Gross profit. As a result of continued sales growth from key products, gross profit for the first quarter of 2012 increased by 28.7% to RMB132.5 million (US$21.0 million) from RMB102.9 million (US$15.7 million) for the same period in 2011. Gross margins increased by 2.9% to 90.0% for the first quarter of 2012 from 87.1% for the same period in 2011 and 89.4% for the fourth quarter of 2011. The increase was partly due to improved manufacturing productivity of the new plant.
Operating expenses. Operating expenses were RMB97.0 million (US$15.4 million) for the first quarter of 2012, representing an increase of 25.0% from RMB77.6 million (US$11.9 million) for the same period in 2011.
Operating income. Operating income was RMB35.5 million (US$5.6 million) for the first quarter of 2012, a 40.2% increase from operating income of RMB25.3 million (US$3.9 million) for the same period in 2011. Operating margin for the first quarter of 2012 was 24.2%, a 2.8% increase from operating margin of 21.4% for the same period in 2011. The improved operating margin is primarily due to improved gross margins and stable administrative overheads.
Interest income. Net interest income was RMB5.4 million (US$0.9 million) for the first quarter of 2012, compared to RMB3.6 million (US$0.6 million) for the same period in 2011.
Net income. Net income was RMB32.6 million (US$5.2 million) for the first quarter of 2012, a 47.1% increase over net income of RMB22.2 million (US$3.4 million) for the same period in 2011. Net income per ADS on a fully-diluted basis for the first quarter of 2012 increased to RMB1.44 (US$0.23) compared to RMB0.99 (US$0.15) for the same period in 2011. Net margin for the first quarter of 2012 was 22.2%, a 3.5% increase over net margin of 18.7% for the same period in 2011.
Cash Balances. Cash, cash equivalents and time deposits were RMB790.8 million (US$125.6 million, including restricted cash of RMB0.7 million), compared to RMB711.4 million (US$108.6 million, including restricted cash of RMB0.7 million) at March 31, 2011.Conference Call 3SBio's senior management will host a conference call on Monday, May 14, 2012 8:00pm (China Standard Time), 8:00am (US Eastern) 5:00am (US Pacific) to discuss its unaudited first quarter 2012 results and recent business activity. The conference call may be accessed using the dial-in numbers below:
Conference ID: 73956752
China landline: 800-819-0121
China mobile: 400-620-8038
Hong Kong : 852-2475-0994
United States: 718-354-1231
International toll-free dial-in:
Hong Kong: 800930346
United States: 1-866-519-4004
United Kingdom: 080-8234-6646
International toll dial-in: 65 6723 9381
Replay- Conference ID: 73956752
A telephone replay will be available two hours after the call until May 22, 2012 at:
United States: 1-866-214-5335
A replay of the webcast will be available within one hour after the conclusion of the call.
Statement Regarding Unaudited Financial Information The unaudited financial information set forth above is preliminary and subject to adjustments and modifications. The audited financial statements and related notes are to be included in the Company's annual report on Form 20-F for the year ending December 31, 2011. Adjustments and modifications to the financial statements may be identified during the course of the audit work, which could result in significant differences from this preliminary unaudited financial information.
Currency Convenience TranslationFor the convenience of readers, certain RMB amounts have been translated into US dollars at the rate of RMB6.2975 to US$1.00, the noon buying rate for US dollars in effect on March 31, 2012 as set forth in the H.10 statistical release of the U.S. Federal Reserve Board. A rate of 6.5483 was used for comparative purposes as of March 31, 2011, which was the noon buying rate for US dollars on that date for cable transfers of RMB per US dollar as certified for customs purposes by the Federal Reserve Bank of New York.
About 3SBio Inc.3SBio is a leading, fully integrated, profitable biotechnology company focused on researching, developing, manufacturing and marketing biopharmaceutical products primarily in China. Its focus is on addressing large markets with significant unmet medical needs in nephrology, oncology, supportive cancer care, inflammation and infectious diseases. With headquarters and GMP-certified manufacturing facilities in Shenyang, PRC, 3SBio employs over 800 people. Shares trade in the form of American Depositary Shares (ADSs) on the NASDAQ stock market under the ticker symbol "SSRX". Please see www.3SBio.com for more information. Cautionary Statement concerning Forward Looking StatementsCertain statements in the disclosures of 3SBio, Inc. (the "Company" or "3SBio") for the first quarter of 2012 ("Disclosures") that are not purely historical in nature may constitute "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. The Disclosures include the press release, the conference call and any accompanying materials, and any other information issued, released or publicized by the Company with respect to the first quarter and the year of 2012.
These forward-looking statements address activities, events, conditions, or developments that we currently expect or anticipate to occur in the future, and may include, but may not be limited to, discussions and statements regarding: full year revenue target, business growth and prospects, product pricing trends, operation plans and objectives, market size or patient number or illness prevalence estimates, product development prospects, future pipeline progress, regulatory review, certification and approval prospects, impact of the government policies and regulations, partnerships or collaborations and the outcome thereof, capital expense estimate, future operations and strategies. Forward-looking statements can be identified by such terminology as "believe," "expect," "plans," "strategy," "potential", "prospects," "forecast," "estimate," "project," "anticipate," "aim," "will" or "would", "may" or "might", and words, phrases, expressions, and usages of similar meaning or substance or the negative thereof.
Forward-looking statements are based on management's current assumptions, beliefs, expectations, and projections, in light of the information currently available, and actual results, performances, or achievements could differ materially from those implied or expressed by the forward-looking statements. Among the factors that could cause actual results to differ from what the Company currently anticipates may include: regulatory actions such as adverse drug pricing adjustments, competition from other domestic and foreign pharmaceutical companies; risks and uncertainties related to cooperation, joint venture, and partnerships, including deal consummation risks; changes in China's healthcare insurance system; Chinese government policies and regulations; the segment market growth for our products; market acceptance of our products; hospital or patient demand for our products; progress of our clinical trials; receipt and timing of regulatory approvals for new products and indications; our ability to enhance production, sales and distribution network and other aspects of operation; our ability to effectively protect intellectual property; changes in the healthcare industry in China; and fluctuations in general economic and business conditions in China.
For additional information on factors identified above and other risk factors, uncertainties and assumptions, please refer to the Company's filings with the Securities and Exchange Commission at www.sec.gov, and, in particular, "Introduction – Cautionary Statement concerning Forward Looking Statements", Item 3.D "Risk Factors", Item 5. "Operating and Financial Review and Prospects", and other applicable discussions in 3SBio's annual report on Form 20-F for the year ended December 31, 2011.
All the statements in the Disclosures speak as of the date of the initial release, even if subsequently made available on the 3SBio website or otherwise. 3SBio undertakes no obligation to update or revise these forward-looking statements, whether as a result of new information, subsequent events or otherwise, after the date of this press release.Investor ContactsBo Tan
Tom FolinsbeeChief Financial Officer
Director of Investor Relations3SBio Inc.
3SBio Inc.Tel: + 86 24 2581-1820
Tel: + 852 8191-6991ir@3SBio.com
Unaudited quarterly consolidated balance sheets
(expressed in thousands)December 31,2011March 31,2012March 31,2012RMBRMBUS$Assets (unaudited)(unaudited)Current assetsCash and cash equivalents
665666106Time deposits with financial institutions
499,201481,56576,469Accounts receivable, less allowance for doubtful accounts:December 31, 2011 – RMB2,542; March 31, 2012 – RMB2,227 (US$354)
27,60429,7734,728Prepaid expenses and other receivables
22,83022,2813,538Prepaid to related parties
6,0004,500715Deferred tax assets
2,7502,190348Total current assets992,7271,007,129159,926Time deposits with financial institutions
10,84811,0581,756Investment in non-consolidated affiliates
2,2451,415225Property, plant and equipment, net
198,053204,95432,545Prepaid land use rights
17,44817,3102,749Prepayment and noncurrent deposits
16,80115,2432,420Intangible assets, net
49,61551,3168,149Long term receivables, less allowance for doubtful accounts:December 31, 2011 – RMB 818; March 31, 2012 – RMB818 (US$130)
3,1112,919464Deferred tax assets
26231350Total assets1,311,1101,341,657213,048Liabilities and shareholders' equityCurrent liabilitiesAccounts payable
6,2185,656898Deferred grant income
37437459Accrued expenses and other payables
48,38946,5517,393Income tax payable
8,8944,267678Total current liabilities63,87556,8489,028Deferred grant income
2,0291,935307Total liabilities65,90458,7839,335Shareholders' equityShare capital - ordinary shares US$0.0001 par value, 500,000,000 shares
authorized, 154,473,159 and 154,551,780 issued and outstanding as of
December 31, 2011 and March 31, 2012, respectively
12412420Additional paid-in capital
973,218978,444155,370Accumulated other comprehensive loss
Total shareholders' equity attributable to 3SBio Inc.1,234,3691,271,946201,978Non-controlling interest10,83710,9281,735Total shareholders' equity1,245,2061,282,874203,713Total liabilities and shareholders' equity1,311,1101,341,657213,048
Unaudited quarterly consolidated statements of income
(expressed in thousands, except per share, per ADS and other share and ADS data)
For the Three Months Ended
For the Three Months EndedMarch 31, 2011March 31, 2012RMBUS$RMBUS$(unaudited)(unaudited)(unaudited)(unaudited)Net Revenues:EPIAO
8071231,096174Total net revenues
118,23518,056147,15123,366Cost of revenues(15,300)(2,336)(14,658)(2,328)Gross profit102,93515,720132,49321,038Operating expensesResearch and development costs
( 7,750)(1,184)( 10,811)(1,717)Sales, marketing and distribution expenses
(55,360)(8,454)(69,667)(11,063)General and administrative expenses
1,09416729747Operating income 25,2953,86335,4705,631Interest income
3,6225535,384855Share of loss in non-consolidated affiliates
(506)(77)(830)(132)Other income, net
1061612320Total other income, net3,2224924,677743Income before income tax expense
28,5174,35540,1476,374Income tax expense
(6,355)(970)(7,463)(1,185)Net income22,1623,38532,6845,189Less: net income attributable to non-controlling interest--(91)(14)Net income attributable to 3SBio Inc.22,1623,38532,5935,175Net income attributable to 3SBio Inc. per share:Basic
0.140.020.210.03Basic weighted average number of shares outstanding
152,706,964152,706,964154,523,610154,523,610Diluted weighted average number of shares outstanding
156,974,480156,974,480158,119,322158,119,322Net income attributable to 3SBio Inc. per ADS:Basic
0.990.151.440.23Basic weighted average number of ADSs outstanding
21,815,28121,815,28122,074,80122,074,801Diluted weighted average number of ADSs outstanding
|SOURCE 3SBio Inc.|
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