China Pharma Holdings, Inc. Announces Record 2007 Year E...(e CMS which covers bothurban and rural p...)

Fiscal Year 2007 Financial Results

For the fiscal year 2007, revenues were $33.2 million, up 51.9% from $21.8 million for 2006. The growth was attributed to strong market demand for the Company's existing products, which was complemented by further expansion of the marketing and sales distribution network. During 2007, many of the Company's products achieved broader market and brand acceptance. In 2007, the Company's branded cold and flu medicine, PusenOK, contributed approximately 12.5% or $3 million to total revenues, an increase of 36.4% from 2006. During the same period, the sales of Neurotrophicpetide increased 84.0%, Andrographolide increased 59.8%, Hepatocyte increased 44.2% and Gastrodin increased 38.9%.

Gross profit for the fiscal year ended December 31, 2007 was $15.6 million, an increase of approximately 54.2% from $10.1 million in 2006. The gross margin was 46.9% in 2007 as compared to 46.2% in 2006, continuing the Company's consistent trend of improving gross margins.

Operating expenses totaled $3.3 million for the fiscal year 2007 compared to $1.5 million for 2006. The increase was primarily related to higher selling expenses related to the expansion of the Company's sales and distribution network to increase its market penetration. More specifically, salaries, commissions and other expenses were increased as the Company added 70 new sales representatives in 2007.

Operating income for the fiscal year 2007 totaled $12.3 million compared to $8.6 million for 2006, representing a 42.1% increase. Operating margins were 37% and 39.4% for 2007 and 2006, respectively.

Net income for the fiscal year 2007 improved 49.3% to $12.8 million, from $8.6 million for the fiscal year 2006. The increase in net income was due primarily to the overall growth in product revenues and the collection of previously recorded bad debts. Net profit margins were 38.6% and 39.3% for the fis
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