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Global Pharm Holdings Group, Inc. Announces Second Quarter 2011 Financial Results
Date:8/12/2011

$15.4 million, or approximately 63.3%, to $39.7 million for the three months ended June 30, 2011, as compared to $24.3 million for the same period in 2010. The increase was primarily due to a series of marketing activities to promote sales, a broader product portfolio and improved efficiency in fulfilling sales orders. Revenue from the Company's TCM processing and distribution segment increased to $5.6 million for second quarter of 2011, compared to $4.3 million for the comparable period in 2010. Revenue from the herbal cultivation and sales segment was nil for both the second quarter of 2011 and 2010, due to the sale of the Company's entire herbal inventory in the first quarter of 2011 and at the end of 2009, and the fact that all of our herbs were at the cultivation stage for the second quarter of 2011.  The Company has suspended its flower tea bags business segment on April 25, 2011, so revenue was nil for the second quarter of 2011 from this segment.

Gross profit and gross margin for the second quarter of 2011 - the Company's gross profit was $7.4 million, an increase of 33.2%, from $5.5 million in the same period in 2010. Gross margin decreased to 16.3% for the second quarter of 2011, from 18.1%, for the comparable period in 2010, primarily attributable to increased costs of TCM products and reduction of sales prices due to competition for the second quarter of 2011.

Operating expenses for the second quarter of 2011 were $0.9 million, increased by $0.7 million from same period in 2010, primarily due to increased advertising, freight and labor costs to support business growth and expansion.

Income from operation for the second quarter of 2011 increased 55.4% to $5.5 million, or 12.0%, of revenue, from $3.5 million, or 11.4%, of revenue for the second quarter of 2010.

Net income for the second quarter of 2011 increased to $3.9 million, or $0.15 per fully diluted share, compared to $2.3 million, or $0.1
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SOURCE Global Pharm Holdings Group, Inc.
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