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Tongli Pharmaceuticals, Inc.: Tongli Pharmaceuticals Announces Strong Revenue and Net Income Growth in Second Quarter of Fiscal

^{Published on 2008-11-19 10:35:09 - Market Wire}
 

NEW YORK, NY--(Marketwire - November 19, 2008) - Tongli Pharmaceuticals (OTCBB: [ TGLP ]), a pharmaceutical company specializing in development, manufacture, and commercialization of a wide range of prescription and over the counter ("OTC") pharmaceutical products, today announced financial results for the quarter ended September 30, 2008.

Financial Results

Revenue in the second quarter of fiscal year 2009 increased 298% year over year to $1,645,540 from $413,034, and revenues in the six months ended September 30, 2008 increased 328% year over year to $3,310,710 from $773,574, reflecting an increase in product demand attributable to increased brand recognition, effective pricing strategy and penetration into previously unaddressed markets.

Gross profit in the second quarter of fiscal year 2009 increased 306% to $718,721 from $177,144 in the same period of 2007. Gross margin was approximately 43.7%, compared to 42.9% in the same period of the prior year. Gross profit in the six months ended September 30, 2008 increased 329% to $1,413,751 from $328,850 in the same period of 2007. Gross margin was approximately 42.7%, compared to 42.5% in the same period of the prior year. These results reflect the stability of our Company's operations and continued focus on profit maximization.

For the second quarter of fiscal year 2009, operating expenses increased 96% to $238,146 from $121,335 in the comparable period of 2007. For the six months ended September 30, 2008, operating expenses increased 89% to $436,114 from $230,178 in the comparable period of 2007. The increase in operating expenses was primarily due to increased administrative costs attributable to expanding operations and costs associated with being a public reporting company. Operating income in the third quarter of 2008 increased 761% to $480,575 from $55,809 in the third quarter of 2007 and increased 890% to $977,637 in the six months ended September 30, 2008 as compared to $98,672 in the same period in 2007.

Net income for the second quarter of fiscal year 2009 increased 1,675% to $487,036, or $0.05 per diluted share, compared to $27,424 or $0.00 per diluted share, in the same period of the prior year. Net income for the six months ended September 30, 2008 increased 1,454% to $992,021, or $0.10 per diluted share, compared to $49,665 or $0.01 per diluted share, in the same period of the prior year.

Mr. Mingli Yao, founder and CEO of Tongli, commented: "This has been a very exciting six months for Tongli. We became a US publicly listed company during the quarter ended September 30, 2008. We are growing rapidly and expanding our product lines. During this period we have filled key management positions in our plant operations and recruited two highly experienced board members who will provide guidance and management oversight. We believe that we are well-positioned to take advantage of the growing demand in China for pharmaceutical products. Looking forward we aim to continue meaningful dialogue with the US financial community and to attract more investors to our Company. Towards that end, we presented at the Rodman and Renshaw Conference on November 12, 2008 and were pleased to meet with new investors interested in growth opportunities in the healthcare sector in China. We will continue to update our stockholders and the investment community about our progress and appreciate your support and interest in our Company."

About Tongli Pharmaceuticals

Tongli Pharmaceuticals (USA), Inc., through its subsidiary, Harbin Tianmu Pharmaceutical Co., Ltd., manufactures and markets pharmaceutical and healthcare products in the People's Republic of China. The company, formerly known as American Tony Pharmaceutical, Inc., is based in New York, New York.

Safe Harbor Statement

Statements made in this press release are forward looking and are made pursuant to the safe harbor provisions of the Securities Litigation Reform Act of 1995. Such statements involve risks and uncertainties that may cause actual results to differ materially from those set forth in these statements. The economic, competitive, governmental, technological and other factors identified in the Company's filings with the Securities and Exchange Commission, including the Form 10-Q for the quarter ended September 30, 2008, may cause actual results or events to differ materially from those described in the forward-looking statements in this press release. The Company undertakes no obligation to publicly update or revise any forward-looking statements, whether because of new information, future events, or otherwise.

 TONGLI PHARMACEUTICALS (USA), INC. CONSOLIDATED BALANCE SHEETS SEPTEMBER 30, MARCH 31, 2008 2008 ----------- ----------- (Unaudited) ASSETS CURRENT ASSETS: Cash $ 127,388 $ 130,630 Trade accounts receivable, net 12,775 2,470 Inventories 34,051 11,172 Prepaid expenses 22,023 - Refundable deposits 10,976 405,643 Advances to suppliers 900,226 678,654 ----------- ----------- TOTAL CURRENT ASSETS 1,107,439 1,228,569 PROPERTY AND EQUIPMENT, NET 7,228,756 7,813,779 CONTRACT DEPOSIT 1,025,514 - ----------- ----------- TOTAL ASSETS $ 9,361,709 $ 9,042,348 =========== =========== LIABILITIES AND SHAREHOLDERS' EQUITY CURRENT LIABILITIES: Note payable - bank $ 1,009,216 $ 995,168 Accounts payable 713,207 959,382 Due to related parties 544,356 819,620 Accrued expenses and other sundry current liabilities 279,243 90,893 ----------- ----------- TOTAL CURRENT LIABILITIES 2,546,022 2,865,063 ----------- ----------- COMMITMENTS AND CONTINGENCIES SHAREHOLDERS' EQUITY: Preferred stock, $0.001 par value, Authorized 1,000,000 shares; none issued - - Common stock, $0.001 par value, Authorized 200,000,000 shares Issued and outstanding - 10,033,216 shares and 9,963,216, respectively 10,033 9,963 Additional paid-in capital 6,585,093 7,092,663 Accumulated other comprehensive income 1,109,169 955,288 Accumulated deficit (888,608) (1,880,629) ----------- ----------- TOTAL SHAREHOLDERS EQUITY 6,815,687 6,177,285 ----------- ----------- TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $ 9,361,709 $ 9,042,348 =========== =========== TONGLI PHARMACEUTICALS (USA), INC. CONSOLIDATED STATEMENTS OF OPERATIONS AND OTHER COMPREHENSIVE INCOME (UNAUDITED) FOR THE THREE MONTHS FOR THE SIX MONTHS ENDED SEPTEMBER 30, ENDED SEPTEMBER 30, ---------------------- ---------------------- 2008 2007 2008 2007 ----------- ---------- ----------- ---------- REVENUE $ 1,645,540 $ 413,034 $ 3,310,710 $ 773,574 COST OF SALES, including depreciation and amortization of $4,111, $9,296 $85,901 and $27,769, respectively 926,819 235,890 1,896,959 444,724 ----------- ---------- ----------- ---------- GROSS PROFIT 718,721 177,144 1,413,751 328,850 ----------- ---------- ----------- ---------- OPERATING EXPENSES: General and administrative 164,551 37,741 304,596 77,748 Research and development 10,175 - 10,175 - Depreciation expense 42,807 72,037 85,155 138,204 Selling expense 20,613 11,557 36,188 14,226 ----------- ---------- ----------- ---------- TOTAL OPERATING EXPENSES 238,146 121,335 436,114 230,178 ----------- ---------- ----------- ---------- OPERATING INCOME 480,575 55,809 977,637 98,672 OTHER EXPENSE (INCOME): Interest expense 51,839 28,385 86,916 49,007 Rental income (58,300) - (101,300) - ----------- ---------- ----------- ---------- NET INCOME 487,036 27,424 992,021 49,665 OTHER COMPREHENSIVE INCOME: Foreign currency translation adjustment 7,763 83,066 153,881 144,903 ----------- ---------- ----------- ---------- COMPREHENSIVE INCOME $ 494,799 $ 110,490 $ 1,145,902 $ 194,568 =========== ========== =========== ========== BASIC AND DILUTED INCOME PER SHARE $ 0.05 $ - $ 0.10 $ 0.01 =========== ========== =========== ========== WEIGHTED AVERAGE SHARES USED IN BASIC AND DILUTED INCOME PER SHARE $10,033,231 $9,963,216 $10,033,231 $9,962,216 =========== ========== =========== ==========