BEIJING, March 31 /Xinhua-PRNewswire/ -- Sinovac Biotech Ltd. (Amex: SVA - News), a leading provider of vaccines in China, today announced unaudited financial results for the three months and twelve months ended December 31, 2007.
Highlights -- Record full year 2007 sales of $33.5 million, up 118% year-over-year -- Record full year 2007 net income of $7.7 million, or $0.19 per share -- Fourth quarter 2007 sales increased 49% year-over-year to $9.2 million -- Fourth quarter 2007 operating income rose 460% year-over-year to $3.3 million -- Fourth quarter 2007 net income increased to $2.0 million, or $0.05 per share -- Reported positive preliminary Phase II results for pandemic influenza (H5N1) whole viron vaccine -- Sold 5.12 million doses of Healive® in 2007, up from 2.6 million in 2006 -- Sold 1.59 million doses of Anflu? in 2007, up from 77,000 doses in in 2006
Mr. Weidong Yin, Chairman, President and CEO, stated, ''''2007 was a record year for Sinovac from a commercialization and a clinical development standpoint. Exceeding our internal projections for year-over-year sales growth, our 2007 sales increased 118%, due to higher than anticipated sales of our lead products, Healive?, our inactivated hepatitis A vaccine, and Anflu?, our seasonal influenza vaccine, based on the proactive efforts of our sales organization across China. In addition, we entered a promotion agreement with GSK China for our seasonal influenza vaccine, Anflu?, and successfully launched a marketing campaign that yielded sales in the second half of the year. We advanced the clinical development of our pandemic influenza vaccine formulations. We successfully completed the Phase II trial of our whole viron vaccine in 2007 that led to the submission with the SFDA during the first quarter of 2008. Most recently during the first quarter of 2008, the Phase I trial for the split inactivated vaccine was completed.''''
Mr. Weidong Yin, Chairman, President and CEO, continued, ''''The fourth quarter results marked our third sequential profitable quarter. Our quarterly sales reflected the continued demand for our lead product, Healive?, our inactivated hepatitis A vaccine. Healive? was recently selected by the Beijing Centers for Disease Control and Prevention for the hepatitis A vaccination program.''''
Full Year 2007
For twelve months ended December 2007, sales increased 118% to $33.5 million, compared to $15.4 million for 2006. The growth was attributable to strong sales of the Company''s inactivated hepatitis A vaccine, Healive?, and ongoing marketing initiatives in support of the Company''s seasonal influenza vaccine, Anflu?.
Gross profit for 2007 was $27.0 million, with a gross margin of 80.6%, compared to $11.1 million and 72.4%, respectively, for 2006. The higher gross margin resulted from the increased economies of scale and lower average unit costs associated with Healive? production and reflected normalized Anflu? production expenses.
Total operating expenses for the full year 2007 increased to $13.6 million, compared to $10.7 million in the same period of 2006. Selling, general and administrative (''''SG&A'''') expenses for 2007 were $12.0 million, compared to $9.8 million for 2006. The year-over-year increase in SG&A expenses reflected increased selling expense that is in line with the increase in sales, offset by decreased bad debt provision due to improvement in accounts receivable collection, decreased lower stock-based compensation and reduced consulting fees.
Aggregated research and development expenses for the full year 2007 were $1.8 million, compared to $1.2 million for 2006. The Company''s net R&D expenses were $965,000 for 2007, compared to $325,000 for 2006. The R&D expenses recognized as a reduction to government grants were $844,000 for 2007, compared to $845,000 for 2006.
Operating income was $13.5 million for the full year 2007, compared to $440,000 for 2006. The year-over-year increase in operating income reflected the significant increase in vaccine sales.
Net income for the twelve months ended December 31, 2007 was $7.7 million, or $0.19 per diluted share, compared to a net loss of $696,000, or $0.02 per diluted share, for 2006. Net income for 2007 included $478,000 of interest and financing expenses, $2.0 million of income taxes, and $3.6 million of minority interest. Net income for 2006 included $319,000 of interest and financing expenses, $101,000 of income taxes, and $1.0 million of minority interest.
As of December 31, 2007, Sinovac''s cash and cash equivalents totaled $17.1 million, compared to $9.2 million as of December 31, 2006.
Fourth Quarter 2007
For the fourth quarter 2007, sales increased 49% to $9.2 million, compared to $6.2 million in the fourth quarter 2006. The growth was attributable to strong sales of the Company''s inactivated hepatitis A vaccine, Healive?, and ongoing marketing initiatives in support of the Company''s seasonal influenza vaccine, Anflu?.
Gross profit for fourth quarter of 2007 was $6.3 million, with a gross margin of 68.3%, compared to $4.9 million and 78.9%, respectively, for the same period of 2006. The lower gross margin resulted primarily from lower margin sales of Anflu?.
