FOSTER CITY, CA / ACCESSWIRE / November 14, 2016 / Aoxing Pharmaceutical Company, Inc. (NYSE MKT: AXN) today announced that for
the first quarter of fiscal year 2017, ended September 30, 2016, the Company reported revenues of $7,569,296, down 13%
year-over-year from the revenue of $8,744,822 realized during the three months ended September 30, 2015. The year-over-year revenue
decline was mainly due to lower sales for Zhongtong'an product, which represented 92.8% of total sales during the first quarter of
fiscal 2017. Sales of Zhongtong'an product have been under pressure as inventories in the pipeline remain low. Our Tilidine product
has not yet contributed to sales.
The Company's net income in Q1 of fiscal year 2017 was $346,080 (or $0.00 per share), compared to $1,267,936 (or $0.02 per
share) for the three months ended September 30, 2015.
Aoxing's cash balance as of September 30, 2016 was $7,055,974, compared to $6,912,100 as of June 30, 2016, the end of its last
fiscal year.
Mr. Zhenjiang Yue, Chairman and CEO of Aoxing Pharma, said, "Although the sales are currently under pressure, we believe the
pipeline inventory is low and the revenue growth could recover going forward. We believe our marketing efforts for products other
than Zhongtong'an, including our Tilidine tablets, could contribute more to the revenue with our market penetration."
About the Company
Aoxing Pharmaceutical Company, Inc. is a U.S. incorporated pharmaceutical company with its operations in China, specializing in
research, development, manufacturing and distribution of a variety of narcotics and pain-management products. Headquartered in
Shijiazhuang City, outside Beijing, Aoxing Pharma has the largest and most advanced manufacturing facility in China for highly
regulated narcotic medicines. Its facility is one of the few GMP facilities licensed for the manufacture of narcotic medicines by
the China Food and Drug Administration ("CFDA"). For more information, please visit: www.aoxingpharma.com.
Safe Harbor Statement. This press release contains certain statements that may include "forward-looking statements." All
statements other than statements of historical fact included herein are "forward-looking statements." These forward-looking
statements are often identified by the use of forward-looking terminology such as "believes," "expects" or similar expressions,
involving known and unknown risks and uncertainties. Although the Company believes that the expectations reflected in these
forward-looking statements are reasonable, they do involve assumptions, risks and uncertainties, and so these expectations may
prove to be incorrect. You should not place undue reliance on these forward-looking statements, which speak only as of the date of
this press release. The Company's actual results could differ materially from those anticipated in these forward-looking statements
as a result of a variety of factors, including the risk factors discussed in the Company's periodic reports that are filed with the
Securities and Exchange Commission and available on the SEC's website (http://www.sec.gov). All forward-looking statements
attributable to the Company or persons acting on its behalf are expressly qualified in their entirety by these risk factors. Other
than as required under the securities laws, the Company does not assume any duty to update these forward-looking
statements.
AOXING PHARMACEUTICAL CO., INC. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS September 30, June 30, 2016 2016 ASSETS
(Unaudited) CURRENT ASSETS: Cash and cash equivalents $ 7,055,974 6,912,100 Accounts receivable, net 12,767,133 10,435,101 Notes
receivable, net 1,227,593 765,317 Inventories, net 2,433,301 2,841,690 Prepaid expenses and other current assets 6,619,058
5,912,555 TOTAL CURRENT ASSETS 30,103,059 26,866,763 LONG-TERM ASSETS: Property and equipment, net of accumulated depreciation
25,277,267 25,603,734 Deferred income tax 1,532,500 1,878,595 Other intangible assets, net 1,862,139 1,878,299 Investment in joint
venture - 4,200 TOTAL LONG-TERM ASSETS 28,671,906 29,364,828 TOTAL ASSETS $ 58,774,965 56,231,591 LIABILITIES AND SHAREHOLDERS'
EQUITY CURRENT LIABILITIES: Short-term borrowings $ 8,544,369 11,070,966 Accounts payable 3,137,060 2,709,819 Loan payable - bank
14,336,552 14,372,630 Current portion of loan payable - related parties 5,793 13,317 Current portion of loan payable - others
2,408,912 15,048 Accrued expenses and other current liabilities 11,406,652 9,633,750 TOTAL CURRENT LIABILITIES 39,839,338
37,815,530 LONG-TERM LIABILITIES: Loan payable - related parties 7,495 Loan payable - others 89,941 Deferred income 322,967 340,089
TOTAL LONG-TERM LIABILITIES 420,403 340,089 Common stock, par value $0.001, 100,000,000 shares authorized, 76,209,195 shares issued
and outstanding on September 30, 2016 and June 30, 2016 76,209 76,209 Additional paid in capital 73,638,151 73,629,751 Accumulated
deficit (55,947,665 ) (56,293,745 ) Accumulated other comprehensive income 1,764,235 1,723,740 TOTAL SHAREHOLDERS' EQUITY OF THE
COMPANY 19,530,930 19,135,955 NONCONTROLLING INTEREST IN SUBSIDIARIES (1,015,706 ) (1,059,983 ) TOTAL EQUITY 18,515,224 18,075,972
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $ 58,774,965 56,231,591 See accompanying notes to the consolidated financial statements
AOXING PHARMACEUTICAL CO., INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (Unaudited) For the
Three Months Ended September 30, 2016 2015 SALES $ $7,569,296 $ $8,744,822 COST OF SALES 1,514,932 1,758,079 GROSS PROFIT 6,054,364
6,986,743 OPERATING EXPENSES: Research and development expense 377,287 377,306 General and administrative expenses 1,276,720
944,358 Selling expenses 2,577,366 2,394,346 Depreciation and amortization 119,485 131,530 TOTAL OPERATING EXPENSES 4,350,858
3,847,540 INCOME FROM OPERATIONS 1,703,506 3,139,203 OTHER INCOME/(EXPENSE): Interest expense, net of interest income (656,486)
(929,029) Gain on foreign currency transactions - 58,593 Equity in loss of joint venture, net of tax (4,186) (24,291) Subsidy
income - 47,760 TOTAL OTHER (EXPENSE) (660,672) (846,967) INCOME BEFORE INCOME TAX 1,042,834 2,292,236 Income tax 651,077 943,803
NET INCOME 391,757 1,348,433 Net income attributed to non-controlling interest in subsidiaries 45,677 80,497 INCOME ATTRIBUTABLE TO
SHAREHOLDERS OF THE COMPANY 346,080 1,267,936 OTHER COMPREHENSIVE LOSS: Foreign currency translation adjustment (28,020) (669,991)
COMPREHENSIVE INCOME 318,060 597,945 Other comprehensive income attributable to non-controlling interest (1,401) (33,500)
COMPREHENSIVE INCOME ATTRIBUTABLE TO THE COMPANY $ $319,461 $ $631,445 BASIC AND DILUTED LOSS PER COMMON SHARE $ $0.00 $ $0.02
WEIGHTED AVERAGE NUMBER OF SHARES OUTSTANDING 76,209,195 69,852,302 See accompanying notes to the consolidated financial statements
CONTACT:
Aoxing Pharmaceutical Company: 646-367-1747 investor.relations@aoxingpharma.com
SOURCE: Aoxing Pharmaceutical Company, Inc.
