SOURCE: Benda Pharmaceutical, Inc.

August 20, 2007 17:04 ET

Benda Pharmaceutical Revenue Up 31% to $5.2 Million for the Quarter Ended June 30, 2007

HUBEI PROVINCE, CHINA--(Marketwire - August 20, 2007) - Benda Pharmaceutical, Inc. ("Benda" or the "Company") (OTCBB: BPMA), a China-based pharmaceutical company producing traditional Chinese and conventional medicines, as well as Gendicine®, the world's first commercialized gene therapy medicine for the treatment of cancer, announced operating results for the quarter ended June 30, 2007.

Benda reported revenue of approximately $5.2 million for the three months ended June 30, 2007, compared to approximately $4.0 million for the three months ended June 30, 2006 -- a 31% increase. For the six months ended June 30, 2007, Benda reported revenue of approximately $8.2 million, compared to approximately $7.6 million for the six months ended June 30, 2006 -- an 8% increase. The increase in revenue was due primarily to the sales of additional products at the Benda Ebei plant; the acquisition of a 60.13 % interest in SiBiono also added $1.5 million to Benda's total revenue for the second quarter 2007.

Benda reported a net loss of approximately $8.9 million for the three months ended June 30, 2007, compared to net income of approximately $0.3 million for the three months ended June 30, 2006. For the six months ended June 30, 2007, Benda reported a net loss of approximately $8.5 million, compared to net income of approximately $1.2 million for the six months ended June 30, 2006.

Included in the net loss for the quarter ended June 30, 2007 were approximately $7.9 million in non-cash expenses related to the acquisition of SiBiono and a non-cash interest expense of approximately $1.0 million.

Excluding these non-cash expenses, the adjusted net loss for the three months ended June 30, 2007 would have been approximately $0.1 million, compared to net income of approximately $0.3 million for the three months ended June 30, 2006. The adjusted decrease in net income was primarily attributable to the temporary closing of the Yidu Benda plant in January 2007 to upgrade wastewater treatment systems to meet government environmental requirements. For the three months ended June 30, 2007, Yidu Benda reported a net loss of $0.7 million, compared to net income of $0.5 million for the three months ended June 30, 2006 when Yidu Benda was fully operational. Yidu Benda is expected to reopen in the third quarter 2007.

Excluding the non-cash expenses of approximately $8.9 million, the adjusted net income for the six months ended June 30, 2007 would have been approximately $0.4 million, compared to net income of approximately $1.2 million for the six months ended June 30, 2006. The decrease in net income was primarily a result of the temporary closing of Yidu Benda, as stated above, which reported a net loss for the six months ended June 30, 2007 of $0.5 million, compared to net income of $0.9 million for the three months ended June 30, 2006, in which Yidu Benda was fully operational.

Benda owns four plants in the Hubei Province of China: Benda Ebei, which produces conventional medicines and Traditional Chinese Medicines; Jiangling Benda, which produces Active Pharmaceutical Ingredients used in capsules, tablets and fluids; Yidu Benda, which produces bulk chemicals; and SiBiono, which produces Gendicine®, the world's first commercialized gene therapy medicine for the treatment of cancer.

Second Quarter Earnings Conference Call

Benda will host a conference call on Wednesday, August 29, 2007 to review second quarter 2007 earnings results. The conference call is scheduled for 9:00 am, Eastern Time. To participate in the call, please dial:

          U.S. and Canada:        1 (800) 289-0544

          International:          1 (913) 981-5533

          Conference ID:          7048368

A replay of the call will be available at 12:00 p.m. Eastern Time. You will be able to access it at any time through the Benda Website at www.BendaPharma.com, or by phone until midnight September 26, 2007. To access the replay by phone, please dial:

          U.S. and Canada:        1 (888) 203-1112

          International:          1 (719) 457-0820

          Conference ID:          7048368

About Benda Pharmaceutical, Inc.

Benda Pharmaceutical, Inc. (www.bendapharma.com), a China-based pharmaceutical company, is a pure play on explosive Chinese pharmaceutical spending and the global search for a cancer cure. Benda produces traditional Chinese and conventional medicines, as well as Gendicine®, the world's first commercialized gene therapy medicine for the treatment of cancer.


FORWARD-LOOKING STATEMENTS

The information contained herein includes forward-looking statements. These statements relate to future events or to our future financial performance, and involve known and unknown risks, uncertainties and other factors that may cause our actual results, levels of activity, performance, or achievements to be materially different from any future results, levels of activity, performance or achievements expressed or implied by these forward-looking statements. You should not place undue reliance on forward-looking statements since they involve known and unknown risks, uncertainties and other factors which are, in some cases, beyond our control and which could, and likely will, materially affect actual results, levels of activity, performance or achievements. Any forward-looking statement reflects our current views with respect to future events and is subject to these and other risks, uncertainties and assumptions relating to our operations, results of operations, growth strategy and liquidity. We assume no obligation to publicly update or revise these forward-looking statements for any reason, or to update the reasons actual results could differ materially from those anticipated in these forward-looking statements, even if new information becomes available in the future. The safe harbor for forward-looking statements contained in the Securities Litigation Reform Act of 1995 protects companies from liability for their forward-looking statements if they comply with the requirements of the Act.



Benda Pharmaceutical, Inc.
Consolidated Balance Sheets
(Amounts expressed in U.S. Dollars)


                                                  June 30     December 31
                                                    2007          2006
                                                ============  =============
Assets                                          (Unaudited)
   Current Assets
         Cash and cash equivalents              $  1,986,585  $   1,676,119
         Account receivables, net                  6,442,629      6,193,585
         Other receivables                           636,629         99,733
         Refundable purchase price paid            1,195,032      5,367,801
         Inventories                               2,037,383        701,339
         Prepaid expenses and deposits               903,790        372,548
                                                ------------  -------------
               Total current assets               13,202,048     14,411,124
   Due from related parties                        2,630,010      1,976,815
   Long-term loan receivable                         131,497              -
   Property and equipments, net                   21,407,356     13,673,067
   Intangible assets, net                          5,303,313      1,501,483
   Goodwill                                        7,093,631              -
   Restricted cash                                 1,304,972              -
   Debt issue costs                                  461,931              -
                                                ------------  -------------
Total Assets                                    $ 51,534,758  $  31,562,489
                                                ============  =============

Liabilities & Shareholders' Equity
   Current Liabilities
         Bank indebtedness                      $    836,539  $           -
         Bank loans payable (current portion)      3,024,422        256,492
         Long term debt payable (current
          portion)                                 3,816,859              -
         Accounts payable and accrued
          liabilities                              1,834,348      1,823,030
         Taxes payable                               400,405        226,931
         Acquisition price payable                 1,749,880              -
         Wages payable                               431,849        145,903
         Deferred revenues                                 -          1,732
                                                ------------  -------------
               Total current liabilities          12,094,302      2,454,088
   Long term debt payable (long term portion)        407,639              -
   Long-term convertible promissory notes            960,985              -
   Due to related parties (Long-term)              2,971,038      3,034,365
                                                ------------  -------------
               Total liabilities                  16,433,964      5,488,454
                                                ------------  -------------

Minority interest                                  3,462,087      2,154,356
                                                ------------  -------------


Redeemable common stock, 2,049,560 shares at
 $3.6 per share                                    7,378,416              -
                                                ------------  -------------

Shareholders' Equity
   Preferred stock, $0.001 par value; 5,000,000
    shares authorized; None issued and
    outstanding                                            -              -
   Common stock, $0.001 par value; 150,000,000
    shares authorized; 96,964,606 shares issued
    and outstanding as of 6/30/2007; 96,258,411
    shares issued and outstanding as of
    12/31/2006                                        96,964         96,258
   Additional paid in capital                     20,985,121     13,099,424
   Retained earnings (unrestricted)               (1,044,206)     7,437,663
   Statutory surplus reserve fund                  1,869,523      1,869,523
   Accumulative other comprehensive income         1,848,888      1,090,408
   Shares issuable for acquisition and services      504,000        326,403
                                                ------------  -------------
   Total Shareholders' Equity                     24,260,291     23,919,680
                                                ------------  -------------
Total Liabilities & Shareholders' Equity        $ 51,534,758  $  31,562,489
                                                ============  =============






Benda Pharmaceutical, Inc.
Consolidated Statement of Operations (UNAUDITED)
(Amounts expressed in U.S. Dollars)

                           SIX MONTHS ENDED         THREE MONTHS ENDED
                               JUNE 30,                  JUNE 30,

                          2007          2006         2007          2006
                      ============  ===========  ============  ===========
                      (Unaudited)   (Unaudited)  (Unaudited)   (Unaudited)

Revenue               $  8,236,852  $ 7,638,628  $  5,207,817  $ 3,981,852
    Cost of goods sold  (4,293,280)  (4,137,171)   (2,484,378)  (2,249,654)
                      ------------  -----------  ------------  -----------
Gross profit             3,943,572    3,501,457     2,723,439    1,732,198
                      ------------  -----------  ------------  -----------

Selling expenses          (344,886)    (279,519)     (256,703)    (139,311)

General and
 administrative expenses
    Amortization of
     intangible assets    (202,746)    (133,645)     (135,340)     (64,363)
    Amortization of
     debt issue costs      (67,269)           -       (58,526)           -
    Depreciation          (355,231)    (277,514)     (158,632)    (139,087)
    Bad debts             (776,859)    (971,506)     (847,845)    (863,013)
    Director remuneration  (33,945)           -       (33,945)           -
    Penalty to investors  (120,000)           -             -            -
    Brokerage Fees        (239,963)           -      (239,963)           -
    Cash bonus            (173,400)           -      (173,400)           -
    Consulting and
     professional fees  (7,882,416)           -    (7,882,416)           -
    Other general and
     administrative
     expenses             (974,139)    (276,361)     (649,426)    (150,691)
                      ------------  -----------  ------------  -----------
Total general and
 administrative
 expenses              (10,825,968)  (1,659,026)  (10,179,493)  (1,217,154)
Research and
 development expenses      (97,119)      (6,231)      (97,119)      (6,231)
                      ------------  -----------  ------------  -----------
    Total operating
     expenses          (11,267,973)  (1,944,776)  (10,533,315)  (1,362,696)
                      ------------  -----------  ------------  -----------
Operating income /
 (loss)                 (7,324,401)   1,556,681    (7,809,876)     369,502

Interest expense        (1,066,406)     (79,237)   (1,048,821)     (39,019)
Other income
 (expenses)                 90,158     (246,390)      101,246          380
Government subsidies
 / grants                  273,115            -       273,115            -
                      ------------  -----------  ------------  -----------

Income / (loss)
 before minority
 interest and income
 taxes                  (8,027,534)   1,231,054    (8,484,336)     330,863
                      ------------  -----------  ------------  -----------
Income taxes                     -            -             -            -
Minority interest         (454,335)     (77,608)     (413,570)     (26,104)
                      ------------  -----------  ------------  -----------

Net income / (loss)   $ (8,481,869) $ 1,153,446  $ (8,897,906) $   304,759
                      ============  ===========  ============  ===========

Earnings / (loss) per
 share - basic        $      (0.09) $      0.02  $      (0.09) $      0.00
                      ============  ===========  ============  ===========

Weighted average
 shares outstanding -
 basic                  96,625,164   70,240,401    96,625,164   70,240,401
                      ============  ===========  ============  ===========

Earnings / (loss) per
 share - diluted      $      (0.09) $      0.02  $      (0.09) $      0.00
                      ============  ===========  ============  ===========

Weighted average
 shares outstanding -
 diluted               128,465,870   70,240,401   128,465,870   70,240,401
                      ============  ===========  ============  ===========


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