SOURCE: Tongli Pharmaceuticals, Inc.

November 19, 2008 12:17 ET

Tongli Pharmaceuticals Announces Strong Revenue and Net Income Growth in Second Quarter of Fiscal Year 2009

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
                            ===========  ========== ===========  ==========

Contact Information

  • Contact:
    Leslie Wolf-Creutzfeldt
    Grayling Global Consulting Group
    Email Contact
    646-284-9472