China Tracker - Details for China Sky One Medical (CSKI)


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 China Sky One Medical
 Business Outlook

COVERAGE TERMINATED (Going Dark)
Recent Chain of Events:
2012-04-03 -- Last SEC Filing
2012-03-12 -- Auditor Resignation
2011-03-08 -- Delisting from NASDAQ
2011-02-16 -- Trading halted by NASDAQ
2011-12-16 -- CFO Resignation
2011-11-09 -- Last Quarterly/Annual Report: Q3/FY2011 ended September 30, 2011

(Source: Trading China, 2012-09-30)

The U.S. Securities and Exchange Commission charged China Sky One Medical and its chief executive with securities fraud and said the company recorded fake sales of a weight loss product. China Sky One inflated revenues in its financial statements by booking $19.8 million in phony export sales, the SEC said.

The company, based in China, said in 2007 securities filings it had entered into a distribution agreement with a Malaysian company that would generate the sales, but never entered into such an agreement, the SEC said on Tuesday.

(Source: Reuters, 2012-09-05)

China Sky One Medical has won the bidding process on 50-year land use rights covering approximately 85,000 m2 of land located in the High-Tech Development Zone of Song Bei District in Harbin, China. The Company acquired the Land Use Rights for total consideration of approximately $7.3 million, which was originally deposited by the Company's wholly owned subsidiary, Harbin Tian Di Ren Medical Science and Technology Company, to Harbin High-Tech Development Zone during the second quarter of 2010. The Company intends to build a research and development center, an injection manufacturing facility, a logistics center and an office building on the Land during the first phase of development, which the Company currently expects to complete in the mid of 2012.

(Source: PR Newswire, 2011-07-19)

On December 21, 2010, China Sky One entered into an agreement with Heilongjiang Tang Wang He Forest Bureau that gives the Company the right to grow and harvest herbs, among other plants, on approximately 74,000 acres of forested land in the Xiao Xing'an Mountain region. The Company's management believes this arrangement will provide its TCM business with a hedge against fluctuations in raw material prices. The Company plans to evaluate the land in the second quarter of 2011 and subsequently develop a strategic plan for its future operation.

"We commenced 2011 by engaging several new distributors and recently acquired thirteen new drug licenses, which we expect to launch as soon as the fourth quarter of this year. Throughout 2011, we anticipate a more strict regulated medicinal market in China, which may impose more challenges on the Company's operating performance. However, given our strong management team, rich product portfolio, outstanding R&D capability, and extensive sales network, we believe we are in a good position to compete and improve shareholder value."

(Source: PR Newswire, 2011-05-11)

Corrected financial reports for 2007, 2008 and 2009 have been submitted to the local SAIC offices in the jurisdictions in which the Company's subsidiaries are located. The Company believes that the financial information included in the amended reports is consistent with the information included in reports filed by the Company with the U.S. Securities and Exchange Commission. As previously reported, the Company believes that, should the SAIC impose a penalty in connection with amending these financial reports, such penalty will not be material. "We always endeavor to follow all relevant rules and regulations when conducting our business, both in the PRC and abroad. If, on occasion, we become aware that an error was made, we seek advice of professionals to determine the appropriate course of action to correct it, and will continue to do so in the future."

(Source: PR Newswire, 2011-02-22)

China Sky One Medical has entered an agreement with Heilongjiang Tang Wang He Forest Bureau that gives the Company the right to grow and harvest herbs, among other plants, on 30,000 hectares of forested land in the Xiao Xing'an Mountain region for 30 years, commencing December 21, 2010. The Company intends to utilize the planting area to produce herbs and other ingredients for use in traditional Chinese medicines (TCM) and various health foods. Under the agreement, total rent for the term of 30-year period is approximately $40 million, based on RMB 300 per hectare per year (approximately $18 per acre per year), which is the lowest possible rate as regulated by China local authorities. To receive a discount of the total rent, and to avoid future rental increase, in accordance with the agreement, the company is making an upfront full payment of $36 million. Pursuant to the agreement, this rental covers the 30-year renting period, and this agreement will not be affected by future government regulations. Over the next three years, management expects to adjust plant assortment to include herbs such as Honeysuckle, Panax Notoginseng, Gastrodia Elata, Coptis Chinensis and Radix Isatidis, to meet its own raw material needs.

"We are very pleased with our new planting area, which is an ideal location for growing precious TCM plants. This new arrangement is intended to provide our TCM business a hedge against fluctuations in raw material prices and also creates new revenue streams for the Company. We now are planning the construction of production facilities near the region and will update investors as we achieve significant milestones on this front."

(Source: PR Newswire, 2010-12-27)

China Sky One Medical today announced that its profitability is not expected to be affected by recent price adjustments enforced by China's National Development and Reform Commission as the Company does not have any products on the price cut list. Furthermore, the Company's ability to discretionarily price roughly 80% of current portfolio and pipeline products lessens the Company's exposure to potential future price cuts by the NDRC.

(Source: PR Newswire, 2010-12-03)

The Company reiterates guidance for 2010 of revenue from $128 million to $136 million and adjusted net income, excluding the impact of the derivative warrant liability, from $26 million to $31 million. The Company currently is in the process of evaluating its outlook for 2011 and will provide guidance for next year once its forecast has been finalized.

"We believe that our strong and efficient sales network, combined with new relationships with national and provincial distributors, provides a solid base from which we can rekindle growth heading into 2011. Furthermore, our healthy cash position provides us with flexibility to pursue value creating acquisitions and to enter into beneficial strategic relationships. We are very excited about our recently announced joint application with Heilongjiang Traditional Chinese Medical University (HTCMU) for production licenses of 15 new medical products. We look forward to revenue and earnings contribution in 2011 from these products as well as from another 3 to 5 products that we hope will obtain SFDA approval by the end of 2010. We will continue our efforts in research and development of high margin branded products, while focusing on increasing sales and promotion of our current products, including our promising portfolio of diagnostic kits."

(Source: PR Newswire, 2010-11-08)

China Sky One Medical today announced that it has submitted, jointly with Heilongjiang Traditional Chinese Medical University (HTCMU), an application to China's State Food and Drug Administration for production licenses for 15 new medical products. These products include Vaginal Suppository, Anti-virus Mouth Wash, Eye Patch, Diabetes Relief Patch, Snore Stopper, Rheumatoid Pain Relief Patch, Liver Patch, Ear Patch, Cicatrice Patch, Sore Relief Patch, Dental Ulcer Membrane, Dental Ulcer Mouth Wash, Nose Patch, Period Pain Relief Patch, and Wound Healing Patch. Management expects to receive final approval of these production licenses by the end of this year.

"We are happy to purchase an exciting group of new products and look forward to their contribution to our revenue and earnings in 2011. As these external-use medical products are a good match with our existing production facilities and sales network, we expect to manufacture and sell them efficiently without much extra effort. Going forward, we will strengthen our partnership with research institutions such as HTCMU to leverage their R&D capabilities to make our product portfolio richer and more profitable."

(Source: PR Newswire, 2010-10-26)

China Sky One Medical today announced that its fiscal year 2010 revenue and adjusted net income, excluding the impact of derivative warrant liabilities, are expected to be lower than its previous financial guidance as a result of the termination of several major distributor relationships. Specifically, the Company has lowered its 2010 revenue guidance from a prior range of $160 million and $164 million to between $128 million and $136 million. The Company also has lowered its 2010 adjusted net income guidance, excluding the impact of derivative warrant liabilities, from between $40 million and $41 million to between $26 million and $31 million.

Management's reduced guidance reflects the termination of relationships with certain private distributors, who after several rounds of discussions, chose to end their cooperation with the Company after learning that their business information was disclosed in the Company's public SEC filings and would continue to be disclosed in such documents as required by SEC regulations. This disclosure, these distributors claim, has led to increased scrutiny of their financial performance by government authorities within China. While the Company expects to replace these lost distribution arrangements over time, revenue and net income in the second half of 2010 are expected to be negatively impacted by the disruption in distribution channels. The Company expects to incur higher selling and marketing costs during second half 2010 to develop new distributor relationships.

(Source: PR Newswire, 2010-09-03)

The Company is currently in the process of negotiating with a few of its key customers for business in the second half of 2010 and plans to provide an update to its annual guidance in the near future if there is any material change. "We remain optimistic that we will obtain SFDA approval of 3 to 5 of new products during the second half of 2010, leading to new revenue streams beginning in 2011. We will continue our efforts in research and development of high margin branded products, while focusing on increasing sales and promotion of our current products, including our promising portfolio of diagnostic kits."

(Source: PR Newswire, 2010-08-10)

China Sky One Medical today announced that the Company has obtained approval from the State Food and Drug Administration (SFDA) in China for the production of Ciclopirox Olamine Vaginal Suppositories. "We expect to launch this product in early 2011 and plan on gaining share in this large market by leveraging our extensive distribution network and strong OTC pharmaceutical sales force."

(Source: PR Newswire, 2010-07-23)

China Sky One is raising its previous 2010 revenue guidance by $4 million to a range of $160 million to $164 million to reflect incremental sales from the previously announced 13 new products, which have been launched or will be launched in 2010. Similarly, the Company's net income guidance, excluding any non-cash items, increased by $1 million to a range of $40 million to $41 million. The net income guidance continues to represent a net profit margin of 25%. Estimated R&D expenditure remains at 15% of total revenue in 2010.

"Looking ahead, we will continue our efforts in research and development of high margin branded products. We look forward to receiving SFDA final approvals for 3-5 new products in 2010. In addition, we will focus on increasing the sales and promotion of our current products, including our promising portfolio of diagnostic kits."

(Source: PR Newswire, 2010-05-18)

We are happy to add two new products to our sales mix and anticipate they will contribute roughly $1.0 million to our total revenues in 2010. We continue our efforts to commercialize 11 additional drugs in our R&D pipeline in order to support sustainable, long term growth.

(Source: PR Newswire, 2010-04-21)

Our financial guidance assumes only organic growth and does not reflect any potential acquisitions or other strategic deals in 2010. The Company is committed to delivering shareholder value and will pursue opportunities to acquire new proprietary drugs, advanced technologies or companies that can increase our growth potential. For the full year 2010, the Company expects net revenue growth of approximately 20% or $156 million. The gross margin guidance is 68%, below historical levels due to our potential lower sales price to support our new sales model, as well as anticipated increases in raw materials costs and related overhead costs. Net income is anticipated to approximate $39 million, representing a net profit margin of 25%. The expected decline in net margin primarily reflects the increase in R&D spending which is expected to be 15% of total revenue for the year of 2010.

(Source: PR Newswire, 2010-03-17)
CSKI
Healthcare & Drugs
SCORE
-1
UNDER REVIEW
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Current Price:  n/a
F10k Day (2006-09-15): -100.00%$7.00
2009 Close: -100.00%$22.75
2010 Close: -100.00%$6.97
2011 Close: -100.00%$0.99
High (2012-02-14): -100.00%$1.63
Low (2012-07-18): -100.00%$0.25
Exchange:
Market Capitalization: n/a
Total Shares: 16.94 mill
Float: n/a
Avg Volume: 101.50 k
Short Interest: 1.69 mill
Short Ratio: 17.38%16.6 d
Last Quarter: 2011-03-31
Revenue (MRQ): 28.37 mill
Net Income (MRQ): 4.75 mill
Op. Cash Flow (MRQ): 9.04 mill
all financial data provided without warranty