Revenue during the quarter grew 9.87 percent to $86.53 million from $78.75 million in the previous year period. Gross margin for the quarter expanded 353 basis points over the previous year period to 68.05 percent. Total expenses were 54.09 percent of quarterly revenues, down from 55.52 percent for the same period last year. This has led to an improvement of 143 basis points in operating margin to 45.91 percent.

Operating income for the quarter was $39.72 million, compared with $35.03 million in the previous year period.

Mr. David (Xiaoying) Gao, Chairman and Chief Executive Officer of China Biologic, commented, “We are very pleased to achieve another quarter of strong financial results with higher-than-expected gross margin and profit growth. Third quarter revenue increased by 9.8% in USD terms, or 17.3% in RMB terms, and would have been higher were it not for the delay of certain new regional drug tenders. Albumin sales were largely in-line with our expectation, and IVIG production and sales were lower than anticipated, compared to the unusually higher levels in the corresponding period of last year as we continued to allocate more production capacity to tetanus immunoglobulin. We are pleased with the increase in our gross margin, which was primarily attributable to higher pricing for most of our products, a more profitable product mix, and a higher sales contribution from products made from in-house sourced raw plasma at lower cost. The overall earnings contribution from our Guizhou facility continued to increase due to several capital injections made over the past twelve months. Our Huitian facility also began contributing to our earnings growth in the third quarter after a two-year production suspension for facility upgrade.”

China Biologic Products expects revenue to grow in the range of 22 percent to 24 percent for the financial year 2016. For the fiscal year 2016, China Biologic Products projects adjusted net income to grow in the range of $33 percent to $35 percent.

The company has spent $44.08 million cash to meet investing activities during the nine month period as against cash outgo of $55.76 million in the last year period. It has incurred net capital expenditure of $40.62 million on net basis during the nine month period, up 800.31 percent or $36.11 million from year ago period.

Cash flow from financing activities was $19.55 million for the nine month period, down 60.63 percent or $30.10 million, when compared with the last year period.

Cash and cash equivalents stood at $203.20 million as on Sep. 30, 2016, up 42.44 percent or $60.54 million from $142.66 million on Sep. 30, 2015.

Working capital increases
China Biologic Products, Inc has recorded an increase in the working capital over the last year. It stood at $362.48 million as at Sep. 30, 2016, up 21.77 percent or $64.81 million from $297.66 million on Sep. 30, 2015. Current ratio was at 6.01 as on Sep. 30, 2016, up from 5.49 on Sep. 30, 2015.

Cash conversion cycle (CCC) has decreased to 249 days for the quarter from 421 days for the last year period. Days sales outstanding were almost stable at 42 days for the quarter, when compared with the last year period.

Days inventory outstanding has decreased to 244 days for the quarter compared with 412 days for the previous year period. At the same time, days payable outstanding went up to 37 days for the quarter from 33 for the same period last year.