Asiapharm Group Ltd Fy2008 Press Release

ASIApharm Group Ltd Press Release – FY2008 Results

ASIAPHARM ACHIEVES 27.9% REVENUE GROWTH TO RMB 651.0 MILLION DESPITE CHALLENGING OPERATING CONDITIONS
Increase in revenue due to higher sales of pharmaceutical drugs; principally attributable to contributions from proprietary drugs including Lipusu, Nuosen, Lutingnuo, CMNa and fresh contributions from Hypocol
Profit before tax grew 27.6% to RMB 83.7 million in line with revenue growth

and increase in share of associates’ profits RMB (million)

FY2008

FY2007

Change %

Total Revenue

651.0

509.0

27.9

Profit before tax

83.7

65.6

27.6

Net Profit

62.1

58.1

6.8

EPS (RMB cts)*

12.60

11.80

6.8

NAV (RMB cts)**

166.8

156.8

6.4

*based on the weighted average number of 492,764,900 and 492,493,667 shares respectively ** based on actual number of 492,764,900 and 492,079,900 shares respectively

Singapore – 27 February 2009 – Singapore Exchange Mainboard-listed AsiaPharm Group Ltd. (“AsiaPharm” or the “Group” or

亚洲药业集团有限公司), a leading specialty pharmaceutical

group in the People’s Republic of China (“PRC”) focusing on the research and development, production and sale of natural drugs and drug delivery systems (“DDS”), announced today a set of resilient results for the financial year ended 31 December 2008 (“FY2008”).

Bolstered by higher sales of its proprietary pharmaceutical products such as Lipusu, Nuosen, Lutingnuo, CMNa and fresh contributions from recently acquired product Hypocol®, AsiaPharm posted a 27.9% jump in revenue to RMB 651.0 million in FY2008 from RMB 509.0 million in FY2007. Underscored by a 28.7% increase in pharmaceutical sales for FY2008, the Group recognised higher selling and distribution expenses in FY2008. Further contributing to the increase in selling and distribution expenses was the strategic decision by the Group’s management to step up marketing efforts on core products which have been deemed to possess significant future growth potential. Export sales of active ingredients declined by RMB 0.5 million to RMB 1.6 million in FY2008 from RMB 2.1 million in FY2007, as the Group continues to strategically reduce its focus in this low-margin and high credit risk sector. Profit before tax increased by 27.6% to RMB 83.7 million in line with revenue growth and the increase in share of associates’ profits. Net profit attributable to shareholders on a year-on-year basis rose 6.8% to RMB 62.1 million in FY2008 from RMB 58.1 million a year ago, in line with the increase in contributions from the Group’s proprietary drugs. The Group’s FY2008 fully diluted earnings per share increased to 12.60 RMB cents compared to 11.80 RMB cents in FY2007. Net asset value per share rose to 166.8 RMB cents as at 31 December 2008 compared to 156.6 RMB cents as at 31 December 2007. AsiaPharm remains in a healthy financial position with net cash of RMB 118.5 million as at 31 December 2008. Commenting on the outlook of the company and industry trends, Mr. Liu Dianbo, Executive Chairman of AsiaPharm, said, ”In view of the global financial crisis and its effect on the PRC economy, the central government has promulgated a broad array of economic stimulus plans of over RMB 4.0 trillion to spur domestic consumption. Acknowledging the growing importance of a comprehensive healthcare system, the PRC central government has committed to increase healthcare expenditure by RMB 850 billion1 over three years to deliver universal healthcare to all its citizens and to expand the participation rate of both urban and rural populace in the basic national medical insurance system to beyond 90 per cent. We believe these measures will

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benefit the PRC healthcare sector and reflects the central government’s commitment to the sustained development of the healthcare sector.”

“AsiaPharm remains resilient despite negative conditions arising in the global market and PRC economy, clearly evidenced by the strong demand for our proprietary products, in particularly our Oncology products. Citing a recent study compiled by the Chinese Ministry of Health with various leading PRC Oncology pharmaceutical companies including our own Nanjing Kanghai Pharmaceutical Co., Ltd. and Nanjing Sike Pharmaceutical Co., Ltd, Cancer was found to be the leading cause of mortality in both urban and rural China, accounting for 21.82 and 16.5% of all urban and rural deaths respectively. Underlined by this trend, sales of anti-cancer drugs have risen steadily in recent years to an estimated market size of approximately RMB 25.5 billion in 20072. The Group is poised to capitalize on its extensive research and knowledge in oncology treatment to bring relief to these cancer patients and enhance their quality of life.” Mr. Liu added. In view of the challenging economic conditions and future capital expenditure requirements, the Board of Directors has not proposed any dividend for FY2008.

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Issued on behalf of AsiaPharm Group Ltd. by WeR1 Consultants Pte Ltd Media Contact Info WeR1 Consultants Pte Ltd 29 Scotts Road Singapore 228224 Tel : (65) 6737 4844 Fax : (65) 6737 4944 Lai Kwok Kin, [email protected] or Yim Jeng Yuh, [email protected] About AsiaPharm Group Ltd. Established in 1994, we are today a leading specialty pharmaceutical group in the People’s Republic of China (“PRC”) focusing on the research and development, production and sale of natural drugs and drug delivery systems. Fully equipped, integrated and GMP-certified, our ultramodern facilities in Yantai and Nanjing enables us to carry out all aspects of pre-clinical evaluation – from pharmaceutical to pharmacology research, drug safety evaluation and clinical trials – as well as full production of our natural and new DDS technology drugs. AsiaPharm currently employs approximately 140researchers and has close collaborative relationships with renowned universities and research institutions around the globe to complement its R&D efforts, enabling AsiaPharm to stay at the forefront of specialty pharmaceutical developments. To reach our customers, we have established an extensive distribution network of 35 sales support offices, covering 30 provinces, municipals, and autonomous regions, reaching approximately 3,500 hospitals. This is further supported by a strong network of 250 distributors and 500 sales and marketing personnel. In line with our international expansion strategy, AsiaPharm has established a market presence in Singapore, Malaysia, Vietnam, Pakistan and Korea.