Exhibit 99.1 

 

El Monte, Calif., April 2, 2018 /PRNewswire/ -- Yew Bio-Pharm Group, Inc. (“Yew Bio” or the “Company”) (OTCQB: YEWB), a major grower and seller of yew trees, yew raw materials used in the manufacture of traditional Chinese medicine, handicraft products made from yew timber and yew candle and soap made with yew essential oil in China, today reported financial results for the three- and twelve-months ended December 31, 2017.

 

2017 Fourth Quarter Results

 

  

Three Months Ended December 31,

  

Twelve Months Ended December 31,

 
  

2017 

  

2016

  

2017

  

2016

 
Revenues:                
TCM Raw Materials  $3,169,400   $4,703,017   $20,180,406   $28,766,815 
Yew Trees   72    (387)   9,978    22,859 
Handicrafts   45,275    643    50,559    98,203 
Others
   2,280,188    7,297,231    20,298,747    22,460,205 
Total Revenues  $5,494,935   $12,000,504   $40,539,690   $51,348,082 

 

Total revenue for the fourth quarter of 2017 decreased 54.2% to $5.5 million from $12.0 million a year ago. Sales of TCM raw materials amounted to 57.7% of total revenues; sales of others segment consisting with yew essential oil candle, yew essential oil soap, pine needle extract, complex Taxus Cuspidate extract and composite northeast yew extract amounted to 41.5% of total revenues; sales of handicrafts amounted to 0.8% of total revenues, and sales of yew trees amounted to 0.0% of total revenues which is due to the Company’s strategy adjustment to reserve more yew trees for future TCM raw materials sales.

 

For the 2017 fourth quarter, gross profit was a loss of $6.8 million, compared with a loss of 1.2 million. The loss for the fourth quarter of 2017 was primarily due to adjustment of inventory and yew forest assets based on our physical inventory observation.

 

Operating expenses increased 460.9% to $878,089 for the 2017 fourth quarter, from $156,546 in the year-ago quarter. The increasing was primarily attributable to the increase in compensation and related benefits and Other fees.

 

Net income in the fourth quarter of 2016 was a loss of $7.8 million, or a loss of $0.14 per diluted share, compared with a loss of $1.4 million in the year-ago quarter, or a loss of $0.03 per diluted share.

 

 

 

 

2017 Results

 

Total revenues for the 2017 fiscal year were $40.5 million, a 21.0% decrease from $51.3 million a year earlier. Sales of TCM raw materials amounted to 49.8% of total revenues, sales of yew trees amounted to 0.0% of total revenues, sales of handicrafts amounted to 0.1% of total revenues and sales of others consisting with yew essential oil candle, yew essential oil soap, pine needle extract, complex Taxus Cuspidate extract and composite northeast yew extract made up the remaining 50.1%.

 

Gross profit was $5.1 million, or 12.5% of total revenues, for the full year, compared with $3.2 million, or 6.3% of total revenues in 2016.

 

Operating expenses increased 56.1% to $1.7 million for the year ended December 31, 2017, from 1.1 million a year earlier. The increasing was primarily attributable to the increases in compensation and related benefits and Other fees.

 

Net income for 2017 increased to $3.2 million, or 0.06 per diluted share, from $2.0 million, or $0.04 per diluted share for 2016.

 

“Our TCM raw materials and Others segment sales contributed most of our revenues for the year 2017,” said Mr. Zhguo Wang, Chairman and Chief Executive Officer of Yew Bio-Pharm Group, Inc. “We developed a series of yew product derivatives such as yew oil candle, yew essential oil soap, face serum and moisturizer cosmetics which contain yew essential oil, functional pillow, complex Taxus Cuspidate extract and composite northeast yew extract since from year 2015, and these products have been accepted by more and more customers of the U.S. and Chinese market. We also established a yew product retail and experience store in San Gabriel, California in 2017, and we hope to introduce our yew products to the U.S. customers by establishing more experience stores in the future.”

 

“Our face serum and moisturizer cream cosmetics containing yew essential oil had formally launched to the market during the fourth quarter of 2017, and now we are working with our Chinese distributors to complete the application to export to Chinese market. We expect the application to be finished during six to nine months. Meanwhile, we are also exploring major U.S. distributors to seek listing our cosmetics on the shelf. As we announced in the earlier news, we have been through to explore the transformation of the Company’s business model from a forestry company to a high value-added manufacturer mainly utilizes the yew tree raw materials as basis. Looking ahead in 2018, we will continue to enrich our product mix and develop more value-added products for the Company, and we expect the Company to achieve sustained growth with the new business.”

 

 2

 

 

ABOUT YEW BIO-PHARM GROUP, INC

 

Yew Bio-Pharm Group, Inc., through its operating entity, Harbin Yew Science and Technology Development Co., Ltd. (HDS), is a major grower and seller of yew trees, yew raw materials used in the manufacture of traditional Chinese medicine (TCM) and products made from yew timber in China. Raw material from the species of yew tree that the Company grows contains taxol, and TCM containing yew raw materials has been approved as a traditional Chinese medicine in China for secondary treatment of certain cancers.  The Company uses a patented, accelerated growth technology to speed the growth and maturity and commercialization of yew trees and believes that it is one of the few companies possessing a permit to sell them. Yew Bio-Pharm also recently established a division to focus on organic foods and dietary supplements with the aim of developing new business opportunities in related industries. To learn more, please visit www.yewbiopharm.com

 

SAFE HARBOR

 

This press release forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, as amended, or the Exchange Act. These forward-looking statements involve a number of risks and uncertainties that could cause actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by these forward-looking statements. A number of factors could cause actual results to differ materially from those contained in any forward-looking statement, including but not limited to the following: our ability to collect from our largest customers; our dependence on a small number of customers for raw materials, including a related party; our ability to continue to purchase raw materials at relatively stable prices; our dependence on a small number of customers for our yew trees for reforestation; our ability to market successfully raw materials used in the manufacture of traditional Chinese medicines; and our ability to receive continued preferential tax treatment for the sale of yew trees and potted yew trees. From time to time, these risks, uncertainties and other factors are discussed in the Company’s filings with the U.S. Securities and Exchange Commission, including its most recent annual report on Form 10-K. Yew Bio does not undertake any obligation to update any forward-looking statements as a result of new information, future events or otherwise, except as required under applicable law.

 

Company Contact:

 

Henry Pang 

Yew Bio-Pharm Group, Inc. 

Tel: (626) 401-9588 

hpang@yewbiopharm.com

 

(financial tables follow)

 

 3

 

 

YEW BIO-PHARM GROUP, INC. AND SUBSIDIARIES

 

CONSOLIDATED BALANCE SHEETS

 

   December 31, 
   2017   2016 
         
ASSETS        
CURRENT ASSETS:        
Cash  $859,830   $278,991 
Accounts receivable   9,881,914    14,467,852 
Accounts receivable - related parties   21,847,733    6,941,931 
Inventories, net   2,579,190    10,296,792 
Prepaid expenses - related parties   57,202    76,995 
Prepaid expenses and other assets   37,519    74,783 
VAT recoverables   170,564    1,655,954 
           
Total Current Assets   35,433,952    33,793,298 
           
LONG-TERM ASSETS:          
Long-term inventories, net   10,546,648    7,151,613 
Property and equipment, net   579,557    692,116 
Land use rights and yew forest assets, net   6,369,938    4,558,234 
           
Total Long-term Assets   17,496,143    12,401,963 
           
Total Assets  $52,930,095   $46,195,261 
           
LIABILITIES AND SHAREHOLDERS’ EQUITY          
CURRENT LIABILITIES:          
Accounts payable  $460,202   $2,700,148 
Accounts payable - related parties   50,318    638,318 
Accrued expenses and other payables   162,619    379,294 
Note payable   -    1,156,444 
Taxes payable   5,574    16,520 
Due to related parties   619,999    883,596 
Short-term borrowings   6,099,876    1,723,865 
           
Total Current Liabilities   7,398,588    7,498,185 
           
NONCURRENT LIABILITIES:          
Deferred income   359,646    120,973 
Total Noncurrent Liabilities   359,646    120,973 
           
Total Liabilities   7,758,234    7,619,158 
           
SHAREHOLDERS’ EQUITY:          
Common Stock ($0.001 par value; 140,000,000 shares authorized; 51,875,000 shares issued and outstanding at December 31, 2017 and 2016)   51,875    51,875 
Additional paid-in capital   10,363,412    9,654,024 
Retained earnings   30,287,658    27,074,624 
Statutory reserves   3,762,288    3,762,288 
Accumulated other comprehensive income (loss)   706,628    (1,966,708)
           
Total Shareholders’ Equity   45,171,861    38,576,103 
           
Total Liabilities and Shareholders’ Equity  $52,930,095   $46,195,261 

 

 4

 

 

YEW BIO-PHARM GROUP, INC. AND SUBSIDIARIES

 

CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME (LOSS)

 

   For the Years Ended December 31, 
   2017   2016 
REVENUES:        
Revenues  $17,634,466   $22,581,267 
Revenues - related parties   22,905,224    28,766,815 
           
Total Revenues   40,539,690    51,348,082 
           
COST OF REVENUES:          
Cost of revenues   17,810,948    24,688,860 
Cost of revenues - related parties   17,666,765    23,424,644 
           
Total Cost of Revenues   35,477,713    48,113,504 
           
GROSS PROFIT   5,061,977    3,234,578 
           
OPERATING EXPENSES:          
Selling   86,633    34,828 
General and administrative   1,650,690    1,078,392 
           
Total Operating Expenses   1,737,323    1,113,220 
           
INCOME FROM OPERATIONS   3,324,654    2,121,358 
           
OTHER INCOME (EXPENSES):          
Interest expense   (225,023)   (140,844)
Other income (expense)   (33,961)   3,853 
Exchange gains   147,978    40,533 
           
Total Other Expenses   (111,006)   (96,458)
           
INCOME BEFORE PROVISION FOR INCOME TAXES   3,213,648    2,024,900 
PROVISION FOR INCOME TAXES   (614)   (18,009)
NET INCOME  $3,213,034   $2,006,891 
           
COMPREHENSIVE INCOME (LOSS):          
NET INCOME  $3,213,034   $2,006,891 
OTHER COMPREHENSIVE INCOME (LOSS):          
Foreign currency translation adjustment   2,673,336    (2,632,390)
           
COMPREHENSIVE INCOME (LOSS)  $5,886,370   $(625,499)
           
NET INCOME PER COMMON SHARE:          
Basic  $0.06   $0.04 
Diluted  $0.06   $0.04 
WEIGHTED AVERAGE COMMON SHARES OUTSTANDING:          
Basic   51,875,000    51,875,000 
Diluted   53,934,497    51,875,000 

 

 5

 

 

YEW BIO-PHARM GROUP, INC. AND SUBSIDIARIES

 

CONSOLIDATED STATEMENTS OF CASH FLOWS

 

   For the Years Ended
December 31,
 
   2017   2016 
CASH FLOWS FROM OPERATING ACTIVITIES:        
Net income  $3,213,034   $2,006,891 
Adjustments to reconcile net income to net cash provided by (used in) operating activities:          
Depreciation   67,790    112,282 
Amortization of land use rights and yew forest assets   3,678,972    8,819,008 
Stock-based compensation   709,388    31,466 
Inventory write-down   -    2,499,563 
Changes in operating assets and liabilities:          
Accounts receivable   5,349,595    (11,345,374)
Accounts receivable - related parties   (13,903,716)   (915,034)
Prepaid and other current assets   40,202    (13,435)
Prepaid expenses - related parties   23,055    23,440 
Inventories, net   850,356    (4,080,175)
VAT recoverables   1,537,471    (1,047,212)
Accounts payable   (2,325,337)   2,807,954 
Accounts payable - related parties   (607,503)   626,557 
Accrued expenses and other payables   (195,047)   362,600 
Due to related parties   (58,417)   9,635 
Note payable   (1,210,833)   615,408 
Deferred income   221,992    126,392 
Taxes payable   (11,271)   3,065 
           
NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES   (2,620,269)   643,031 
           
CASH FLOWS FROM INVESTING ACTIVITIES:          
Change in restricted cash   -    296,419 
Purchase of property and equipment   -    (61,509)
Purchase of land use rights and yew forest assets   (799,070)   - 
           
NET CASH PROVIDED BY (USED IN) INVESTING ACTIVITIES   (799,070)   234,910 
           
CASH FLOWS FROM FINANCING ACTIVITIES:          
Proceeds from short-term borrowings   10,940,220    1,809,189 
Repayments of short-term borrowings   (6,844,634)   (3,022,055)
Proceeds from related party   -    81 
Repayments to related parties   (170,875)   (49,030)
           
NET CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES   3,924,711    (1,261,815)
           
EFFECT OF EXCHANGE RATE ON CASH   75,467    (18,743)
           
NET INCREASE (DECREASE) IN CASH   580,839    (402,617)
           
CASH - Beginning of the year   278,991    681,608 
           
CASH - End of the year  $859,830   $278,991 
           
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:          
Cash paid for:          
Interest  $189,403   $145,452 
Income taxes  $18,328   $24,451 
           
NON-CASH INVESTING AND FINANCING ACTIVITIES          
Operating expense paid by related party  $38,140   $88,088 
Property and equipment paid by related party  $-   $82,491 
Settlement of due to related party with property and equipment  $82,491   $- 
Reclassification of inventories to land use rights and yew forest assets  $4,331,025   $- 

 

 

6

 


The following information was filed by Yew Biopharm Group, Inc. (YEWB) on Tuesday, April 10, 2018 as an 8K 2.02 statement, which is an earnings press release pertaining to results of operations and financial condition. It may be helpful to assess the quality of management by comparing the information in the press release to the information in the accompanying 10-Q Quarterly Report statement of earnings and operation as management may choose to highlight particular information in the press release.

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