China Jo-Jo Drugstores Announces Fiscal Year 2015 First Quarter Financial Results

CHINA JO-JO DRUGSTORES, INC AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(UNAUDITED)

June 30,

March 31,

2014

2014

A S S E T S

CURRENT ASSETS

Cash

$

3,378,916

$

4,445,276

Restricted cash

3,706,658

3,114,543

Trade accounts receivable, net

5,677,129

6,734,536

Inventories

7,223,808

8,419,132

Other receivables, net

425,983

149,546

Advances to suppliers, net

3,184,527

4,577,194

Other current assets

1,726,872

1,663,102

Total current assets

25,323,893

29,103,329

PROPERTY AND EQUIPMENT, net

9,034,288

9,412,688

OTHER ASSETS

Long-term biological assets

1,373,425

-

Long term deposits

2,764,792

2,786,437

Other noncurrent assets

2,947,235

3,036,930

Intangible assets, net

1,563,347

1,569,443

Total other assets

8,648,799

7,392,810

Total assets

$

43,006,980

$

45,908,827

L I A B I L I T I E S A N D S T O C K H O L D E R S' E Q U I T Y

CURRENT LIABILITIES

Short-term loan payable

$

-

$

162,300

Accounts payable, trade

10,218,415

14,554,726

Notes payable

9,065,063

7,820,718

Other payables

1,825,591

1,282,211

Other payables - related parties

2,808,588

2,384,294

Loan from third parties

234,813

294,042

Customer deposits

3,386,007

3,185,885

Taxes payable

349,562

373,501

Accrued liabilities

823,309

1,208,242

Total current liabilities

28,711,348

31,265,919

Purchase option and warrant liability

155,217

278,916

Total liabilities

28,866,565

31,544,835

COMMITMENTS AND CONTINGENCIES

STOCKHOLDERS' EQUITY

Preferred stock; $0.001 par value; 10,000,000 shares authorized; nil issued and
outstanding as of March 31, 2014 and June 30, 2014

-

-

Common stock; $0.001 par value; 250,000,000 shares authorized; 14,416,022 and 14,416,022 shares issued and outstanding as of June 30, 2014 and March 31, 2014

14,416

14,416

Additional paid-in capital

17,427,911

17,355,555

Statutory reserves

1,309,109

1,309,109

Accumulated deficit

(8,607,504)

(8,260,767)

Accumulated other comprehensive income

3,957,404

3,905,136

Total stockholders' equity

14,101,336

14,323,449

Noncontrolling interests

39,079

40,543

Total equity

14,140,415

14,363,992

Total liabilities and stockholders' equity

$

43,006,980

$

45,908,827

CHINA JO-JO DRUGSTORES, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS

(UNAUDITED)

For the three months ended
June 30,

2014

2013

REVENUES, NET

$

16,459,232

$

15,336,519

COST OF GOODS SOLD

13,948,613

11,735,350

GROSS PROFIT

2,510,619

3,601,169

SELLING EXPENSES

1,768,577

1,680,842

GENERAL AND ADMINISTRATIVE EXPENSES

1,081,201

2,640,818

TOTAL OPERATING EXPENSES

2,849,778

4,321,660

LOSS FROM OPERATIONS

(339,159)

(720,491)

OTHER LOSS, NET

(115,836)

(40,413)

CHANGE IN FAIR VALUE OF DERIVATIVE LIABILITIES

123,699

12,665

LOSS BEFORE INCOME TAXES

(331,296)

(748,239)

PROVISION FOR INCOME TAXES

16,141

39,520

NET LOSS

(347,437)

(787,759)

ADD: NET LOSS ATTRIBUTABLE TO NONCONTROLLING INTEREST

700

243

NET LOSS ATTRIBUTABLE TO CHINA JO-JO DRUGSTORES, INC.

(346,737)

(787,516)

OTHER COMPREHENSIVE INCOME

Foreign currency translation adjustments

52,268

759,791

COMPREHENSIVE LOSS

$

(294,469)

$

(27,725)

WEIGHTED AVERAGE NUMBER OF SHARES:

Basic

14,416,022

13,609,003

Diluted

14,416,022

13,609,003

LOSSES PER SHARES:

Basic

$

(0.02)

$

(0.06)

Diluted

$

(0.02)

$

(0.06)

CHINA JO-JO DRUGSTORES, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(UNAUDITED)

Three months ended
June 30,

2014

2013

CASH FLOWS FROM OPERATING ACTIVITIES:

Net loss

$

(347,437)

$

(787,759)

Adjustments to reconcile net (loss) income to net cash provided by (used in) operating activities:

Depreciation and amortization

502,101

588,936

Stock compensation

71,544

27,338

Bad debt provision

(637,819)

1,181,478

Inventory reserve

4,316

-

Change in fair value of purchase option derivative liability

(123,699)

(12,665)

Change in operating assets:

Accounts receivable, trade

1,187,128

(190,989)

Notes receivable

-

(290,214)

Inventories and biological assets

(171,784)

(398,271)

Other receivables

(59,183)

(159,171)

Advances to suppliers

1,694,269

(1,111,259)

Other current assets

(61,633)

(782,304)

Long term deposit

25,040

-

Other noncurrent assets

93,294

49,586

Change in operating liabilities:

Accounts payable, trade

(4,347,548)

1,363,429

Other payables and accrued liabilities

155,208

(570,952)

Customer deposits

195,894

365,295

Taxes payable

(24,361)

(2,212)

Net cash used in operating activities

(1,844,670)

(729,734)

CASH FLOWS FROM INVESTING ACTIVITIES:

Purchase of equipment

(104,682)

(2,934)

Additions to leasehold improvements

-

(3,958)

Payments on construction-in-progress

-

(111,152)

Net cash used in investing activities

(104,682)

(118,044)

CASH FLOWS FROM FINANCING ACTIVITIES:

Proceeds from short-term bank loan

-

161,230

Repayment of short-term bank loan

(162,250)

-

Repayment of third parties loan

(59,500)

-

Change in restricted cash

(587,371)

(1,336,189)

Proceeds from notes payable

1,918,599

650,108

Repayments of notes payable

(685,791)

(816,304)

Proceeds from other payables-related parties

423,752

194,973

Net cash provided by financing activities

847,439

(1,146,182)

EFFECT OF EXCHANGE RATE ON CASH

35,553

181,265

DECREASE IN CASH

(1,066,360)

(1,812,695)

CASH, beginning of period

4,445,276

4,524,094

CASH, end of period

$

3,378,916

$

2,711,399

SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:

Cash paid for income taxes

$

21,325

$

9,529

Cash paid for interest

$

1,460

$

8,764