China Sky One Medical, Inc. (NSDQ: CSKI) announced 2008 financial results that were a significant advance over 2007 and also slightly ahead of forecasts. In 2008, the company’s revenues increased 86% to $91.8 million, while net income rose 88% to $35.7 million or $1.87 per share, fully diluted.
China Sky One expects its business will continue to grow: it issued 2009 guidance for revenues in a $128-$130 million range, a 40% jump, and net income of $38-39 million, which is higher by 30%.
Investors loved the report. They sent shares of China Sky One higher by $3.12 to $14.22, a 28% rise. At this price, China Sky One has a trailing 12-month price/earnings ratio of just 7.6 and market capitalization of $231 million.
During 2008, China Sky One received SFDA approval for 19 drugs, completed three acquisitions (Heilongjiang Tianlong Pharmaceuticals, Heilongjiang Haina Pharmaceuticals, and Peng Lai Jin Chuang Pharmaceutical Company), and signed an agreement to acquire a new breast drug from Harbin Medical University.
The company finished the year on a strong note. Its Q4 was 104% ahead of the 2007 quarter. The nature of its business is changing, as it adds new offerings to its own product portfolio. China Sky One's product sales rose 137% in 2008 to $86.2 million. Contract sales, meanwhile, dropped 57% to $5.7 million.
At the end of 2008, China Sky One held $40 million in cash and has $58 million in working capital. It raised $23.5 million in a private placement in January 2008, and it generated $27.5 million in net cash flow during the year, up from $11.6 million in 2007.
