The 2011 Third Quarterly Report of Livzon Pharmaceutical Group Inc.
The 2011 Third Quarterly Report of Livzon Pharmaceutical Group Inc.
§1 Important notice
1.1 The Board of Directors (BOD), Board of Supervisors (BOS), directors, supervisors, and senior executives
hereby guarantee that the data in the present report contain no false representation, misleading statements and
serious omissions, and shall be severally and jointly liable for the authenticity, accuracy and completeness of the
content.
1.2 No directors, supervisors and senior executives have any guaranty or objection to the authenticity, accuracy
and completeness of the content.
1.3 All directors attended the shareholders’ meeting.
1.4 The third quarterly report has not been audited by any accountants firms.
1.5 Mr. Zhu Baoguo, principal of the Company, Mr. An Ning, the principal in charge of accounting, and Ms. Si
Yanxia, the principal of the Accounting Department hereby declare: We guarantee the authenticity and
completeness of the Financial Report in this quarterly report.
1.6 This Quarterly Report is published in Chinses and English vsrsions.In the event of inconsiatency, the Chinese
vsrsion shall prevail.
§2 Brief introduction of the Company
2.1 Financial highlights
Unit :( RMB) Yuan
September 30, 2011 September 30, 2010 Increase or decrease
Total assets (RMB Yuan) 4,307,153,787.15 3,661,991,627.95 17.62%
Owners’ equity attributable to the shareholders of
2,759,694,119.70 2,517,438,110.24 9.62%
listed company (RMB Yuan)
Share capital (Share) 295,721,852.00 295,721,852.00 0.00%
Net asset per share attributable to the
shareholders of listed company (RMB 9.33 8.51 9.64%
Yuan/share)
Increase or Increase or
July to decrease January to decrease
September compared with the September compared with the
2011 same period of 2011 same period of
previous year (%) previous year (%)
2,263,842,654.
Total operating income(RMB Yuan) 792,405,153.47 16.76% 13.11%
10
Net profit attributable to shareholders of listed 280,853,492.8
59,991,797.25 -31.25% -14.57%
company(RMB Yuan) 4
Net cash flows from operating activities (RMB
- - 408,029,117.80 -4.88%
Yuan)
Net cash flows per share from operating activities
- - 1.38 -4.83%
(RMB Yuan/share)
Basic profit per share (RMB Yuan/share) 0.20 -33.33% 0.95 -14.41%
Diluted profit per share (RMB Yuan/share) 0.20 -33.33% 0.95 -14.41%
Down 1.54 Down 3.72
Weighed yield rate of net asset（%） 2.27% 10.64%
percentage points percentage points
Weighed yield rate of net assets after deduction Down 0.73 Down 3.37
2.75% 10.40%
of non-recurring profit and loss（%） percentage points percentage points
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The 2011 Third Quarterly Report of Livzon Pharmaceutical Group Inc.
The items of non-recurring profit and loss (January to September 2011)
Unit :( RMB) Yuan
Amount from the year
Items of non-recurring profit and loss beginning to end of Note
report period
Profit and loss in disposal of non-circulation assets 352,757.83
All types of governmental
Governmental allowance accrued to the current profit and loss 24,788,073.65 allowances received by
the company.
Except the effective hedge business related to the normal Profits in the changes of
operation business of the company, the profit and loss in the fair values of tradable
changes of fair values caused by the holding of tradable financial financial assets, and the
-14,257,495.05
assets and tradable financial liabilities as well as the investment investment returns from
returns in disposal of tradable financial assets, tradable financial the holding and disposal of
liabilities and saleable financial assets tradable financial assets
Other net non-operating income and payment except the above
243,267.70
items
Subtotal 11,126,604.13
Minus: effect of income tax 3,898,246.69
Minus: Non-recurring profit and loss attributable to the minority of
655,296.61
shareholders
Total of non-recurring profit and loss 6,573,060.83
Note: this table is calculated and filled in accordance with the regulation of No. 1 Explanatory Announcement about
Information Disclosure of Companies Making Public Offering of Securities – Non-recurring Profit and Loss (2009)
(Zheng Jian Hui Gong Gao (2009) No. 43).
2.2 Table about total quantity of all shareholders and shareholding particulars of top ten
shareholders without trading restriction at the end of report period
Unit: share
Total quantity of shareholders at the end of The shareholder quantity amounted to 27,701 (including 8,648 B-sha
report period re holders)
Shares held by top ten shareholders without trading restriction
Quantity of shares without
No. Shareholder name Share type
trading restriction
1 Joincare Pharmaceutical Group Industry Co., Ltd 77,510,167 RMB Common share
Tiancheng Industry Co., Ltd Domestically-listed shares
2 45,769,070
for overseas investors
First Shanghai Securities Co., Ltd Domestically-listed shares
3 10,348,547
for overseas investors
Domestically-listed shares
4 GAOLING FUND,L.P. 10,258,112
for overseas investors
5 Dacheng Value Growth Securities Investment Fund 9,120,500 RMB Common share
Agricultural Bank of China –Greatwall Anxin Huibao
6 6,250,020 RMB Common share
Mixed Securities Investment Fund
7 Shenzhen Haibin Pharmaceutical Co., Ltd 5,892,943 RMB Common share
8 Agricultural Bank of China – LOF 5,100,000 RMB Common share
Bank of Communications – Greatwall Jiufu Core Growth
9 4,829,286 RMB Common share
Stock-type Securities Investment Fund (LOF)
China Construction Bank – Greatwall Consumption
10 2,878,296 RMB Common share
Value-added Stock-type Securities Investment Fund
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The 2011 Third Quarterly Report of Livzon Pharmaceutical Group Inc.
§3 Major events
3.1 Great changes and reasons of main financial statement items and financial indexes of the
Company
√ Applicable □ Inapplicable
I. Items in the Balance Sheet: 1. the currency capital increased by RMB 347.1883 million Yuan, up 40.19% compared with
the beginning of report period. The main causes are that the company issued the short-tern financing bonds and the sales
income increased; 2. The tradable financial assets decreased by RMB 17.3932 million Yuan, down 30.06% compared with
the beginning of report period. The main cause is the decrease of the fair prices of tradable financial assets held by the
company within the report period; 3. The accounts receivable increased by RMB 132.4394 million Yuan, up 30.18%
compared with the beginning of report period. The main cause is the increase of sales incomes of main businesses of the
company within the report period; 4. The advance money increased by RMB 77.9585 million Yuan, up 114.78% compared
with the beginning of report period. The main cause is the increase of advance money of Ningxia Raw Material Drug Base
Construction Project for the equipment; 5. The long-term equity investment increased by RMB 72.6803 million Yuan, up
158.27% and the main cause is the share-rationing in China Resources Bank of Zhuhai Co., Ltd; 6. The engineering under
construction decreased by RMB 110.3357 million Yuan, down 34.71% compared with the beginning of report period. The
main cause is that the engineering under construction of relocation projects of new factories of Livzon Pharmaceutical
Factory has been transferred to fixed assets after the completion;; 7. The other accounts payable increased by RMB
116.2457 million Yuan, up 35.89% compared with the beginning of report period. The main cause is the increase of
business expenses due to the increase of sales incomes of products of the company such as the preparations within the
report period; 8. The non-current liabilities due within one year decreased by RMB 70 million Yuan, up 99.43% compared
with the beginning of report period. The main cause is the repayment of short-term bank loans; 9. The deferred profit
increased by RMB 9.2558 million Yuan, up 32.41% compared with the beginning of report period. The main cause is the
increase of governmental allowance received by the company.
II. The items in the Profit Statement from the year beginning to the end of report period: 1. The operating tax and surtax
increased by RMB 23.0887 million Yuan, up 443.05% compared with the same period of previous year. The main causes
are the increase of city construction tax and educational surtax for foreign-invested enterprises to be paid by the company
due to the changes of relevant policies as well as the increase of local educational surtax for enterprises located at
Guangdong Province; 2. The sales expense increased by RMB 199.5158 million Yuan, up 43.47% compared with the
same period of previous year. The main cause is the increase of business promotion expense due to the increase of main
business incomes of the company; 3. The financial expense decreased by RMB 137.841 million Yuan, down 2780.91%
compared with the same period of previous year. The main causes are the increase of interests incomes caused by the
increase of currency capitals and the changes of exchange profit and loss due to the changes of exchange rate; payment
for bank loans; 4. The profits from the changes of fair values decreased by RMB 20.3782 million Yuan, down 403.67%;
The main cause is the decrease of securities prices invested by the company; 5. The non-operating incomes increased by
RMB 15.7589 million Yuan, up 134.17%. The main cause is the increase of received governmental allowance.
III. The items in the Cash Flow Statement: 1. the cash received related to other operating activities increased by RMB
32.4265 million Yuan, up 62.90% compared with the same period of previous year. The main cause is the increase of
governmental allowance related to operating activities that are received by the company; 2. The taxes increased by RMB
94.2467 million Yuan, up 37.36% compared with the same period of previous year, the main cause is the increase of
value-added tax and income tax paid by Livzon Pharmaceutical Factory and Limin Pharmaceutical factory, the
subcompanies controlled by the company; 3. Other cashes paid to operating activities increased by RMB 174.1779 million
Yuan, up 37.00% compared with the same period of previous year. The main cause is the increase of sales expenses due
to the increase of sales incomes. 4. The cash paid to acquire investments increased by RMB 76.3513 million Yuan, up
8591.15% compared with the same period of previous year. The main cause is the share-rationing in China Resources
Bank of Zhuhai Co., Ltd; 5. The cash from loans decreased by RMB 210.5484 million Yuan, down 54.93% compared with
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The 2011 Third Quarterly Report of Livzon Pharmaceutical Group Inc.
the same period of previous year. The main cause is that the company has financed by bonds and gained the sufficient
capitals and then reduced the bank loans; 6. The cash received from the issuing of bonds increased by RMB 400 million
Yuan compared with the same period of previous year. The main reason is the increase of cash received from the issuing
of short-term financing bonds.
3.2 Analysis and particulars of major events, their effects and resolutions
3.2.1 Non-standard opinions
□ Applicable √ Inapplicable
3.2.2 Particulars about the company providing the funds to its controlling shareholders or its
associated parties, or proving the guaranty to foreign parties by violating the specified
procedures
□ Applicable √ Inapplicable
3.2.3 Particulars about execution and performance of key contracts about routine operation
□ Applicable √ Inapplicable
3.2.4 Others
□ Applicable √ Inapplicable
3.3 Performance of commitments by the Company, shareholders and actual
controllers
√ Applicable □Inapplicable
(I) Commitments
1. In 2002, this company signed the patent license agreement with Korea Yiyang Medicine Company. This agreement
approves our company’s exclusive and irrevocable right to use the patent PPI(proton pump inhibitor) compound and Yiyang
patent in China including Hong Kong and Macao in order to production, processing and distribution. The transfer fee will be
USD 2.50 million, and by December 31, 2008, the company has fully paid it. The company agrees to deduct a percentage for
Yiyang according to 10% of sales amount during the first three years when this product begins to be sold. And deduct a
percentage according to 8% of sales amount during the next five years. And deduct a percentage according to 6% of sales
amount from the remaining time to July 22, 2014 (the expiry date of agreement). Since 2009, the company has begun to sell
the products and pay a specified percentage of sales volume to Yiyang as a commission in accordance with the agreement.
2. In 2005, the company signed the approval and supply agreement with Korea LG life science Ltd. (hereinafter referred to as
LG Company), and it grants Gemifloxacin Mesylate with the relevant certificates about intellectual properties and specifies
that the permission fees of the methanesulfonic acid spasmolytic and pellet will be USD1, 000,000 respectively (It has been
fully paid by December 31, 2006). This agreement specifies as follows: Within the first five years from the validity date of the
agreement, the company’s net sales volume of Jimishaxing pellet will amount to 1.5 million bags (3 pellets in each bag) and
LG Company will refund USD 500,000 after the taxation at one time within two months after the company has submitted the
net sales volume certificate. At the same time, during the validity period of the agreement (by the end of 2015), the company
should pay a royalty of 1.5% of net sales volume after the taxation to LG Company during 30 days after each quarter. Since
2008, the company has begun to sell the products and pay a specified royalty to LG Company in accordance with the
agreement.
Within the first five years from the validity date of the agreement, the company will pay a royalty of 10% of net sales volume
after the taxation about injection products to LG Company within 30 days after each quarter. The company will pay a royalty
of 6% of net sales volume after the taxation about injection products to LG Company within 30 days after each quarter from
the sixth business year to the expiry date of agreement (by the end of 2019).
(II) Commitments of shareholders holding over 5% of total shares of the company
The controlling shareholder Joincare Pharmaceutical Group Industry Co., Ltd made the following commitments while
handling the formalities to cancel trading restriction of shares: 1. If Joincare transfers its tradable shares of Livzon Group
whose trading restriction has been released, it will strictly comply with the relevant regulations of the Guiding Opinions on the
Listed Companies’ Transfer of Original Shares Released from Trading Restrictions ([2008] No. 15 announcement) issued by
China Securities Regulatory Commission. 2. If Joincare plans to reduce its tradable shares of Livzon Group whose trading
restriction has been released through the competing price trading system in the stock exchange in the future and the reduced
quantity of shares amounts to over 5% within 6 months from the first reduction, Joincare will disclose the reminder
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The 2011 Third Quarterly Report of Livzon Pharmaceutical Group Inc.
announcement about the selling affairs via Livzon Group in 2 trading days before the first reduction.
During the report period, Joincare did not decrease its shareholding quantity of this company.
3.4 Warning and relevant reasons for the forecast that the accumulative net profit
from the beginning of 2011 to the end of next report period may suffer from any loss
or have any great changes over the same period of previous year
□ Applicable √ Inapplicable
3.5 Particulars about Other Major events
3.5.1 Particulars about Securities investment
√ Applicable □ Inapplicable
Unit :( RMB) Yuan
Percentage
of total Profit and loss
Initial
Holding Book Values investment during the
Securities Securities Securities investment
No. quantity at the end of in the report period
Type Code abbreviation amount (RMB
(share) period securities at (July to
Yuan)
the end of September)
period (%)
13,307,164.8
1 Stock 00135 Kunlun Energy 6,552,717.21 1,500,000 32.88%
0 -2,968,212.09
China National
2 Stock 00883 Offshore Oil 14.67%
2,671,833.26 560,000 5,936,039.20 -2,407,247.41
Corporation
Shenzhen
3 Stock 00152 13.36%
International 9,405,131.53 17,000,000 5,406,035.70 -3,113,252.22
4 Stock 01880 Baili Company 11.73%
2,185,550.82 428,000 4,746,222.11 -941,517.91
5 Stock 02007 Phoenix Island 10.76%
19,439,584.35 2,450,000 4,354,997.99 -2,542,170.15
Rainbow
6 Stock 00438 4.60%
group 5,828,707.08 5,016,000 1,860,948.29 -1,714,788.82
7 Stock 00968 Little Sheep 2.39%
555,249.83 212,000 968,031.01 -113,667.38
8 Stock 01688 Alibaba 1.14%
867,269.00 78,000 463,011.06 -331,894.18
China Railway
9 Stock 00390 Engineering 1.00%
1,494,799.49 314,000 404,531.29 -521,060.49
Group Co.
Sinotrans
10 Stock 00368 0.91%
Shipping 1,755,037.84 260,500 369,591.83 -116,020.07
Other securities investment at the end of this
- 2,481,724.85 6.00% -18,312.69
period 1,836,720.32
Profit and loss of sold Securities investment
- - - 0.00
during the report period
40,472,609.6 -15,116,326.1
Total - 100%
52,592,600.74 2 4
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The 2011 Third Quarterly Report of Livzon Pharmaceutical Group Inc.
Note: in above securities investment, the investment amount of H-share of H-share market of Hongkong
has been converted to RMB amount at the exchange rate issued on September 30, 2011.
3.5.2 Shareholding particulars of other listed companies
√ Applicable □ Inapplicable
Unit :( RMB) Yuan
Securities Securities Initial Percentage of total Book value at Profit and
code abbreviatio investment shares of this the end of this Change of owners’
loss during
n capital Company period equity during the report
the report
period
period
Bank of
601328 Communic 2,450,179.00 0.002% - 90,643.41
6,183,170.56
ations
Huadong
000963 Medicine 0.021% - -1,462,982.32
39,851.86 2,312,780.34
Co., Ltd
Total - -1,372,338.91
2,490,030.86 8,495,950.90
3.5.3 Routine associated transactions
√ Applicable □ Inapplicable
3.5.3.1 Purchase of commodities
Unit :( RMB) Yuan
Associated party January to September 2011 January to September 2010
Guangdong Blue Treasure Pharmaceutical Co.
3,413.33
Ltd 4,337,080.90
Shenzhen Haibin Pharmaceutical Co., Ltd 11,696,365.27 8,451,537.99
Shenzhen Taitai Pharmaceutical Company
153,384.00
Limited -
Joincare Pharmaceutical Group Industry Co., Ltd 53,914.53 14,974.36
Jiaozuo Joincare Pharmaceutical Group Industry
152,921,956.54
Co., Ltd 66,025,606.84
Total 82,112,967.54 161,545,266.22
3.5.3.2 Sales of commodities
Unit :( RMB) Yuan
Associated party January to September 2011 January to September 2010
Zhuhai Joincare Pharmaceutical Group Industry
14,331.96 4,310.07
Co., Ltd
Shenzhen Taitai Pharmaceutical Company
- 16,683.76
Limited
Total 14,331.96 20,993.83
3.5.3.3 Provision of labors
Unit :( RMB) Yuan
Associated party January to September 2011 January to September 2010
Guangdong Blue Treasure Pharmaceutical Co.
4,055,639.46
Ltd 7,000,876.26
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The 2011 Third Quarterly Report of Livzon Pharmaceutical Group Inc.
3.5.3.4 Leased assets
Unit :( RMB) Yuan
Associated party January to September 2011 January to September 2010
Zhuhai Joincare Pharmaceutical Group Industry
77,571.00
Co., Ltd 80,003.88
Health Pharmaceutical (China) Co., Ltd 74,961.00 74,961.00
Total 154,964.88 152,532.00
3.5.3.5 Renting of assets
Unit :( RMB) Yuan
Associated party January to September 2011 January to September 2010
Joincare Pharmaceutical Group Industry Co., Ltd 453,287.80 -
The above-mentioned associated transaction came from the normal supply demand of the company. It is predicated that
this associated transaction will continue during the production operations from now on. The associated transaction follows
the principle of equity, justice and no damage to the company’s benefits. Because the associated transaction amount
accounts for the small percentage of total sales revenue or purchasing amount, it makes no effect on financial status and
operation result. And it also makes no effect on the independence of the company. The company also will not depend on
associated persons due to this associated transaction.
3.5.4 List of Activities in which the Company receives the investigation, communication and
interview, etc during the report period
Reception date Receptio Receptio Objects Discussion topics and
n place n mode provided materials
Headquarter Local Rater Investment Management Operation status of the Company;
August 11, 2011 s investigation Co., Ltd provide no text materials
Headquarter Local Operation status of the Company;
August 11, 2011 Century Securities Co., Ltd Institute
s investigation provide no text materials
Headquarter Investment Management
s Local Operation status of the Company;
August 17, 2011 Department of Guoyuan Securities
investigation provide no text materials
Co., Ltd
Headquarter Local Shenzhen Lonteng Assets Operation status of the Company;
August 18, 2011 s investigation Management Co., Ltd provide no text materials
3.6 Investments in derivative products
□Applicable √Inapplicable
3.6.1 Holding particulars of investments in derivative products at the end of report period
□ Applicable √ Inapplicable
§4 Appendix
4.1 Balance Sheet
Prepared by: Livzon Pharmaceutical Group Inc. September 30, 2011 Unit :( RMB) Yuan
Balance at the end of period Balance at the beginning of year
Item
Consolidation Parent Company Consolidation Parent Company
Current assets:
Currency capital 1,211,120,184.72 1,120,598,040.48 863,931,857.59 681,878,797.62
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The 2011 Third Quarterly Report of Livzon Pharmaceutical Group Inc.
Tradable financial assets 40,472,609.62 57,865,790.18
Notes receivable 182,302,220.78 26,993,844.31 232,945,814.77 36,943,041.55
Accounts receivable 571,203,101.26 234,401,574.72 438,763,726.58 178,746,580.44
Advance money 145,881,243.39 13,231,076.00 67,922,719.62 4,111,999.69
Dividend receivable
Other accounts receivable 51,230,138.84 217,951,032.90 44,079,280.01 385,777,156.54
Inventory 448,712,874.60 118,709,156.51 450,214,441.42 71,349,271.13
Non-current assets due within
one year
Other current assets
Total of current assets 2,650,922,373.21 1,731,884,724.92 2,155,723,630.17 1,358,806,846.97
Non-current assets:
Issuing of entrusted loans and
advance money
Saleable financial assets 8,495,950.90 8,495,950.90 10,572,886.89 10,572,886.89
Investment held to the maturity
date
Long-term accounts receivable
Long-term equity investment 118,600,953.20 1,490,055,185.07 45,920,620.54 1,131,259,264.48
Real estate for Investment
Fixed assets 1,002,144,415.58 91,360,193.02 803,942,036.05 88,379,927.98
Engineering under construction 207,570,690.52 317,906,371.50
Engineering goods 4,983,251.54 25,195,844.94
Liquidation of fixed assets
Production biology assets
Intangible assets 171,706,585.84 34,809,106.44 163,772,276.26 32,657,247.08
Development expenses 2,610,153.51 1,289,662.78 4,332,137.81 1,289,662.78
Goodwill 103,040,497.85 103,040,497.85
Long-term deferred and
8,611,854.10 8,640,218.34
prepaid expenses
Assets with deferred income
28,467,060.90 12,303,225.41 22,945,107.60 11,550,335.20
taxes
Other non-current assets
Subtotal of non-current assets 1,656,231,413.94 1,638,313,323.62 1,506,267,997.78 1,275,709,324.41
Total of assets 4,307,153,787.15 3,370,198,048.54 3,661,991,627.95 2,634,516,171.38
Current liabilities:
Short-term loans 207,932,237.81 483,177,567.81 207,460,286.80 101,583,700.00
Tradable financial liabilities
Notes payable
Accounts payable 179,320,692.91 244,485,430.43 164,677,954.49 200,455,422.69
Deposit receivable 19,874,591.67 7,304,312.01 21,127,228.70 8,250,583.82
Payroll payable 44,952,860.27 17,181,350.42 51,323,701.39 15,430,849.29
Tax payable 79,025,323.45 16,959,666.23 83,837,811.52 9,358,777.21
Interests payable
Dividend payable 2,531,984.46 20,174.46 2,531,984.46 20,174.46
Other accounts payable 440,100,831.43 1,064,597,985.73 323,855,124.01 781,235,594.73
Non-current liabilities due
400,000.00 70,400,000.00 70,000,000.00
within one year
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The 2011 Third Quarterly Report of Livzon Pharmaceutical Group Inc.
Other current liabilities 400,000,000.00
Total of current liabilities 1,374,138,522.00 1,833,726,487.09 925,214,091.37 1,186,335,102.20
Non-current liabilities
Long-term loan 1,200,000.00 66,796,116.23 20,000,000.00
Bonds payable
Long-term accounts payable
Deferred profit 37,812,011.10 13,201,689.07 28,556,183.49 10,453,489.34
Anticipation liability
Liabilities with the deferred
1,802,699.62 900,888.00 2,274,648.21 1,212,428.40
income taxes
Other non-current liabilities
Subtotal of non-current
40,814,710.72 14,102,577.07 97,626,947.93 31,665,917.74
liabilities
Total of liabilities 1,414,953,232.72 1,847,829,064.16 1,022,841,039.30 1,218,001,019.94
Owners' equity (or
shareholders’ equities):
Paid-up capital (or share
295,721,852.00 295,721,852.00 295,721,852.00 295,721,852.00
capital)
Capital reserve 346,671,254.14 337,319,772.07 348,436,179.34 339,085,167.66
Minus: treasury share
Special reserve
Surplus reserve 443,274,429.10 260,712,690.11 443,274,429.10 260,712,690.11
General risk reserve
Profit in this period 280,853,492.84 137,121,128.87
Undistributed profit 1,417,212,975.75 491,493,541.33 1,446,714,876.09 520,995,441.67
Conversion margin in foreign
-24,039,884.13 -16,709,226.29
currency statement
Subtotal of equities attributable
to the owners of parent 2,759,694,119.70 1,522,368,984.38 2,517,438,110.24 1,416,515,151.44
company
Equities of the minority of
132,506,434.73 121,712,478.41
shareholders
Subtotal of owners’ equities 2,892,200,554.43 1,522,368,984.38 2,639,150,588.65 1,416,515,151.44
Total of liabilities and owners’
4,307,153,787.15 3,370,198,048.54 3,661,991,627.95 2,634,516,171.38
equities
4.2 Profit statement in this report period
Prepared by: Livzon Pharmaceutical Group Inc. July to September 2011 Unit :( RMB) Yuan
Amount in this period Amount in previous period
Item
Consolidation Parent Company Consolidation Parent Company
I. Total operating income 792,405,153.47 350,926,420.24 678,660,658.55 251,352,303.76
Including: operating income 792,405,153.47 350,926,420.24 678,660,658.55 251,352,303.76
Interests income
II. Total operating cost 697,370,353.85 349,300,532.47 569,733,264.34 233,882,222.33
Including: operating cost 341,459,503.89 184,610,686.13 325,112,741.94 118,338,597.41
Interests payments
Operating tax and surtax 9,967,997.67 2,924,561.91 2,183,720.32 60,000.00
Sales expense 274,579,754.37 140,356,232.00 173,773,199.71 94,891,867.05
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The 2011 Third Quarterly Report of Livzon Pharmaceutical Group Inc.
Management expense 74,541,335.77 26,753,977.54 65,477,030.24 22,009,090.31
Financial expense -8,029,278.84 -8,074,313.87 -273,851.84 -2,567,074.82
Loss from asset depreciation 4,851,040.99 2,729,388.76 3,460,423.97 1,149,742.38
Plus: returns from the changes of
fair values (the loss is listed -15,373,818.88 7,199,732.61
beginning with “-”).
Investment returns (the loss is
1,797,547.34 -540,987.52 -700,312.81 16,538,342.18
listed beginning with “-”).
Including: the investment returns
from the associated enterprises -1,172,693.84 -540,987.52 -873,796.85 -572,301.36
and joint enterprises
Profits form currency exchange
(the loss is listed beginning with “-”)
III. Operating profit (the loss is
81,458,528.08 1,084,900.25 115,426,814.01 34,008,423.61
listed beginning with “-”)
Plus : non-operating income 5,252,988.04 25,663.33 1,197,442.98 440,253.04
Minus: non-operating payments 1,865,785.95 1,644,662.40 881,852.91 225,181.09
Including: loss in the disposal of
102,014.36 19,980.91 49,531.46 602.50
non-current assets
IV. Total profit (the loss is listed
84,845,730.17 -534,098.82 115,742,404.08 34,223,495.56
beginning with “-”)
Minus: income tax expense 19,743,560.07 32,245.54 20,203,089.72 2,565,122.67
V. Net profit (the loss is listed
65,102,170.10 -566,344.36 95,539,314.36 31,658,372.89
beginning with “-”)
Net profit attributable to the owners
59,991,797.25 -566,344.36 87,262,656.82 31,658,372.89
of parent company
Profit and loss of the minority of
5,110,372.85 8,276,657.54
shareholders
VI. Profit per share:
(I) Basic profit per share 0.20 0.30
(II) Diluted profit per share 0.20 0.30
VII. Other comprehensive gains -6,477,764.74 -1,166,488.07 -687,351.59 167,669.49
VIII. Total of comprehensive gains 58,624,405.36 -1,732,832.43 94,851,962.77 31,826,042.38
Total of comprehensive gains
attributable to the owners of parent 53,514,032.51 -1,732,832.43 86,575,305.23 31,826,042.38
company
Total of comprehensive gains
attributable to the minority of 5,110,372.85 8,276,657.54
shareholders
4.3 Profit statement from year beginning to the end of this report period
Prepared by: Livzon Pharmaceutical Group Inc. January to September 2011 Unit :( RMB) Yuan
Amount in this period Amount in previous period
Item
Consolidation Parent Company Consolidation Parent Company
I. Total operating income 2,263,842,654.10 946,006,255.04 2,001,430,248.29 733,316,600.60
Including: operating income 2,263,842,654.10 946,006,255.04 2,001,430,248.29 733,316,600.60
Interests income
II. Total operating cost 1,906,952,893.51 898,913,458.65 1,600,624,741.14 664,604,382.38
Including: operating cost 1,018,552,911.16 546,206,247.87 960,876,870.69 348,672,296.07
Interests payments
Operating tax and surtax 28,300,021.22 7,137,672.34 5,211,349.86 135,000.00
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The 2011 Third Quarterly Report of Livzon Pharmaceutical Group Inc.
Sales expense 658,489,170.63 286,635,513.99 458,973,330.76 253,533,625.31
Management expense 204,108,651.52 70,515,637.96 164,666,273.27 62,179,701.32
Financial expense -13,288,418.03 -16,634,251.68 495,668.76 -2,382,423.94
Loss from asset depreciation 10,790,557.01 5,052,638.17 10,401,247.80 2,466,183.62
Plus: returns from the changes
of fair values (the loss is listed -15,329,948.18 5,048,295.93
beginning with “-”).
Investment returns (the loss is
1,142,974.78 98,300,968.59 -1,085,288.89 15,214,484.59
listed beginning with “-”).
Including: the investment
returns from the associated
-2,645,427.34 -1,576,039.41 -2,881,706.89 -2,046,388.42
enterprises and joint
enterprises
Profits form currency exchange
(the loss is listed beginning
with “-”)
III. Operating profit (the loss is
342,702,787.19 145,393,764.98 404,768,514.19 83,926,702.81
listed beginning with “-”)
Plus : non-operating income 27,503,971.07 284,292.64 11,745,081.41 7,452,762.30
Minus: non-operating
2,119,871.89 1,670,070.99 2,367,418.87 1,063,121.01
payments
Including: loss in the disposal
162,021.45 25,573.39 548,263.58 5,037.48
of non-current assets
IV. Total profit (the loss is listed
368,086,886.37 144,007,986.63 414,146,176.73 90,316,344.10
beginning with “-”)
Minus: income tax expense 66,744,421.51 6,886,857.76 60,806,689.52 11,082,439.28
V. Net profit (the loss is listed
301,342,464.86 137,121,128.87 353,339,487.21 79,233,904.82
beginning with “-”)
Net profit attributable to the
280,853,492.84 137,121,128.87 328,742,889.80 79,233,904.82
owners of parent company
Profit and loss of the minority of
20,488,972.02 24,596,597.41
shareholders
VI. Profit per share:
(I) Basic profit per share 0.95 1.11
(II) Diluted profit per share 0.95 1.11
VII. Other comprehensive
-9,096,053.43 -1,765,395.59 -4,189,112.99 -2,589,798.81
gains
VIII. Total of comprehensive
292,246,411.43 135,355,733.28 349,150,374.22 76,644,106.01
gains
Total of comprehensive gains
attributable to the owners of 271,757,439.41 135,355,733.28 324,553,776.81 76,644,106.01
parent company
Total of comprehensive gains
attributable to the minority of 20,488,972.02 24,596,597.41
shareholders
4.4 Cash flow statement from year beginning to the end of report period
Prepared by: Livzon Pharmaceutical Group Inc. January to September 2011 Unit :( RMB) Yuan
Amount in this period Amount in previous period
Item
Consolidation Parent Company Consolidation Parent Company
I. Cash flows from operating
activities
11
The 2011 Third Quarterly Report of Livzon Pharmaceutical Group Inc.
Cash received from sales of
2,229,443,047.45 946,025,305.81 1,979,990,574.16 760,946,546.83
goods or rendering of services
Net increase from disposal of
tradable financial assets
Net increase of capitals from
repurchase business
Tax refunding 6,213,246.47 98,724.31 7,770,752.23
Other cash received related to
83,981,322.58 127,641,195.39 51,554,793.18 88,727,358.95
other operating activities
Subtotal of cash inflow from the
2,319,637,616.50 1,073,765,225.51 2,039,316,119.57 849,673,905.78
operating activities
Cash paid for purchase of
714,017,294.94 573,826,849.93 700,403,831.69 312,967,842.24
goods or receiving of services
Cash paid to and on behalf of
206,159,157.98 55,110,014.24 186,935,903.91 59,813,731.19
employees
Tax payments 346,524,302.40 71,045,139.36 252,277,560.94 74,794,377.77
Other cashes paid to operating
644,907,743.38 376,964,672.72 470,729,870.54 257,913,325.95
activities
Subtotal of cash outflow from
1,911,608,498.70 1,076,946,676.25 1,610,347,167.08 705,489,277.15
operating activities
Net cash flow from operating
408,029,117.80 -3,181,450.74 428,968,952.49 144,184,628.63
activities
II. Cash flow from investment
activities:
Cash received from disposal of
investments
Cash received from investment
1,049,579.38 828,598.31 22,802,164.87
returns
Net cash received from
disposal of fixed assets,
600,700.00 187,095.00 2,691,640.04
intangible assets and other
long-term assets
Net cash amount received from
the disposal of subcompanies
and other business units
Other cash received related to
99,877,008.00
investment activities
Subtotal of cash inflow from the
1,650,279.38 100,064,103.00 3,520,238.35 22,802,164.87
investment activities
Cash paid to acquire and
construct fixed assets,
209,089,094.21 12,749,509.10 287,093,072.00 19,549,311.57
intangible assets and other
long-term assets
Cash paid to acquire
77,239,971.40 362,969,971.40 888,720.00 55,088,720.00
investments
Net increase from the
mortgage loan
Net cash amount paid to
acquire the subcompanies and
other operating units
Other cash paid related to
126,379.95 26,894.96
investment activities
Subtotal of cash outflow from
286,329,065.61 375,845,860.45 287,981,792.00 74,664,926.53
investment activities
Net amount of cash flow -284,678,786.23 -275,781,757.45 -284,461,553.65 -51,862,761.66
received from the investment
12
The 2011 Third Quarterly Report of Livzon Pharmaceutical Group Inc.
activities
III. Cash flow from financing
activities:
Cash received from investors 11,270,000.00 9,800,000.00
Including: cash received from
the investment of minority of
shareholders in the
subcompanies
Cash from loans 172,745,504.00 85,070,944.00 383,293,855.32 205,882,550.00
Cash received from the issuing
400,000,000.00 400,000,000.00
of bonds
Other cash received related to
6,200,000.00 1,191,499.75 1,187,447.18
financing activities
Subtotal of cash inflow from the
590,215,504.00 485,070,944.00 394,285,355.07 207,069,997.18
financing activities
Repayments of loans 299,293,208.34 190,027,800.11 339,961,332.82 213,418,400.00
Cash paid for distribution of
dividends, profits and 56,998,779.07 33,954,051.97 56,751,840.99 49,601,456.50
repayment of interests
Including: the dividends and
profits paid to the minority of
shareholders by the
subcompanies
Other cash payments related to
1,600,000.00 1,600,000.00 1,345,000.00 125,000.00
financing activities
Loans paid to subcompanies -605,504,148.33 -46,252,125.80
Sub-total of cash outflow from
357,891,987.41 -379,922,296.25 398,058,173.81 216,892,730.70
the financing activities
Net cash flow from financing
232,323,516.59 864,993,240.25 -3,772,818.74 -9,822,733.52
activities
IV. Effect of foreign exchange
fluctuation on cash and cash -2,285,521.03 -2,480.27 -1,476,812.24 -35,468.68
equivalents
V. Net increase of cash and
353,388,327.13 586,027,551.79 139,257,767.86 82,463,664.77
cash equivalents
Plus: Balance of cash and cash
equivalents at the beginning of 844,481,857.59 521,320,488.69 558,262,596.74 418,389,049.61
the period
VI Balance of cash and cash
equivalents at the end of the 1,197,870,184.72 1,107,348,040.48 697,520,364.60 500,852,714.38
period
4.5 Auditing report
Auditing opinion: this financial statement has not been audited.
Livzon Pharmaceutical Group Inc.
Chairman: Zhu Baoguo
October 22, 2011
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