SINOCOM PHARMACEUTICAL, INC.

CIK:0001434017|SEC Filings

CONSOLIDATED STATEMENTS OF INCOME FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2011 AND 2010 (USD $)	3 Months Ended		6 Months Ended
	Jun. 30, 2011	Jun. 30, 2010	Jun. 30, 2011	Jun. 30, 2010
Sales, net	$ 25,572,574	$ 19,357,750	$ 55,785,495	$ 44,254,101
Cost of Sales	19,141,211	14,433,803	39,521,303	30,602,816
Gross profit	6,431,363	4,923,947	16,264,192	13,651,285
Selling expenses	937,121	871,373	1,819,431	1,647,012
General and administrative expenses	427,822	310,852	838,826	699,103
Income from operations	5,066,420	3,741,722	13,605,935	11,305,170
Other income (expense):
Non-operating income (expense), net	(5,434)	4,567	84,847	73,612
Interest income	38,129	21,058	57,373	27,246
Total other income (expense)	32,695	25,625	142,220	100,858
Income before income taxes	5,099,115	3,767,347	13,748,155	11,406,028
Provison for income taxes	1,302,842	971,810	3,494,188	3,047,035
Net Income	3,796,273	2,795,537	10,253,967	8,358,993
Dividend on Series A preferred stock	(373,973)	(186,986)	(743,836)	(371,918)
Net income available to common shareholders	$ 3,422,300	$ 2,608,551	$ 9,510,131	$ 7,987,075
Net income per share common stock basic	$ 0.05	$ 0.04	$ 0.13	$ 0.11
Net income per share common stock diluted	$ 0.04	$ 0.03	$ 0.12	$ 0.10
Weighted average common stock outstanding basic	71,416,660	71,416,660	71,416,660	71,416,660
Weighted average common stock outstanding diluted	87,263,759	87,263,759	87,263,759	87,263,759

CONSOLIDATED STATEMENTS OF CASH FLOWS FOR THE SIX MONTHS ENDED JUNE 30, 2011 AND 2010 (USD $)

6 Months Ended

Jun. 30, 2011

Jun. 30, 2010

Net Income

$ 10,253,967

$ 8,358,993

Adjustments to reconcile net income to net cash used in operating activities:

Depreciation and amortization

336,141

312,894

Loss on disposal of property and equipment

3,713

(Increase) / decrease in current assets:

Changes in accounts receivable

3,000,577

4,941,113

Changes in inventories

(420,758)

12,307

Changes in trade deposits

(370,415)

(4,846,811)

Changes in prepaid expenses and other receivables

(7,363)

(373,778)

Increase / (decrease) in current liabilities:

Changes in accounts payable

1,850,987

(7,787,249)

Changes in accrued expenses and other payables

(720,965)

(282,963)

Changes in due to related parties

12,140

117,987

Changes in income taxes payable

(1,925,876)

(1,249,544)

Total adjustments

1,754,468

(9,152,331)

Net cash provided/(used) by operating activities

12,008,435

(793,338)

Cash flows from investing activities:

Purchase of property and equipment

(2,422)

(152,600)

Payments for other investing activities

^[1]

(8,531,771)

^[2]

Net cash used in investing activities

(2,422)

(8,684,371)

Cash flows from financing activities:

Issuance cost of preferred stock paid

(378,157)

Preferred stock dividend paid

(369,863)

(184,932)

Net cash provided by financing activities

(369,863)

(563,089)

Effect of exchange rate changes in cash and cash equivalents

1,276,888

106,427

NET CHANGE IN CASH AND CASH EQUIVALENTS

12,913,038

(9,934,371)

INITIAL CASH AND CASH EQUIVALENT

24,783,238

34,363,124

FINAL CASH AND CASH EQUIVALENT

37,696,276

24,428,753

SUPPLEMENTAL DISCLOSURE

Cash paid for income taxes

$ 5,420,064

$ 4,296,579

[1]	Payment to acquire land use right, nil ; prepaid lease, nil and deposit for construction, nil for the period ending June 30, 2011
[2]	Payment to acquire land use right, $(2,985,905); prepaid lease, $(2,689,091); and depost paid for construction $(2,856,775) for the year ending December 31, 2010

CONSOLIDATED BALANCE SHEETS (USD $)

Jun. 30, 2011

Dec. 31, 2010

Current assets:

Cash and cash equivalents

$ 37,696,276

$ 24,783,238

Accounts receivable

38,322,125

41,322,702

Inventories

2,452,766

2,032,008

Trade deposits

5,368,666

4,998,251

Prepaid expenses and other receivables

1,005,684

998,321

Total current assets

84,845,517

74,134,520

Land use right

3,059,256

2,925,589

Prepaid lease

3,503,289

3,557,069

Deposit for construction

3,016,974

2,856,775

Property and equipment, net

828,412

704,888

Total Assets

95,253,448

84,178,841

Current liabilities:

Accounts payable

15,940,165

14,089,178

Due to related party

87,132

74,992

Accrued expenses and other payables

1,744,764

2,091,758

Income tax payable

1,107,044

3,032,920

Total current liabilities

18,879,105

19,288,848

Stockholders' equity:

Common stock

71,417

^[1]

71,417

^[2]

Preferred stock

15,847

^[3]

15,847

^[4]

Additional paid-in capital

15,112,290

Statutory reserves

5,677,041

Other comprehensive income

8,304,045

6,329,825

Retained earnings

47,193,703

37,683,573

Total stockholders' equity

76,374,343

64,889,993

TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY

$ 95,253,448

$ 84,178,841

[1]	Common stock, par value $.001; 150,000,000 shares authorized; 71,416,660 shares issued and outstanding as of June 30, 2011.
[2]	Common stock, par value $.001; 150,000,000 shares authorized; 71,416,660 shares issued and outstanding as of December 31, 2010.
[3]	Preferred stock, par value $.001; 20,000,000 shares authorized; 15,847,099 shares issued and outstanding as of June 30, 2011.
[4]	Preferred stock, par value $.001; 20,000,000 shares authorized; 15,847,099 shares issued and outstanding as of December 31, 2010.