China Biologic Products Holdings, Inc. announced unaudited consolidated earnings results for the second quarter and six months ended June 30, 2018. Total sales in the second quarter of 2018 increased by 25.5% in RMB terms, or 34.8% in USD terms due to the benefit of favorable exchange rates, to USD 120.4 million from USD 89.3 million in the same quarter of 2017. The increase in total sales was partly attributable to a USD 13.0 million contribution from TianXinFu, which accounted for approximately 10.8% of total sales for the quarter. Income from operations for the second quarter of 2018 decreased by 15.3% in RMB terms, or 8.9% in USD terms, to USD 35.9 million from USD 39.4 million in the same quarter of 2017. Excluding TianXinFu, income from operations for the second quarter of 2018 decreased by 30.3% in RMB terms, or 25.1% in USD terms, to USD 29.5 million from USD 39.4 million in the same quarter of 2017. Net income attributable to the Company decreased by 14.1% in RMB terms, or 7.7% in USD terms, to USD 28.6 million in the second quarter of 2018 from USD 31.0 million in the same quarter of 2017. Diluted net earnings per share decreased to USD 0.83 in the second quarter of 2018 compared to USD 1.09 in the same quarter of 2017. Excluding TianXinFu, net income attributable to the Company decreased by 29.7% in RMB terms, or 24.2% in USD terms, in the second quarter of 2018 compared to the same quarter of 2017. Non-GAAP adjusted income from operations decreased by 3.7% in RMB terms, or increased by 3.6% in USD terms, to USD 49.2 million in the second quarter of 2018 from USD 47.5 million in the same quarter of 2017. Excluding TianXinFu, non-GAAP adjusted income from operations decreased by 21.0% in RMB terms, or 15.1% in USD terms, in the second quarter of 2018 compared to the same quarter of 2017. Non-GAAP adjusted net income attributable to the Company decreased by 2.8% in RMB terms, or increased by 4.4% in USD terms, to USD 40.2 million in the second quarter of 2018 from USD 38.5 million in the same quarter of 2017. Non-GAAP adjusted net income per diluted share decreased to USD 1.17 in the second quarter of 2018 from USD 1.35 in the same quarter of 2017. Excluding TianXinFu, non-GAAP adjusted net income attributable to the Company decreased by 19.4% in RMB terms, or 13.2% in USD terms, in the second quarter of 2018 compared to the same quarter of 2017. Income before income tax expense was USD 40,798,699 against USD 41,703,934 a year ago.

Total sales in the first half of 2018 increased by 19.5% in RMB terms, or 28.8% in USD terms, to USD 232.8 million from USD 180.7 million in the same period of 2017. This includes a USD 24.4 million contribution from TianXinFu, which accounts for approximately 10.5% of total sales for the first half of 2018. Income from operations for the first half of 2018 decreased by 11.3% in RMB terms, or 4.3% in USD terms, to USD 74.8 million from USD 78.2 million in the same period of 2017. Excluding TianXinFu, income from operations for the first half of 2018 decreased by 24.9% in RMB terms, or 19.1% in USD terms, in the first half of 2018 compared to the same period of 2017. Net income attributable to the Company decreased by 8.5% in RMB terms, or 1.3% in USD terms, to USD 60.2 million in the first half of 2018 from USD 61.0 million in the same period of 2017. Diluted earnings per share for the first half of 2018 decreased to USD 1.75 from USD 2.15 for the same period of 2017. Excluding TianXinFu, net income attributable to the company decreased by 22.8% in RMB terms, or 16.8% in USD terms, in the first half of 2018 compared to the same period of 2017. Non-GAAP adjusted income from operations decreased by 2.4% in RMB terms, or increased by 5.2% in USD terms, to USD 99.3 million in the first half of 2018 from USD 94.4 million in the same period of 2017. Excluding TianXinFu, non-GAAP adjusted income from operations decreased by 18.3% in RMB terms, or 11.9% in USD terms in the first half of 2018 compared to the same period of 2017. Non-GAAP adjusted net income attributable to the Company decreased by 0.4% in RMB terms, or increased by 7.5% in USD terms, to USD 81.6 million in the first half of 2018 from USD 75.9 million in the same period of 2017. Non-GAAP adjusted net income per diluted share decreased to USD 2.37 in the first half of 2018 from USD 2.67 in the same period of 2017. Excluding TianXinFu, non-GAAP adjusted net income attributable to the Company decreased by 15.8% in RMB terms, or 9.1% in USD terms, in the first half of 2018 compared to the same period of 2017. Net cash provided by operating activities for the first half of 2018 was USD 45.5 million, including an USD 11.6 million contribution from TianXinFu, compared to USD 36.9 million for the same period of 2017. Income before income tax expense was USD 85,062,135 against USD 82,992,964 a year ago. Payment for property, plant and equipment was USD 18,443,583 against USD 15,975,643 a year ago.

The Company is making a downward revision to its full year 2018 forecast. The company expects non-GAAP adjusted income from operations to increase by 0% to 2% in RMB terms and non-GAAP adjusted net income to decrease by 2% to 4% in RMB terms over full year 2017 financial results. Excluding TianXinFu, full year 2018 non-GAAP adjusted income from operations is expected to decrease by 16% to 18% in RMB terms and non-GAAP adjusted net income to decrease by 19% to 21% in RMB terms over full year 2017 financial results. The full year 2018 forecast was lowered to account for worse-than-expected results for the first half of 2018 and an ongoing challenging outlook in the second half of the year due to the following factors: persisting regulatory headwinds, which places downward pressure on sales growth; intensified competition in China's plasma industry, which continues to drive costs higher and prices lower among plasma product providers in China; investments in long-term improvements and upgrades to the marketing and sales capabilities, which places additional downward pressure on the bottom line; and a one-time provision in connection with the new facility project in Guizhou and certain fixed assets among certain non-operating collection stations. The Company expects that the non-GAAP adjusted income from operations and non-GAAP adjusted net income in USD terms in 2018 could be affected by the foreign currency translation impact.