Tianyin Pharmaceutical Provides Update on Filing of Form 10-K for Fiscal Year Ended June 30, 2014

CHENGDU, China, October 15, 2014 /PRNewswire/ — Tianyin Pharmaceutical Inc. (NYSE MKT: TPI, the “Company”), a pharmaceutical company that specializes in the development and sale of patented biopharmaceutical medicine, modernized traditional Chinese medicine (TCM), branded generics and active pharmaceutical ingredients (API), today reported that it has delayed the filing of its Annual Report on Form 10-K for the year ended June 30, 2014 (“2014 Form 10-K”) beyond the extended filing due date of October 14, 2014. As TPI indicated in its Current Reports on Form 8-K filed on October 8, 2013 and November 4, 2013, its Audit Committee and the Board of Directors both unanimously approved the termination of the Company’s independent auditor, Patrizio and Zhao LLC (“P&Z”), due to the fact that P&Z agreed to a cease-and-desist order and prohibition from practicing before the Securities and Exchange Commission (the “SEC”) on September 30, 2013; on November 4, 2013, TPI signed an Engagement Letter with Paritz & Company, P.A. (“Paritz”) to engage Paritz as the independent accountants to audit its financial statements for the years ended June 30, 2014 and 2013. Accordingly, the Company was required by the SEC to have the financial statements for the year ended June 30, 2013 reaudited as a result of the cease-and-desist order and prohibition from practicing before the SEC in connection with its prior auditor.

Currently the Company is working diligently with the auditor to finish the audit and complete the 2014 10-K, and expect to file the 2014 Form 10-K within two weeks.

Under NYSE MKT rules, until the Company files its Form 10-K, its common stock will remain listed on the NYSE MKT under the symbol “TPI,” but will be assigned an “.LF” indicator to signify late filing status.

Although the Company is working diligently to complete the 2014 Form 10-K and currently expects to complete and file the 2014 Form 10-K within two weeks of its due date, no assurance can be given that the 2014 Form 10-K will be filed within such period.

About TPI

Headquartered at Chengdu, China, TPI is a pharmaceutical company that specializes in the development, manufacturing, marketing and sales of patented biopharmaceutical, modernized traditional Chinese medicines, branded generics and active pharmaceutical ingredients (API). TPI currently manufactures a comprehensive portfolio of 58 products, 24 of which are listed in the highly selective national medicine reimbursement list, 10 are included in the essential drug list of China. TPI’s pipeline targets various high incidence healthcare indications. For more information about TPI, please visit: http://www.tianyinpharma.com

Cautionary Statement Regarding Forward-Looking Statements

The forward-looking statements made in this press release and its attachments concerning, among other things, Tianyin Pharmaceutical Inc.’s expected financial performance and outlook, its strategic operational plans and growth strategy are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. These statements involve risks and uncertainties and the Company’s actual results could differ materially from the results expressed or implied by such forward-looking statements. Furthermore, reported results should not be considered as an indication of future performance. The potential risks, uncertainties and other factors include, but are not limited to, changes to the Company’s previously reported financial information as a result of the aforementioned re-audit and the risk that the Company will not be able to file the 2014 Form 10-K within 90 days of its due date. More information regarding these and other risks, uncertainties and factors is contained in the Company’s filings with the Securities and Exchange Commission (“SEC”) which are available on the SEC’s website at www.sec.gov or the Company’s website at http://www.tianyinpharma.com. You are cautioned not to unduly rely on these forward-looking statements, which speak only as of the date of this press release. All information in this press release and its attachments is as of October 15, 2014 and, unless required by law, the Company undertakes no obligation to publicly revise any forward-looking statement to reflect circumstances or events after the date of this press release or to report the occurrence of unanticipated events.

For more information, please visit: http://www.tianyinpharma.com, or email: ir@tpi.asia

Tel: +86-28-8551-6696 (Chengdu, China)

Address:
Tianyin Pharmaceutical Inc.
23rd Floor, Unionsun Yangkuo Plaza
No. 2, Block 3, South Renmin Road
Chengdu, 610041
China

Below is our preliminary financial information as of June 30, 2014:

Cash: $16.1 million
Total Assets: $107.1 million

Total Liabilities: $9.0 million
Equity: $98.1 million

Revenues: $46.6 million
Net Loss: $(0.4) million

Attached herein are our preliminary Consolidated Balance Sheet, Consolidated Statements of Operations, Consolidated Statements of Cash Flow, and Statements of Stockholders’ Equity. Changes and adjustments may be made to the preliminary financial information contained in this press release as the Company is completing and finalizing the audit of the above-mentioned periods.

TIANYIN PHARMACEUTICAL CO., INC

Consolidated Balance Sheets

June 30,

June 30,

2014

2013

Assets

Current assets:

Cash and cash equivalents

$16,120,041

$26,827,008

Restricted cash

994,017

4,536,000

Accounts receivable, net of allowance for doubtful accounts of $102,401 and $102,149 at June 30, 2014 and 2013, respectively

9,074,565

10,112,718

Inventory

3,921,313

6,036,014

Advance payments

1,981,291

Prepaid income tax

1,717,387

Other current assets

313,320

Total current assets

33,808,614

47,825,060

Property and equipment, net

45,378,356

40,603,232

Intangibles, net

27,699,733

21,505,012

Goodwill

211,120

210,600

Total assets

$107,097,823

$110,143,904

Liabilities

Current liabilities:

Accounts payable and accrued expenses

$1,491,771

$1,352,560

Accounts payable – construction related

2,238,927

2,723,290

Short-term bank loans

4,547,200

5,929,200

Income tax payable

0

701,311

Other taxes payable

179,610

740,800

Other current liabilities

522,995

449,062

Total current liabilities

8,980,503

11,896,223

Total liabilities

8,980,503

11,896,223

Equity

Stockholders’ equity:

Preferred stock, $0.001 par value, 25,000,000 shars authorized,

no shares issued and outstanding at June 30, 2014 and 2013

Common stock, $0.001 par value, 50,000,000 shares authorized,

29,546,276 shares issued, 29,432,791 shares outstanding at June 30, 2014 and 29,496,276 shares issued, 29,382,791 shares outstanding at June 30, 2013

29,546

29,496

Additional paid-in capital

30,189,802

30,134,852

Treasury stock

(135,925)

(135,925)

Statutory reserve

6,976,412

6,847,315

Retained earnings

50,569,206

50,967,308

Accumulated other comprehensive income

10,409,430

10,178,358

Total stockholders’ equity

98,038,471

98,021,404

Noncontrolling interest

78,849

226,277

Total equity

98,117,320

98,247,681

Total liabilities and equity

$107,097,823

$110,143,904

TIANYIN PHARMACEUTICAL CO., INC

Consolidated Statements of Operations

For the Years Ended June 30,

2014

2013

Sales

$46,555,021

$67,500,476

Cost of sales

29,146,615

41,496,812

Gross profit

17,408,407

26,003,664

Operating expenses

Selling expenses

7,800,507

11,442,664

General and administrative expenses

5,796,448

4,351,592

Research and development

946,300

894,995

Total operating expenses

14,543,255

16,689,251

Income from operations

2,865,151

9,314,413

Other income (expenses):

Interest income

165,533

162,563

Interest expense

(392,010)

(437,897)

Other expense

(3,070,795)

Total other income (expenses)

(3,297,272)

(275,334)

Income (loss) before provision for income tax

(432,121)

9,039,079

Provision for income tax

0

2,423,906

Net income (loss)

(432,121)

6,615,173

Less: Net income (loss)attributable to noncontrolling interest

(163,115)

(56,978)

Net income attributable to Tianyin Pharmaceutical Co., Inc.

$ (269,005)

$ 6,672,151

Basic and diluted earnings per share

($0.01)

$0.23

Weighted average number of common shares outstanding:

Basic and diluted

29,432,791

29,382,791

TIANYIN PHARMACEUTICAL CO., INC

Consolidated Statements of Comprehensive Income

For the Years Ended June 30,

2014

2013

Net income (loss)

($432,121)

$6,615,173

Other comprehensive income

Foreign currency translation adjustment

246,759

2,083,061

Total other comprehensive income

246,759

2,083,061

Total Comprehensive income (loss)

(185,362)

8,698,234

Less: Comprehensive income (loss) attributable to the noncontrolling interest

(147,428)

(51,749)

Comprehensive income (loss) attributable to

Tianyin Pharmaceutical Co., Inc.

($37,934)

$8,749,983

TIANYIN PHARMACEUTICAL CO., INC

Statements of stockholders’ equity

ITEM

Common Stock

Treasury stock

Preferred Stock

Additional Paid in Capital

Statutory Reserve

Retained Earnings

Accumulated other Comprehensive Income

Total Stockholders’ Equity

Noncontrolling Interest

Total Equity

Balance at Jun 30, 2012

29,446,276

$29,446

$(135,925)

0

$-

$30,104,902

$6,120,143

$45,022,329

$8,100,526

$89,241,421

$278,026

$89,519,447

Net income

6,672,151

6,672,151

(56,978)

6,615,173

Other comprehensive income:

Foreign currency translation adjustment

2,077,832

2,077,832

5,229

2,083,061

Comprehensive income

8,749,983

(51,749)

8,698,234

Common shares issued

50,000

50

29,950

30,000

30,000

Statutory reserve

727,172

(727,172)

Balance at Jun 30, 2013

29,496,276

29,496

(135,925)

0

0

30,134,852

6,847,315

50,967,308

10,178,358

98,021,404

226,277

98,247,681

Net income

(269,005)

(269,005)

(163,115)

(432,120)

Other comprehensive income:

Foreign currency translation adjustment

231,072

231,072

15,687

246,759

Comprehensive income

(37,933)

(147,428)

(185,361)

Common shares issued

50,000

50

54,950

55,000

55,000

Statutory reserve

129,097

(129,097)

Balance at Jun 30, 2014

29,546,276

$29,546

$(135,925)

0

$-

$30,189,802

$6,976,412

$50,569,206

$10,409,430

$98,038,471

$78,849.00

$98,117,320

TIANYIN PHARMACEUTICAL CO., INC.

Consolidated Statements of Cash Flows

For the Years Ended June 30,

2014

2013

Cash flows from operating activities:

Net Income

($432,121)

$6,615,173

Adjustments to reconcile net income to net cash

provided by (used in) operating activities:

Depreciation and amortization

2,587,565

2,435,138

Change in fair value of warrant liability

Provision for bad debts

(14,004)

Share-based payment

55,000

30,000

Changes in current assets and current liabilities:

Accounts receivable

1,065,075

1,400,397

Inventory

2,133,539

(42,849)

Advance payments

645,923

Other current assets

314,674

130,893

Accounts payable and accrued expenses

136,123

(264,388)

Accounts payable – construction related

(491,994)

1,935,150

Trade notes payable

(4,703,775)

Income tax payable

(2,418,061)

(119,146)

Other taxes payable

(564,060)

225,356

Other current liabilities

72,959

(27,787)

Net cash provided by operating activities

2,458,699

8,246,081

Cash flows from investing activities:

Addition to property and equipment

(1,704,154)

Addition of Contruction in progress

(6,450,737)

(13,274,213)

Additions to intangible assets – land use right

(6,973,301)

(886,611)

Loans receivable

(1,984,940)

Acquisition of subsidiary

(207,285)

Net cash used in investing activities

(15,408,978)

(16,072,263)

Cash flows from financing activities:

Restricted cash

3,559,747

(908,865)

Proceeds from short-term bank loans

4,555,600

10,300,470

Repayments of short-term bank loans

(5,954,820)

(10,523,700)

Net cash provided by (used in) financing activities

2,160,527

(1,132,095)

Effect of foreign currency translation on cash

82,785

632,990

Net increase in cash and cash equivalents

(10,706,967)

(8,325,287)

Cash and cash equivalents – beginning

26,827,008

35,152,295

Cash and cash equivalents – ending

$16,120,041

$26,827,008

Supplemental cash flow disclosure

Cash paid for interest

$391,942

$437,605

Income tax paid

$2,421,477

$2,583,722

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