Press Releases

Avalon GloboCare Provides Second Quarter 2018 Business Update; Reports 32% Increase in Revenues

FREEHOLD, N.J., Aug. 15, 2018 (GLOBE NEWSWIRE) -- Avalon GloboCare Corp. (OTCQB: AVCO), a leading global developer of cell-based technologies, today announced financial results and provided a business update for the second quarter ended June 30, 2018.

Second Quarter 2018 Highlights:

  • Revenues increased 32% to $496,093 for the second quarter ended June 30, 2018;
  • Cash at June 30, 2018 was $3.6 million;
  • Formed joint laboratory with top-ranked hospital in Shanghai for regenerative exosomics;
  • Appointed Former Deputy Secretary of the U.S. Department of Health and Human Services Dr. Tevi Troy to Board of Directors;
  • Formed joint venture with Jiangsu Unicorn to establish provincial network of translational cellular therapy and bio-banking programs;
  • Appointed Senior Healthcare Executive William Stilley to Board of Directors

David Jin, M.D., Ph.D., CEO and President of Avalon GloboCare Corp., commented, “We continue to make rapid progress towards the advancement of our cell-based therapies and exosome technology platform. Notably, we have formed a strategic partnership with the Shanghai Ninth People’s Hospital, a top-ranked medical institute in China and the Asia Pacific region, renowned for its plastic and reconstructive surgery specialty.  This strategic partnership with the Shanghai Ninth People's Hospital is the first of its kind in establishing an innovative, state-of-the-art joint laboratory in regenerative exosomics. The joint laboratory will utilize Avalon’s proprietary exosome isolation system to in order to accelerate the development of diagnostic and therapeutic applications particularly in the areas of plastic/reconstructive surgery, wound healing, skincare, and exosomic bioinformatics. In addition, we have formed a joint venture with Jiangsu Unicorn Biological Technology Co. Ltd to establish provincial network of translational cellular therapy and bio-banking programs. A major initiative of this joint venture is to establish the world’s largest aqueous humor derived exosome bio-bank to advance the next-generation of diagnosis and therapeutics for ophthalmologic diseases. Through this provincial network of translational programs, we are able to further strengthen our leadership role and capabilities in order to accelerate our growth and development in regenerative medicine and cellular therapies.”

“Throughout the second quarter of 2018, we continued to move forward towards a NASDAQ uplisting by appointing prominent independent board members, Dr. Tevi Troy and William Stilley. Dr. Tevi Troy brings extensive government relationships and experience in the healthcare industry that will aid in accelerating the development of our cell-based therapies and exosome technology platform. William Stilley is the perfect fit to chair our audit committee as he brings valuable operational, financial and strategic experience, including product licensing, partnering, financing, and M&A. We are also pleased to announce that we completed a $2.1 million financing with strategic investors in August 2018, which further strengthens our balance sheet and shareholders’ equity in advance of a listing on a national exchange.” concluded Dr. Jin.

Revenues for the second quarter ended June 30, 2018 were $496,093 versus $374,751 for the second quarter ended June 30, 2017. The increase in revenues was due to property rental income, development services and sales of developed products. Operating loss for the quarter ended June 30, 2018 was $1.2 million versus operating loss of $0.4 million for second quarter ended June 30, 2017, which reflects increased SG&A expenses to support the anticipated growth, as well as an increase in public company expenses in advance of the planned listing on a national exchange. Net loss attributable to Avalon GloboCare Corp. common shareholders for the second quarter ended June 30, 2018 was $1.3 million or ($0.02) earnings per share, versus net loss attributable to Avalon GloboCare Corp. common shareholders of $0.4 million or ($0.01) earnings per share for the second quarter ended June 30, 2017.

About Avalon GloboCare Corp.

Avalon GloboCare Corp. (OTCQB:AVCO) is a global intelligent biotech developer and healthcare service provider dedicated to promoting and empowering high impact, transformative cell-based /technologies and their clinical applications, as well as healthcare facility management through its core platforms, namely "Avalon Cell" and "Avalon Rehab." In addition, Avalon provides strategic advisory and outsourcing services to facilitate and enhance their clients' growth, development, as well as competitiveness in both domestic and global healthcare markets. Avalon also engages in the management of stem cell banks and specialty clinical laboratories. Through its U.S. subsidiaries, namely GenExosome Technologies Inc. and Avactis Biosciences Inc., Avalon will further establish our leading roles in the fields of CAR-T therapy, liquid biopsy, precision medicine and regenerative medicine.

Forward-Looking Statements
Certain statements contained in this press release may constitute "forward-looking statements." Forward-looking statements provide current expectations of future events based on certain assumptions and include any statement that does not directly relate to any historical or current fact. Actual results may differ materially from those indicated by such forward-looking statements as a result of various important factors as disclosed in our filings with the Securities and Exchange Commission located at their website (http://www.sec.gov). In addition to these factors, actual future performance, outcomes, and results may differ materially because of more general factors including (without limitation) general industry and market conditions and growth rates, economic conditions, and governmental and public policy changes. The forward-looking statements included in this press release represent the Company's views as of the date of this press release and these views could change. However, while the Company may elect to update these forward-looking statements at some point in the future, the Company specifically disclaims any obligation to do so. These forward-looking statements should not be relied upon as representing the Company's views as of any date subsequent to the date of the press release.

Contact Information:
Avalon GloboCare Corp.
4400 Route 9, Suite 3100
Freehold, NJ 07728
PR@Avalon-GloboCare.com

Investor Relations:
Crescendo Communications, LLC
Tel: (212) 671-1020
avco@crescendo-ir.com
                                                                           

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AVALON GLOBOCARE CORP. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS

    As of  
    June 30,
2018
    December 31,
2017
 
    (Unaudited)        
ASSETS              
             
CURRENT ASSETS:                
Cash   $ 3,643,316     $ 3,027,033  
Accounts receivable, net of allowance for doubtful accounts     74,969       10,179  
Accounts receivable - related party, net of allowance for doubtful accounts     144,779        
Tenants receivable, net of allowance for doubtful accounts     38,527       38,469  
Security deposit     328,615       6,916  
Inventory     22,049       2,667  
Prepaid expenses and other current assets     707,925       149,713  
                 
Total Current Assets     4,960,180       3,234,977  
                 
OTHER ASSETS:                
Security deposit - noncurrent portion           25,322  
Prepayment for long-term assets     67,044       153,688  
Property and equipment, net     143,226       48,029  
Investment in real estate, net     7,725,301       7,623,757  
Intangible assets, net     1,419,474       1,583,260  
                 
Total Other Assets     9,355,045       9,434,056  
                 
Total Assets   $ 14,315,225     $ 12,669,033  
                 
LIABILITIES AND EQUITY                
                 
CURRENT LIABILITIES:                
Accounts payable   $ 1,702     $ 29  
Accrued liabilities and other payables     299,788       124,064  
Accrued liabilities and other payables - related parties     48,694       39,927  
Deferred rental income     11,182       12,769  
Loan payable     1,000,000       1,500,000  
Interest payable     24,931       138,110  
VAT and other taxes payable     12,516       2,997  
Tenants’ security deposit     73,400       92,288  
Due to related party     450,000       450,000  
Refundable deposit     2,000,000       3,000,000  
                 
Total Current Liabilities     3,922,213       5,360,184  
                 
Commitments and Contingencies - (Note 20)            
                 
EQUITY:                
Preferred stock, $0.0001 par value; 10,000,000 shares authorized;                
no shares issued and outstanding at June 30, 2018 and December 31, 2017            
Common stock, $0.0001 par value; 490,000,000 shares authorized;                
73,560,622 shares issued and 73,040,622 shares outstanding at June 30, 2018;                
70,278,622 shares issued and outstanding at December 31, 2017     7,356       7,028  
Additional paid-in capital     18,034,773       11,490,285  
Less: common stock held in treasury, at cost;                
520,000 and 0 shares at June 30, 2018 and December 31, 2017, respectively     (522,500 )      
Accumulated deficit     (6,293,627 )     (3,517,654 )
Statutory reserve     6,578       6,578  
Accumulated other comprehensive loss - foreign currency translation adjustment     (135,404 )     (91,994 )
Total Avalon GloboCare Corp. stockholders’ equity     11,097,176       7,894,243  
Non-controlling interest     (704,164 )     (585,394 )
                 
Total Equity     10,393,012       7,308,849  
                 
Total Liabilities and Equity   $ 14,315,225     $ 12,669,033  
 

AVALON GLOBOCARE CORP. AND SUBSIDIARIES
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS

    For the
Three
Months
Ended
    For the
Three
Months
Ended
    For the Six
Months
Ended
    For the Six
Months
Ended
 
    June 30, 2018     June 30, 2017     June 30, 2018     June 30, 2017  
                         
REVENUES                          
Real property rental   $ 278,872     $ 222,254     $ 575,495     $ 222,254  
Medical related consulting services - related parties     141,996       152,497       141,996       218,783  
Development services and sales of developed products     75,225             86,515        
Total Revenues     496,093       374,751       804,006       441,037  
                                 
COSTS AND EXPENSES                                
Real property operating expenses     195,941       161,854       406,215       161,854  
Medical related consulting services - related parties     124,715       125,231       124,715       224,812  
Development services and sales of developed products     42,093             58,613        
Total Costs and Expenses     362,749       287,085       589,543       386,666  
                                 
REAL PROPERTY OPERATING INCOME     82,931       60,400       169,280       60,400  
GROSS PROFIT (LOSS) FROM MEDICAL RELATED CONSULTING SERVICES     17,281       27,266       17,281       (6,029 )
GROSS PROFIT FROM DEVELOPMENT SERVICES AND SALES OF DEVELOPED PRODUCTS     33,132             27,902        
                                 
OTHER OPERATING EXPENSES:                                
Selling expenses           6,279             14,990  
Compensation and related benefits     487,452       205,473       1,026,266       388,400  
Professional fees     593,025       172,705       1,164,797       379,923  
Other general and administrative     266,121       91,927       551,373       152,659  
                                 
Total Other Operating Expenses     1,346,598       476,384       2,742,436       935,972  
                                 
LOSS FROM OPERATIONS     (1,213,254 )     (388,718 )     (2,527,973 )     (881,601 )
                                 
OTHER INCOME (EXPENSE)                                
Interest income     1,300       210       1,708       1,004  
Interest expense     (24,932 )     (42,000 )     (261,918 )     (42,000 )
Foreign currency transaction loss     (106,929 )           (106,929 )     (57,244 )
Other income                 328        
                                 
Total Other Expense, net     (130,561 )     (41,790 )     (366,811 )     (98,240 )
                                 
LOSS BEFORE INCOME TAXES     (1,343,815 )     (430,508 )     (2,894,784 )     (979,841 )
                                 
INCOME TAXES                        
                                 
NET LOSS   $ (1,343,815 )   $ (430,508 )   $ (2,894,784 )   $ (979,841 )
                                 
LESS: NET LOSS ATTRIBUTABLE TO NON-CONTROLLING INTEREST     (49,421 )           (118,811 )      
                                 
NET LOSS ATTRIBUTABLE TO AVALON GLOBOCARE CORP. COMMON SHAREHOLDERS   $ (1,294,394 )   $ (430,508 )   $ (2,775,973 )   $ (979,841 )
                                 
COMPREHENSIVE LOSS:                                
NET LOSS     (1,343,815 )     (430,508 )     (2,894,784 )     (979,841 )
OTHER COMPREHENSIVE (LOSS) INCOME                                
Unrealized foreign currency translation (loss) gain     (96,207 )     7,647       (43,369 )     (32,124 )
COMPREHENSIVE LOSS   $ (1,440,022 )   $ (422,861 )   $ (2,938,153 )   $ (1,011,965 )
LESS: COMPREHENSIVE LOSS ATTRIBUTABLE TO NON-CONTROLLING INTEREST     (49,540 )           (118,770 )      
COMPREHENSIVE LOSS ATTRIBUTABLE TO AVALON GLOBOCARE CORP. COMMON SHAREHOLDERS   $ (1,390,482 )   $ (422,861 )   $ (2,819,383 )   $ (1,011,965 )
                                 
NET LOSS PER COMMON SHARE ATTRIBUTABLE TO AVALON GLOBOCARE CORP. COMMON SHAREHOLDERS:                                
Basic and diluted   $ (0.02 )   $ (0.01 )   $ (0.04 )   $ (0.02 )
                                 
WEIGHTED AVERAGE COMMON SHARES OUTSTANDING:                                
Basic and diluted     71,979,678       64,628,622       71,122,356       63,617,572  
 

 AVALON GLOBOCARE CORP. AND SUBSIDIARIES
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

    For the Six
Months
Ended
    For the Six
Months
Ended
 
    June 30,
2018
    June 30,
2017
 
             
CASH FLOWS FROM OPERATING ACTIVITIES:                
Net loss   $ (2,894,784 )   $ (979,841 )
Adjustments to reconcile net loss from operations to                
net cash used in operating activities:                
Depreciation and amortization     247,975       34,156  
Stock-based compensation expense     1,082,923       266,467  
Changes in operating assets and liabilities:                
Accounts receivable     (67,542 )      
Accounts receivable - related parties     (150,516 )     (160,964 )
Tenants receivable     (58 )     (25,433 )
Inventory     (19,892 )      
Prepaid expenses and other current assets     (153,785 )     21,653  
Security deposit     (308,694 )     (29,786 )
Accounts payable     1,740       22,646  
Accrued liabilities and other payables     176,584       146,680  
Accrued liabilities and other payables - related parties     9,811       32,135  
Deferred rental income     (1,587 )     4,178  
Interest payable     (113,179 )      
Income taxes payable           (21,191 )
VAT and other taxes payable     9,850       (3,841 )
Tenants’ security deposit     (18,888 )     92,288  
                 
NET CASH USED IN OPERATING ACTIVITIES     (2,200,042 )     (600,853 )
                 
CASH FLOWS FROM INVESTING ACTIVITIES:                
Purchase of property and equipment     (10,192 )     (27,784 )
Prepayment for purchase of long-term assets     (22,606 )      
Purchase of commercial real estate           (7,008,571 )
Improvement of commercial real estate     (165,155 )      
                 
NET CASH USED IN INVESTING ACTIVITIES     (197,953 )     (7,036,355 )
                 
CASH FLOWS FROM FINANCING ACTIVITIES                
Proceeds received from loan payable           2,100,000  
Repayments of loan     (500,000 )      
Proceeds received from related parties’ advance           70,000  
Repayment of related parties’ advance           (500 )
Repurchase of common stock     (522,500 )      
Refundable deposit in connection with Share Subscription Agreement           3,000,000  
Refund for refundable deposit in connection with Share Subscription Agreement     (1,000,000 )      
Proceeds received from equity offering     5,437,250        
Disbursements for equity offering costs     (380,607 )      
                 
NET CASH PROVIDED BY FINANCING ACTIVITIES     3,034,143       5,169,500  
                 
EFFECT OF EXCHANGE RATE ON CASH     (19,865 )     (36,527 )
                 
NET INCREASE (DECREASE) IN CASH     616,283       (2,504,235 )
                 
CASH - beginning of period     3,027,033       2,886,189  
                 
CASH - end of period   $ 3,643,316     $ 381,954  
                 
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:                
Cash paid for:                
Interest   $ 375,096     $  
Income taxes   $     $ 21,190  
                 
NON-CASH INVESTING AND FINANCING ACTIVITIES:                
Common stock issued in connection with Share Subscription Agreement   $     $ 300  
Acquisition of equipment by decreasing prepayment for long-term assets   $ 109,889     $  
Acquisition of real estate by decreasing prepayment for property   $     $ 700,000  
Common stock issued for future services   $ 405,250     $  
                 

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Source: Avalon GloboCare Corp.