-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, LsR5Zni92qAd/qFN4CGnEfusbJV3ZAQvisgdxX0k8Kk6l24JdGk2838MnLeNs9P5 j0m7dg+LYjQ8vr/r9hg74Q== 0001127855-09-000416.txt : 20090930 0001127855-09-000416.hdr.sgml : 20090930 20090930120144 ACCESSION NUMBER: 0001127855-09-000416 CONFORMED SUBMISSION TYPE: 6-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20090819 FILED AS OF DATE: 20090930 DATE AS OF CHANGE: 20090930 FILER: COMPANY DATA: COMPANY CONFORMED NAME: SINOVAC BIOTECH LTD CENTRAL INDEX KEY: 0001084201 STANDARD INDUSTRIAL CLASSIFICATION: PHARMACEUTICAL PREPARATIONS [2834] IRS NUMBER: 000000000 STATE OF INCORPORATION: B9 FISCAL YEAR END: 0430 FILING VALUES: FORM TYPE: 6-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-32371 FILM NUMBER: 091094836 BUSINESS ADDRESS: STREET 1: 39 SHANGDI XI ROAD STREET 2: HAIDIAN DISTRICT CITY: BEIJING STATE: F4 ZIP: 100085 BUSINESS PHONE: 86-10-82890088 MAIL ADDRESS: STREET 1: 39 SHANGDI XI ROAD STREET 2: HAIDIAN DISTRICT CITY: BEIJING STATE: F4 ZIP: 100085 FORMER COMPANY: FORMER CONFORMED NAME: NET FORCE SYSTEMS INC DATE OF NAME CHANGE: 19991110 6-K 1 sinovac6k081909.htm SINOVAC BIOTECH 6K, 08.19.09 sinovac6k081909.htm



FORM 6-K

SECURITIES AND EXCHANGE COMMISSION
Washington D.C. 20549

REPORT OF FOREIGN ISSUER
PURSUANT TO RULE 13a-16 OR 15d-16 OF THE
SECURITIES EXCHANGE ACT OF 1934

For the month of August, 2009
__________

Commission File Number: 001-32371
__________

SINOVAC BIOTECH LTD.

39 Shangdi Xi Road
Haidian District
Beijing 100085, People’s Republic of China
(Address of principal executive offices)


Indicate by check mark whether the registrant files or will file annual reports under cover Form 20-F or Form 40-F.

Form 20-F        X                Form 40-F _______

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1):________________

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7):________________

Indicate by check mark whether by furnishing the information contained in this Form, the registrant is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.

Yes _______        No        X      

If "Yes" is marked, indicate below the file number assigned to the registrant in connection with Rule 12g3-2(b):

82-        N/A      




 
 

 

SINOVAC BIOTECH LTD.

Form 6-K

TABLE OF CONTENTS

 
Page
   
Signature
3
Exhibit 99.1 – Press Release
4


 
 
 
 
 
 
 

 



 
 

 
 
SIGNATURE
 
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.


  SINOVAC BIOTECH LTD.  
     
       
 
By:
/s/ Weidong Yin  
    Name:   Weidong Yin  
    Title:     Chief Executive Officer, President  
       
       
Date:  August 18, 2009      
 
 
 
 
 
 
 
 

 

 
 

 

EX-99.1 2 sinovacexh99_1.htm SINOVAC BIOTECH 6K, PRESS RELEASE 08.19.09 sinovacexh99_1.htm

Exhibit 99.1
 
I.
SINOVAC REPORTS UNAUDITED SECOND QUARTER 2009 FINANCIAL RESULTS
 
 
- Conference call scheduled Wednesday, August 19, 2009 at 8:00 a.m. ET -
 
- Reaffirmation of 2009 sales projection to be $55 million to $60 million -
 
- H1N1 vaccine may drive additional growth -
 
BEIJING, Aug. 19 /PRNewswire-Asia/ -- Sinovac Biotech Ltd. (NYSE Amex: SVA), a leading developer and provider of vaccines in China, announced today its unaudited financial results for the three-month and six- month periods ended June 30, 2009.
 
Financial Highlights
   
--
Sales for the quarter increased 21% to $20.0 million
--
Sales for the six-month period increased 5% to $26.6 million
--
Operating income for the quarter rose 52% to $10.7 million
--
Operating income for the six-month period increased 11% to $11.3 million.
--
Net income attributable to the shareholders increased 74% to $5.8 million in the second quarter, with diluted EPS of $0.14
--
Cash and cash equivalents at June 30, 2009 was $46.7 million.
   
Business Highlights
 
--
In June, Sinovac received the first order in China to supply its pandemic influenza A (H1N1) vaccine to the Beijing government. The initial order consisted of vaccines for 2 million people; delivery is expected by the end of September with additional orders expected to commence in October.
   
--
In July, Sinovac began the clinical trial of its H1N1 influenza vaccine, enrolling 1,614 volunteers, including 101 elders, 706 adults, 404 juveniles and 403 children. The trial began on July 21, 2009 and all of the volunteers received their first shot of the vaccine through July 25, 2009. During the three-day observation period, none of the volunteers experienced a severe adverse reaction.  Between August 12 and 15, 2009, the volunteers received the second shot of the vaccine. Preliminary tests on the H1N1 influenza vaccine have indicated that the vaccine is safe and reliable in humans.
 
Mr. Weidong Yin, Chairman, President and CEO of Sinovac, commented, "We are very pleased with our second quarter results, with sales up 21% and net income up 74%. Our revenue growth in the quarter was partly driven by increased sales of our inactivated hepatitis A vaccine, Healive®, to the public market, as we worked to fulfill the previously announced purchase order from China's Ministry of Public Health (MOH). Sinovac fulfilled and recorded 89% of the original order for $12.8 million worth of doses in the second quarter of 2009. Going forward, we will continue to focus on increasing our penetration of both the private and public markets.
 
"Since the onset of the global outbreak of the H1N1 influenza virus, Sinovac has earned a great deal of recognition from local and national governments and health agencies for our efforts to help prevent and control the spread of this virus. As China's only approved manufacturer of a pandemic influenza (H5N1) vaccine, we had the fully integrated human vaccine development expertise and manufacturing capability necessary to quickly produce a vaccine for H1N1. In June, Sinovac was the first company in China to receive an order for the H1N1 influenza vaccine; we expect to deliver the initial order of vaccines for 2 million people to the Beijing government by the end of September 2009. Administration of the second dose of H1N1 vaccine to volunteers began on August 12, 2009 and has been completed. The clinical data unblinding conference was held in Beijing on the afternoon of August 17, 2009. The analysis of the clinical trial results showed that the H1N1 vaccine developed by Sinovac induces good immunogenicity and has good safety profile after one dose. Sinovac plans to complete the summary report as soon as possible
 

 
 

 
 
and fully evaluate the safety and immunogenicity of the H1N1 vaccine. We plan to apply for the Production License for H1N1 vaccine in compliance with SFDA's regulations. We are very proud to be able to make such a significant contribution in helping to slow the spread of this epidemic in China.
 
Mr. Yin continued, "We remain very excited about our growth prospects for 2009 and beyond. In addition to the H1N1 vaccine, we have a robust pipeline of other investigational vaccines, including enterovirus 71 (EV 71), pneumococcal conjugated vaccine, and Japanese encephalitis. Overall, our objective for the next three to five years is to have one or two product candidates per year entering into clinical trials beginning in 2010 and one or two products launched into the market per year commencing in 2012. In addition to our organic growth strategy, we have the financial flexibility to selectively pursue acquisition candidates that will help to expand our product pipeline, due to $47 million of cash and cash equivalents on our balance sheet. Previously, we projected revenues of $55 million to $60 million for the full year 2009. Based largely on expected demand for our H1N1 vaccine, we believe that our 2009 revenues will exceed expectations. However, due to uncertainty on the timing of future orders, we are not able to further quantify our expectations.
 
Market Overview
 
The market for Sinovac's principal product, Healive, has been developed with the PRC government greatly expanding publicly funded inoculations. As a result, the share of the market generated by public sales is expected to increase in the next few years, and private market sales are expected to decrease as a percentage of overall sales. Although the gross margin on public sales is lower than on private sales, Sinovac expects to realize offsetting cost savings and efficiencies.
 
In the current year, Sinovac expects to generate significant revenues from the sale of H1N1 vaccine, but this is expected to be a short-term initiative that will extend through to the end of the influenza season in the spring of 2010. These sales are not expected to be recurring, but demonstrate the Company's ability to develop, manufacture and distribute vaccines on short notice.
 
In future periods, the Company is seeking to expand its sales by adding new product lines, including the sale of animal vaccines by its subsidiary Tangshan Yian.
 
Financial Review for Three Months Ended June 30, 2009
 
During the second quarter of 2009, sales were $20.2 million, up 21.2 percent from $16.5 million in the second quarter of 2008. Sinovac continues to devote significant resources to marketing Healive to China's private market and an increase in demand for Healive in the public market is expected as well.
 
During the second quarter of 2009, Sinovac's unit dose sales were:
 
Three months ended June 30
 
2009
   
2008
 
   
(000 doses)
   
(000 doses)
 
             
Healive
    3,263       2, 720  
Bilive
    315       176  
 
Sales of Healive in the quarter were largely driven by fulfillment of the previously announced MOH purchase order as part of its vaccination campaign. Sales of the hepatitis A vaccine to the public market accounted for 60% of total sales in the quarter. Sales of Bilive increased significantly
 

 
 

 
 
during the quarter and the Company expects it to become a complementary product to Healive in the private market, whereas Healive is expected to increasingly penetrate the public market.
 
Gross profit for the second quarter 2009 was $16.3 million, with a gross margin of 81%, compared to $13.9 million and a gross margin of 84%, for the same period of 2008. The gross margin was adversely impacted by the lower selling price on the 2 million doses of hepatitis A vaccine sold to MOH. The gross margin for the second quarter of 2009 increased from the gross margin of 78% reported in the first quarter of 2009 due to efficiencies resulting from expanded production volume.
 
Total operating expenses for the second quarter of 2009 were $5.6 million, compared to $6.9 million in the comparative period in 2008. Selling, general and administrative expenses for the second quarter of 2009 were $4.9 million, compared to $6.0 million in the same period of 2008. SG&A expenses, as a percentage of second quarter 2009 sales, decreased to 24%, down from 37% during the prior year. The lower selling expenses resulted from the higher proportion of Healive sold to the government.
 
Net research and development expenses for the second quarter 2009 were $550,000, compared to $668,000 in the same period of 2008. R&D expenses in the second quarter of 2009 were mainly related to the EV 71 vaccine, pneumococcal conjugated vaccine, and universal pandemic influenza vaccine.
 
Second quarter 2009 operating income was $10.7 million, compared to operating income of $7.0 million in the prior year. Net income for the second quarter of 2009 included $126,000 in net interest and financing expenses and $2.1 million in income tax expenses. Net income for the same period of 2008 included $541,000 of net interest expense and $1.6 million of income tax expense. Net income for second quarter of 2009 was $5.8 million, or $0.14 per diluted share, up 75% compared to net income of $3.3 million, or $0.08 per diluted share, in the same period of 2008.
 
As of June 30, 2009, Sinovac's cash and cash equivalents totaled $46.7 million, compared to $32.9 million as of December 31, 2008. The increase in cash and cash equivalents primarily reflects an commercial bank loan obtained in the second quarter.
 
Financial Review for Six-Months Ended June 30, 2009
 
During the six-months ended June 30, 2009, sales were $26.6 million, up 4.7 percent from $25.4 million for the same period in 2008. Sinovac recorded a strong second quarter, which greatly improved the company's performance for the year to date.
 
During the first six-months of 2009, Sinovac's unit dose sales were:
 
Six months ended June 30
 
2009
   
2008
 
   
(000 doses)
   
(000 doses)
 
             
Healive
    4,034       4,220  
Bilive
    491       207  
Anflu
    136       23  
 
Gross profit for the six-month period was $21.4 million, with a gross margin of 80%, compared to $21.7 million and a gross margin of 86%, for the prior year period. The gross margin was adversely affected by the lower selling price of the 2 million doses of hepatitis A vaccine sold to MOH in the second quarter of 2009. Total operating expenses for the first six months of 2009 were $10.0 million, compared to $11.6 million in the comparative period in 2008.
 

 
 

 
 
Selling, general and administrative expenses for the first six months of 2009 were $8.4 million, compared to $9.6 million in the prior year period. SG&A expenses as a percentage of sales decreased to 32 percent, down from 38 percent in the comparative period. Net research and development expenses for the first six-months of 2009 were $1.3 million, compared to $1.6 million in the prior year period.
 
Operating income for the six-months ended June 30, 2009 was $11.3 million, compared to an operating income of $10.2 million in the prior year period. Net income for the first six months of 2009 included $159,000 in net interest and financing expenses and $2.6 million in income tax expenses. Net income for the same period of 2008 included $653,000 of net interest expense and $2.3 million of income tax expense. Net income for the first six months of 2009 was $5.8 million, or $0.14 per diluted share, compared to net income of $4.9 million, or $0.12 per diluted share, in the same period of 2008.
 
Conference Call Details
 
The Company will host a conference call on Wednesday, August 19, 2009 at 8:00 a.m. ET (8:00 p.m. China Standard Time) to review the Company's second quarter financial results for the period ended June 30, 2009 and provide an update on recent corporate developments. To access the conference call, please dial 1-877-407-4018 (USA) or 1-201-689-8471 (international). A replay of the call will be available from 11:00 a.m. ET on August 19, 2009 until September 2, 2009. To access the replay, please dial 1-877-660-6853 (USA) or 1-201-612-7415 (international) and reference the account number 3055 and the access code 330444. A live audio webcast of the call will also be available from the Investors section on the corporate web site at http://www.sinovac.com . A webcast replay can be accessed on the corporate website beginning August 19, 2009 and the replay will remain available for 30 days.
 
About Sinovac
 
Sinovac Biotech Ltd. is a China-based biopharmaceutical company that focuses on the research, development, manufacture and commercialization of vaccines that protect against human infectious diseases. Sinovac's vaccine products include Healive® (hepatitis A), Bilive® (combined hepatitis A and B), Anflu® (influenza), Panflu(TM) (pandemic influenza (H5N1) has already been approved for government stockpiling) and an H1N1 vaccine. Sinovac is developing vaccines for enterovirus 71, universal pandemic influenza, Japanese encephalitis vaccine, and human rabies vaccine. Its wholly owned subsidiary, Tangshan Yian, is conducting field trials for independently developed inactivated animal rabies vaccines.
 
Safe Harbor Statement
 
This announcement contains forward-looking statements. These statements are made under the "safe harbor" provisions of the U.S. Private Securities Litigation Reform Act of 1995. These forward-looking statements can be identified by words or phrases such as "will," "expects," "anticipates," "future," "intends," "plans," "believes," "estimates" and similar statements. Among other things, the business outlook and quotations from management in this press release contain forward-looking statements. Statements that are not historical facts, including statements about Sinovac's beliefs and expectations, are forward-looking statements. Forward-looking statements involve inherent risks and uncertainties. A number of important factors could cause actual results to differ materially from those contained in any forward-looking statement. Sinovac does not undertake any obligation to update any forward-looking statement, except as required under applicable law.
 

 
 

 

SINOVAC BIOTECH LTD.
                       
Consolidated Statements of Income and Comprehensive Income
                       
Three Months and Six Months Ended June 30, 2009 and 2008
                   
(Unaudited)
                       
(Expressed in U.S. Dollars)
 
                         
   
Three months ended
   
Six months ended
 
   
30-Jun
   
30-Jun
 
   
2009
   
2008
   
2009
   
2008
 
                         
Sales
  $ 20,018,327     $ 16,521,429     $ 26,584,426     $ 25,383,430  
Cost of sales
    3,762,786       2,613,939       5,210,556       3,661,805  
Gross profit
    16,255,541       13,907,490       21,373,870       21,721,625  
Selling, general and administrative expenses
    4,860,279       6,038,650       8,407,902       9,616,536  
                                 
Research and development expenses
    549,734       667,508       1,309,175       1,596,844  
                                 
Depreciation of property, plant and equipment  and amortization of  licenses and permits
    167,004       169,484       331,873       347,713  
Total operating expenses
    5,577,017       6,875,642       10,048,950       11,561,093  
Operating income
    10,678,524       7,031,848       11,324,920       10,160,532  
Interest and financing expenses
    -199,113       -399,854       -325,313       -557,561  
                                 
Interest income and other income (expenses)
    73,020       -141,491       166,151       -95,141  
                                 
Income  before income taxes and non-controlling interest
    10,552,431       6,490,503       11,165,758       9,507,830  
                                 
Income taxes recovery (expense)
                               
- Current
    -1,471,543       -2,579,104       -1,795,917       -3,224,439  
- Deferred
    -690,556       970,614       -847,950       897,433  
Net income for the period
    8,390,332       4,882,013       8,521,891       7,180,824  
                                 
Net income attributable to non-controlling interest
    -2,581,676       -1,545,764       -2,688,556       -2,284,619  
Net income attributable to the stockholders
  $ 5,808,656     $ 3,336,249     $ 5,833,335     $ 4,896,205  
Net income for the period
  $ 8,390,332     $ 4,882,013     $ 8,521,891     $ 7,180,824  
Other comprehensive income
                               
Foreign currency translation adjustment
    -38,279       960,676       26,620       2,243,204  
Comprehensive income
    8,352,053       5,842,689       8,548,511       9,424,028  
                                 
Comprehensive income attributable to non-controlling interest
    2,583,246       1,551,187       2,695,811       2,299,930  
Comprehensive income attributable to stockholders
  $ 5,768,807     $ 4,291,502     $ 5,852,700     $ 7,124,098  
Earnings per share – basic and diluted
    0.14       0.08       0.14       0.12  
Weighted average number of shares of common stock outstanding
                               
- Basic
    42,427,503       42,851,228       42,653,223       41,983,709  
- Diluted
    42,431,249       43,210,296       42,653,223       42,351,756  
 
 
 
 

 
 
SINOVAC BIOTECH LTD.
           
Consolidated Balance Sheets
           
(Unaudited)
           
(Expressed in U.S. Dollars)
 
             
   
June 30,
   
December 31,
 
   
2009
   
2008
 
ASSETS
           
Current assets
           
Cash and cash equivalents
  $ 46,704,452     $ 32,894,102  
Accounts receivable – net
    31,740,850       19,486,596  
Inventories
    9,654,400       6,486,351  
Income tax refundable
    521,484       348,018  
Prepaid expenses and deposits
    678,673       933,297  
Deferred tax assets
    448,965       1,189,831  
Due from related party
    1,460,963       -  
                 
Total current assets
    91,209,787       61,338,195  
                 
Property, plant and equipment
    21,244,659       19,262,099  
Long term inventories
    2,919,129       942,514  
Deferred tax asset
    545,102       569,937  
Licenses and permits
    893,146       1,090,477  
                 
Total assets   $ 116,811,823     $ 83,203,222  
                 
                 
LIABILITIES AND STOCKHOLDERS' EQUITY
               
                 
Current liabilities
               
Loans payable
  $ 24,105,891     $ 8,024,277  
Accounts payable and accrued liabilities
    11,708,409       11,909,037  
Due  to  related  parties
    46,971       46,971  
Dividends payable to non-controlling shareholder of Sinovac Beijing
    115,835       115,677  
Deferred research grants
    1,011,842       1,182,703  
Total current liabilities
    36,988,948       21,278,665  
Deferred  government grants
    2,749,228       2,836,994  
Loan payable
    2,191,445       2,188,439  
Deferred revenue-H5N1
    9,642,356       -  
Long-term debt
    14,583,029       5,025,433  
Total liabilities
    51,571,977       26,304,098  
Commitments and contingencies
               
                 
STOCKHOLDERS' EQUITY
               
Preferred stock
    -       -  
Common stock
    42,424       42,894  
Additional paid in capital
    41,422,187       41,629,506  
Accumulated other comprehensive income
    4,162,591       4,143,225  
Dedicated reserves
    5,549,684       5,549,684  
Retained earnings (Accumulated deficit)
    4,181,800       -1,651,534  
Total stockholders' equity
    55,358,686       49,713,775  
Non-controlling interest
    9,881,160       7,185,349  
Total equity
    65,239,846       56,899,124  
Total liabilities and equity
  $ 116,811,823     $ 83,203,222  
 
 
 
 

 
 
SINOVAC BIOTECH LTD.
                       
Consolidated Statements of Cash Flows
                       
Three Months and Six Months Ended June 30, 2009 and 2008
                       
(Unaudited)
                       
(Expressed in U.S. Dollars)
 
             
   
Three Months ended June 30
   
Six Months ended June 30
 
   
2009
   
2008
   
2009
   
2008
 
Cash flows from (used in) operating activities
                       
Net Income for the period
  $ 8,390,332     $ 4,882,013     $ 8,521,891     $ 7,180,824  
Adjustments to reconcile net income to net cash used by operating activities:
                               
- deferred income taxes
    690,556       -970,614       847,950       -897,433  
- loss (income) on disposal fixed assets
    2,434       -       -7,349       -  
- stock-based compensation
    61,540       16,635       128,043       33,271  
- provision for doubtful debts
    1,443,986       932,113       2,312,924       1,559,918  
- depreciation of property, plant and equipment, and   amortization of licenses
    431,753       388,460       864,107       780,563  
- research and development expenditures qualified for government grant
    -70,374       -126,829       -128,685       -130,848  
Change in other assets and liabilities
                               
- accounts receivable
    -12,080,553       -9,218,834       -14,543,552       -13,369,079  
- inventories
    -2,803,876       -865,187       -5,135,639       -2,314,630  
- income tax refundable
    712,224       -       -173,028       -  
- prepaid expenses and deposits
    224,922       -403,304       255,826       -84,290  
- advance from stockpiling program
    9,644,568       -       9,644,568       -  
- accounts payable and accrued liabilities
    1,487,986       3,668,617       -1,283,789       4,142,407  
Net cash provided by (used in) operating activities
    8,135,498       -1,696,930       1,303,267       -3,099,297  
Cash flows from (used in) financing activities
                               
Loan proceeds
    16,074,281       -       16,074,281       -  
Loan repayment
    -       -       -       -  
Proceeds from issuance of common stock
    -       1,966       -       9,815,265  
Repurchase of common shares
    -16,189       -       -335,832       -  
Loan to non-controlling shareholder of  Sinovac    Beijing
    -       -       -1,460,600       -  
Proceeds from shares subscribed
    -       39,295       -       39,295  
Dividends paid to non-controlling shareholder of   Sinovac Beijing
    -       -       -       -2,947,877  
Government grant received
    -       70,695       -       70,695  
Net cash provided by financing activities
    16,058,092       111,956       14,277,849       6,977,378  
                                 
Cash flows from (used in) investing activities
                               
Restricted cash
    -       935,765       -       -434,921  
Acquisition of property, plant and equipment
    -750,509       -1,229,151       -1,762,001       -2,236,575  
Net cash used in investing activities
    -750,509       -293,386       -1,762,001       -2,671,496  
                                 
Exchange effect on cash and equivalents
    -47,508       119,919       -8,765       542,189  
Increase (decrease) in cash and cash equivalents
    23,395,573       -1,758,441       13,810,350       1,748,774  
 
                               
Cash and cash equivalents, beginning of period
    23,308,879       20,578,712       32,894,102       17,071,497  
                                 
Cash and cash equivalents, end of period
  $ 46,704,452     $ 18,820,271     $ 46,704,452     $ 18,820,271  
                                 
Cash paid for interest, net of interest capitalized
  $ 206,866     $ 133,612     $ 330,268     $ 306,005  
                                 
Cash paid for income taxes
  $ 759,318     $ 871,557     $ 1,968,944     $ 1,309,963  
 
 
 
 

 
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