Financial Performance - Revenue for 2023 was RMB 13,229,453, a decrease of 3.8% from RMB 13,747,473 in 2022[38]. - Profit attributable to owners of the company for 2023 was RMB 2,001,906, down from RMB 2,764,093 in 2022[33]. - Total assets as of December 31, 2023, were RMB 33,670,231, compared to RMB 33,402,242 in 2022[31]. - The company reported a profit before taxation of RMB 2,369,187 for 2023, a decrease from RMB 3,385,739 in 2022[31]. - Basic earnings per share for 2023 were RMB 0.41, down from RMB 0.44 in 2022[33]. - The Group's gross profit margin decreased from 53.1% to 50.2% due to price reductions for certain products and changes in product mix[43]. - Gross profit for 2023 was RMB 6,643,033,000, reflecting a decline of 9.1% from RMB 7,305,732,000 in 2022[62]. - Net profit attributable to the owners of the company, excluding extraordinary items, was RMB 1,982,432,000, down 28.8% from RMB 2,783,452,000 in 2022[62]. Market Position and Growth - In 2023, Shandong Weigao Group Medical Polymer Company Limited achieved strong sales growth across major products despite facing pressure on overall results[6]. - The company reported continuous rapid growth in market share across various business lines, including clinical care consumables and pharmaceutical packaging[5]. - Weigao's market position has significantly improved over the past 20 years, becoming a leading enterprise in the medical devices sector in China[5]. - The company is cultivating new business segments through strategic recalibration to foster additional growth points[8]. - The company is focused on improving digital management in production and actively deploying new materials and technologies[11]. - The company is actively developing new markets, rapidly increasing customer coverage in county-level hospitals, and establishing new offices at the prefecture and city levels[21]. Product Development and R&D - Weigao's product portfolio is being enhanced through R&D, product cooperation, and mergers and acquisitions[12]. - In R&D strategy, the company is increasing in-house R&D investment and collaborating with innovative start-ups to accelerate new product launches and market access[22][23]. - The Group obtained product registration certificates for 115 new products in the PRC and completed research and development for 57 products[50]. - Total research and development expenses amounted to approximately RMB592,850,000, representing 4.5% of the Group's revenue[50]. - The clinical nursing digital products have received widespread acclaim from hospitals and healthcare personnel, indicating a promising market outlook[73]. Corporate Governance and Leadership - The company is committed to enhancing corporate governance, increasing dividend payout ratios, and promoting gender equality in leadership roles[28]. - The company has a strong leadership team with diverse backgrounds in sales, operations, and finance, enhancing its strategic direction[83][85][86]. - The board includes both executive and non-executive directors, ensuring a balanced approach to governance and strategy[85][86]. - The company has a commitment to corporate governance, with a company secretary who has over 25 years of experience in corporate finance and management[96]. - The Company has adopted a dividend policy, allowing shareholders to receive dividends declared at the Board's discretion, subject to approval by the general meeting[178]. Sales and Marketing Strategy - Weigao has developed a comprehensive direct sales network to hospitals, enhancing its channel advantages[12]. - The company is enhancing its sales platform integration, focusing marketing resources on core customer development, and improving product penetration rates in key accounts, especially tertiary hospitals[21]. - The integration of sales channels has strengthened market penetration and increased sales contribution per customer[56]. - The company maintains a strong corporate culture centered on conscience, sincerity, and loyalty to meet clinical demands[7]. Financial Commitments and Investments - The company invested approximately RMB 644,632,000 in property and production facilities to enhance its industrial zone for medical consumables[65]. - A planned investment of RMB 770,000,000 was made to acquire a 38.5% interest in the Songyuan Healthcare Industry Fund, with RMB 308,000,000 already contributed[65]. - The company plans to invest approximately RMB200,000,000 in a new production line for pre-filled syringes, expected to be operational by 2025[66]. - The company has established a robust marketing system tailored for the Chinese market, particularly a comprehensive direct sales network to hospitals, enhancing channel advantages through further integration[13]. Social Responsibility and Sustainability - The company was selected for the pilot program for green, low-carbon development zones in Shandong Province and recognized as the first medical "green bond" client of the World Bank[25]. - The Group emphasizes responsible operation and sustainable development, being recognized as the first healthcare "Green Bond" customer of the International Finance Corporation in Asia[77]. - The Group made charitable donations amounting to RMB939,000 in 2023, an increase from RMB677,000 in 2022[119]. Challenges and Market Conditions - The company faced significant profit impacts in 2023 due to decreased ex-factory prices from volume-based procurement of orthopedic products[68]. - The sales volume of general consumables and pharmaceutical packaging products increased significantly, but revenue growth was weaker than sales volume growth due to pricing and product structure impacts[68]. - The orthopedic segment has significantly improved terminal service capabilities and expanded customer coverage amid ongoing policy impacts and industry reshaping[71]. Future Outlook - The Group's management is confident in long-term sustainable development despite fluctuations in operating results in 2023, noting strong sales growth across major products[80]. - The Group has proposed a three-pronged operational strategy focusing on "platform-based," "internationalized," and "digitalized" development to create long-term stable value[79].

Investment Rating - Maintains an "Overweight" rating for the company [1][2] Core Views - Performance under pressure in 2023 due to centralized procurement and base effects, but expected to return to normal growth from 2024 onwards [1] - Revenue for 2023 was RMB 13.229 billion, a year-on-year decrease of 3.8%, with net profit attributable to shareholders of RMB 2.002 billion, down 27.6% year-on-year [1] - Operating cash flow for 2023 was approximately RMB 2.8 billion, indicating a healthy cash flow position [1] - Centralized procurement impact is narrowing, and base effects are diminishing, with expectations of a return to normal growth in 2024 [1] - The company continues to expand its product lines and internationalization efforts, with overseas revenue reaching RMB 3.4 billion in 2023, accounting for 26% of total revenue [1] Financial Summary - Revenue for 2023 was RMB 13.229 billion, a decrease of 2.9% year-on-year [4] - Gross profit for 2023 was RMB 6.643 billion [4] - Net profit for 2023 was RMB 2.002 billion, a decrease of 26.5% year-on-year [4] - PE ratio for 2023 was 9.33, with a PB ratio of 0.83 [4] - Forecasted EPS for 2024-2026 is RMB 0.48, RMB 0.53, and RMB 0.58 respectively [1] Business Segments - Medical devices segment revenue grew slightly by 2.6% to RMB 7.0 billion in 2023, with regular product revenue increasing by approximately 10% [1] - Orthopedics segment revenue decreased by 38% to RMB 1.27 billion in 2023, but is expected to stabilize and recover in 2024 [1] - Pharmaceutical packaging segment revenue decreased by 4% to RMB 2.02 billion in 2023 due to high base effects from COVID-19 vaccine packaging orders [1] - Interventional segment revenue increased by 11% to RMB 1.93 billion in 2023, with overseas business maintaining high growth [1] - Blood management segment revenue decreased by 5% to RMB 1.04 billion in 2023 due to the impact of Radisuisse [1] Innovation and Internationalization - R&D expenses in 2023 were RMB 590 million, accounting for 4.5% of revenue, with R&D personnel increasing to 1,370 by the end of 2023 [1] - The company is expanding into new business areas such as life information and support, endocrine chronic disease management, and endoscopic diagnosis and treatment [1] - Overseas revenue in 2023 was RMB 3.4 billion, a 7% increase year-on-year, with high growth in pharmaceutical packaging and blood management businesses [1]

Financial Performance - For the year ended December 31, 2023, the company recorded revenue of approximately RMB 13,229,453,000, a decrease of 3.8% compared to RMB 13,747,473,000 in 2022[3]. - The net profit attributable to the company's owners for the year was approximately RMB 2,001,906,000, down 27.6% from RMB 2,764,093,000 in the previous year[3]. - Excluding special items, the net profit attributable to the company's owners was approximately RMB 1,982,432,000, a decrease of 28.8% compared to RMB 2,783,452,000 in 2022[3]. - The company's gross profit for the year was RMB 6,643,033,000, down from RMB 7,305,732,000 in 2022, reflecting a decline in gross margin[4]. - The total segment profit for the year was RMB 2,166,194,000, down from RMB 3,259,130,000 in the previous year, indicating a decrease of about 33.6%[16][18]. - The company reported a decrease in pre-tax profit to RMB 2,369,187,000 from RMB 3,385,739,000 in the previous year, a decline of approximately 30%[16][18]. - The gross profit margin declined from 53.1% in the previous year to 50.2% in 2023, primarily due to price reductions and changes in product structure[56]. - The company recorded a foreign exchange loss of approximately RMB 16,602,000 for the year ended December 31, 2023, compared to a foreign exchange gain of RMB 138,325,000 in the previous year[77]. Revenue Breakdown - The medical device segment generated revenue of RMB 7,007,204,000, accounting for 53% of total revenue, while the orthopedic products segment contributed RMB 1,271,203,000, representing 9.6%[16]. - The intervention products segment reported revenue of RMB 1,931,040,000, which is an increase from RMB 1,726,167,000 in the previous year, reflecting a growth of approximately 11.9%[16][18]. - The blood management products segment generated revenue of RMB 1,041,994,000, slightly down from RMB 1,097,960,000 in the previous year, representing a decline of about 5.1%[16][18]. - Revenue from medical device products reached RMB 6,727,859 thousand in 2023, compared to RMB 6,567,676 thousand in 2022, marking a growth of 2.4%[26]. - The orthopedic product segment saw a decline in revenue to RMB 1,271,203 thousand in 2023 from RMB 2,038,168 thousand in 2022, a decrease of 37.7%[26]. - The interventional business achieved revenue of approximately RMB 2,164,588,000, an increase of 11.7% year-on-year, with steady growth in the Chinese market[59]. Expenses and Investments - Research and development expenses increased to RMB 592,850,000 from RMB 556,442,000 in the previous year, indicating a focus on innovation despite overall profit decline[4]. - The company plans to invest RMB 770,000,000 in the Songyuan Health Medical Industry Fund, focusing on medical devices and biomedicine[79]. - The company has committed capital expenditures of approximately RMB 1,151,986,000 for property and equipment acquisitions as of December 31, 2023[81]. - The company plans to invest approximately RMB 200,000,000 in a new pre-filled syringe production line, expected to commence production in 2025[83]. Assets and Liabilities - Total assets decreased to RMB 26,088,190,000 from RMB 27,397,085,000 in the previous year, indicating a contraction in the asset base[8]. - The company’s total liabilities increased to RMB 7,582,041,000 from RMB 6,005,157,000, reflecting a rise in financial obligations[8]. - The company’s equity attributable to owners increased to RMB 22,449,121,000 from RMB 21,766,866,000, showing a slight improvement in shareholder equity[8]. - Total liabilities decreased slightly to RMB 9,677,526 thousand in 2023 from RMB 9,819,957 thousand in 2022, a reduction of 1.4%[21]. - The capital debt ratio decreased to 18.6% at the end of 2023, down from 20.6% in 2022[75]. Cash Flow and Dividends - The company proposed a final dividend of RMB 0.0943 per share, up from RMB 0.079 per share in 2022, pending shareholder approval[3]. - The total dividends declared for the year ended December 31, 2023, amounted to RMB 696,565,000, slightly up from RMB 690,165,000 in 2022, with a mid-year dividend of RMB 0.0734 per share compared to RMB 0.086 in 2022[41]. - The company maintained a strong cash position with cash and bank balances of approximately RMB 6,988,731,000 as of December 31, 2023[74]. - The cash and cash equivalents as of December 31, 2023, were RMB 4,797,461,000, down from RMB 5,521,051,000 in 2022, representing a decrease of about 13.1%[51]. Corporate Governance and Compliance - The company has maintained compliance with the corporate governance code throughout the year, ensuring transparency and effective protection of shareholder interests[108]. - The audit committee reviewed the audited consolidated financial statements for the year and confirmed they were prepared in accordance with applicable accounting standards and regulations[104]. - The company has received annual independence confirmations from all independent non-executive directors, affirming their independence under the listing rules[105]. - The internal audit department will regularly monitor and report on key issues to ensure appropriate remedial actions are implemented[101]. Strategic Initiatives and Market Outlook - The company plans to continue expanding its market presence and investing in new product development to drive future growth[13]. - The company aims to explore potential mergers and acquisitions to strengthen its market position and expand its product portfolio[13]. - The management remains confident in the long-term sustainable growth despite macroeconomic uncertainties, supported by a strong product portfolio and strategic market positioning[94]. - The group emphasizes corporate social responsibility and sustainable development, receiving recognition from the International Finance Corporation (IFC) for its green bond initiatives[92]. - The group is actively pursuing digital clinical nursing products, which have received positive feedback from hospitals and healthcare personnel, indicating a promising market outlook[88].

Financial Performance - The company's unaudited revenue for the six months ended June 30, 2023, was approximately RMB 6,897,700,000, a decrease of about 2.6% compared to RMB 7,078,689,000 in the same period of 2022[2] - The unaudited net profit attributable to the company's owners was approximately RMB 1,197,767,000, down approximately 21.3% from RMB 1,522,133,000 in the same period last year[2] - Excluding special items, the net profit attributable to the company's owners was approximately RMB 1,197,767,000, a decrease of about 15.8% from RMB 1,421,735,000 in the same period of 2022[2] - The gross profit for the six months ended June 30, 2023, was RMB 3,543,479,000, compared to RMB 3,708,004,000 in the same period of 2022, reflecting a decrease in gross profit margin[5] - The total comprehensive income for the period attributable to the company's owners was RMB 1,335,382,000, down from RMB 1,690,391,000 in the same period of 2022[6] - The company reported a net profit of RMB 1,197,767 for the first half of 2023, down from RMB 1,522,133 in the same period last year, reflecting a decrease of approximately 21.3%[11] - The financing costs for the six months ended June 30, 2023, were approximately RMB 138,174,000, compared to RMB 71,577,000 in the same period of 2022, indicating an increase of 93%[23] - The pre-tax profit for the six months ended June 30, 2023, was RMB 1,197,767,000, down from RMB 1,522,133,000 in the same period of 2022, reflecting a decrease of 21%[26] - Basic earnings per share for the six months ended June 30, 2023, were RMB 0.26, compared to RMB 0.34 for the same period in 2022[26] Dividends and Shareholder Returns - The company proposed an interim dividend of RMB 0.0734 per share for the six months ended June 30, 2023, compared to RMB 0.086 per share in the same period of 2022[3] - The company declared dividends amounting to RMB (356,122) for the first half of 2023, compared to RMB (292,853) in the same period of 2022, representing an increase of approximately 21.6%[11] - The company plans to distribute an interim dividend of RMB 0.0734 per share for the six months ended June 30, 2023, down from RMB 0.086 per share in the same period of 2022[59] Assets and Liabilities - The company's non-current assets as of June 30, 2023, amounted to RMB 15,184,394,000, compared to RMB 15,114,839,000 as of December 31, 2022[7] - Current assets as of June 30, 2023, were RMB 18,751,334,000, slightly up from RMB 18,287,500,000 as of December 31, 2022[8] - The company's total liabilities as of June 30, 2023, were RMB 6,603,430,000, compared to RMB 6,005,158,000 as of December 31, 2022[8] - The total liabilities decreased to RMB 27,332,298 as of June 30, 2023, compared to RMB 27,397,181 at the end of 2022, indicating a slight reduction in overall debt[10] - The company's total assets remained stable at RMB 23,579,456 as of June 30, 2023, compared to RMB 23,582,284 at the end of 2022[10] Cash Flow and Investments - For the six months ended June 30, 2023, the net cash inflow from operating activities was RMB 1,117,151, a slight decrease from RMB 1,132,320 in the same period of 2022[10] - The net cash outflow from investing activities significantly improved to RMB (268,164) compared to RMB (1,028,014) in the previous year, indicating a reduction in investment expenditures[10] - The company’s cash and bank balances were approximately RMB 6,556,096,000 as of June 30, 2023, indicating a healthy cash flow situation[49] - The company invested approximately RMB 322,017,000 in property, production equipment, and factory construction during the reporting period[52] - A planned investment of RMB 770,000,000 in the Songyuan Health Medical Industry Fund, representing a 38.5% stake, has been initiated, with RMB 308,000,000 already contributed[53] - The company has started a new production line project with an investment of approximately RMB 200,000,000, expected to commence production by 2025[53] - The company acquired 100% equity of Shandong Weigao New Biomedical Device Co., Ltd. for RMB 1,030,000,000, with RMB 721,000,000 paid during the reporting period[53] Research and Development - The company reported a decrease in research and development expenses to RMB 294,558,000 for the six months ended June 30, 2023, compared to RMB 249,126,000 in the same period of 2022[5] - Research and development expenses for the six months ended June 30, 2023, amounted to approximately RMB 294,558,000, representing 4.3% of total revenue, compared to 3.5% in the same period last year[40] - The company is investing $50 million in R&D for new technologies aimed at enhancing product features[81] Market and Product Performance - Medical device products generated revenue of approximately RMB 3,454,340,000, a year-on-year increase of 0.4%[38] - Pharmaceutical packaging business recorded revenue of approximately RMB 1,061,119,000, a year-on-year increase of 0.5%[39] - Orthopedic business revenue decreased by 33.5% to approximately RMB 797,103,000 due to ongoing policy impacts and industry restructuring[39] - Interventional business revenue increased by 18.9% to approximately RMB 1,061,650,000, with strong growth in the Chinese market[39] - The company added 177 new hospital clients, 50 other medical institutions, and 400 distributors in the domestic market during the reporting period[42] - The total number of domestic clients reached 9,735, including 3,778 hospitals and 4,369 distributors, while overseas clients totaled 7,267[42] - The company holds 722 product registration certificates and 880 patents domestically, with 771 product registration certificates and 189 patents overseas as of June 30, 2023[40] Corporate Governance and Compliance - The company has adopted the corporate governance code and has complied with all relevant provisions, except for a deviation regarding the term of non-executive directors[72] - The board consists of nine directors, including four executive directors, two non-executive directors, and three independent non-executive directors[73] - The audit committee, chaired by independent non-executive director Li Guohui, oversees the financial reporting process and internal control systems[78] - The company emphasizes the importance of effective internal controls and risk management systems, regularly reviewing their effectiveness[77] Future Outlook and Strategic Initiatives - The company provided a future outlook with a revenue guidance of $1.5 billion for the next quarter, representing a 25% increase[81] - New product launches are expected to contribute an additional $200 million in revenue over the next year[81] - Market expansion plans include entering three new countries by the end of the fiscal year, targeting a 30% increase in market share[81] - The company is considering strategic acquisitions to bolster its technology portfolio, with a budget of $100 million allocated for potential deals[81] - Operational efficiency improvements are projected to reduce costs by 5%, enhancing overall profitability[81] Shareholder Meetings and Events - The company will suspend H-share transfer registration from October 10, 2023, to October 13, 2023, to determine the eligibility of shareholders attending the special general meeting[60] - The deadline for submitting transfer documents for the special general meeting is October 9, 2023, at 4:30 PM[61] - The interim dividend entitlement period will be suspended from October 21, 2023, to October 27, 2023[62] - The deadline for submitting transfer documents to qualify for the interim dividend is October 20, 2023, at 4:30 PM[63] - The interim dividend will be distributed on or before November 24, 2023[63] Employee and Operational Metrics - The company’s total employee costs for the six months ended June 30, 2023, amounted to RMB 1,223,966,000, an increase from RMB 1,169,839,000 in the same period of 2022[24] - Customer satisfaction ratings increased to 90%, indicating strong brand loyalty and product acceptance[81]

[Performance Overview](index=1&type=section&id=Performance%20Overview) [Overall Performance](index=1&type=page&id=Overall%20Performance) For the six months ended June 30, 2023, revenue decreased by 2.6% to RMB 6.90 billion, and net profit attributable to owners of the parent declined 21.3% to RMB 1.20 billion, primarily due to volume-based procurement and a high prior-year base Key Financial Indicators for H1 2023 | Indicator | H1 2023 (Unaudited) | H1 2022 (Restated) | YoY Change | | :--- | :--- | :--- | :--- | | Revenue | RMB 6.90 Billion | RMB 7.08 Billion | -2.6% | | Profit attributable to owners of the Company | RMB 1.20 Billion | RMB 1.52 Billion | -21.3% | | Profit attributable to owners of the Company (excluding special items) | RMB 1.20 Billion | RMB 1.42 Billion | -15.8% | | Basic earnings per share | RMB 0.27 | RMB 0.33 | -18.2% | - The Board recommended an interim dividend of **RMB 0.0734 per share** for the six months ended June 30, 2023, a decrease from **RMB 0.086** in the prior year period[3](index=3&type=chunk) [Financial Statements](index=2&type=section&id=Financial%20Statements) [Unaudited Condensed Consolidated Statement of Comprehensive Income](index=2&type=page&id=Unaudited%20Condensed%20Consolidated%20Statement%20of%20Comprehensive%20Income) During the reporting period, revenue was RMB 6.90 billion, down 2.6%, gross profit was RMB 3.54 billion, down 4.4%, and gross margin decreased from 52.4% to 51.4%; finance costs significantly increased by 93.1% to RMB 138 million, leading to a net profit attributable to owners of the parent of RMB 1.20 billion, down 21.3% Key Consolidated Statement of Comprehensive Income Data (Unit: RMB Thousand) | Item | H1 2023 | H1 2022 (Restated) | YoY Change | | :--- | :--- | :--- | :--- | | Revenue | 6,897,700 | 7,078,689 | -2.6% | | Gross profit | 3,543,479 | 3,708,004 | -4.4% | | Selling expenses | (1,321,107) | (1,257,774) | +5.0% | | Research and development expenses | (294,558) | (249,126) | +18.2% | | Finance costs | (138,174) | (71,577) | +93.1% | | Profit before tax | 1,468,339 | 1,945,532 | -24.5% | | Profit attributable to owners of the Company | 1,197,767 | 1,522,133 | -21.3% | [Unaudited Condensed Consolidated Statement of Financial Position](index=4&type=page&id=Unaudited%20Condensed%20Consolidated%20Statement%20of%20Financial%20Position) As of June 30, 2023, the company's total assets were RMB 33.94 billion, largely consistent with the end of 2022, with trade and other receivables increasing by 12.0% to RMB 7.94 billion; total liabilities were RMB 10.36 billion, with current liabilities increasing by 10.0%, and total equity remained stable at RMB 23.58 billion Key Consolidated Statement of Financial Position Data (Unit: RMB Thousand) | Item | June 30, 2023 | December 31, 2022 (Restated) | Change | | :--- | :--- | :--- | :--- | | Total assets | 33,935,728 | 33,402,339 | +1.6% | | - Non-current assets | 15,184,394 | 15,114,839 | +0.5% | | - Current assets | 18,751,334 | 18,287,500 | +2.5% | | Total liabilities | 10,356,272 | 9,819,055 | +5.5% | | - Current liabilities | 6,603,430 | 6,005,158 | +10.0% | | - Non-current liabilities | 3,752,842 | 3,814,897 | -1.6% | | Total equity | 23,579,456 | 23,582,284 | -0.01% | [Unaudited Condensed Consolidated Statement of Cash Flows](index=6&type=page&id=Unaudited%20Condensed%20Consolidated%20Statement%20of%20Cash%20Flows) During the reporting period, net cash inflow from operating activities was RMB 1.12 billion, largely stable year-on-year, while net cash outflow from investing activities significantly decreased by 73.9% to RMB 268 million; net cash outflow from financing activities substantially increased to RMB 1.25 billion, primarily for loan repayments and dividend payments, resulting in cash and cash equivalents decreasing to RMB 5.17 billion at period-end Key Consolidated Statement of Cash Flows Data (Unit: RMB Thousand) | Item | H1 2023 | H1 2022 (Restated) | Change | | :--- | :--- | :--- | :--- | | Net cash inflow from operating activities | 1,117,151 | 1,132,320 | -1.3% | | Net cash outflow from investing activities | (268,164) | (1,028,014) | -73.9% | | Net cash outflow from financing activities | (1,246,076) | (4,754) | Substantial Increase | | Net decrease in cash and cash equivalents | (397,089) | 99,552 (Net Increase) | From Increase to Decrease | | Cash and cash equivalents at end of period | 5,167,185 | 5,604,254 | -7.8% | [Notes to the Financial Statements](index=8&type=section&id=Notes%20to%20the%20Financial%20Statements) [Company Overview and Accounting Policies](index=8&type=page&id=Company%20Overview%20and%20Accounting%20Policies) The company, incorporated in China, primarily engages in the R&D, manufacturing, and sales of medical devices, orthopedic products, interventional products, pharmaceutical packaging, and blood management products, with financial statements prepared under HKAS 34 and consistent accounting policies - The company's principal businesses span multiple sectors including medical devices, orthopedics, interventional products, pharmaceutical packaging, and blood management, alongside financing operations[11](index=11&type=chunk) - The financial statements for the current period adopted newly revised Hong Kong Financial Reporting Standards, which had no significant impact on the Group's financial position or performance[13](index=13&type=chunk) [Revenue and Segment Information](index=9&type=page&id=Revenue%20and%20Segment%20Information) The Group's business is divided into six operating segments, with medical device products remaining the largest revenue source, accounting for over 50% with a slight 0.6% year-on-year increase; orthopedic products saw a significant 33.5% year-on-year revenue decrease due to volume-based procurement, while interventional products showed strong performance with a 20.4% year-on-year revenue increase, and pharmaceutical packaging and blood management businesses maintained steady growth External Sales Revenue by Segment (Unit: RMB Thousand) | Segment | H1 2023 | H1 2022 (Restated) | YoY Change | | :--- | :--- | :--- | :--- | | Medical device products | 3,568,392 | 3,548,294 | +0.6% | | Orthopedic products | 797,103 | 1,198,810 | -33.5% | | Interventional products | 947,598 | 785,928 | +20.6% | | Pharmaceutical packaging | 1,061,119 | 1,056,174 | +0.5% | | Blood management | 523,488 | 489,483 | +6.9% | | **Total** | **6,897,700** | **7,078,689** | **-2.6%** | Profit by Segment (Unit: RMB Thousand) | Segment | H1 2023 | H1 2022 (Restated) | YoY Change | | :--- | :--- | :--- | :--- | | Medical device products | 660,716 | 623,738 | +5.9% | | Orthopedic products | 102,713 | 490,640 | -79.1% | | Interventional products | 45,628 | 89,040 | -48.8% | | Pharmaceutical packaging | 421,526 | 451,853 | -6.7% | | Blood management | 65,382 | 96,643 | -32.3% | | Other | 38,583 | 30,633 | +25.9% | | **Total** | **1,334,548** | **1,782,547** | **-25.1%** | [Management Discussion and Analysis](index=20&type=section&id=Management%20Discussion%20and%20Analysis) [Business Segment Review](index=20&type=page&id=Business%20Segment%20Review) During the period, the Group's gross margin decreased from 52.4% to 51.4% due to volume-based procurement; medical device revenue slightly increased by 0.4%, while orthopedic revenue declined 33.5% due to policy impacts, and interventional business revenue grew strongly by 18.9% - The Group actively responded to volume-based procurement by increasing sales volume, enhancing market share, and optimizing operating expenses to offset the impact of price reductions on profit[38](index=38&type=chunk) - - **Medical Device Products**: Revenue increased by **0.4%**, with growth in conventional consumables offsetting the decline in anti-epidemic material sales - - **Pharmaceutical Packaging Business**: Revenue increased by **0.5%**, driven by strong demand for pre-filled syringes - - **Orthopedic Business**: Revenue decreased by **33.5%**, but terminal surgical implant volume significantly increased, and sales model transformation progressed - - **Interventional Business**: Revenue increased by **18.9%**, with Alang China maintaining rapid growth[38](index=38&type=chunk)[39](index=39&type=chunk) [Research and Development, Production, and Sales](index=21&type=page&id=Research%20and%20Development%2C%20Production%2C%20and%20Sales) The Group increased R&D investment to RMB 295 million, representing 4.3% of revenue, while expanding production capacity and sales networks, adding over 600 domestic customers, and achieving 10.4% growth in overseas revenue, which now accounts for 23.4% of total revenue - Total R&D expenditure was approximately **RMB 295 million**, an **18.2% year-on-year increase**, raising its proportion of revenue from **3.5% to 4.3%**[40](index=40&type=chunk) - Domestic customers increased by **177 hospitals**, **50 other medical institutions**, and **400 distributors**, while the total number of overseas customers reached **7,267**[42](index=42&type=chunk) Revenue by Geographical Region (Unit: RMB Thousand) | Region | H1 2023 | % of Total Revenue | YoY Change | | :--- | :--- | :--- | :--- | | Domestic | 5,285,752 | 76.6% | -5.9% | | Overseas | 1,611,948 | 23.4% | +10.4% | | **Total** | **6,897,700** | **100.0%** | **-2.6%** | [Financial Review](index=25&type=page&id=Financial%20Review) The Group maintained a healthy financial position with approximately RMB 6.56 billion in cash and bank balances and healthy operating cash flow at period-end; the gearing ratio decreased from 20.6% to 19.7%, and the Group realized an exchange gain of approximately RMB 14.97 million through foreign currency hedging tools - As of June 30, 2023, the Group's cash and bank balances were approximately **RMB 6.56 billion**, with net cash flow from operating activities of approximately **RMB 1.12 billion**[48](index=48&type=chunk) - The gearing ratio (total debt/equity attributable to owners) was **19.7%**, a decrease from **20.6%** at the end of 2022[49](index=49&type=chunk) - The Group utilized foreign exchange structured derivative financial contracts to hedge foreign exchange risks, realizing an exchange gain of **RMB 14.971 million** during the period[50](index=50&type=chunk) [Significant Investments and Capital Commitments](index=27&type=page&id=Significant%20Investments%20and%20Capital%20Commitments) During the period, the Group invested approximately RMB 322 million in industrial park construction, planned RMB 770 million for the Songyuan Health Medical Industry Fund, and initiated new production line projects, while its subsidiary Weigao Orthopedic acquired Shandong Weigao Xinsheng Medical Devices Co., Ltd. for RMB 1.03 billion - - **Industrial Park Construction**: Approximately **RMB 322 million** invested in land acquisition, factory construction, and equipment - - **Industry Fund**: Planned investment of **RMB 770 million** in Songyuan Health Medical Industry Fund, with **RMB 308 million** already contributed - - **Equity Acquisition**: Weigao Orthopedic acquired **100% equity** of Shandong Weigao Xinsheng Medical Devices Co., Ltd. for **RMB 1.03 billion**, focusing on tissue repair product lines[51](index=51&type=chunk) - As of June 30, 2023, the Group's contracted but unprovided capital commitments amounted to approximately **RMB 1.199 billion**[52](index=52&type=chunk) [Review and Outlook](index=28&type=page&id=Review%20and%20Outlook) First-half performance fluctuated due to orthopedic volume-based procurement, the exit of anti-epidemic products, and US dollar interest rate hikes; the company views medical reform policies as long-term opportunities despite short-term challenges, planning to advance digital clinical nursing, transform orthopedic sales models, and expand specialized product portfolios, while pursuing "platformization, internationalization, and digitalization" strategies for sustainable growth - First-half performance was impacted by three negative factors: 1) price fluctuations due to orthopedic volume-based procurement; 2) pricing and structural effects on revenue growth from general consumables and pharmaceutical packaging products; and 3) the rapid exit of anti-epidemic products from the market[53](index=53&type=chunk) - The company launched digital clinical nursing products with broad market prospects, expected to become a new performance growth driver[53](index=53&type=chunk) - The company proposed three major operational strategies: "Platformization," "Internationalization," and "Digitalization," along with two supporting strategies: "Talent" and "Innovation," to create long-term stable value[55](index=55&type=chunk) [Other Information](index=30&type=section&id=Other%20Information) [Dividends and General Meetings](index=30&type=page&id=Dividends%20and%20General%20Meetings) The Board recommended an interim dividend of RMB 0.0734 per share, subject to approval at the Extraordinary General Meeting on October 13, 2023, with detailed share transfer registration suspension dates provided for determining meeting attendance and dividend entitlement - The proposed interim dividend is **RMB 0.0734 per share**, subject to approval at the Extraordinary General Meeting[56](index=56&type=chunk) - - **Date of Extraordinary General Meeting**: October 13, 2023 - - **Record Date for Dividend Entitlement**: October 27, 2023 - - **Interim Dividend Dispatch Date**: On or before November 24, 2023[57](index=57&type=chunk)[59](index=59&type=chunk) [Corporate Governance](index=37&type=page&id=Corporate%20Governance) The company is committed to maintaining high corporate governance standards, complying with all code provisions of Appendix 14 to the Listing Rules' Corporate Governance Code during the period, with the only deviation being the absence of specific terms for non-executive directors; the Board comprises nine directors, including three independent non-executive directors, and an Audit Committee has been established, with the company adopting standard securities dealing codes for directors and regularly reviewing internal control systems - The company has complied with all code provisions of the Corporate Governance Code, with the sole deviation being that independent non-executive directors do not have specific terms but are subject to retirement by rotation and re-election[68](index=68&type=chunk) - The Audit Committee, comprising three independent non-executive directors and one non-executive director, has reviewed the financial statements for the current period[73](index=73&type=chunk)

Revenue and Sales Performance - In 2022, the revenue breakdown for medical device products was as follows: clinical care 34.7%, anesthesia and surgical related products 4.5%, medical testing 2.4%, and other consumables 7.2%[11]. - The sale of orthopaedic products accounted for 13.4% of total sales, while interventional products contributed 14.2% and pharma packaging products made up 15.5%[11]. - Total revenue for 2022 reached RMB 13,619,007,000, representing a 3.1% increase from RMB 13,208,942,000 in 2021[18]. - Sales of medical testing products grew by 10.5% to RMB 325,680,000 in 2022, compared to RMB 294,833,000 in 2021[13]. - Sales of other consumables surged by 38.8% to RMB 979,131,000 in 2022, up from RMB 705,304,000 in 2021[13]. - Sales of orthopaedic products decreased by 13.9% to RMB 1,830,419,000 in 2022, down from RMB 2,126,594,000 in 2021[13]. - The PRC accounted for 76.8% of total sales in 2022, down from 79.9% in 2021[16]. - Sales in the United States increased by 11.0% to RMB 1,272,330,000 in 2022, compared to RMB 1,145,923,000 in 2021[17]. - The Company experienced a 29.9% increase in sales from other regions, totaling RMB 399,002,000 in 2022[17]. Profitability and Financial Metrics - Gross profit decreased by 3.3% to RMB 7,113,082,000 in 2022, down from RMB 7,352,893,000 in 2021[18]. - Net profit attributable to the owners of the Company, excluding extraordinary items, increased by 19.7% to RMB 2,723,309,000 in 2022[18]. - The gross profit margin decreased from 55.7% to 52.2% due to changes in product structure[24]. - The clinical care business recorded a turnover of approximately RMB 4,726,552,000, an increase of 2.0% over last year[25]. - The interventional business recorded a turnover of approximately RMB 1,938,237,000, representing an increase of 9.3% over last year, mainly due to significant growth in Argon sales[25]. - The pharma packaging business recorded a turnover of approximately RMB 2,105,432,000, representing an increase of 3.2% over last year[25]. - Blood management revenue increased by 12.4% to RMB 1,097,960,000 from RMB 976,862,000 in the previous year[35]. Research and Development - The company is engaged in the research and development, production, and sale of various medical device products, indicating a strong focus on innovation[7]. - Total research and development expenses amounted to approximately RMB 546,552,000, representing 4.0% of the Group's revenue[27]. - The Group obtained 123 new patents and has 171 new patents under application in the PRC, with 60 new product registration certificates obtained[25]. Corporate Governance and Management - The independent auditor for the company is Deloitte Touche Tohmatsu Certified Public Accountants, ensuring compliance and transparency in financial reporting[6]. - The Board proposed a final dividend of RMB 0.079 per share for the year ended 31 December 2022, totaling RMB 361,080,000, an increase from RMB 297,091,000 in 2021[21]. - The final dividend will be subject to shareholder approval at the Annual General Meeting[21]. - The Company has adopted the Model Code for securities transactions by Directors, confirming compliance throughout 2023[149]. - The Board of Directors consists of nine members, including four executive Directors, two non-executive Directors, and three independent non-executive Directors[153]. - The Company emphasizes the importance of good corporate governance as part of its culture to create value for shareholders[136]. - The Company has established a corporate governance committee on May 30, 2013, to develop and review corporate governance policies[181]. Investments and Acquisitions - The Group invested approximately RMB 1,069,636,000 in the purchase of properties and production facilities during the year[44]. - The Group acquired 100% equity interest in Weihai Weigao Medical Materials Company Limited for RMB 288,000,000, focusing on infection protection products[44]. - In January 2023, the Group's subsidiary Weigao Orthopaedic agreed to acquire 100% equity interest in Shandong Weigao Newlife Medical Device Co., Ltd. for RMB 1,030,000,000, with an estimated payment of RMB 721,000,000 in 2023[45]. Employee and Workforce Information - The total number of employees as of December 31, 2022, was 12,122, an increase from 11,123 in the previous year[36]. - The total cost of salaries, welfare, and social benefits for the Group amounted to approximately RMB 2,178,787,000, up from RMB 2,068,103,000 in 2021[38]. - The gender ratio in the workforce was 56% male and 44% female as of December 31, 2022[139]. Market Strategy and Competitive Position - The company is leveraging its extensive market coverage and product portfolio to enhance competitiveness and market share[48]. - The Group's strategy of integrating sales channels has strengthened market penetration and increased sales contribution per customer[34]. - The company aims to enhance customer loyalty and global market shares by focusing on international customer development and seizing overseas market opportunities[52]. - The company has expanded its product portfolio in specialist care sectors such as anesthetics, pulmonology, and urology[49]. Financial Health and Cash Flow - The Group's cash and bank balance as of December 31, 2022, amounted to approximately RMB 6,862,278,000, with a net cash flow from operating activities of approximately RMB 2,214,574,000 for the year[43]. - Total interest expenses for the Group for the year ended December 31, 2022, were approximately RMB 191,401,000, compared to RMB 140,441,000 in 2021[43]. - The gearing ratio of the Group decreased to 20.1% as of the end of 2022, down from 20.9% in 2021[43]. Shareholder and Investor Relations - The Company maintains an ongoing dialogue with shareholders and investors, regularly reviewing its communication policy to ensure effectiveness[196]. - The Company disseminates information to shareholders through interim and annual results reports, Stock Exchange announcements, and general meetings[195]. - The external auditor is appointed as the scrutineer to ensure proper counting and recording of votes at shareholders' meetings[199]. Connected Transactions - The Company acquired Weigao Medical Materials for a cash consideration of RMB 288 million, constituting a connected transaction under the Listing Rules[127]. - The auditor performed assurance procedures on the continuing connected transactions for the year ended December 31, 2022, in accordance with relevant standards[134]. - The independent non-executive directors confirmed that the continuing connected transactions were conducted in the ordinary course of business and on normal commercial terms[132]. Future Outlook and Strategic Plans - The management is confident in the long-term sustainable development and growth of the company in 2023 and beyond, despite macroeconomic uncertainties[62][64]. - The company aims to enhance its product portfolio through R&D, domestic and international collaborations, and acquisitions, focusing on "platformization," "internationalization," and "digitalization" as key strategies[61].

Financial Performance - Shandong Weigao Group recorded revenue of approximately RMB 13,619,007,000 for the year ended December 31, 2022, representing a growth of 3.1% compared to RMB 13,208,942,000 in 2021[3]. - The net profit attributable to the owners of the company was approximately RMB 2,723,309,000, an increase of 19.7% from RMB 2,275,929,000 in the previous year[3]. - Excluding special items, the net profit attributable to the owners was approximately RMB 2,742,668,000, reflecting a growth of 13.9% compared to RMB 2,407,853,000 in 2021[3]. - Total comprehensive income for the year was RMB 3,250,092,000, compared to RMB 2,376,297,000 in 2021, indicating a significant increase[5]. - The company reported a pre-tax profit of RMB 3,317,901 thousand for the year, up from RMB 2,877,845 thousand in the previous year, indicating a growth of about 15.3%[16][17]. - The company’s net profit for the year ended December 31, 2022, was RMB 2,723,309,000, an increase from RMB 2,275,929,000 in 2021, representing a growth of approximately 19.6%[35]. - The company reported other income of RMB 323,210,000 for the year ended December 31, 2022, compared to RMB 283,438,000 in 2021, an increase of 14.0%[28]. - The income tax expense for the year ended December 31, 2022, was RMB 424,267,000, slightly higher than RMB 420,066,000 in 2021, an increase of 1.0%[32]. - The financing costs for the year ended December 31, 2022, amounted to RMB 191,401,000, up from RMB 140,441,000 in 2021, representing a rise of 36.3%[31]. Dividends and Shareholder Returns - The company proposed a final dividend of RMB 0.079 per share, up from RMB 0.065 per share in the previous year, subject to shareholder approval[3]. - The company declared a total dividend of RMB 690,165,000 for the year, compared to RMB 655,739,000 in the previous year, marking an increase of approximately 5.2%[36]. - The board proposed a final dividend of RMB 0.079 per share for the year ended December 31, 2022, totaling RMB 361,079,995, compared to RMB 0.065 per share and RMB 297,091,101 in the previous year[89]. - The final dividend will be paid in RMB for non-listed domestic shares and H-shares held through the Stock Connect, while other H-share dividends will be paid in HKD[89]. - The record date for the final dividend entitlement is June 8, 2023, with the payment expected to be made on or before July 14, 2023[88]. Assets and Liabilities - The company's total assets less current liabilities amounted to RMB 27,261,403,000 as of December 31, 2022, compared to RMB 25,400,021,000 in the previous year[8]. - Total equity increased to RMB 23,446,603 thousand from RMB 21,047,005 thousand, reflecting a growth of approximately 11.4%[9]. - The total assets of the group increased to RMB 33,195,926 thousand in 2022, up from RMB 30,577,757 thousand in 2021, representing a growth of approximately 5.3%[20]. - The total liabilities for the segments amounted to RMB 9,386,445 thousand in 2022, compared to RMB 9,041,200 thousand in 2021, indicating an increase of about 3.8%[21]. - Non-current liabilities decreased to RMB 3,814,800 thousand from RMB 4,353,016 thousand, a reduction of approximately 12.4%[9]. Research and Development - Research and development expenses increased to RMB 546,552,000 from RMB 503,080,000 in the previous year, reflecting the company's commitment to innovation[4]. - Research and development expenses for the year were approximately RMB 546,552,000, representing 4.0% of the group's revenue, up from 3.8% in 2021[52]. - The group obtained 123 new patents in China and has 171 patents pending as of December 31, 2022[51]. - The company is actively increasing internal R&D investment to accelerate product development and market access, responding to the changing economic cycle and challenges faced by startups[71]. Revenue Breakdown - The medical device segment generated revenue of RMB 6,859,029 thousand, accounting for approximately 50.4% of total revenue[16]. - The orthopedic products segment reported revenue of RMB 1,830,419 thousand, representing about 13.5% of total revenue[16]. - The interventional products segment achieved revenue of RMB 1,726,167 thousand, contributing around 12.7% to total revenue[16]. - The pharmaceutical packaging products segment generated revenue of RMB 2,105,432 thousand, which is approximately 15.4% of total revenue[16]. - The blood management products segment reported revenue of RMB 1,097,960 thousand, making up about 8.1% of total revenue[16]. - Revenue from clinical care medical devices reached RMB 4,726,552,000, up from RMB 4,632,034,000 in the previous year, indicating a growth of 2.0%[25]. - Revenue from blood management products increased by 12.4% year-on-year, contributing to overall revenue growth[56]. - The orthopedic business revenue decreased by 13.9% to approximately RMB 1,830,419,000 in 2022[50]. - The interventional business recorded revenue of approximately RMB 1,938,237,000, a growth of 9.3% compared to the previous year[50]. Operational Highlights - The company employed a total of 12,122 employees, an increase from 11,123 in the previous year, with significant growth in the production department[57]. - The company maintained a strong cash and bank balance of approximately RMB 6,862,278,000 as of December 31, 2022[62]. - The company achieved a net cash flow from operating activities of approximately RMB 2,214,574,000, reflecting good cash flow conditions[62]. - The company has a capital commitment of approximately RMB 1,299,231,000 for acquisitions and property purchases as of December 31, 2022[66]. - The company has pledged bank deposits of RMB 694,084,000 to secure short-term loans and credit facilities[67]. Corporate Governance - The company has confirmed the independence of its non-executive directors as of March 30, 2023, in compliance with listing rules[85]. - The company has adhered to the corporate governance code throughout the year ending December 31, 2022, ensuring transparency and protection of shareholder rights[86]. - The company is committed to maintaining high levels of corporate governance to enhance shareholder value[86]. - The annual general meeting is scheduled for May 29, 2023, with a suspension of share transfer registration from May 23 to May 29, 2023[86]. Strategic Initiatives - The company aims to enhance its market share and industry competitiveness through product upgrades and cost control measures[69]. - The company is expanding its product portfolio in clinical nursing, including digital products to improve nursing management quality[70]. - The company is focusing on developing international clients to capture overseas market opportunities in the pharmaceutical packaging sector[70]. - The company established Baiqing Energy to enter the hospital energy management sector, aiming for energy efficiency and carbon reduction[71]. - The company promotes collaboration and resource sharing across its segments, fostering flexibility and vitality, and is actively cultivating new business areas for growth[73]. - The company has developed an excellent marketing system tailored to the Chinese market, particularly through a robust hospital direct sales network, enhancing channel advantages[75]. - The management is confident in sustainable growth for 2023 and beyond, supported by a strategic layout across diverse business areas and high-quality products[76]. - The company is committed to a three-pronged operational strategy focusing on "platformization," "internationalization," and "digitalization," supported by "talent" and "innovation" strategies[75].

Financial Performance - The company reported unaudited revenue of approximately RMB 6,975,420,000 for the six months ended June 30, 2022, an increase of about 12.0% compared to RMB 6,229,604,000 in the same period last year [2]. - The unaudited net profit attributable to shareholders for the same period was approximately RMB 1,459,106,000, representing a growth of about 20.6% from RMB 1,209,394,000 year-on-year [2]. - The adjusted net profit attributable to the company’s owners, excluding special items, was approximately RMB 1,391,075,000, up about 15.0% from RMB 1,209,394,000 in the previous year [2]. - Total comprehensive income for the period was RMB 1,773,384,000, compared to RMB 1,265,766,000 in the same period last year [6]. - The company reported a net profit of RMB 1,459,106 thousand for the six months ended June 30, 2022, up 20.7% from RMB 1,209,394 thousand in the previous year [11]. - The total revenue for the six months ended June 30, 2022, was RMB 6,229,604,000, compared to RMB 5,500,000,000 for the same period in 2021, reflecting a growth of 13.3% [23]. - The company reported a net profit attributable to shareholders of approximately RMB 1,459,106,000 for the six months ended June 30, 2022, compared to RMB 1,209,394,000 for the same period in 2021, representing an increase of 20.6% [28]. - The basic earnings per share for the six months ended June 30, 2022, was RMB 0.32, up from RMB 0.27 in the same period of 2021 [29]. Dividends - The board proposed an interim dividend of RMB 0.086 per share, compared to RMB 0.077 per share in the same period last year, pending shareholder approval [2]. - The company proposed an interim dividend of RMB 0.086 per share for the six months ended June 30, 2022, compared to RMB 0.077 per share for the same period in 2021, marking an increase of 11.7% [29]. - The record date for the mid-term dividend entitlement is set for October 10, 2022, with the dividend payment date on November 11, 2022 [79]. Assets and Liabilities - The company’s total assets as of June 30, 2022, were RMB 26,743,859,000, compared to RMB 25,254,083,000 at the end of the previous year [8]. - The company’s total liabilities amounted to RMB 4,408,836 thousand as of June 30, 2022, compared to RMB 4,346,633 thousand in the previous year, indicating a slight increase of 1.4% [9]. - The company’s total equity increased to RMB 22,335,023 thousand as of June 30, 2022, compared to RMB 20,907,450 thousand in the previous year, representing an increase of approximately 6.4% [9]. - The company’s total current assets amounted to RMB 7,072,409,000, up from RMB 6,045,579,000 at the end of 2021, representing an increase of about 17.0% [37]. - The company’s total current liabilities increased to RMB 4,358,323,000 as of June 30, 2022, compared to RMB 3,952,044,000 at the end of the previous year [138]. Cash Flow - The net cash inflow from operating activities for the six months ended June 30, 2022, was RMB 1,045,686 thousand, a decrease of 23.5% from RMB 1,367,394 thousand in the same period last year [10]. - The company’s cash and bank balances as of June 30, 2022, were approximately RMB 6,716,663,000, indicating healthy cash flow with a net cash flow from operating activities of approximately RMB 1,045,686,000 [59]. - The total cash and cash equivalents at the end of the period increased to RMB 6,716,663 thousand, compared to RMB 6,580,571 thousand at the end of the previous year, reflecting a growth of 2.1% [10]. Research and Development - Research and development expenses increased to RMB 244,573,000, up from RMB 205,923,000 in the previous year, reflecting a focus on innovation [5]. - The total R&D expenditure for the six months ended June 30, 2022, was approximately RMB 244,573,000, accounting for 3.5% of the group's revenue [49]. - The company is actively engaged in research and development of new medical technologies and products to enhance its competitive edge in the market [110]. Market Presence and Growth Strategy - The company plans to continue expanding its market presence and investing in new product development to drive future growth [12]. - The company plans to continue enriching its product portfolio and leverage its scale to maintain and enhance its market position [46]. - The company plans to continue expanding the sales of its products in the Chinese market through internal resource sharing [48]. - The company aims to maintain and strengthen its leading position in the Chinese market while promoting global resource sharing for coordinated domestic and international market development [73]. Corporate Governance - The board of directors consists of nine members, including four executive directors, two non-executive directors, and three independent non-executive directors [86]. - The audit committee, chaired by independent non-executive director Li Guohui, is responsible for overseeing the company's financial reporting and internal control systems [94]. - The company emphasizes the importance of good corporate governance practices to achieve effective accountability and maintain high standards [85]. - The company has adopted the corporate governance code as per the listing rules and has complied with all relevant provisions, except for a deviation regarding the term of non-executive directors [183]. Employee Costs - The company’s total employee costs, including salaries and other allowances, amounted to RMB 1,128,685,000 for the six months ended June 30, 2022, compared to RMB 1,055,297,000 in the same period of 2021, reflecting a rise of 6.9% [25]. - The company employed a total of 11,476 employees as of June 30, 2022, an increase from 11,123 employees at the end of the previous year [154]. Product Revenue - The company’s revenue from medical device products for the six months ended June 30, 2022, was RMB 3,552,919,000, contributing significantly to overall performance [21]. - The clinical care business recorded revenue of approximately RMB 2,297,879,000, reflecting a growth of 9.2% compared to the same period last year [46]. - The pharmaceutical packaging business recorded revenue of approximately RMB 1,056,174,000, representing a year-on-year growth of 10.3% [48]. - The orthopedic business achieved revenue of approximately RMB 1,090,916,000, with a slight increase of 0.6% compared to the previous year [48]. - The interventional business generated revenue of approximately RMB 892,966,000, reflecting a year-on-year growth of 3.2% [48]. Investment Activities - The company invested approximately RMB 537,969,000 in production equipment and construction of factories during the period to enhance its medical consumables industrial park [63]. - The company plans to invest RMB 770,000,000 in the Songyuan Health Medical Industry Fund, focusing on medical devices and biopharmaceuticals, with RMB 308,000,000 already contributed [63]. - A new production line project with an investment of approximately RMB 700,000,000 has been initiated, expected to commence production in 2024 [161]. Challenges and Outlook - The company is actively responding to national healthcare reform policies, including price negotiations and centralized procurement, which are expected to significantly impact the medical industry [164]. - The management is confident in the company's long-term sustainable development despite various challenges, focusing on strategic layout and high-quality products [171].

Shandong Weigao Group Medical Polymer Company Limited* 山東威高集團醫用高分子製品股份有限公司 | --- | --- | --- | --- | |-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|-------|-------|-------| | | | | | | (a joint stock limited company incorporated in the People's Republic of China with limited liability)(在中華人民共和國接爵成立的服務有限公司)(Stock Code 股票站碼 : 10 ...

Financial Performance - The company's unaudited revenue for the six months ended June 30, 2021, was approximately RMB 6,229,604,000, an increase of about 19.4% compared to RMB 5,215,509,000 for the same period last year[2]. - The unaudited net profit attributable to shareholders for the same period was approximately RMB 1,209,394,000, representing a growth of about 21.4% from RMB 995,841,000 in the previous year[2]. - Gross profit for the six months was RMB 3,662,863,000, compared to RMB 3,019,850,000 in the previous year, indicating a significant increase[4]. - The company's total comprehensive income for the period was RMB 1,265,766,000, compared to RMB 1,096,236,000 in the previous year[5]. - The company reported a net cash inflow from operating activities of RMB 1,367,394,000 for the period, compared to RMB 1,067,230,000 in the previous year[8]. - The basic earnings per share for the six months ended June 30, 2021, was RMB 0.27, compared to RMB 0.22 for the same period in 2020, reflecting a growth of approximately 22.7%[23]. - The net profit attributable to the owners of the company for the six months ended June 30, 2021, was approximately RMB 1,209,394,000, compared to RMB 995,841,000 for the same period in 2020, representing an increase of approximately 21.4%[22]. - The total equity as of June 30, 2021, increased to RMB 18,716,978,000 from RMB 17,719,287,000 as of June 30, 2020, reflecting a year-on-year increase of about 5.6%[9]. Dividends and Shareholder Returns - The board proposed an interim dividend of RMB 0.077 per share, up from RMB 0.062 per share in the same period last year, pending shareholder approval[2]. - The proposed interim dividend for the six months ended June 30, 2021, is RMB 0.077 per share, up from RMB 0.062 per share for the same period in 2020, indicating a 24.2% increase[23]. - The retained earnings available for distribution to shareholders as of June 30, 2021, amounted to approximately RMB 8,634,597,000[36]. Assets and Liabilities - The company's total assets as of June 30, 2021, were RMB 24,328,501,000, compared to RMB 23,359,671,000 at the end of the previous year[7]. - The total liabilities as of June 30, 2021, were RMB 4,171,650,000, an increase from RMB 3,849,579,000 as of December 31, 2020, indicating a growth of approximately 8.4%[31]. - The company's total equity attributable to owners was RMB 18,716,978,000, an increase from RMB 18,033,580,000 at the end of the previous year[7]. - The company's cash and cash equivalents at the end of the period were RMB 6,580,571,000, an increase from RMB 4,926,227,000 at the end of the previous year[8]. Research and Development - Research and development expenses for the period were RMB 205,923,000, compared to RMB 146,816,000 in the previous year, reflecting an increase in investment in innovation[4]. - The company obtained 66 new patents and has 142 patents pending in China during the six months ended June 30, 2021[38]. - The company aims to enhance its innovation capabilities and actively develop a high-value, specialized medical device product portfolio, increasing R&D resource investment[54]. Market and Product Performance - The company reported a significant increase in revenue from medical device products, with sales reaching RMB 2,567,845,000 for the first half of 2021[18]. - The clinical care business recorded revenue of approximately RMB 2,104,557,000, a year-on-year increase of 13.1%, driven by the recovery of hospital services[37]. - The orthopedic business generated revenue of approximately RMB 1,084,445,000, reflecting a 30.6% year-on-year growth through enhanced market promotion and logistics[37]. - The interventional business reported revenue of approximately RMB 865,388,000, a 10.5% increase year-on-year, supported by the recovery of clinical treatments[37]. Employee and Operational Costs - The total employee costs, including salaries and other allowances, amounted to RMB 1,055,297,000 for the first half of 2021, compared to RMB 920,153,000 in the same period of 2020, marking an increase of approximately 14.6%[20]. - The company employed a total of 10,792 employees as of June 30, 2021, compared to 10,433 employees at the end of the previous year[44]. Corporate Governance - The board consists of eight directors, including two executive directors and three independent non-executive directors, ensuring compliance with listing rules[147]. - The company has adopted the corporate governance code and has complied with all relevant provisions, except for the specific term appointment of non-executive directors[69]. - The audit committee, chaired by independent non-executive director Mr. Lu Weihong, oversees the financial reporting process and internal control systems[74]. Strategic Initiatives - The company plans to continue its market expansion efforts, particularly in the orthopedic and interventional product segments, to capture a larger market share[10]. - The company has engaged in mergers and acquisitions to enhance its product portfolio and strengthen its market position[10]. - The company plans to invest approximately RMB 600,000,000 in the acquisition of new production lines, with production expected to start in 2024[50].