Financial Performance - For the six months ended June 30, 2023, the group's sales revenue increased by approximately 30.91% compared to the same period in 2022, reaching RMB 3,946,415,000[2] - The profit attributable to the owners of the company for the same period rose by approximately 15.65%, amounting to RMB 368,151,000[2] - The earnings per share attributable to the owners of the company for the six months ended June 30, 2023, was RMB 0.29, compared to RMB 0.25 for the same period in 2022[4] - The operating profit for the six months ended June 30, 2023, was RMB 640,630,000, an increase from RMB 560,131,000 in the previous year[4] - Total comprehensive income for the period was RMB 664,847,000, compared to RMB 578,553,000 for the same period in 2022[7] - The company reported a gross profit of RMB 1,566,963,000 for the six months ended June 30, 2023, compared to RMB 1,293,166,000 in the previous year[4] - Total revenue for the six months ended June 30, 2023, was RMB 3,946,415,000, compared to RMB 3,014,688,000 for the same period in 2022, indicating an increase of 31%[24] - The profit for the period was RMB 452,209,000, with a breakdown of RMB 275,037,000 from the company, RMB 197,881,000 from Tongrentang Chinese Medicine, and a loss of RMB 20,709,000 from others[43] Assets and Liabilities - As of June 30, 2023, total assets amounted to RMB 13,080,233,000, an increase from RMB 12,484,768,000 as of December 31, 2022[9] - The company's total liabilities as of June 30, 2023, were RMB 3,772,892,000, compared to RMB 3,467,830,000 at the end of 2022[10] - The net value of accounts receivable and notes was RMB 1,404,740,000 as of June 30, 2023, compared to RMB 1,497,249,000 as of December 31, 2022[33] - Accounts payable increased to RMB 909,419,000 as of June 30, 2023, from RMB 823,233,000 as of December 31, 2022[37] - The current ratio as of June 30, 2023, was 4.49, indicating strong financial resources, compared to 4.42 as of December 31, 2022[72] - The group maintained a debt-to-equity ratio of 0.22 as of June 30, 2023, slightly down from 0.23 as of December 31, 2022, reflecting stable capital structure management[73] Cash Flow - The cash and cash equivalents as of June 30, 2023, were RMB 4,064,607,000, up from RMB 3,721,668,000 at the end of 2022[8] - Operating cash inflow for the six months ended June 30, 2023, was RMB 1,070,672 thousand, a 72.5% increase from RMB 621,389 thousand in 2022[11] - Net cash flow from operating activities increased to RMB 848,473 thousand, up 59.8% from RMB 531,447 thousand in the previous year[11] - Net cash outflow from investing activities was RMB 376,022 thousand, significantly reduced from RMB 1,056,386 thousand in the same period last year[12] - Cash received from interest increased to RMB 34,752 thousand, compared to RMB 14,298 thousand in 2022, marking a 143.5% increase[12] - Cash inflow from borrowings was RMB 200,000 thousand, a decrease of 75.5% from RMB 816,300 thousand in the previous year[12] - Net cash outflow from financing activities was RMB 208,695 thousand, compared to a net outflow of RMB 147,776 thousand in 2022[12] Dividends and Shareholder Returns - The board of directors resolved not to declare an interim dividend for the six months ended June 30, 2023[2] - The board decided not to declare an interim dividend for the six months ended June 30, 2023, while recommending a cash dividend of RMB 0.16 per share for the year ended December 31, 2022, totaling RMB 204,925,440, which was approved at the annual general meeting on June 15, 2023[31] - The company did not declare an interim dividend for the six months ended June 30, 2023, consistent with the previous year[62] Revenue Segments - Traditional Chinese medicine product sales revenue reached RMB 3,311,352,000 in mainland China, up from RMB 2,547,031,000 in the previous year, representing a growth of 30%[24] - Revenue from the company's main segment in mainland China was RMB 2,523,119,000 for the six months ended June 30, 2023[40] - The company reported a significant increase in external customer revenue, totaling RMB 3,946,415,000 for the six months ended June 30, 2023[40] - The company’s six subsidiaries engaged in traditional Chinese medicine raw material production achieved sales revenue of RMB 175.887 million, reflecting a year-on-year growth of 14.23%[68] Research and Development - Research and development expenses (excluding employee benefits, depreciation, and amortization) were RMB 47.794 million, representing 1.21% of revenue, up from 0.89% in the previous year[76] - The company continues to focus on R&D for existing products, enhancing efficacy and safety studies for major products like Zhuangyao Jianren Wan and Xihuang Wan[67] Corporate Governance and Compliance - The company adheres to corporate governance codes and has maintained compliance with the relevant regulations throughout the reporting period[82] - The audit committee reviewed the unaudited financial statements for the six months ending June 30, 2023, and found no issues with the accounting treatment[88] - The company has adopted a code of conduct for securities trading by directors and supervisors, ensuring compliance with the standards set by the listing rules[83] - The board is responsible for evaluating acceptable risk levels and ensuring effective risk management and internal control systems are in place[84] - The company continues to deepen risk management and internal control self-inspection efforts, providing timely improvement suggestions to minimize operational risks[84] Market Strategy and Operations - The company has focused on enhancing production capacity and ensuring stable supply of key products, such as Liuwei Dihuang Wan and Jinkui Shenqi Wan, to meet market demand[64] - The company has implemented a strategy to adapt to the new normal in the traditional Chinese medicine industry, emphasizing brand, variety, and quality as core competitive advantages[63] - The sales strategy focuses on the "big variety strategy" and includes marketing initiatives like "Colorful Action" and "300 Years of Royal Medicine" to improve market coverage and sales performance[81] - The company is leveraging e-commerce platforms such as Alibaba and JD.com to boost product promotion during major sales events, effectively increasing market competitiveness[66] Employee and Workforce Management - The company maintains a workforce of 4,030 employees, focusing on talent development and providing training and career planning opportunities[69] - The company has implemented a comprehensive employee compensation policy, ensuring fair value distribution based on performance and contribution[69] Shareholding Structure - The company holds 600,000,000 shares of Tongrentang, representing 92.01% of domestic shares and 46.85% of total voting rights[90] - Hillhouse Capital holds 47,663,000 shares, accounting for 7.58% of H shares and 3.72% of total registered capital[91] Future Outlook - The company aims to enhance production efficiency by ensuring supply, variety, and output value, adapting production plans to market demand changes in the post-pandemic era[81] - The company has a commitment to prioritize the manufacturing and sales of new products developed by its parent companies in the specified product categories[95] - The mid-term report for the six months ending June 30, 2023, will be published on the Hong Kong Stock Exchange and the company's website[96]

Financial Performance - The company reported a revenue increase of 15% year-over-year, reaching RMB 1.2 billion in 2022[14]. - The Group's revenue for the year ended December 31, 2022, was RMB 5,991,841,000, representing a 10.95% increase from RMB 5,400,487,000 in the previous year[23]. - The net profit attributable to shareholders was RMB 300 million, representing a 20% increase compared to 2021[14]. - Net profit for the year was RMB 1,001,620,000, reflecting a 15.55% increase from RMB 866,844,000 in 2021[23]. - Profit attributable to owners of the Company was RMB 582,888,000, up 14.91% from RMB 507,249,000 in the prior year[23]. - The Group's total revenue for 2022 was RMB 5,991,841,000, an increase from RMB 5,400,487,000 in 2021, representing a growth of approximately 10.9%[104]. - Sales of Chinese medicine products accounted for 98.96% of total income, with RMB 5,929,362,000 generated, up from RMB 5,333,605,000 in 2021[104]. - Revenue from Mainland China was RMB 4,848,999,000, representing 80.93% of total income, while revenue from outside Mainland China was RMB 1,080,363,000, accounting for 18.03%[105]. Profitability Metrics - Gross profit margin improved to 52%, up from 48% in the previous year, indicating better cost management[14]. - The Group maintained a gross margin of 43.26% and a net profit margin of 16.72% for 2022[19]. - Earnings per share increased to RMB 0.46 from RMB 0.40 in 2021[23]. - The gross margin for the year ended December 31, 2022, was 43.26%, up from 42.43% in 2021, while the net profit margin increased to 16.72% from 16.05%[74]. User and Market Expansion - User base expanded by 25%, with a total of 5 million active users by the end of 2022[14]. - The company plans to launch three new products in the next fiscal year, targeting a 10% increase in market share[14]. - The Group's strategy focused on ensuring supply, improving quality, and increasing sales volume amidst economic challenges[25]. - The Group aims to innovate in scientific research and development while exploring effective strategies for subsidiaries and potential mergers and acquisitions[34]. - The Group plans to enhance its market presence through a "Big Variety Strategy" and targeted marketing campaigns to increase product sales and market coverage[100]. Research and Development - Investment in R&D increased by 30%, totaling RMB 150 million, to enhance product innovation[14]. - Research and development expenses for 2022 were RMB134,194,000, accounting for 2.24% of revenue, compared to RMB100,155,000 and 1.85% in 2021[75]. - The Group is focusing on the research and development of innovative traditional Chinese medicine, including pharmacodynamic evaluation and clinical research for products targeting oral ulcers and Alzheimer's disease[46]. Strategic Partnerships and Acquisitions - A strategic partnership was formed with a leading healthcare provider to enhance distribution channels[14]. - The company is exploring potential acquisitions to strengthen its market position in the Asia-Pacific region[14]. Marketing and Sales Strategies - The board has approved a new marketing strategy focusing on digital channels, expected to increase customer engagement by 40%[14]. - The Group's marketing strategy included participation in large-scale industry exhibitions and dynamic marketing activities to boost sales of major varieties[44]. - The Group continued to invest in e-commerce platforms, utilizing promotional tools to enhance sales conversion rates for key products[44]. Financial Health and Liquidity - Total assets reached RMB 12,484,768,000, an increase from RMB 11,593,866,000 in 2021[19]. - The current ratio improved to 4.42, indicating better short-term financial health compared to 3.31 in 2021[19]. - The Group's liquidity ratio was 4.42 as of December 31, 2022, compared to 3.31 on December 31, 2021, indicating sufficient financial resources[69]. Shareholder Information - The Group proposed a final dividend of RMB 0.16 per share, totaling RMB 204,925,440, consistent with the previous year's dividend[114]. - Total shares held by substantial shareholders amounted to 617.88 million, representing 93.46% of total issued voting shares[156]. Risks and Compliance - The Group faces major risks including policy risks and operational risks, which may impact business operations and financial performance[165]. - The COVID-19 pandemic has affected the supply of raw materials and the overall production and sales processes of the Group[170]. - The Group is committed to compliance with various laws and regulations, ensuring legal risk management and corporate governance[175].

Financial Performance - The group's revenue for the year ended December 31, 2022, was RMB 5,991.84 million, an increase of 10.95% compared to RMB 5,400.49 million in the previous year[3]. - Net profit for the same period was RMB 1,001.62 million, reflecting a growth of 15.55% from RMB 866.84 million year-on-year[3]. - Earnings attributable to the owners of the company reached RMB 582.89 million, up 14.91% from RMB 507.25 million in the previous year[3]. - The basic and diluted earnings per share were RMB 0.46, compared to RMB 0.40 in the previous year[7]. - The company reported a gross profit of RMB 2,591.83 million, with a gross margin improvement driven by effective cost management[7]. - The total comprehensive income for the year was RMB 1,264.81 million, significantly higher than RMB 784.63 million in the previous year[9]. - The total revenue recognized from contract liabilities at the beginning of the year was RMB 222,373 in 2022, significantly higher than RMB 2,078 in 2021[25]. - The company recognized a total annual profit of RMB 1,001,620,000 across its segments for 2022[39]. Assets and Liabilities - Total assets increased to RMB 12,484,768 thousand in 2022, up from RMB 11,593,866 thousand in 2021, representing a growth of approximately 7.7%[10]. - Non-current assets decreased slightly to RMB 3,412,587 thousand in 2022 from RMB 3,463,576 thousand in 2021, a decline of about 1.5%[10]. - Current assets rose significantly to RMB 9,072,181 thousand in 2022, compared to RMB 8,130,290 thousand in 2021, marking an increase of approximately 11.6%[10]. - Total liabilities amounted to RMB 3,467,830 thousand in 2022, compared to RMB 3,435,464 thousand in 2021, reflecting a slight increase of about 0.9%[12]. - Total equity increased to RMB 9,016,938 thousand in 2022, up from RMB 8,158,402 thousand in 2021, indicating a growth of about 10.5%[12]. - Non-current liabilities rose to RMB 1,416,187 thousand in 2022 from RMB 977,334 thousand in 2021, an increase of approximately 44.9%[12]. Research and Development - The company will continue to invest in research and development to innovate and meet the growing health awareness among consumers[5]. - Research and development expenses for 2022 amounted to RMB 78,433, an increase of 60.4% from RMB 48,904 in 2021[28]. - The company is advancing clinical research for new drug projects, including the efficacy evaluation of Jingzhi Niuhuang Jiedu Pian for oral ulcers and Anshen Jiannao Ye for Alzheimer's disease[65]. - The company is also focusing on the safety evaluation and production verification of multiple classic Chinese medicine formulations[65]. Marketing and Sales - The company launched new products including Guanxin Suhe Wan and Jiawei Xiaoyao Wan during the year to enhance production capacity and ensure supply[63]. - The company continues to deepen its marketing strategy through various promotional activities and partnerships with major distributors to drive sales growth[64]. - The company is leveraging e-commerce platforms to enhance sales, utilizing tools like promotional events to boost product visibility and conversion rates[64]. - The sales of the Jin Kui Shen Qi Wan series increased by 1.71%, while the sales of the Ganmao Qingre Granules series grew by 11.00% year-on-year[64]. Corporate Governance - The company has adopted the principles and standards of the Corporate Governance Code as per the Hong Kong Stock Exchange, ensuring robust governance practices[87]. - The audit committee held two meetings in 2022 to review the financial performance and compliance of the company, ensuring adherence to risk management and internal controls[88]. - The company has received annual statements from independent non-executive directors regarding compliance with the October Commitment, confirming no breach of competitive agreements[86]. - The board of directors includes a mix of executive and independent non-executive members, ensuring diverse oversight and governance[90]. Dividends and Shareholder Returns - The cash dividends paid in 2022 were RMB 204,925,000, maintaining the same level as in 2021, with a dividend per share of RMB 0.16[33]. - The company proposed a final cash dividend of RMB 0.16 per share for the year ending December 31, 2022, totaling RMB 204,925,440, subject to approval at the annual general meeting[34]. - The company proposed a final dividend of RMB 0.16 per share for the year ended December 31, 2022, totaling RMB 204,925,440, consistent with the previous year's dividend[60]. Strategic Focus - The company plans to focus on "large variety strategy" to enhance brand, variety, and quality, aiming for high-quality development in the TCM industry[5]. - The company aims to enhance its production capabilities and market responsiveness, focusing on a "big variety strategy" to meet market demands[83]. - The company has established a competitive framework with Beijing Tongrentang Co., Ltd., ensuring no direct competition in product names and formulations, except for the An Gong Niu Huang Wan[84].

Financial Performance - For the six months ended June 30, 2022, the group's sales revenue increased by approximately 8.99% compared to the same period in 2021, reaching RMB 3,014,688 thousand[4]. - The profit attributable to the owners of the company for the same period rose by approximately 0.91%, amounting to RMB 318,322 thousand[4]. - The earnings per share attributable to the owners of the company for the six months ended June 30, 2022, was RMB 0.25[4]. - The total comprehensive income for the period was RMB 578,553 thousand, compared to RMB 443,953 thousand in the previous year, reflecting a significant increase[7]. - The company's total assets as of June 30, 2022, were RMB 12,353,189 thousand, up from RMB 11,593,866 thousand at the end of the previous year[9]. - The total liabilities of the company increased to RMB 3,944,960 thousand from RMB 3,435,464 thousand at the end of the previous year, indicating a rise in financial obligations[9]. - Operating cash flow increased to RMB 621,389 thousand from RMB 566,705 thousand, representing a growth of approximately 9.5% year-over-year[11]. - Net cash flow from operating activities reached RMB 531,447 thousand, up from RMB 470,016 thousand, indicating a year-over-year increase of about 13.0%[11]. - The total equity attributable to shareholders as of June 30, 2022, was RMB 8,158,402 thousand, compared to RMB 7,278,958 thousand at the beginning of the year, showing an increase of approximately 12.1%[12]. - The company's financial income for 2022 was RMB 18,936,000, compared to RMB 14,880,000 in 2021, reflecting an increase of 27.5%[24]. - The net financial expenses decreased to RMB 9,324,000 in 2022 from RMB 14,576,000 in 2021, indicating a reduction of 36.5%[24]. - The total tax expense for the first half of 2022 was RMB 102,012,000, a decrease of 3.3% from RMB 105,736,000 in the same period of 2021[27]. Assets and Liabilities - Inventory as of June 30, 2022, was RMB 2,994,092 thousand, compared to RMB 2,847,116 thousand at the end of the previous year, indicating an increase in stock levels[8]. - Cash and cash equivalents decreased to RMB 2,671,707 thousand from RMB 3,246,159 thousand at the end of the previous year, showing a reduction in liquidity[9]. - Non-current assets, including property, plant, and equipment, totaled RMB 2,585,705 thousand as of June 30, 2022, slightly down from RMB 2,614,731 thousand at the end of the previous year[8]. - As of June 30, 2022, accounts receivable and notes totaled RMB 1,597,937 thousand, an increase from RMB 1,256,651 thousand as of December 31, 2021, representing a growth of approximately 27.2%[32]. - Accounts payable as of June 30, 2022, amounted to RMB 814,933 thousand, a decrease from RMB 893,714 thousand as of December 31, 2021, reflecting a decline of approximately 8.8%[36]. - The company's net accounts receivable and notes stood at RMB 1,528,166 thousand as of June 30, 2022, compared to RMB 1,193,165 thousand as of December 31, 2021, indicating a significant increase of approximately 28.1%[32]. Dividends and Shareholder Information - The company did not declare an interim dividend for the six months ended June 30, 2022[4]. - Major shareholder, Tong Ren Tang Holdings, holds 600,000,000 shares, representing 92.01% of domestic shares and 46.85% of total voting shares[93]. - The total shares held by major shareholders amount to 617,877,000, accounting for 93.46% of domestic shares and 48.24% of total voting shares[93]. Market and Product Development - The company plans to continue expanding its market presence and investing in new product development to drive future growth[12]. - New products such as Guanxin Suhe Pills and Jiawei Xiaoyao Pills were introduced to meet market demand during the reporting period[59]. - The company is actively expanding its marketing channels and enhancing product promotion through e-commerce platforms like JD and Alibaba, resulting in improved product exposure and consumer awareness[61]. - The company plans to open brand stores in the global duty-free trade channels, leveraging its new subsidiary established in Hainan[63]. - The company is committed to ongoing research and development of existing products, focusing on enhancing their core value and safety evaluations for classic formulas[61]. - The company achieved sales revenue exceeding RMB 100 million for five products and RMB 10 million for nine products during the reporting period[61]. - Sales revenue for the Six Flavor Rehmannia Pill series increased by 17% year-on-year, while the Jiawei Xiaoyao Pill series saw a 66% increase[61]. Challenges and Adjustments - The company faced challenges such as material supply difficulties and employee isolation due to pandemic policies, impacting the overall production and value of traditional Chinese medicine[58]. - The company has implemented production adjustments and emergency plans to ensure continuous supply of medicines amid the pandemic[59]. - The company has faced challenges due to the pandemic, impacting production and supply, but has managed to reverse the declining trend in core markets[63]. Compliance and Governance - The financial data presented is unaudited and prepared in accordance with International Accounting Standards, ensuring compliance with relevant regulations[15]. - The audit committee has reviewed the unaudited financial statements for the six months ending June 30, 2022, and found no issues with the accounting treatment[90]. - The company has adopted a set of standards for securities transactions by directors and supervisors, ensuring compliance with regulations[83]. - Independent non-executive directors will review compliance with non-competition commitments at least annually[97]. Research and Development - Research and development expenses reached RMB 2,695.4 million, representing 0.89% of revenue, up from 0.49% in the previous year[74]. - The company focuses on developing four main product types: granules, water honey pills, tablets, and soft capsules[97].

Financial Performance - The company's revenue for 2021 was RMB 5,400,487, an increase of 17.2% compared to RMB 4,607,369 in 2020[11]. - Gross profit for 2021 reached RMB 2,291,295, reflecting a gross margin of 42.43%[12]. - Profit for the year was RMB 866,844, up 10.2% from RMB 786,507 in 2020[11]. - Earnings per share increased to RMB 0.40, compared to RMB 0.37 in the previous year[11]. - The total assets of the company as of December 31, 2021, were RMB 11,593,866, an increase from RMB 10,940,798 in 2020[12]. - The net profit margin for 2021 was 16.05%, down from 17.07% in 2020[12]. - The company declared a dividend per share of RMB 0.16, consistent with the previous year[11]. - The return on equity for 2021 was 10.63%, an increase from 10.15% in 2020[12]. Market Strategy and Expansion - The company plans to continue expanding its market presence and invest in new product development[10]. - The Group plans to focus on major product series and expand into daily cosmetics, food supplements, and disinfection products to meet market demands[26]. - The Group aims to achieve high-quality comprehensive development in line with the "14th Five Year Plan" goals[26]. - The Group's strategic focus on "active health" aligns with national policies promoting traditional Chinese medicine, creating a favorable market environment for growth[30]. - The company is expanding its distribution channels, particularly in e-commerce and medical channels, to enhance market presence and sales[36]. Product Performance - In 2021, 54 product lines achieved single-product sales exceeding RMB 5 million, with 11 products surpassing RMB 100 million in sales[35]. - Major products such as Jinkui Shenqi Pills and Xihuang Pills saw sales increases of 4.84% and 11.69%, respectively, while Liuwei Dihuang Pills experienced a decline of 13.13% due to regulatory changes[35]. - The sales amount of Ejiao series increased by 9.79% compared to the previous year, attributed to expanded distribution channels and retail store construction[35]. - Sales of Jinkui Shenqi Pills increased by 4.84%, Shengmai Liquor by 6.21%, and Ganmao Qingre Granules by 11.55% year-on-year, while sales of Liuwei Dihuang Pills decreased by 13.13% due to regulatory changes[36]. Operational Efficiency - The Company improved production efficiency and maintained stringent control over production cycles, ensuring stability in product supply[32]. - The Daxing Branch Factory and Tong Ren Tang Technologies Tangshan operated at full capacity, contributing to overall production stability[32]. - The Group's cash and cash equivalents totaled RMB 3,246,159,000 as of December 31, 2021, up from RMB 2,947,958,000 in the previous year[46]. - Short-term borrowings increased to RMB 735,300,000 with an interest rate of 3.450% per annum, compared to RMB 235,000,000 at 1.354% in the previous year[47]. - Long-term borrowings amounted to RMB 732,153,000, with an annual interest rate of 3.672%[47]. Research and Development - The company is focusing on technological innovation to enhance the efficacy and market value of products, including research on chronic disease treatments[39]. - Research and development expenses for the year ended December 31, 2021, were RMB 48,904,000, accounting for 0.60% of net assets and 0.91% of revenue[59][66]. - The company is conducting safety evaluations and stability research on classic prescriptions as part of its product development strategy[39]. Customer and Supplier Relations - The largest customer, Tong Ren Tang Holdings and its subsidiaries, contributed RMB 1,286,642,000, accounting for 23.82% of the Group's total revenue[97]. - The Group's five largest customers accounted for 47.73% of total revenue, with the largest customer representing 23.82%[97]. - The Group's purchases from the five largest suppliers accounted for 20.67% of total purchases, with the largest supplier contributing 6.48%[98]. - There were no significant disputes with suppliers or customers during the reporting period, indicating stable relationships[105]. Environmental and Compliance - The Group emphasizes environmental protection and adheres to relevant laws such as the Environmental Protection Law and the Air Pollution Prevention Law[139]. - The Group has implemented strict quality control measures in production, adhering to Good Manufacturing Practice (GMP) and Good Supply Practice (GSP)[136]. - The Group's operations are subject to various laws and regulations, including the Company Law and the Contract Law of the People's Republic of China[137]. Connected Transactions - The annual caps for the continuing connected transactions under the Property Leasing Framework Agreement for the three years ending December 31, 2022, are RMB200,000,000, RMB80,000,000, and RMB60,000,000, respectively[147][151]. - In 2021, the rental fee paid by the Group to the Tong Ren Tang Group under the Property Leasing Framework amounted to RMB817,000, which did not exceed the relevant annual cap[147][151]. - The Group's pricing policies for continuing connected transactions have been confirmed to be followed in 2021[176]. Risk Management - Major risks identified include policy risks and operational risks, which may impact product sales and operational costs[127][128]. - The company faces uncertainties due to potential adjustments in industry policies and increasing regulatory requirements[128][131]. - The pandemic has affected the supply chain, impacting the availability of raw materials and production processes[133]. - The Group faces risks related to supply chain disruptions due to climate change and the ongoing pandemic[136].

Contents 目錄 2 Corporate Structure 公司架構 4 Corporate Information 公司資料 6 Financial Highlights 財務概要 8 Chairman's Statement 董事長報告 12 Management Discussion and Analysis 管理層討論與分析 26 Report of the Board of Directors 董事會報告 68 Report of the Supervisory Committee 監事會報告 70 Corporate Governance Report 企業管治報告 98 Directors, Supervisors and Senior Management 董事、監事及高級管理人員 104 Independent Auditor's Report 獨立核數師報告 114 Consolidated Balance Sheet 合併資產負債表 116 Consolidated Income Statement 合併利潤表 117 Consolidated Statement of Comp ...

Financial Performance - In 2019, the total revenue of Tong Ren Tang Technologies reached RMB 10,469,970,000, an increase from RMB 9,769,866,000 in 2018, representing a growth of approximately 7.1%[26] - The gross profit for the year was RMB 3,055,396,000, up from RMB 2,493,017,000 in 2018, indicating a growth of about 22.6%[26] - The profit attributable to owners of the Company was RMB 5,527,255,000, compared to RMB 5,316,652,000 in 2018, reflecting an increase of approximately 4.0%[26] - The EBITDA for the year was RMB 5,527,255,000, showing a consistent performance compared to previous years[23] - The gross profit margin improved to 29.2% in 2019 from 25.5% in 2018, indicating enhanced operational efficiency[23] - The net profit margin for the year was 52.8%, up from 54.3% in 2018, demonstrating strong profitability despite slight fluctuations[23] - For the year ended December 31, 2019, the Group's revenue was RMB4,476,449,000, a decrease of 11.53% from RMB5,059,638,000 in the previous year[31] - Net profit for the same period was RMB741,390,000, down 26.29% from RMB1,005,853,000 in 2018[31] - Net profit attributable to owners of the Company was RMB417,650,000, representing a decrease of 38.38% from RMB677,815,000 in the previous year[31] - Earnings per share decreased to RMB0.33 from RMB0.53 in 2018, while the dividend per share was RMB0.16, down from RMB0.18[31] Operational Challenges - The Group faced challenges including increased competition in the pharmaceutical industry and insufficient production capacity, leading to declines in both production volume and value[32] - The outbreak of COVID-19 in early 2020 posed additional challenges, prompting the Group to monitor the situation closely and implement effective response measures[39] - The Group anticipates continued downward pressure on the macro economy and challenges in the pharmaceutical industry, including stricter regulatory policies[41] - The overall production volume of Chinese patent medicine decreased by more than approximately 20% compared to the previous year due to production capacity transition issues[47] - The transition from old to new production capacity has been a significant challenge, impacting the production of key products like Liuwei Dihuang Pills and Jinkui Shenqi Pills[47] Strategic Initiatives - The Company plans to continue expanding its market presence and investing in new product development to drive future growth[23] - Two new production bases in Daxing District, Beijing, and Yutian County, Tangshan, commenced production during the year, aimed at alleviating supply and demand pressure[34] - The Group plans to enhance production scheduling capabilities and has commenced operations at two new production bases to meet market demand[98] - The Group aims to strengthen its marketing, production, and management capabilities to support sustainable high-quality development in the future[102] Financial Position - The current ratio stood at 2.5, indicating a strong liquidity position for the Company[23] - The total assets of the Company amounted to RMB 10,469,970,000, while total liabilities were RMB 3,055,396,000, resulting in a liability-to-asset ratio of approximately 29.2%[26] - The return on equity was reported at 15.3%, reflecting the Company's effective use of equity capital[23] - As of December 31, 2019, the group's cash and cash equivalents totaled RMB 2,990.645 million, up from RMB 1,904.036 million in 2018[63] - Short-term borrowings were reported at RMB 35 million, down from RMB 195 million in the previous year, with an interest rate of 4.534%[64] - Long-term borrowings increased to RMB 1,223.571 million, representing 40.05% of total liabilities, with an annual interest rate of 2.660%[64] Market Dynamics - The Chinese government is expected to provide more support for the traditional Chinese medicine industry, presenting new opportunities for development[40] - The Group's products, including Huoxiang Zhengqi Liquid, were included in the national treatment plan for COVID-19, indicating a strategic response to market demand[97] - Revenue from the five largest customers accounted for 47.83% of total revenue, with the largest customer, Tong Ren Tang Group, contributing RMB959,408,000, or 21.43% of total revenue[119][124] Research and Development - Research and development expenses amounted to RMB 28,316,000 (2018: RMB 27,835,000), accounting for 0.63% of revenue (2018: 0.55%)[74] - The company received five national invention patents for the production process and therapeutic use of certain products, enhancing intellectual property protection[54] Employee and Supplier Relations - The company emphasizes the importance of employee development and offers training and career planning opportunities[122] - The company maintains a strong partnership with suppliers, ensuring quality through rigorous selection and assessment processes[123] - The group maintained a strong focus on developing new customers and suppliers, expanding new channels, and tapping into new markets to mitigate reliance risks, with no significant disputes reported with suppliers and customers during the reporting period[128] Legal and Compliance - The Group's compliance with laws and regulations is ensured through internal control and approval procedures, with no significant legal risks reported during the year[157] - The Group has established a professional legal team to enhance its legal affairs management and prevent legal risks related to contracts[158] Environmental Commitment - The Group's commitment to environmental protection includes compliance with the Environmental Protection Law and the Air Pollution Prevention Law of the People's Republic of China[162] - The Group's philosophy emphasizes equal importance on development and environmental protection, aiming to minimize environmental impact[163]