Core Viewpoint - Dongrui Pharmaceutical (02348) announced the appointment of Mr. Hu Shuo as a non-executive director, effective from August 1, 2025 [1] Company Summary - The appointment of Mr. Hu Shuo is a strategic move for Dongrui Pharmaceutical, indicating potential changes in governance and direction [1]

Group 1 - The core point of the article is the appointment of Hu Shuo as a non-executive director of Dongrui Pharmaceutical, effective from August 1, 2025 [1]

香港交易及結算所有限公司及香港聯合交易所有限公司對本公告的內容概不負責 ， 對其準 確性或完整性亦不發表任何聲明，並明確表示概不對因本公告全部或任何部分內容而產生 或因倚賴該等內容而引致的任何損失承擔任何責任。 DAWNRAYS PHARMACEUTICAL (HOLDINGS) LIMITED 東瑞製葯(控股)有限公司* (於開曼群島註冊成立的有限公司) (股份代號: 2348) 委任非執行董事 根據董事會作出一切合理查詢後深知和盡悉及胡先生的確認，有關胡先生的委任，除上述 披露外，概無其他根據上市規則第 13.51(2)條第(h)至 13.51(2)條第(v)段規定須作出披露的資 料，亦無其他就委任胡先生一事須提請本公司證券持有人注意的事項。 本公告乃由東瑞製葯(控股)有限公司（「本公司」，連同其附屬公司統稱「本集團」）根 據香港聯合交易所有限公司證券上市規則（「上市規則」）第13.51(2)條作出。 本公司董事會（「董事會」）欣然宣佈，胡碩先生（「胡先生」）已獲委任為本公司非執 行董事，自二零二五年八月一日起生效。 胡碩先生（曾用名:胡春雲），49歲，於貴州大學獲得工商管理碩士學位。胡先生現任上 海建信 ...

Summary of Key Points Core Viewpoint - As of July 14, a total of 138 stocks reached their 52-week highs, indicating a strong performance in the market, with notable leaders including Green Heart Group Holdings, OK Blockchain, and Pearl River Steel Pipe [1]. Group 1: Top Performers - Green Heart Group Holdings (02999) achieved a closing price of 0.013 with a peak of 0.017, marking a 70.00% increase [1]. - OK Blockchain (01499) closed at 0.680, reaching a high of 0.690, reflecting a 48.39% rise [1]. - Pearl River Steel Pipe (01938) had a closing price of 0.335 and a peak of 0.340, resulting in a 33.33% increase [1]. Group 2: Other Notable Stocks - Weishi Jiajie (00856) saw a 32.01% increase, closing at 8.870 with a high of 11.300 [1]. - Cloud Intelligence (09678) reached a high of 520.000, closing at 510.000, which is a 20.99% increase [1]. - China Chengtong Development Group (00217) closed at 0.165 with a peak of 0.166, marking a 14.48% rise [1]. Group 3: Additional Stocks with Significant Increases - Sihuan Pharmaceutical (00460) closed at 1.380, reaching a high of 1.430, which is a 14.40% increase [1]. - Taited Pharmaceutical (03880) had a closing price of 36.950 and a peak of 37.400, reflecting a 13.85% rise [1]. - Beihai Kangcheng-B (01228) closed at 0.850 with a high of 0.960, resulting in a 12.94% increase [1].

Financial Performance - For the year ended December 31, 2024, the Group recorded revenue of approximately RMB1,060,309,000, representing a decrease of 7.9% compared to 2023[11]. - Profit attributable to owners of the parent was approximately RMB564,940,000, an increase of 73.3% compared to 2023[11]. - The profit included a net gain of RMB277,627,000 from the disposal of a 35% equity interest in AD Pharmaceuticals Co., Ltd.[12]. - Excluding non-recurring profits, the operating profit attributable to owners of the parent amounted to approximately RMB201,717,000, a decrease of 19.3% compared to 2023[12]. - The decrease in operating profit was mainly due to reduced sales of the "An" series products impacted by national centralized procurement[12]. - High production costs and inventory provision of RMB43,880,000 were recorded, compared to RMB10,936,000 in 2023[12]. - Losses from the bulk medicine and intermediate segment amounted to RMB60,975,000, compared to a loss of RMB32,692,000 in 2023[12]. - Total sales revenue declined by 7.9% compared to the same period in 2023, constrained by pricing pressures despite an increase in sales volume[28]. - The segment profit from the finished drugs segment was approximately RMB425,211,000, a decrease of RMB62,066,000 compared to RMB487,277,000 in 2023, mainly due to centralized procurement impacts[86]. - Gross profit was approximately RMB577,628,000, a decrease of RMB63,891,000 or 10.0%, with a gross profit margin of 54.5%, down 1.2 percentage points from the previous year[78]. Dividends - The Board recommends a final dividend of HK$0.048 per share for the year ended December 31, 2024, totaling approximately HK$72,091,000, a decrease from HK$97,516,000 in 2023[16]. - A special dividend of HK$0.032 per share is proposed, totaling approximately HK$48,061,000, subject to shareholder approval at the 2025 AGM[17]. - The total annual dividend distribution will be HK$0.095 per share, representing an 18.8% year-on-year increase from HK$0.080 in 2023[18]. - The annual dividend payout ratio is approximately 23.5%, slightly below the company's policy of at least 25% due to a one-time book gain of approximately RMB366,919,000 in 2024[18]. Market Challenges and Strategies - The Group's financial results reflect challenges in both domestic and overseas markets due to regulatory changes and operational adjustments[12]. - Future strategies may focus on improving production efficiency and expanding market presence to mitigate the impact of centralized procurement[12]. - The Group's sales volume for certain products decreased due to unsuccessful bids in national centralized procurement, while other categories like Atorvastatin Calcium Tablets and Entecavir Dispersible Tablets saw growth[28]. - The Group plans to increase R&D investment focusing on chronic diseases, antiviral, and antimicrobial fields, while also exploring anti-aging and nutritional health domains[36]. - The Group aims to enhance production efficiency through smart manufacturing and lean production to optimize cost structures[36]. - The Group will expand market channels by leveraging e-commerce platforms and exploring international markets to increase product coverage[36]. Research and Development - Approximately 60% of the ongoing R&D projects are self-developed, with a new PhD appointed as the head of the R&D team to optimize project management and enhance efficiency[31]. - The Suzhou Dawnrays Advanced Technology Research Institute has about 60% of its products under development as self-developed projects, focusing on generics and innovative drugs[29]. - The Group's R&D platform, Suzhou Dongrui Advanced Technology Research Institute, will continue to optimize talent structure and enhance technical capabilities, with a focus on increasing the proportion of independent R&D[59]. - The Group plans to increase R&D investment to diversify its product pipeline and aims to launch new products annually to drive future growth[56]. Production and Sales - The Group achieved a 22.5% increase in the production volume of intermediates and bulk medicines compared to 2023, and a 49.3% increase in the production volume of cephalosporin powder for injection[41]. - The sales volume of "Xianshu" (Cefoperazone Sodium and Sulbactam Sodium for Injection: (1:1)) increased by 21.3%, and the sales amount increased by 42.9% compared to the same period in 2023[44]. - The bulk medicine base in Suzhou obtained commercial production qualification, with primary products achieving commercial sales, enhancing the Group's market share in intermediates and bulk medicines[55]. - The sales volume of the antibiotic injection products has shown a steady recovery, with key products winning bids in national centralized procurement[54]. Governance and Compliance - The Board of Directors is composed of a balanced mix of executive and independent non-executive directors, ensuring strong governance and independent judgment[138][140]. - The Company has complied with the Corporate Governance Code, with the exception of two independent directors who could not attend the annual general meeting due to other commitments[135][136]. - The Company has mechanisms to ensure independent views from directors are conveyed to enhance decision-making[141]. - The governance framework is reviewed annually by the Board to ensure its effectiveness[141]. - The Company ensures that all Directors are properly briefed on issues arising at board meetings[167]. Financial Position and Cash Flow - The Group's cash and bank balances were approximately RMB1,158,261,000 as of December 31, 2024, an increase from RMB905,826,000 in the previous year[98]. - Net cash inflows from operating activities were approximately RMB220,200,000, down from RMB338,400,000 in 2023[98]. - The Group recorded net cash inflows from investing activities of approximately RMB205,170,000, compared to net cash outflows of RMB387,573,000 in the previous year[98]. - The Group's interest-bearing bank and other borrowings decreased to RMB29,864,000 as of December 31, 2024, from RMB120,060,000 in 2023, resulting in a debt ratio of 0.7% compared to 3.3% in the previous year[102]. Employee and Operational Management - As of December 31, 2024, the Group employed approximately 1,183 employees, an increase from 1,143 in 2023, with total remuneration of approximately RMB 230,667,000, up from RMB 211,780,000 in 2023, primarily due to staff increase and salary adjustments[120][123]. - The management is responsible for supplying the Board with monthly updates and adequate information for informed decision-making[166]. - Directors have independent access to management for further inquiries if needed[166]. Risk Management - The Group's risk management framework includes identifying significant risks, developing measures to mitigate them, and monitoring their effectiveness[180]. - The internal audit department continuously reviews major operational and financial controls, reporting directly to the Chairman of the Board and the Audit Committee[183]. - The Group has integrated its risk management systems into core operating practices, with business units assessing potential risks to achieve their objectives[182].

Financial Performance - Revenue for the year ended December 31, 2024, was RMB 1,060,309, a decrease of 7.9% compared to RMB 1,151,145 in 2023[2] - Gross profit for the same period was RMB 577,628, down 10.0% from RMB 641,519, resulting in a gross margin of 54.5%, a decline of 1.2 percentage points[2] - Profit before tax increased by 53.8% to RMB 636,949 from RMB 414,057 in the previous year[3] - Net profit for the year was RMB 562,762, representing a 74.4% increase from RMB 322,667 in 2023[3] - Basic earnings per share rose by 72.7% to RMB 0.3754 from RMB 0.2174[3] - The company reported a total comprehensive income of RMB 577,777 for the year, compared to RMB 326,292 in 2023[4] - The company reported a loss from an associate company of RMB 3,696 thousand for the year ended December 31, 2024, compared to a loss of RMB 40,933 thousand in 2023[18] - The total income tax expense for 2024 was RMB 74,187,000, compared to RMB 91,390,000 in 2023, reflecting a reduction of approximately 19%[30] - The operating profit, excluding non-recurring gains, was RMB 201,717,000, a decline of 19.3% from RMB 249,954,000 in 2023[45] - The net profit attributable to the company's owners for the year was approximately RMB 564,940,000, an increase of RMB 238,940,000 or 73.3% from RMB 326,000,000 in 2023[76] Dividends - The company proposed a final dividend of HKD 0.048, a decrease of 26.2% from HKD 0.065 in the previous year, while the total proposed dividend for the year increased by 18.8% to HKD 0.095[2] - The company plans to distribute a final dividend of HKD 0.048 per share for 2024, down from HKD 0.065 in 2023, while introducing a special dividend of HKD 0.032 per share[35] - The board proposed a final dividend of HKD 0.048 per share for the year ending December 31, 2024, totaling approximately HKD 72,091,000, a decrease from HKD 97,516,000 in 2023[46] - The total annual dividend will be HKD 0.095 per share, representing an 18.8% increase compared to HKD 0.080 per share in 2023, with a payout ratio of approximately 23.5%[47] - The final dividend and special dividend will be distributed to shareholders on June 12, 2025[99] Assets and Liabilities - Non-current assets increased to RMB 1,807,035 from RMB 1,902,463, with property, plant, and equipment rising to RMB 1,038,195 from RMB 758,907[5] - Current assets grew to RMB 2,202,241 from RMB 1,720,196, with cash and bank deposits increasing to RMB 1,158,261 from RMB 905,826[5] - Total assets as of December 31, 2024, were RMB 4,009,276 thousand, an increase from RMB 3,622,659 thousand in 2023[17] - Total liabilities decreased to RMB 682,608 thousand in 2024 from RMB 763,425 thousand in 2023, reflecting improved financial health[17] - The company's liabilities ratio was 0.7%, down from 3.3% in 2023, with interest-bearing bank loans totaling RMB 29,864,000[82] Sales and Revenue Breakdown - Total revenue for the year ended December 31, 2024, was RMB 1,060,309 thousand, a decrease of 7.9% from RMB 1,151,145 thousand in 2023[20] - Sales of pharmaceutical products accounted for RMB 1,058,297 thousand, while testing services contributed RMB 2,012 thousand in 2024[21] - The pharmaceutical segment reported a profit of RMB 425,211,000, while the intermediates and raw materials segment incurred a loss of RMB 60,975,000 for the year ended December 31, 2024[16] - The sales revenue for the anti-hypertension series reached RMB 334,252,000, down from RMB 424,186,000 in 2023, accounting for 31.5% of total sales[57] - The sales revenue for anti-lipid products increased to RMB 299,372,000, up from RMB 292,331,000 in 2023, representing 28.2% of total sales[58] - The sales revenue for antiviral products rose to RMB 141,241,000, compared to RMB 124,828,000 in 2023, making up 13.3% of total sales[59] - The overall sales of powder injections increased to RMB 108,846,000, up from RMB 76,196,000 in 2023, representing 10.3% of total sales[60] Research and Development - Research and development expenses for the year amounted to RMB 70,755,000, down from RMB 84,611,000 in 2023, indicating a decrease of about 16%[28] - Approximately 60% of the products under development are self-researched projects, with a focus on first generics and improved innovative drugs to invigorate the product line[52] - The company is enhancing its R&D capabilities and plans to maintain a steady release of new products each year, focusing on therapeutic areas including cardiovascular, anti-infective, and antiviral drugs[62] - The company has made significant advancements in product quality and efficacy consistency studies, with 35 varieties under research, of which 31 specifications have been approved[63] Operational Performance - The company’s management monitors operational performance by product category, facilitating informed resource allocation decisions[14] - The company recorded a significant inventory provision of RMB 43,880,000, compared to RMB 10,936,000 in 2023, due to high production costs and low sales volumes[45] - The company has maintained a rigorous credit monitoring system to manage credit risk, with no significant concentration of credit risk among customers[38] - The company is actively responding to market changes and increasing R&D investment, aiming to occupy a favorable position in the procurement market and explore untapped markets[49] Market and Industry Trends - The global pharmaceutical industry continues to advance despite geopolitical tensions and high interest rates, with China's healthcare reforms focusing on improving service efficiency and high-quality development[48] - The company anticipates ongoing challenges but aims to enhance R&D investment, improve production efficiency, and expand market channels to meet rising drug demand driven by an aging population[53] Investments and Future Plans - The company has sufficient financial resources to cover capital expenditures and plans to potentially use bank loans for future investments[93] - The company aims for significant growth by 2025 through optimized marketing strategies and expanding cooperation with chain pharmacies and exploring new business models[56] - New production facilities in Suzhou and Lanzhou have received production approvals, although initial low output has led to higher costs and losses in raw materials and intermediates[50]

Financial Performance - Revenue for the six months ended June 30, 2024, was RMB 577,447,000, a decrease of 11.2% compared to RMB 649,920,000 in 2023[9] - Gross profit for the same period was RMB 337,912,000, down 6.6% from RMB 361,849,000, with a gross profit margin of 58.5%, an increase of 2.8 percentage points from 55.7%[9] - Profit before tax increased by 70.2% to RMB 556,752,000, compared to RMB 327,211,000 in the previous year[9] - Profit for the period attributable to owners of the parent rose by 92.6% to RMB 493,046,000, up from RMB 255,941,000 in 2023[9] - Net profit margin improved significantly to 85.4%, up 46 percentage points from 39.4%[9] - Basic earnings per share increased by 92.5% to RMB 0.3286, compared to RMB 0.1707 in the prior year[9] - The interim dividend per share remained at HK$0.015, consistent with the previous year[9] - The gain on disposal of an associate was RMB 286,670,000, which was not applicable in the previous year[9] Research and Development - The Group established the "Suzhou Dawnrays Advanced Technology Research Institute" to enhance its R&D capabilities and improve product development processes[19] - The Group will continue to invest more resources in R&D and innovation of production technology and products, seeking various cooperation opportunities to optimize product mix and profitability[19] - Research and development expenses increased by approximately RMB 13,122,000 to approximately RMB 43,883,000 compared to the same period last year[37] - The Group focuses on the research and development of difficult-to-generate, first-to-market, and innovative drugs to achieve synergistic development of generic and innovative drugs[32] Market and Sales Performance - The sales volume and amount of the Group's anti-hypertensive drug "An" series decreased by 2.8% and 18.4% respectively, due to the impact of national centralized procurement[16] - The sales volume of Fujian Dawnrays series products increased by 11.2%, while the sales amount increased by 4.3% compared to the same period of last year[16] - The sales volume and amount of cephalosporin intermediates and bulk medicines decreased by 88.3% and 84.9% respectively, compared to the same period of 2023[16] Financial Position - As of June 30, 2024, net assets attributable to owners of the parent were approximately RMB 3,271,104,000, with a return on net assets of 15.1%, up from 9.1% in 2023[44] - The current ratio and quick ratio were reported at 3.40 and 3.04 respectively[46] - Total assets as of June 30, 2024, amounted to RMB 4,044,544,000, up from RMB 3,622,659,000 as of December 31, 2023[107] - Total equity attributable to owners of the parent increased to RMB 3,271,104,000 as of June 30, 2024, from RMB 2,859,234,000 at the end of 2023, representing a growth of 14.4%[87] Cash Flow and Liquidity - The net cash flows from operating activities were approximately RMB 171,454,000, compared to RMB 192,470,000 in 2023, while cash and cash equivalents increased by approximately RMB 169,211,000[49] - Cash and bank balances rose significantly to RMB 1,132,322,000 from RMB 905,826,000, marking an increase of 25.0%[85] - The total cash flows from operating activities for the six months ended June 30, 2024, were RMB 349,621,000, compared to RMB 260,216,000 for the same period in 2023, reflecting an increase of approximately 34%[91] Shareholder Information - The Group's share capital includes 704,304,000 shares held by Ms. Li Kei Ling and Mr. Hung Yung Lai, representing approximately 46.94% and 39.91% of the issued share capital, respectively[69] - Fortune United Group Limited holds 596,932,000 shares, representing approximately 39.78% of the company's issued share capital[78] - The company declared an interim dividend of HK$0.015 per share, totaling approximately HK$22,506,000 (around RMB 20,594,000)[82] Compliance and Governance - The interim results have been reviewed by the audit committee of the Company, ensuring accuracy and compliance[8] - The interim financial statements have not been audited and were approved by the Board on August 23, 2024[97] - The company maintains compliance with regulatory requirements regarding shareholder interests and disclosures[79] Risk Management - The Group's financial risk management objectives include minimizing exposure to foreign currency and credit risks while maintaining liquidity[161] - Interest rate risk primarily arises from borrowings, with the Group managing this risk through fixed rate borrowing and interest rate swaps[165] - The Group continues to assess credit risk by grouping other receivables into Stage 1 and Stage 2, with Stage 1 allowing for a 12-month expected credit loss (ECL) provision[162]

Revenue and Profitability - Revenue for the six months ended June 30, 2024, was RMB 577,447 thousand, a decrease of 11.2% compared to RMB 649,920 thousand in the same period of 2023[4] - Gross profit for the same period was RMB 337,912 thousand, down 6.6% from RMB 361,849 thousand, with a gross margin of 58.5%, an increase of 2.8 percentage points year-on-year[4] - Profit before tax increased by 70.2% to RMB 556,752 thousand from RMB 327,211 thousand in the previous year[5] - Net profit attributable to the owners of the parent company rose by 92.6% to RMB 493,046 thousand, compared to RMB 255,941 thousand in the prior year[4] - Basic earnings per share increased by 92.5% to RMB 0.3286 from RMB 0.1707 in the same period last year[5] - The company reported other income and gains of RMB 421,636 thousand, significantly up from RMB 162,927 thousand in the previous year[5] - The profit attributable to equity holders of the parent company for the same period was approximately RMB 493,046,000, an increase of 92.6% from RMB 255,941,000 in 2023[31] - The main reason for the profit increase was the net gain from the sale of a 35% stake in Kangrong Dongfang amounting to approximately RMB 277,627,000[45] Assets and Liabilities - Total assets less current liabilities amounted to RMB 3,388,691 thousand, compared to RMB 2,953,719 thousand at the end of 2023[7] - Cash and bank deposits increased to RMB 1,132,322 thousand from RMB 905,826 thousand at the end of 2023[7] - The company’s total liabilities as of June 30, 2024, were RMB 4,044,544 thousand, indicating a significant increase from the previous reporting period[18] - As of June 30, 2024, the net assets attributable to the parent company were approximately RMB 3,271,104,000, with a return on equity of 15.1%, up from 9.1% in the previous year[46] - The group’s total liabilities ratio was 4.5% as of June 30, 2024, compared to 3.3% at the end of the previous year[49] Revenue Breakdown - The revenue from external sales in the "Finished Drugs" category was RMB 560,878 thousand, while the "Intermediates and Raw Materials" category generated RMB 16,569 thousand for the six months ended June 30, 2024[17] - Total revenue from customer contracts reached RMB 577,447,000, with pharmaceutical product sales contributing RMB 577,416,000[20] - The group’s total revenue from the Chinese market was RMB 574,210,000, with additional revenue from other countries amounting to RMB 3,237,000[20] - Sales of finished drugs amounted to approximately RMB 560,878,000, an increase of 3.8% from RMB 540,313,000 year-on-year, representing 97.1% of total sales, up 14 percentage points[41] Research and Development - Research and development costs for the current period were RMB 37,047,000, up from RMB 27,004,000 in the same period last year[23] - The company established the "Suzhou Dongrui Advanced Technology Research Institute" to enhance R&D capabilities and improve product development efficiency[34] - The group plans to enhance its R&D capabilities and focus on chronic disease management, leveraging resources from its advanced technology research institutes[39] - R&D expenses increased by approximately RMB 13,122,000 to RMB 43,883,000, reflecting a focus on innovation and development[42] Dividends and Shareholder Returns - The company maintained an interim dividend of HKD 0.015 per share, unchanged from the previous year[4] - The company declared a final dividend of RMB 90,786,000 for the fiscal year, with an interim dividend of RMB 20,594,000 for the six months ended June 30, 2024[25] - The diluted earnings per share for the same period was RMB 0.3282, up from RMB 0.1702 in 2023[27] Operational Performance - The company’s management is closely monitoring operational performance across its product categories to make informed resource allocation decisions[16] - The company plans to continue optimizing its structure and expanding its market presence, focusing on the development and sales of non-patented drugs[16] - The company aims to establish broader partnerships with chain pharmacies and explore diversified business models, including online sales through e-commerce[39] Financial Reporting and Compliance - The financial statements were prepared in accordance with International Financial Reporting Standards and are unaudited[12] - The company has adopted new accounting policies in line with the latest International Financial Reporting Standards, impacting the financial reporting for the current period[15] - The group has complied with the corporate governance code as per the Hong Kong Stock Exchange rules, with the exception of two independent non-executive directors who were unable to attend the annual general meeting[57] Market Conditions and Future Outlook - The pharmaceutical industry is experiencing strong growth driven by technological innovation and increasing health awareness post-pandemic[32] - The group has no significant investments or acquisitions of subsidiaries or associates during the period, but has sufficient financial resources to cover planned capital expenditures[50] - There are no major investment plans or capital asset acquisitions disclosed for the future, aside from capital expenditures related to subsidiary capital increases and relocation projects[55]

Financial Performance - Revenue for the year ended December 31, 2023, was RMB 1,151,145 thousand, a decrease of 9.9% compared to RMB 1,277,682 thousand in 2022[1]. - Gross profit decreased by 17.1% to RMB 641,519 thousand, with a gross margin of 55.7%, down from 60.5% in the previous year[1]. - Profit attributable to equity holders of the parent was RMB 326,000 thousand, representing a decline of 9.0% from RMB 358,057 thousand in 2022[1]. - Basic earnings per share decreased by 9.0% to RMB 0.2174, down from RMB 0.2389 in the prior year[1]. - The proposed final dividend per share is HKD 0.065, a decrease of 11.0% from HKD 0.073 in 2022[1]. - The adjusted profit before tax for the year 2023 was RMB 414,057,000, a decrease from RMB 438,408,000 in 2022, representing a decline of approximately 5.3%[31]. - The company's profit for the year ended December 31, 2023, was RMB 322,667,000, a decrease of 9.3% compared to RMB 355,851,000 in 2022[86]. - Total comprehensive income for the year, after tax, was RMB 326,292,000, down from RMB 364,256,000 in the previous year, reflecting a decline of 10.4%[86]. - The company's equity attributable to owners of the parent increased to RMB 2,854,656,000 in 2023 from RMB 2,641,956,000 in 2022, representing a growth of 8.0%[88]. - The company's total equity as of December 31, 2023, was RMB 2,859,234,000, compared to RMB 2,649,867,000 in 2022, indicating an increase of 7.9%[88]. Assets and Liabilities - Non-current assets totaled RMB 1,902,463 thousand, slightly down from RMB 1,928,648 thousand in the previous year[5]. - Current assets decreased to RMB 1,720,196 thousand from RMB 1,743,995 thousand, with cash and bank deposits increasing to RMB 905,826 thousand from RMB 811,682 thousand[5]. - Total liabilities decreased to RMB 94,485 thousand from RMB 90,719 thousand, reflecting improved financial stability[5]. - The total assets as of December 31, 2023, amounted to RMB 3,622,659 thousand, a decrease from RMB 3,672,643 thousand in 2022[97]. - The total liabilities as of December 31, 2023, were RMB 763,425 thousand, down from RMB 1,022,776 thousand in 2022, indicating a significant reduction of 25.4%[97]. Research and Development - Research and development costs rose to RMB 90,808 thousand, compared to RMB 79,478 thousand in 2022, indicating increased investment in innovation[3]. - Research and development costs for the year totaled RMB 84,611,000, compared to RMB 74,799,000 in 2022, marking an increase of approximately 13%[39]. - The company established the Suzhou Dongrui Advanced Technology Research Institute in April 2023 to optimize R&D resources, with 59% of current R&D projects being self-developed[65]. - The company is focusing on developing generic drugs and improved innovative drugs, with a strategy to prepare for the next round of bidding[65]. - The company plans to increase R&D investment and upgrade production facilities to accelerate the launch of new products[68]. Sales and Market Performance - The company experienced a decline in sales volume for certain products due to competitive bidding, with sales for the "An" series products decreasing by 22.8% compared to the same period in 2022[64]. - Sales of antihypertensive products amounted to RMB 424,186,000 in 2023, down from RMB 549,229,000 in 2022, accounting for 36.8% of total sales[130]. - Antihyperlipidemic products generated sales of RMB 292,331,000 in 2023, compared to RMB 310,502,000 in 2022, representing 25.4% of total sales[131]. - Antiviral products achieved sales of RMB 124,828,000 in 2023, a slight decrease from RMB 133,005,000 in 2022, making up 10.8% of total sales[132]. - The sales volume of the hypertension treatment product series decreased by 28.1%, with sales revenue down by 22.8% compared to 2022[186]. - The sales volume of the anti-allergy drugs "Xikewei" and "Xikexin" decreased by 16.1%, with sales revenue down by 22.6% compared to the previous year[186]. - The sales volume of the antiviral drug Entecavir dispersible tablets increased by 3.2%, but sales revenue decreased by 6.2% compared to the previous year[186]. Dividends and Shareholder Returns - The mid-term dividend per ordinary share for 2023 was HKD 0.015, consistent with 2022, while the proposed final dividend decreased to HKD 0.065 from HKD 0.073 in 2022[43]. - The group proposed a final dividend of HKD 0.065 per share, bringing the total dividend for the year to HKD 0.08 per share, with a payout ratio of approximately 34.0%, an increase of 1.6 percentage points year-on-year[53]. - The board proposed a final dividend of HKD 0.065 per share for the year ending December 31, 2023, totaling approximately HKD 97,516,000, down from HKD 109,412,000 in 2022[62]. - The company remains optimistic about its business development and aims to create reasonable investment returns for shareholders[68]. Operational Changes and Strategies - The group has completed the trial production phase at its new facilities, which is expected to enhance the production and supply of intermediates and active pharmaceutical ingredients[54]. - The group is actively expanding its export business and international presence, with ongoing customer registration and overseas registration efforts[54]. - The company is adapting to the national pharmaceutical development plan, aiming for high-quality development and integration in the pharmaceutical industry[63]. - The company is actively exploring new business models such as pharmaceutical e-commerce to enhance profitability[188]. - The company plans to expand new product market development and strengthen cooperation with chain pharmacies to drive sales growth in 2024[188]. Financial Management and Risks - The company has implemented a rigorous credit monitoring system to manage credit risk, with no significant concentration of credit risk among its diverse customer base[48]. - The expected credit loss rate increased to 2.30% in 2023 from 1.37% in 2022, with total carrying amount of RMB 155,967,000[57]. - The company reported a foreign exchange loss of RMB 2,679,000 from overseas operations, an improvement from a loss of RMB 10,414,000 in the previous year[86]. - The group recorded a foreign exchange loss of RMB 5,526,000 for the year, compared to a gain of RMB 4,537,000 in 2022[167]. - The company has no income tax obligations due to tax exemptions in the Cayman Islands, effective for 20 years from October 8, 2002, and renewed for another 20 years from September 19, 2023[124]. Capital Expenditure and Investments - Capital expenditure for the year was RMB 231,269,000, compared to RMB 92,483,000 in the previous year[114]. - The group invested RMB 20,000,000 to hold a 1.48% stake in China-U.S. Huashitong Biomedical Technology Co., Ltd.[161]. - The group received RMB 175,595,000 in compensation for the relocation of its Suzhou facility, with a total planned investment of RMB 519,799,000 for the new site[163]. - Employee costs increased to approximately RMB 211,780,000 from RMB 183,630,000, reflecting an increase in headcount and salary adjustments[168].

Financial Performance - For the six months ended June 30, 2023, the total revenue was RMB 649,920,000, with external sales of finished drugs at RMB 540,313,000 and intermediates at RMB 109,607,000[17]. - The segment results showed a profit before tax of RMB 327,211,000, compared to RMB 225,591,000 for the same period in 2022, indicating a year-over-year increase of approximately 45%[17]. - The company reported unallocated gains of RMB 158,150,000, while corporate and other unallocated expenses were RMB 108,665,000, leading to a net profit before tax after adjustments[17]. - The company’s external sales to customers decreased from RMB 568,544,000 in the previous year to RMB 540,313,000, reflecting a decline of approximately 5%[17]. - The company’s segment results for finished drugs showed a profit of RMB 290,301,000, while intermediates reported a loss of RMB 12,269,000[17]. - The group reported a profit before tax of RMB 96,929,000 for the six months ended June 30, 2023, compared to RMB 75,350,000 in 2022, indicating a growth of approximately 28.7%[49]. - Revenue from contracts with customers for the six months ended June 30, 2023, was RMB 649,920,000, representing an increase from RMB 623,478,000 in the same period of 2022[29]. Revenue Breakdown - Revenue from Mainland China was RMB 537,134,000, accounting for the majority of total revenue from contracts with customers[29]. - The finished drugs segment generated revenue of RMB 540,307,000, while the intermediates and bulk medicines segment contributed RMB 109,607,000 for the six months ended June 30, 2023[29]. - The total segment revenue for the six months ended June 30, 2022, was RMB 623,478,000, indicating a decrease in overall sales compared to the current period[17]. - Total revenue from contracts with customers for the six months ended June 30, 2023, was RMB 623,478,000, a slight increase from RMB 623,302,000 in 2022[33]. - Revenue from pharmaceutical goods sales was RMB 623,302,000, contributing significantly to total revenue[33]. Costs and Expenses - Cost of sales increased to RMB 288,071,000 in 2023 from RMB 231,200,000 in 2022, reflecting a rise of about 24.6%[49]. - Research and development costs for the period amounted to RMB 30,761,000, slightly up from RMB 29,960,000 in 2022[49]. - Other income for the six months ended June 30, 2023, was RMB 16,452,000, down from RMB 21,305,000 in 2022[37]. - The depreciation of property, plant, and equipment was RMB 31,751,000 in 2023, compared to RMB 22,446,000 in 2022, representing a significant increase of about 41.5%[49]. - The company incurred finance costs of RMB 27,333,000 for lease liabilities, up from RMB 43,225,000 in 2022, indicating a decrease in financial burden[39]. Taxation - Current income tax charge increased to RMB 75,699, up 90.2% from RMB 39,801 in the previous year[60]. - Total tax charge for the period reached RMB 73,041, representing a 36.0% increase compared to RMB 53,765 in 2022[60]. Assets and Liabilities - As of June 30, 2023, the total assets of the Group amounted to RMB 3,557,356,000, a decrease from RMB 3,672,643,000 as of December 31, 2022[19][24]. - The Group's segment assets for finished drugs were RMB 908,319,000 and for intermediates and bulk medicines were RMB 1,192,678,000 as of June 30, 2023[19]. - The assets held for sale amounted to RMB 2,578,000 as of June 30, 2023[19]. - Trade and notes receivables decreased to RMB 193,431 from RMB 204,324, a decline of 5.0%[64]. - Cash and bank balances decreased to RMB 741,149 from RMB 811,682, a reduction of 8.7%[64]. Financial Instruments and Risks - The Group's financial instruments are exposed to foreign currency risk, credit risk, liquidity risk, and interest rate risk[79]. - The Group has no significant credit risk concentration from third-party debtors, with maximum exposure to credit risk represented by cash, bank balances, and trade receivables[79]. - The expected loss allowance provision for trade receivables was not material during the period ended June 30, 2023[83]. - The Group's management believes the risk of default by counterparties is low[83]. Share Capital and Dividends - For the six months ended June 30, 2023, profit attributable to ordinary equity holders of the parent was RMB 255,941,000, an increase of 49% compared to RMB 171,661,000 in 2022[99]. - Basic earnings per share for the period was RMB 0.1707, up from RMB 0.11456 in the same period last year, reflecting a growth of approximately 49%[99]. - The company declared an interim dividend of HK$0.015 per share, totaling approximately HK$22,497,000 (approximately RMB 20,986,000) for the year ending December 31, 2023[94]. - The issued and fully paid ordinary shares increased from 1,498,789,000 at the beginning of the period to 1,499,793,000 at the end of the period[178]. Share Option Scheme - The 2023 Share Option Scheme allows for a total of 149,970,500 shares to be issued, which is 10% of the total shares in issue on the adoption date[182]. - The Chief Executive Officer holds 6,000,000 share options, which are exercisable from 29 April 2023 to 28 April 2028[188]. - The total number of options available for grant under the 2023 Share Option Scheme remained at 149,970,500 at both the adoption date and the end of the period[182]. - The total number of options available for grant under the service provider sublimit was 7,498,525 at both the adoption date and the end of the period[182]. - For the six months ended June 30, 2023, no share options were cancelled[190].