证券研究报告·行业跟踪周报·医药生物 增持（维持） 医药生物行业跟踪周报 [Table_Tag] [Table_Summary] 投资要点 GLP-1 药物成为药王，建议关注博瑞医药、 信达生物、联邦制药等 2025 年 05 月 11 日 证券分析师 朱国广 执业证书：S0600520070004 zhugg@dwzq.com.cn 东吴证券研究所 1 / 26 请务必阅读正文之后的免责声明部分 ◼ 本周、年初至今 A 股医药指数涨幅分别为 1.0%、1.2%，相对沪深 300 的超额收益分别为-1.0%、3.4%；本周、年初至今 H 股生物科技指数涨 跌幅分别为-4%、27%，相对于恒生科技指数跑赢-19%、29 %；本周 A 股医疗器械（+1.7%）、中药（+1.5%）、生物制品（+1.1%）股价明显上 涨，原料药（+0.8%）、医疗服务（+0.5%）、化药（+0.6%）及医药商业 （+0.4%）等股价有所下跌；本周 A 股涨幅居前锦好医疗（+24%）、常 山药业（+24%）、海创药业-U（+23%），跌幅居前*ST 葫芦娃(-18%)、 永安药业（-18%）、*ST 苏吴（-15%）；本周 H 股涨幅 ...

Research and Development - The company has over 100 ongoing research projects and has obtained more than 120 patents[1] - The company has eight Class 1 new drug projects that have entered clinical stages, including several high-value products[19] - The company is actively pursuing global licensing for new drug projects to enhance treatment options for patients[20] - The company has increased its R&D investment and efficiency, responding to national strategies for innovative drug development[19] - Total investment in drug research and development amounted to RMB 985,500,000, with R&D expenses increasing by 21.9% year-on-year[45] - The company is developing 45 new human drugs, including 22 Class 1 new drugs focused on endocrine, metabolism, and autoimmune diseases[45] - The company successfully entered into an exclusive licensing agreement with Novo Nordisk for its self-developed product UBT251, marking a significant milestone in its R&D progress[28] Financial Performance - The company reported a revenue of RMB 13,758,937,000 for 2024, a slight increase of 0.1% compared to RMB 13,739,879,000 in 2023[10] - Profit attributable to the company's owners decreased by 1.5% to RMB 2,659,704,000, down from RMB 2,701,350,000 in the previous year[10] - Basic earnings per share were RMB 146.39, reflecting a decrease of 1.5% from RMB 148.67[10] - The company declared a total annual dividend of RMB 56.0 per share, which is a 7.7% increase from RMB 52.0 in the previous year[10] - The gross profit was RMB 6,082,400,000, reflecting a year-on-year decline of 4.0%[49] - The net profit for the year was RMB 2,657,821 thousand, down from RMB 2,700,845 thousand in 2023, indicating a decrease of approximately 1.60%[171] - Operating cash flow for the year reached RMB 3,199,302,000, an increase from RMB 2,439,438,000 in the previous year[179] Market Position and Products - The company ranked 16th in the "2023 China Chemical Pharmaceutical Enterprises TOP 100" list[5] - The company’s insulin products were selected for the national centralized procurement program[5] - The company’s new drug UBT251 injection completed Phase Ia clinical research in healthy subjects in China[5] - The company’s amoxicillin potassium clavulanate tablets passed the consistency evaluation[5] - The company’s insulin injection application was accepted by the National Medical Products Administration of China[6] - The company’s amoxicillin sodium sterile API received CEP certification from the European Directorate for the Quality of Medicines[6] - The company’s new product, mupirocin ointment, received approval from the National Medical Products Administration for market launch[6] - Diabetes products achieved total sales revenue of RMB 1,248,300,000, marking a year-on-year increase of 9.5%[38] - Insulin product procurement volume increased by 52.5% due to successful selection in the national drug procurement program, leading to a significant rise in sales volume and market share[38] Corporate Governance and Management - The company has adopted the corporate governance code as per the Hong Kong Stock Exchange listing rules[122] - The board consists of six executive directors and three independent non-executive directors, with a total attendance rate of 100% for board meetings[125] - The company has achieved a gender diversity ratio of 33.3% on the board, with three out of nine directors being female[127] - The company maintains a gender ratio of 60% male to 40% female among its employees, including senior management[127] - The board has established five committees: Audit Committee, Remuneration Committee, Nomination Committee, Risk Management Committee, and Sustainability Committee[124] - The company has not appointed a CEO as of December 31, 2024, and plans to fill this position at an appropriate time[123] - All directors are required to participate in continuous professional development to enhance their knowledge and skills[129] Sustainability and ESG - The company was recognized as a "Benchmark Enterprise for ESG Comprehensive Governance" at the 2024 China International Service Trade Fair[6] - The company is committed to sustainable development, implementing advanced environmental technologies to reduce energy consumption and pollution emissions[26] - The company established a Sustainability Committee in December 2023 to set and update environmental, social, and governance goals and strategies[139] Financial Position and Assets - As of December 31, 2024, the group's current assets amounted to RMB 16,070,700,000, an increase from RMB 13,787,200,000 in 2023[55] - The total assets of the group reached approximately RMB 25,833,100,000, up from RMB 21,017,200,000 in the previous year[55] - Total liabilities increased to RMB 11,397,800,000 in 2024 from RMB 8,269,600,000 in 2023[55] - Equity attributable to owners increased from RMB 12,734,800,000 in 2023 to RMB 14,388,300,000 in 2024[55] - The company's total equity reached RMB 14,435,240 thousand in 2024, compared to RMB 12,747,618 thousand in 2023, indicating an increase of about 13.23%[175] Shareholder Relations - The company aims to enhance investor confidence and deepen understanding of its business through effective communication strategies[152] - The company has established multiple communication channels with shareholders, including annual general meetings and reports published on its website[152] - The independent auditor's report confirms that the consolidated financial statements fairly reflect the group's financial position as of December 31, 2024[154] Compliance and Legal Matters - The company has not violated any relevant laws or regulations that significantly impact its business operations during the fiscal year ending December 31, 2024[116] - The group is involved in ongoing litigation to recover approximately RMB 343,000,000 from Chengdu Evergrande, with a court ruling in favor of the group for RMB 136,300,000[59]

Summary of Conference Call on Federated Pharmaceuticals Company Overview - The conference call focused on Federated Pharmaceuticals, discussing its recent economic situation and performance in the pharmaceutical industry, particularly in the weight loss medication sector [2][3]. Key Financial Highlights - The overall revenue for the year was 13.759 billion RMB, remaining stable compared to the previous year [4]. - Profit slightly decreased by 1.5% to 2.66 billion RMB [4]. - The company plans to distribute a total dividend of 0.56 RMB per share for the year, including a special dividend of 0.12 RMB [4]. - The payout ratio increased to 38.3%, up from 35% the previous year, indicating a focus on shareholder returns [9]. Product Development and Innovation - Federated Pharmaceuticals has made significant strides in its weight loss drug pipeline, particularly with the product UBT-251, which has shown promising results in clinical trials [19][32]. - The company entered a licensing agreement with Novo Nordisk for UBT-251, receiving an upfront payment of 200 million USD and potential milestone payments totaling 1.8 billion USD [8]. - The product has demonstrated a weight loss effect of 15.1% in the highest dosage group during trials, outperforming placebo results [19][33]. Market Position and Strategy - The company is positioned as a leader in the pharmaceutical industry, benefiting from a favorable industry environment and a robust product pipeline [2][3]. - Federated Pharmaceuticals is expanding its international presence, having registered six animal health products in Vietnam and Australia, with plans for further market penetration in Southeast Asia and beyond [13][39]. - The company is also focusing on the pet care market, with plans to introduce high-end pet food products, capitalizing on the growing demand in this sector [37][38]. Operational Efficiency and Cost Management - The company is implementing various projects to improve production efficiency and reduce costs, including an environmental project aimed at 100% recycling of waste [26]. - A new power station has been established to optimize energy costs based on coal price fluctuations [26][27]. Challenges and Market Outlook - There are concerns regarding price fluctuations in the market, primarily driven by changes in demand [25][29]. - The company remains optimistic about its ability to manage these fluctuations through cost improvements and strategic planning [29][30]. Conclusion - Federated Pharmaceuticals is demonstrating stable financial performance while actively pursuing innovation and market expansion. The focus on shareholder returns, product development, and operational efficiency positions the company well for future growth in the competitive pharmaceutical landscape [22][40].

Investment Rating - The investment rating for the company is "Buy" with a target price of 18.59 HKD [8][9]. Core Views - The company is expected to achieve a revenue of 13.759 billion RMB in 2024, a slight increase of 0.1% year-on-year, and a net profit of 2.660 billion RMB, a decrease of 1.5% year-on-year, primarily due to seasonal factory maintenance in the second half of 2024 [1]. - The company has entered a significant partnership with Novo Nordisk for the overseas development and commercialization rights of UBT251, marking a milestone in GLP-1 related transactions in China [2]. - The diabetes segment is projected to grow steadily in 2025, driven by existing product demand and new product launches [2]. - The intermediate segment achieved sales of 2.659 billion RMB in 2024, a 15% year-on-year increase, supported by stable pricing and export opportunities [3]. - The animal health segment saw a 17% year-on-year increase in revenue in 2024, with expectations for accelerated growth in 2025 due to new product launches and partnerships [4]. - The company anticipates a rapid increase in net profit in 2025, supported by the confirmation of UBT251's upfront payment [5]. Summary by Sections Financial Performance - The company forecasts revenues of 14.945 billion RMB in 2025, with a year-on-year growth of 8.62% [7]. - The net profit is expected to rise to 4.146 billion RMB in 2025, reflecting a 55.87% increase year-on-year [7]. - The EPS for 2025 is projected at 2.28 RMB, with a PE ratio of 7.5x [5]. Business Segments - The diabetes segment is expected to generate 1.248 billion RMB in revenue in 2024, a 9.5% increase year-on-year, with further growth anticipated in 2025 [2]. - The intermediate segment's revenue is projected to remain stable in 2025, supported by controlled pricing and export opportunities [3]. - The animal health segment is expected to see significant growth in 2025 due to new product launches and collaborations with industry leaders [4]. Valuation - The target price of 18.59 HKD is based on a PE ratio of 7.5x for 2025, compared to a comparable company average of 9x [5].

Group 1 - Federal Pharmaceutical (03933) shares rose over 10%, reaching HKD 15.32 with a trading volume of HKD 450 million [1] - The company announced an exclusive licensing agreement with Novo Nordisk for UBT251, retaining rights in China while granting global rights (excluding mainland China, Hong Kong, Macau, and Taiwan) to Novo Nordisk [1] - Federal Biotech will receive an upfront payment of USD 200 million and up to USD 1.8 billion in potential milestone payments, along with tiered sales royalties based on annual net sales outside of China [1] Group 2 - Federal Pharmaceutical reported a revenue of approximately RMB 13.759 billion for 2024, a year-on-year increase of 0.1%, while net profit attributable to shareholders was about RMB 2.66 billion, a decrease of 1.5% [2] - The company proposed a final dividend of HKD 0.28 per share and a special dividend of HKD 0.12 per share [2] - Due to expected short-term pressure on the sales of intermediates, raw materials, and antibiotics, revenue forecasts for 2025-2026 were adjusted downwards by 8.9% and 12.3% respectively, although the company anticipates receiving the USD 200 million upfront payment from Novo Nordisk in 2025 [2]

Financial Performance - The total revenue for the year 2024 was approximately RMB 13,758.9 million, showing a slight increase of 0.1% compared to 2023[3]. - The profit attributable to the company's owners for the year was RMB 2,659.7 million, reflecting a decrease of 1.5% year-on-year[4]. - The basic earnings per share for the year were RMB 146.39, down 1.5% from the previous year[3]. - Gross profit decreased to RMB 6,082,391 thousand in 2024 from RMB 6,334,837 thousand in 2023, reflecting a decline of about 3.98%[13]. - The company reported a net profit of RMB 2,657,821 thousand for 2024, down from RMB 2,700,845 thousand in 2023, indicating a decrease of approximately 1.6%[13]. - The revenue breakdown for 2024 includes RMB 2,658,691 thousand from intermediate products, RMB 6,372,683 thousand from active pharmaceutical ingredients, and RMB 4,727,563 thousand from formulation products[30]. - The segment profit before R&D expenses for 2024 was RMB 4,009,219 thousand, compared to RMB 4,112,034 thousand in 2023, indicating a decrease of about 2.5%[30][32]. - R&D expenses for 2024 totaled RMB 890,757 thousand, an increase from RMB 757,248 thousand in 2023, reflecting a rise of approximately 17.6%[34]. - The company reported a pre-tax profit of RMB 3,288,898 thousand for 2024, compared to RMB 3,344,148 thousand in 2023, showing a decrease of about 1.65%[32]. - The total other income for 2024 was RMB 356,929 thousand, significantly higher than RMB 212,475 thousand in 2023, representing an increase of about 67.9%[33]. - The company’s external customer revenue from the Chinese market was RMB 11,115,585 thousand in 2024, slightly down from RMB 11,124,265 thousand in 2023, a decrease of about 0.08%[32]. - The company’s net profit attributable to shareholders was RMB 2,659,700,000, a decrease of 1.5% year-on-year, with earnings per share at RMB 146.39[62]. - The company’s formulation product segment saw a significant profit decline of 47.0%, primarily due to price reductions from national drug procurement policies[62]. Dividends and Shareholder Returns - The company declared a total annual dividend of RMB 56.0 per share, representing a 7.7% increase compared to the previous year[3]. - The total dividend declared for 2024 was RMB 726,733,000, consistent with the previous year's total of RMB 726,811,000, indicating stability in dividend distribution[39]. Assets and Liabilities - The total assets increased to RMB 17,060,503 thousand in 2024 from RMB 14,390,448 thousand in 2023, marking a growth of about 18.6%[14]. - Non-current assets rose to RMB 9,762,356 thousand in 2024, compared to RMB 7,229,979 thousand in 2023, an increase of approximately 35%[14]. - The company’s total assets rose to approximately RMB 25,833,100,000 from RMB 21,017,200,000 in 2023, while total liabilities increased to RMB 11,397,800,000 from RMB 8,269,600,000[65]. - The company’s accounts payable for trade and supplier financing arrangements amounted to RMB 2,088,785,000, a decrease from RMB 2,238,152,000 in 2023[13]. Investments and Expenditures - The company invested approximately RMB 2,858,081,000 in property, plant, and equipment in 2024, significantly higher than RMB 1,143,439,000 in 2023, representing an increase of about 150%[41]. - The company has committed to capital expenditures of RMB 2,147,126,000 for property, plant, and equipment that have been contracted but not yet provided for in the financial statements[45]. - The company recorded a depreciation expense of RMB 579,883,000 for property, plant, and equipment in 2024, compared to RMB 536,303,000 in 2023, reflecting an increase of about 8.1%[39]. Research and Development - The company has 8 Class 1 new drug projects in clinical stages, including several high-value products[5]. - The company is actively pursuing new drug projects for overseas licensing to provide comprehensive treatment options globally[5]. - The company has established a comprehensive R&D system, including multiple platforms for biological, chemical, and innovative drug development[59]. - The company invested approximately RMB 985,500,000 in drug research and development, with R&D expenses increasing by 21.9% year-on-year[59]. - The company has 45 new human drug products in development, including 22 Class 1 new drugs focusing on endocrine, metabolism, autoimmune, ophthalmology, and anti-infection fields[59]. Market Expansion and Partnerships - The company has secured 6 overseas registrations for its animal health products and is expanding its international market presence[8]. - Strategic partnerships have been formed with various domestic and international partners to enhance the company's global footprint[8]. - The company achieved record overseas revenue in its intermediates and raw materials business, enhancing its international brand recognition[9]. Corporate Governance and Management - The company has adopted and complied with the corporate governance code as per the Stock Exchange Listing Rules, with some deviations noted[72]. - There is currently no Chief Executive Officer, and the company plans to appoint one at an appropriate time[73]. - The audit committee, consisting of three independent non-executive directors, reviewed the consolidated financial statements for the year ending December 31, 2024[75]. - The board of directors includes six executive directors and three independent non-executive directors as of the announcement date[77]. Compliance and Accounting Standards - The group has adopted revised Hong Kong Financial Reporting Standards effective from January 1, 2024, including HKFRS 16 regarding lease liabilities and HKAS 1 for classifying liabilities as current or non-current[17]. - The adoption of these amendments did not have a significant impact on the consolidated financial statements[22]. - The group has not early adopted any new or revised Hong Kong Financial Reporting Standards that have been issued but are not yet effective[23]. Legal Matters - The group is involved in a lawsuit to recover approximately RMB 340,000,000 in unpaid receivables, with a court ruling on December 28, 2024, ordering Chengdu Evergrande to pay approximately RMB 136,300,000[69].

Financial Performance - The total revenue for the year 2024 was approximately RMB 13,758.9 million, showing a slight increase of 0.1% compared to 2023[3] - The profit attributable to the company's owners for 2024 was RMB 2,659.7 million, reflecting a decrease of 1.5% year-on-year[3] - The basic earnings per share for 2024 were RMB 146.39, down 1.5% from the previous year[3] - The gross profit for 2024 was RMB 6,082,391 thousand, down from RMB 6,334,837 thousand in 2023, indicating a decrease of about 3.98%[14] - The company achieved a net profit of RMB 2,657,821 thousand for 2024, compared to RMB 2,700,845 thousand in 2023, reflecting a decline of approximately 1.6%[14] - The company’s net profit attributable to shareholders for 2024 was RMB 2,659,704,000, a slight decrease from RMB 2,701,350,000 in 2023, representing a decline of about 1.5%[46] - The company reported a pre-tax profit of RMB 3,288,898 thousand for the fiscal year ending December 31, 2024, compared to RMB 3,344,148 thousand in 2023, reflecting a decrease of about 1.66%[35] - The total tax expenses for 2024 amounted to RMB 631,077,000, compared to RMB 643,303,000 in 2023, reflecting a decrease of approximately 1.9%[41] Dividends and Shareholder Returns - The company declared a total annual dividend of RMB 56.0 per share, an increase of 7.7% compared to the previous year, with a payout ratio of 38.3%[5] - The company declared a total dividend of RMB 726,733,000 for the year ending December 31, 2024, slightly lower than RMB 726,811,000 in 2023[44] Research and Development - The company has 8 Class 1 new drug projects in clinical stages, including several high-value products, and is actively advancing its R&D efforts[6] - The company has entered into an exclusive licensing agreement with Novo Nordisk for the self-developed product UBT251, marking a significant milestone in its R&D progress[12] - R&D expenses for the year amounted to RMB 890,757 thousand, up from RMB 757,248 thousand in 2023, indicating an increase of approximately 17.6%[38] - The company invested approximately RMB 985,500,000 in drug research and development, with R&D expenses increasing by 21.9% year-on-year[68] - The company has established a comprehensive R&D system, including multiple platforms for biological, chemical, and innovative drug research, as well as clinical studies and external collaborations[68] - The company has initiated several key clinical trials for new drugs, including TUL01101 and UBT251, with significant milestones achieved in 2024[69] Market Expansion and Strategic Initiatives - The company has signed a strategic cooperation agreement with New Zealand Riverland Foods Ltd. to enter the high-end pet food market in China[9] - The company has obtained 6 overseas registration approvals for its animal health products and aims to expand its market presence in Southeast Asia, Latin America, the Middle East, and Africa[9] - The company achieved record overseas revenue in its intermediates and raw materials business, enhancing its global brand recognition[10] - The company plans to enhance its core industry advantages and strengthen vertical integration while optimizing its diversified business layout and resource allocation to accelerate international market expansion[12] - The company aims to maintain its leading position in the industry amidst ongoing healthcare reforms and demographic changes in China, which are expected to drive market growth[12] Financial Position and Assets - The total assets as of December 31, 2024, amounted to RMB 17,060,503 thousand, an increase from RMB 14,390,448 thousand in 2023, showing a growth of about 18.6%[15] - The company’s cash and cash equivalents rose to RMB 6,329,841 thousand in 2024, up from RMB 4,261,989 thousand in 2023, marking an increase of approximately 48.5%[15] - The company’s total equity increased to RMB 14,435,240 thousand in 2024 from RMB 12,747,618 thousand in 2023, reflecting a growth of about 13.2%[17] - The company’s total assets increased to approximately RMB 25,833,100,000, compared to RMB 21,017,200,000 in 2023, while total liabilities rose to RMB 11,397,800,000 from RMB 8,269,600,000[74] Operational Efficiency - The company reported a decrease in selling and distribution expenses to RMB 1,402,483 thousand in 2024 from RMB 1,593,799 thousand in 2023, a reduction of approximately 11.97%[14] - The company’s financial costs decreased to RMB 34,958 thousand in 2024 from RMB 66,896 thousand in 2023, a reduction of approximately 47.8%[40] - The company’s employee costs, including director remuneration, rose to RMB 1,827,993,000 in 2024 from RMB 1,648,745,000 in 2023, an increase of about 10.9%[44] - The inventory cost recognized in expenses for 2024 was RMB 7,692,205,000, compared to RMB 7,361,854,000 in 2023, representing an increase of approximately 4.5%[44] Corporate Governance and Compliance - The group has adopted revised Hong Kong Financial Reporting Standards effective from January 1, 2024, which include HKFRS 16 regarding lease liabilities and HKAS 1 for classifying liabilities as current or non-current[20] - The group has retrospectively applied new accounting policies for classifying liabilities as current or non-current, with no significant impact on the consolidated financial statements[23] - The company has adopted and complied with the corporate governance code as per the Stock Exchange Listing Rules, with a commitment to high standards of corporate governance[81] - There is currently no Chief Executive Officer, and the company plans to appoint one at an appropriate time[82] - The audit committee, consisting of three independent non-executive directors, reviewed the consolidated financial statements for the year ending December 31, 2024[84] Legal Matters - The company is involved in a lawsuit to recover approximately RMB 340,000,000 in unpaid receivables from Chengdu Evergrande, with a court ruling on December 18, 2024, ordering payment of approximately RMB 136,300,000[78]

Investment Rating - The report initiates coverage on Federal Pharmaceutical (03933 HK) with a "Buy" rating [2][3] Core Investment Thesis - Federal Pharmaceutical is a leading player in the penicillin-based antibiotics sector, benefiting from the current high industry demand [1] - The company has a well-established presence in the insulin and GLP-1 markets, with a robust pipeline including the innovative triple-target UBT251, which has global rights and is in advanced clinical stages [1] - The animal health business is poised to become a second growth driver, with three new production bases expected to alleviate capacity constraints [1] - The company has implemented an equity incentive plan in 2023, granting 12 0969 million shares, which is expected to enhance group cohesion [1] Antibiotics Business - Federal Pharmaceutical is the global leader in penicillin intermediates, with a nearly 50% market share in 6-APA production [1] - The company's 6-APA production is supported by high environmental barriers, ensuring stable competition [1] - In H1 2024, the company's intermediate revenue increased by 25 4% to RMB 1 314 billion, while API revenue rose by 1 2% to RMB 3 464 billion [1] - The company is expanding into higher-value sterile APIs, with a RMB 1 2 billion project in Gaolan Port expected to commence production in 2025 [1] Insulin and GLP-1 Pipeline - Federal Pharmaceutical has a comprehensive pipeline in the diabetes and weight loss sector, with 44 R&D projects, including GLP-1 products like liraglutide and semaglutide [2] - The company's UBT251, a triple-target GLP-1/GIP/GCG agonist, is the first in China and second globally to enter clinical trials using chemical synthesis [2] - The company's insulin products, including U40, U100, and premixed insulins, have secured favorable positions in national procurement, with a 52 5% increase in procurement volume [2] Animal Health Business - The animal health business has shown rapid growth, with a CAGR of 75% from 2020 to 2023 [2] - The company's core products in the animal health sector are primarily antibiotic formulations, leveraging its expertise in antibiotics [2] - Three new production bases are expected to be operational by the end of 2024, with a combined output value exceeding RMB 5 billion [2] - The pet drug segment is a key focus, with over 40 pet drugs in the pipeline, including five Class 1 new veterinary drugs [2] Financial Projections - The company is expected to achieve net profits of RMB 3 095 billion, RMB 3 513 billion, and RMB 3 892 billion for 2024, 2025, and 2026, respectively [2] - The corresponding P/E ratios are projected at 4 8x, 4 2x, and 3 8x for the same periods [2] Industry Overview - The global antibiotics market is projected to reach USD 57 billion by 2024, with China being the largest consumer [29] - The industry faces strict regulatory controls, with limited new capacity additions due to environmental barriers [30] - Federal Pharmaceutical holds a dominant position in the 6-APA market, with a 45% market share, followed by Chia Tai Tianqing and CSPC Pharmaceutical [34]

Financial Performance - Revenue for the six months ended June 30, 2024, was RMB 7,175,804 thousand, representing a 3.9% increase from RMB 6,906,524 thousand in the same period of 2023[3]. - EBITDA for the same period was RMB 2,231,943 thousand, up 14.2% from RMB 1,953,790 thousand year-over-year[3]. - Profit before tax increased by 18.0% to RMB 1,901,702 thousand, compared to RMB 1,612,155 thousand in the previous year[3]. - Net profit attributable to the company's owners rose by 16.1% to RMB 1,491,404 thousand, from RMB 1,284,496 thousand in 2023[3]. - Basic earnings per share increased to RMB 82.08, a 16.1% rise from RMB 70.69 in the prior year[3]. - The interim dividend per share was declared at RMB 16.0, reflecting a 33.3% increase from RMB 12.0 in the previous year[3]. - Gross profit increased to RMB 3,344,365 thousand, up 4.1% from RMB 3,213,298 thousand year-over-year[9]. - Net profit for the period was RMB 1,490,995 thousand, a rise of 16.1% compared to RMB 1,284,240 thousand in the previous year[9]. - Basic earnings per share increased to RMB 82.08, up from RMB 70.69, reflecting a growth of 16.5%[9]. - The company reported a pre-tax profit of RMB 1,901,702 thousand for the six months ended June 30, 2024, an increase of 17.9% compared to RMB 1,612,155 thousand for the same period in 2023[14]. - The company recognized a total comprehensive income of RMB 1,285,591 thousand for the six months ended June 30, 2024, compared to RMB 1,284,240 thousand for the same period in 2023, indicating a slight increase[12]. Assets and Liabilities - Total assets as of June 30, 2024, amounted to RMB 15,147,724 thousand, compared to RMB 13,787,201 thousand at the end of 2023, indicating a growth of 9.9%[10]. - Non-current assets increased to RMB 7,678,405 thousand from RMB 7,229,979 thousand, marking a rise of 6.2%[10]. - Current liabilities decreased to RMB 7,733,502 thousand from RMB 7,160,469 thousand, a reduction of 8.0%[11]. - The company’s total equity attributable to owners increased to RMB 13,525,453 thousand as of June 30, 2024, compared to RMB 11,530,528 thousand as of June 30, 2023, representing a growth of 17.3%[12]. - The company’s total liabilities decreased from RMB 2,030,355 thousand in the previous year to RMB 127,000 thousand in the current year, showing a significant reduction in debt[15]. - The group’s total liabilities decreased to RMB 5,376,343,000 as of June 30, 2024, from RMB 6,084,888,000 as of December 31, 2023, reflecting a decline of approximately 11.6%[53]. Cash Flow and Investments - The company reported a cash and cash equivalents balance of RMB 6,554,830 thousand, significantly up from RMB 4,261,989 thousand, reflecting a growth of 53.7%[10]. - Operating cash flow generated was RMB 2,207,903 thousand, up from RMB 1,470,153 thousand year-over-year, reflecting a growth of 50.1%[14]. - The company recorded a net cash increase of RMB 2,292,276 thousand for the six months ended June 30, 2024, compared to a net increase of RMB 1,174 thousand in the same period of 2023[15]. - The company invested RMB 732,459 thousand in property, plant, and equipment during the six months ended June 30, 2024, compared to RMB 396,697 thousand in the same period of 2023, reflecting an increase of 84.5%[15]. - Capital expenditures on property, plant, and equipment for the six months ended June 30, 2024, were approximately RMB 741,061,000, significantly higher than RMB 395,085,000 in the same period of 2023, marking an increase of about 87.5%[46]. Revenue Sources and Market Performance - Revenue from intermediates was RMB 3,081,282 thousand, while raw materials and formulations generated RMB 3,917,640 thousand and RMB 2,397,777 thousand, respectively, contributing to the overall revenue[24]. - The revenue from the Chinese market (including Hong Kong) was RMB 5,748,478 thousand, up from RMB 5,544,083 thousand in the previous year, indicating a growth of about 3.7%[26]. - The company reported a significant increase in sales of antibiotic products, generating RMB 5,150,288 thousand, compared to RMB 5,144,679 thousand in the prior period, reflecting stable demand[24]. - The insulin product line contributed RMB 528,341 thousand in revenue, showing a positive trend in this segment[24]. - The company plans to continue expanding its market presence, particularly in Europe and India, where revenues were RMB 376,958 thousand and RMB 331,769 thousand, respectively[26]. - The total segment revenue for intermediates, APIs, and formulations for the first half of 2024 was RMB 9,396,699,000, with a total inter-segment sales of RMB 2,220,895,000[28]. Research and Development - Research and development expenses rose to RMB 446,800 thousand, an increase of 32.0% from RMB 338,678 thousand in the previous year[9]. - The company invested RMB 479,400,000 in drug research and development, a 36.9% increase compared to the previous year[74]. - The company has 44 new human drug products under development, including 19 Class 1 new drugs focusing on various therapeutic areas[74]. - The company is focused on enhancing its research and innovation capabilities to adapt to industry changes[84]. Shareholder and Corporate Governance - The company declared an interim dividend of RMB 0.16 per ordinary share for the six months ended June 30, 2024, totaling RMB 290,724,000, compared to RMB 218,043,000 for the same period in 2023[46]. - The company is committed to creating more value for shareholders and society amidst the transformation of the pharmaceutical industry in China[84]. - The company adopted a share incentive plan on October 26, 2023, allowing for the issuance of up to 181,702,650 shares, representing 10% of the total issued shares[93]. - A total of 12,096,900 shares were granted under the share incentive plan on November 13, 2023, all acquired through market transactions[93]. - The board of directors confirmed compliance with the standards set forth in the code of conduct for securities trading during the six-month period ending June 30, 2024[98]. Employee and Operational Metrics - The total employee costs, including directors' remuneration, for the six months ended June 30, 2024, were RMB 916,843,000, up from RMB 769,768,000 in the previous year, indicating a rise of approximately 19.1%[41]. - The company employed approximately 15,000 staff as of June 30, 2024, maintaining the same number as at the end of 2023[81]. - The total remuneration for directors for the six months ended June 30, 2024, was RMB 10,034,000, compared to RMB 9,630,000 for the same period in 2023, reflecting an increase of 4.2%[63]. Compliance and Regulatory Matters - The company has implemented revised Hong Kong Financial Reporting Standards, which did not have a significant impact on the financial performance for the current and prior periods[21]. - The company has no significant contracts or interests that conflict with its business operations as of the reporting period[86]. - The audit committee reviewed the unaudited condensed consolidated financial statements for the six-month period ending June 30, 2024[100].