Financial Performance - For the nine months ended September 30, 2022, the company's revenue was RMB 593,415,000, representing a 25.3% increase from RMB 473,661,000 in the same period of 2021[4] - Gross profit for the nine months ended September 30, 2022, was RMB 469,804,000, up 23.7% from RMB 379,611,000 year-on-year[4] - Operating profit for the nine months ended September 30, 2022, was RMB 123,929,000, compared to RMB 118,720,000 in the same period of 2021, reflecting a growth of 4.0%[4] - Profit attributable to equity holders for the nine months ended September 30, 2022, was RMB 104,658,000, an increase of 7.4% from RMB 96,969,000 in the previous year[4] - Basic earnings per share for the nine months ended September 30, 2022, was 18.68 cents, compared to 17.3 cents for the same period in 2021, marking an increase of 8.0%[4] - The company reported a total sales cost of RMB 123,611,000 for the nine months ended September 30, 2022, which is an increase from RMB 94,050,000 in the same period of 2021[4] - The company’s other income for the nine months ended September 30, 2022, was RMB 18,804,000, compared to RMB 13,990,000 in the same period of 2021, indicating a growth of 34.0%[4] - The company incurred tax expenses of RMB 18,577,000 for the nine months ended September 30, 2022, down from RMB 21,544,000 in the same period of 2021[8] - The company’s administrative expenses increased to RMB 90,494,000 for the nine months ended September 30, 2022, compared to RMB 60,497,000 in the same period of 2021, reflecting a rise of 49.5%[4] - The gross margin for the nine months ended September 30, 2022, was approximately 79.17%, a decrease of 0.97% from 80.14% in the previous year[13] - Selling expenses as a percentage of revenue increased to 46.2% from 45.3% in the previous year, attributed to higher advertising and promotional costs[13] Financial Position - As of September 30, 2022, the group maintained a strong financial position with cash and bank balances of approximately RMB 852,968,000 and a net asset value of approximately RMB 1,558,407,000[15] - The group had zero short-term bank borrowings as of September 30, 2022, resulting in a capital-to-debt ratio of 0%[16] Corporate Governance - The company adopted a code of conduct for securities trading by directors, ensuring compliance with GEM Listing Rules, with no known violations reported[29] - The company did not fully comply with GEM Listing Rules regarding corporate governance practices, specifically the separation of roles between the chairman and CEO, which are held by the same individual[30] - The audit committee, established in May 2001, is responsible for overseeing the financial reporting process and internal control systems, having reviewed the unaudited results for the period ending September 30, 2022[33] - No repurchase, sale, or redemption of the company's listed shares occurred during the nine-month period ending September 30, 2022[34] - The board consists of 6 executive directors and 3 independent non-executive directors as of the report date[35] Business Development - The company has completed the renovation of its biochemical extraction workshop, expected to commence production in 2022[14] - A new R&D inspection center has been established and was officially put into use in September 2021 for new product development and quality control[14] - Management believes that the Haikun Shenxi capsule has matured in the market and has replaced the compound Huonaoshush capsule as the group's best-selling product[17] - The group is committed to identifying potential business opportunities to create substantial results in the coming years[17]

Financial Performance - For the six months ended June 30, 2022, the company reported a revenue of RMB 377,295,000, representing a 25.2% increase from RMB 301,326,000 in the same period of 2021[4] - Gross profit for the same period was RMB 297,844,000, up 24.5% from RMB 239,108,000 year-on-year[4] - Operating profit increased to RMB 92,043,000, a 46.8% rise compared to RMB 62,694,000 in the previous year[4] - The net profit attributable to shareholders was RMB 77,255,000, reflecting a 57.7% increase from RMB 48,977,000 in the prior year[4] - Basic earnings per share rose to 13.79 cents, compared to 8.74 cents in the same period last year, marking a 57.5% increase[4] - The company's revenue for the six months ended June 30, 2022, was RMB 389,825,000, representing a 25.9% increase from RMB 309,297,000 in the same period of 2021[15] - The operating profit for the six months ended June 30, 2022, was RMB 77,255,000, compared to RMB 48,977,000 for the same period in 2021, marking a 57.8% increase[19] - The basic earnings per share for the six months ended June 30, 2022, was RMB 0.138, up from RMB 0.087 in the same period of 2021[19] - The company's net profit for the six months ended June 30, 2022, was RMB 77,255,000, compared to RMB 48,977,000 for the same period in 2021, indicating a 57.8% growth[19] - The gross margin for the six months ended June 30, 2022, was approximately 78.9%, a decrease of 0.5% from 79.4% for the same period in 2021[45] Assets and Liabilities - Total assets as of June 30, 2022, amounted to RMB 2,595,530,000, compared to RMB 2,072,313,000 at the end of 2021[5] - Current assets increased to RMB 1,017,610,000 from RMB 889,873,000, indicating a growth of 14.4%[5] - The company's cash and cash equivalents rose to RMB 84,671,000, up from RMB 55,294,000, representing a 53.2% increase[5] - Total liabilities increased to RMB 585,917,000 from RMB 571,794,000, showing a slight rise of 2.5%[7] - The company maintained a stable equity position with total equity reaching RMB 1,531,004,000, up from RMB 1,453,749,000, reflecting a growth of 5.3%[7] - The total assets of the company as of June 30, 2022, were RMB 1,531,004,000, an increase from RMB 1,394,459,000 as of December 31, 2021[19] - Inventory as of June 30, 2022, totaled RMB 104,541,000, up from RMB 86,313,000 as of December 31, 2021[37] - Trade receivables as of June 30, 2022, amounted to RMB 272,296,000, compared to RMB 230,252,000 as of December 31, 2021[39] Operational Developments - The company has established a new R&D inspection center equipped with advanced facilities for new product development and quality control, officially in use since September 2021[46] - The company plans to officially launch the renovated biochemical extraction workshop in 2022 to meet market demand[46] - The company aims to continue developing potential business opportunities to drive future growth[54] Shareholder Information - As of June 30, 2022, Mr. Zhang Hong holds 101,937,000 shares, representing 26.29% of domestic shares and 18.19% of total registered capital[56] - Mr. Zhang Xiaoguang owns 42,315,000 shares, accounting for 10.91% of domestic shares and 7.55% of total registered capital[56] - Huinan County Caiyuan Investment Co., Ltd. holds 81,975,000 shares, which is 21.14% of domestic shares and 14.63% of total registered capital[60] Corporate Governance - The audit committee consists of three independent non-executive directors, ensuring oversight of the company's financial processes and internal controls[66] - The company has adopted a code of conduct for securities trading that meets or exceeds the standards set by GEM Listing Rules[63] - No arrangements were made for directors or senior management to acquire rights to benefit from purchasing the company's shares or bonds during the reporting period[57] - The company did not identify any other individuals holding interests or short positions in the company's shares outside of the disclosed parties as of June 30, 2022[61] - The chairman and CEO roles are held by the same individual, Mr. Zhang Hong, which the board believes does not affect accountability or independent decision-making[64] Employment and Share Transactions - The company employed 956 staff members as of June 30, 2022, an increase from 951 staff members a year earlier[67] - The company did not repurchase, sell, or redeem any of its listed shares during the six-month period ending June 30, 2022[68]

吉 林 省 輝 南 長 龍 生 化 藥 業 股 份 有 限 公 司 Jilin Province Huinan Changlong Bio-pharmacy Company Limited Jilin Province Huinan Changlong Bio-pharmacy Company Limited (股份代號：8049) 第一季度業績報告2022 香港聯合交易所有限公司（「聯交所」）GEM之特色 GEM的定位乃為相比其他在聯交所上市的公司可能帶有較高投資風險的中小型公司提供一個上 市的市場。有意投資者應了解投資於該等公司的潛在風險，並應經過審慎周詳的考慮後方作出投 資決定。 由於GEM上市公司一般為中小型公司，在GEM買賣的證券可能會較於聯交所主板買賣的證券承 受較大的市場波動風險，同時無法保證在GEM買賣的證券會有高流通量的市場。 香港交易及結算所有限公司及聯交所對本報告之內容概不負責，對其準確性或完整性亦不發表任 何聲明，並明確表示概不會就本報告全部或任何部分內容而產生或因倚賴該等內容而引致之任何 損失承擔任何責任。 本報告乃遵照GEM證券上市規則（「GEM上市規則」）提供有關吉林省輝南長龍生 ...

Financial Performance - The total revenue for the year ended December 31, 2021, was approximately RMB 705,456,000, representing a 13% increase compared to RMB 622,250,000 in the previous year[14]. - Profit attributable to owners of the Company increased to RMB 143,283,000 from RMB 126,558,000 last year[14]. - Basic earnings per share rose to RMB 25.57 cents from RMB 22.59 cents in the previous year[14]. - For the year ended 31 December 2021, the Group's revenue increased to RMB 705,456,000 from approximately RMB 622,250,000, representing an increase of about 13.38%[35]. - Profit for the year attributable to owners of the Company increased to RMB 143,283,000 from RMB 126,558,000, reflecting a growth of approximately 13.19%[35]. - Basic earnings per share rose to RMB 25.57 cents from RMB 22.59 cents, marking an increase of about 13.2%[35]. - Profit before income tax for 2021 was RMB 177,273,000, compared to RMB 150,041,000 in 2020, reflecting a growth of 18.2%[89]. - The audited profit attributable to owners of the Company was approximately RMB 143,283,000, representing a 13% increase from RMB 126,558,000 in the previous year[50]. Operational Challenges - The Company faced rising production costs due to stricter national quality and environmental protection standards for pharmaceuticals[15]. - The overall price level of pharmaceuticals continued to decline following the implementation of drug price control policies, increasing operational pressure on pharmaceutical enterprises[15]. - The pandemic situation in many regions of the country remained severe, affecting major sales provinces[15]. - The company faced significant operational pressures due to rising production costs and declining drug prices, yet successfully achieved its project goals for the year[16]. - The core revenue source, Hai Kun Shen Xi capsule, remained unaffected despite rising production costs and price control policies in the pharmaceutical sector[35]. Research and Development - Investment in research and development of new drugs was increased, collaborating with pharmaceutical universities and research institutes to develop technologically advanced drugs with independent intellectual property rights[20]. - The Group has focused on enhancing R&D capabilities by building a new R&D inspection center with advanced equipment[52]. - A new R&D and testing center was built and officially put into operation in September 2021, aimed at improving product development and quality control[47]. - The Group invested approximately RMB48,466,749 in research and development projects during the year[44]. Financial Management - As at 31 December 2021, the Company held Wealth Management Products totaling approximately RMB 176,533,000[37]. - The expected annualised return rate of the Wealth Management Products subscribed during the year was around 2.25%–4.13%, compared to 1.58%–3.8% in 2020[35]. - Unrealised gains on fair value change from the Wealth Management Products amounted to approximately RMB 1,533,000 as at 31 December 2021[39]. - The Group's investments in Wealth Management Products were primarily in lower-risk options issued by major banks in China[41]. - The management has shifted investment strategy towards time deposits due to decreasing expected returns on Wealth Management Products[42]. - The Group's investment in time deposits as of December 31, 2021, was approximately RMB806,918,000, slightly up from RMB805,020,000 in 2020[42]. Corporate Governance - The Company has complied with the Corporate Governance Code as set out in Appendix 15 of the GEM Listing Rules throughout the year ended 31 December 2021[140]. - The Audit Committee is composed exclusively of Independent Non-Executive Directors, ensuring independent oversight[150]. - The Company has implemented adequate systems of internal controls and risk management procedures as part of its corporate governance practices[143]. - The Board meets at least four times a year to discuss business development, operations, and financial performance[145]. - The Company has made specific inquiries of all Directors regarding compliance with the required standard of dealings, with no non-compliance reported[140]. Employee and Stakeholder Engagement - The company expressed gratitude to staff and stakeholders for their support and contributions in 2021, emphasizing the importance of teamwork in achieving success[33]. - The Group has encouraged participation in environmental and social activities among employees, customers, suppliers, and other stakeholders[54]. - The Group has enhanced cooperation with suppliers to ensure the provision of high-quality products and services[54]. Future Outlook - The Company aims to leverage its competitive advantages to achieve new accomplishments in the coming years[15]. - The company is committed to exploring and adjusting its business strategy, focusing on sustainable development and increasing investment in technology and product R&D[24]. - The company aims to adapt to new challenges and achieve rapid growth by focusing on pharmaceutical quality, market sales, and scientific innovation[32].

吉 林 省 輝 南 長 龍 生 化 藥 業 股 份 有 限 公 司 Jilin Province Huinan Changlong Bio-pharmacy Company Limited Jilin Province Huinan Changlong Bio-pharmacy Company Limited (股份代號：8049) 第三季度業績報告2021 香港聯合交易所有限公司（「聯交所」）GEM的特色 GEM的定位乃為相比其他在聯交所上市的公司可能帶有較高投資風險的中小型公司提供一個上 市的市場。有意投資者應了解投資於該等公司的潛在風險，並應經過審慎周詳的考慮後方作出投 資決定。 由於GEM上市公司一般為中小型公司，在GEM買賣的證券可能會較於聯交所主板買賣的證券承 受較大的市場波動風險，同時無法保證在GEM買賣的證券會有高流通量的市場。 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報告的內容概不負責，對其準確性或 完整性亦不發表任何聲明，並明確表示概不會就因本報告全部或部份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。 本報告（吉林省輝南長龍生化藥業股份有限公司的董事（「董事」）願 ...

Financial Performance - For the six months ended June 30, 2021, the company reported revenue of RMB 301,326,000, an increase of 5.8% compared to RMB 285,644,000 for the same period in 2020[4] - Gross profit for the same period was RMB 239,108,000, a decrease of 1.8% from RMB 243,274,000 year-on-year[4] - Operating profit increased to RMB 62,694,000, up 1.4% from RMB 61,844,000 in the previous year[4] - Profit attributable to shareholders was RMB 48,977,000, down 5.5% from RMB 51,686,000 in the same period last year[4] - Basic earnings per share for the six months was 8.74 cents, compared to 9.23 cents in the previous year[4] - The operating profit for the six months ended June 30, 2021, was RMB 48,977,000, down from RMB 51,686,000 in the same period of 2020, reflecting a decrease of approximately 5.23%[20] - The basic earnings per share for the six months ended June 30, 2021, was RMB 0.087, down from RMB 0.092 in the same period of 2020, indicating a decrease of approximately 5.43%[20] - The gross margin for the six months ended June 30, 2021, was approximately 79.4%, down 5.9% from 85.3% in the same period of 2020[45] Assets and Liabilities - Total non-current assets as of June 30, 2021, amounted to RMB 1,090,544,000, an increase from RMB 996,616,000 at the end of 2020[6] - Current assets totaled RMB 803,799,000, slightly down from RMB 807,887,000 at the end of 2020[6] - Current liabilities increased to RMB 452,222,000 from RMB 415,435,000 at the end of 2020[6] - The company's net asset value as of June 30, 2021, was RMB 1,394,459,000, up from RMB 1,345,482,000 at the end of 2020[8] - The total assets of the company as of June 30, 2021, were RMB 167,745,000, compared to RMB 169,969,000 as of December 31, 2020, showing a decrease of about 1.31%[24] Dividends - The company did not declare any dividends for the period[4] - The company did not declare an interim dividend for the six months ended June 30, 2021, consistent with the previous year[21] - The company proposed a special dividend of RMB 0.0275 per share, subject to shareholder approval[44] Tax and Expenses - The income tax expense for the six months ended June 30, 2021, was RMB 13,526,000, compared to RMB 9,481,000 in the same period of 2020, which is an increase of about 42.4%[19] - The company’s depreciation expense for the six months ended June 30, 2021, was RMB 11,441,000, compared to RMB 10,114,000 in the same period of 2020, representing an increase of approximately 13.09%[17] - Sales expenses accounted for 43% of revenue for the six months ended June 30, 2021, a decrease from 44% in the same period of 2020[45] Shareholder Information - As of June 30, 2021, Mr. Zhang Hong holds 101,937,000 shares, representing 26.29% of domestic shares and 18.19% of total registered capital[56] - Huinan County Caiyuan Investment holds 81,975,000 shares, accounting for 21.14% of domestic shares and 14.63% of total registered capital[60] - The company did not repurchase, sell, or redeem any of its listed shares during the six-month period ending June 30, 2021[69] Corporate Governance - The audit committee consists of three independent non-executive directors, responsible for reviewing the financial procedures and internal control systems of the group[67] - The company has adopted a code of conduct for securities trading that meets or exceeds the standards set by GEM Listing Rules[64] - No directors or senior management were granted or exercised any rights to acquire benefits through the purchase of the company's shares or bonds during the period[58] - The company reported no knowledge of any other individuals holding interests or short positions in the company's shares and related securities, aside from those disclosed[61] - The company has not established any arrangements allowing directors or senior management to acquire rights in any other corporations[58] - The company believes that having an executive chairman is in the best interest of the group, as it benefits from the chairman's deep understanding of the business[65] Workforce - The company employed 951 staff members as of June 30, 2021, an increase from 856 staff members on June 30, 2020[68] Research and Development - The company plans to develop 16 new products in the areas of generic drug research and production, enhancing its R&D capabilities and market competitiveness[48] - The company upgraded production facilities to increase production capacity and meet market demand[46] Risk Management - The company believes that foreign exchange risk has minimal impact on its operations[49] - The company maintained a capital debt ratio of approximately 0% as of June 30, 2021, with no short-term bank borrowings[51]

Financial Performance - The company's revenue for the first quarter of 2021 reached RMB 148,719,000, representing a 14.4% increase compared to RMB 129,952,000 in the same period of 2020[4] - Gross profit for the first quarter of 2021 was RMB 125,364,000, up from RMB 111,380,000 in the first quarter of 2020, indicating a growth of 12.6%[4] - Operating profit increased to RMB 23,725,000 in Q1 2021, compared to RMB 16,964,000 in Q1 2020, reflecting a growth of 39.5%[4] - Profit attributable to shareholders for the first quarter of 2021 was RMB 20,108,000, a significant increase of 45.3% from RMB 13,870,000 in the same quarter of 2020[4] - Basic earnings per share for Q1 2021 were RMB 3.59 cents, compared to RMB 2.47 cents in Q1 2020, marking a 45.2% increase[4] - The profit attributable to shareholders for the same period was RMB 20,108,000, representing a 45% increase from RMB 13,870,000 in the previous year[16] - The basic earnings per share for the three months ended March 31, 2021, was RMB 3.59 cents[16] Revenue Sources - All revenue generated in the first quarter of 2021 was from domestic sales within China, with no identifiable assets located outside the country[8] - For the three months ended March 31, 2021, the group recorded revenue of approximately RMB 148,719,000, an increase of approximately RMB 18,767,000 compared to the same period last year[16] Cost and Margin Analysis - The gross margin for the same period was approximately 84.3%, a decrease of 1.4% from 85.7% in the previous year[16] - Distribution and selling costs as a percentage of revenue decreased to 46.2% from 78% in the previous year, a reduction of 31.8%[16] Cash and Assets - As of March 31, 2021, the group's cash and bank balances totaled RMB 818,180,000, compared to RMB 131,450,000 in the previous year[19] - The group's net asset value as of March 31, 2021, was approximately RMB 1,365,590,000, an increase from RMB 1,252,403,000 in the previous year[19] - The capital debt ratio as of March 31, 2021, was 0.03%, down from 0.2% in the previous year[20] Business Operations - The company has not reported any changes in its main business operations, which focus on the manufacturing and distribution of traditional Chinese medicine and pharmaceutical products in China[5] - The company upgraded production facilities and purchased new equipment to enhance production capacity and meet market demand[18] - The company plans to develop and produce 16 new varieties of generic drugs in newly constructed production workshops[18] Dividends and Shareholder Information - The board of directors proposed a special dividend of RMB 3.5 cents per share for the previous fiscal year, totaling RMB 19,608,750, which is the same as the previous year[12] - The company did not purchase, sell, or redeem any of its listed shares during the three months ended March 31, 2021[45] Governance - The audit committee is composed solely of independent non-executive directors, ensuring accountability and independent decision-making[43] - The company’s chairman and CEO, Zhang Hong, is also the major shareholder, contributing to the group's growth and profitability[42]

Financial Performance - The total revenue for the year ended December 31, 2020, was approximately RMB 622,250,000, representing a decrease of 3.7% compared to RMB 645,885,000 in the previous year[16]. - Profit attributable to owners of the Company decreased to RMB 126,558,000 from RMB 144,726,000 last year[16]. - Basic earnings per share decreased to RMB 22.59 cents from RMB 25.83 cents last year[16]. - For the year ended December 31, 2020, the Group's revenue decreased to RMB 622,250,000 from approximately RMB 645,885,000, representing a decline of about 3.6%[38]. - Profit for the year attributable to owners of the Company decreased to RMB 126,558,000 from RMB 144,726,000, a decrease of approximately 12.6%[38]. - Basic earnings per share decreased to RMB 22.59 cents from RMB 25.83 cents, reflecting a decline of about 12.5%[38]. - The audited profit attributable to owners of the Company was approximately RMB 126,558,000, representing a decrease of 12.55% from RMB 144,726,000 in the previous year[99]. - Profit before income tax for 2020 was RMB 150,041,000, down from RMB 175,294,000 in 2019, reflecting a decline of 14.4%[173]. Operational Challenges - The COVID-19 outbreak significantly impacted the global economy, but the Company resumed work and production promptly to minimize the impact on production and sales[18]. - The Company faced increased production costs due to stricter environmental and resource constraints, as well as declining overall drug prices following the implementation of drug price control policies[19]. - The Company faced considerable operational pressure due to rising production costs and declining overall price levels of pharmaceutical products[37]. Strategic Initiatives - The Group emphasized the research and development of new drugs, increasing investment in technologically advanced new drugs with independent intellectual property rights[23]. - The Group's strategy includes exploring and adjusting business strategies and increasing investment in technology to pursue sustainable development[26]. - The Company plans to develop 16 new varieties of generic drugs through newly built workshops for research and production[98]. - The Group aims to achieve rapid growth and become a centennial enterprise by focusing on technological innovation and serving global health needs[33]. Financial Management - The expected annualized rate of return for wealth management products subscribed during the year was around 1.58%–3.8%, which was higher than comparable market bank deposit interest rates[40]. - As of December 31, 2020, the Group held Wealth Management Products totaling approximately RMB 60,417,000, a decrease from RMB 683,483,000 in 2019[91]. - The expected annualized return rate for the subscribed Wealth Management Products ranged from 1.20% to 3.80%[91]. - The unrealized gains on fair value change from the Wealth Management Products amounted to approximately RMB 417,000 as of December 31, 2020[92]. - The Group's investment in time deposits as of December 31, 2020, amounted to approximately RMB 805,020,000, compared to RMB Nil in 2019[91]. - The management has shifted investment strategy towards time deposits due to decreasing expected returns on Wealth Management Products[94]. - The Group established a Risk Management Committee to enhance the assessment and management of investments in Wealth Management Products and time deposits[94]. - The subscriptions of Wealth Management Products were aimed at maximizing the utilization of surplus cash while maintaining high liquidity and low risk[94]. - The Group did not experience any losses on the Wealth Management Products as of December 31, 2020[94]. - The Group will continue to seek opportunities to invest idle cash in appropriate Wealth Management Products[94]. Asset and Liability Management - Total assets increased to RMB 1,804,503,000 from RMB 1,671,477,000 in 2019[110]. - The total liabilities to total assets ratio was 25% in 2020, slightly down from 26% in 2019, with total liabilities amounting to RMB 459,021,000[114]. - The Group's gearing ratio was 0.02% in 2020, compared to 0.2% in 2019, indicating a significant reduction in leverage[114]. - The Group's total equity rose to RMB 1,345,482,000 in 2020, up from RMB 1,238,533,000 in 2019, marking an increase of about 8.6%[112]. - The total borrowings of the Group were RMB 400,000 as of December 31, 2020, significantly reduced from RMB 2,350,000 in 2019[112]. - The Group's current liabilities amounted to RMB 415,435,000 in 2020, compared to RMB 387,872,000 in 2019, indicating an increase of approximately 7.4%[112]. Employee and Community Engagement - The Group employed a total of 951 employees, with remuneration based on market conditions and individual performance[115]. - The Group has maintained compliance with all relevant laws and regulations, emphasizing its commitment to environmental and social standards[116]. - The Group encourages participation in environmental and social activities among employees, customers, and suppliers to benefit the community[116]. Future Outlook - The company has outlined a positive outlook for 2021, projecting a revenue growth of 10% to 12% based on current market trends and product demand[141]. - New product development includes the launch of two innovative drug formulations, which are expected to contribute an additional 200 million CNY in revenue in the upcoming fiscal year[141]. - The company is expanding its market presence, targeting an increase in distribution channels by 25% in 2021 to enhance accessibility of its products[141]. - A strategic acquisition of a smaller biotech firm is planned, which is anticipated to enhance the company's R&D capabilities and product pipeline[141]. - The company has invested 50 million CNY in new technology for production efficiency, aiming to reduce costs by 15% over the next two years[141]. - The R&D department has successfully filed for three new patents in 2020, focusing on advanced extraction methods that could improve product efficacy[141]. - The company has established a partnership with a leading university to foster innovation in drug development, which is expected to yield new products within the next 18 months[141]. - The management team has emphasized a commitment to sustainability, with plans to reduce carbon emissions by 30% by 2025 through improved operational practices[141].

Financial Performance - For the nine months ended September 30, 2020, the company's revenue was RMB 440,471,000, a decrease of 6.7% compared to RMB 472,058,000 for the same period in 2019[5] - Gross profit for the nine months ended September 30, 2020, was RMB 374,377,000, down 5.5% from RMB 396,184,000 in the same period of 2019[5] - Operating profit for the nine months ended September 30, 2020, was RMB 98,689,000, a decrease of 4.3% compared to RMB 103,756,000 for the same period in 2019[5] - Profit attributable to equity holders for the nine months ended September 30, 2020, was RMB 83,027,000, down 5.4% from RMB 88,107,000 in the same period in 2019[5] - Basic earnings per share for the nine months ended September 30, 2020, was 14.8 cents, compared to 15.7 cents for the same period in 2019[5] - The net profit attributable to shareholders for the nine months ended September 30, 2020, was approximately RMB 83,027,000, down 5.76% from RMB 88,107,000 in the same period of 2019[14] Expenses and Financial Position - The company’s operating expenses for the nine months ended September 30, 2020, were RMB 101,222,000, compared to RMB 32,492,000 for the same period in 2019[5] - The company’s financial expenses for the nine months ended September 30, 2020, were RMB 707,000, compared to RMB 92,000 for the same period in 2019[5] - The company’s tax expense for the nine months ended September 30, 2020, was RMB 14,955,000, compared to RMB 15,557,000 for the same period in 2019[9] - General and administrative expenses increased from RMB 32,492,000 to RMB 101,222,000 in 2020[15] - As of September 30, 2020, the group maintained a strong financial position with cash and bank balances of approximately RMB 808,597,000 and a net asset value of approximately RMB 1,321,560,000[18] - The group had a capital-to-debt ratio of 0% as of September 30, 2020, with no short-term bank borrowings[19] Dividends and Shareholder Actions - The company did not recommend the payment of an interim dividend for the nine months ended September 30, 2020[11] - No repurchase, sale, or redemption of the company's listed shares occurred during the nine-month period ending September 30, 2020[37] Market Position and Strategy - The company has upgraded production facilities to enhance capacity and meet market demand, including the establishment of a new solid dosage drug workshop[16] - The management believes that the Haikun Shenxi capsule has matured in the market and has replaced the compound Huoluan Shushu capsule as the group's best-selling product[20] - The group is committed to identifying potential business opportunities to create substantial results in the coming years[20] - Selling expenses as a percentage of revenue decreased to 45.8% in 2020 from 60.8% in the previous year, attributed to reduced advertising and promotional costs[15] - The gross margin for the nine months ended September 30, 2020, was approximately 85%, an increase of 1.1% from 83.9% in the previous year[15] Corporate Governance - The company has adopted a code of conduct for directors' securities trading, which is strictly in line with GEM Listing Rules, with no known violations reported[32] - The company did not fully comply with GEM Listing Rules regarding corporate governance practices during the review period, particularly concerning the roles of the Chairman and CEO being held by the same individual[34] - The Audit Committee, established on May 24, 2001, is responsible for reviewing and supervising the financial reporting process and internal control systems of the group[35]

Financial Performance - The company reported a revenue of RMB 285,644,000 for the six months ended June 30, 2020, a decrease of 4.2% compared to RMB 299,404,000 for the same period in 2019[5]. - Gross profit for the six months ended June 30, 2020, was RMB 243,274,000, down from RMB 248,926,000 in 2019, reflecting a gross margin of approximately 85.2%[5]. - The net profit attributable to shareholders for the six months ended June 30, 2020, was RMB 51,686,000, compared to RMB 53,473,000 in the same period of 2019, representing a decline of 3.3%[5]. - For the six months ended June 30, 2020, the total revenue was RMB 307,735,000, a decrease of 3.4% compared to RMB 320,411,000 for the same period in 2019[21]. - The pharmaceutical sales amounted to RMB 285,644,000 for the six months ended June 30, 2020, down from RMB 299,404,000 in the previous year, representing a decline of 4.8%[21]. - The basic earnings per share for the six months ended June 30, 2020, were RMB 51,686,000, compared to RMB 53,473,000 for the same period in 2019, reflecting a decrease of 3.3%[28]. - The operating profit for the six months ended June 30, 2020, was not explicitly stated but is derived from the revenue figures and expenses reported[28]. - The company reported other income of RMB 22,091,000 for the six months ended June 30, 2020, compared to RMB 21,007,000 in the same period of 2019, showing a slight increase of 5.2%[5]. - The company’s operating expenses decreased to RMB 126,178,000 for the six months ended June 30, 2020, from RMB 182,650,000 in 2019, indicating a reduction of 30.9%[5]. - The company’s financial expenses for the six months ended June 30, 2020, were RMB 61,844,000, slightly down from RMB 62,985,000 in the previous year[5]. Assets and Liabilities - The company’s total assets as of June 30, 2020, amounted to RMB 1,419,857,000, an increase from RMB 1,398,922,000 as of December 31, 2019[10]. - Current liabilities totaled RMB 1,334,647,000 as of June 30, 2020, compared to RMB 1,283,605,000 at the end of 2019, indicating an increase in short-term obligations[10]. - The company’s equity increased to RMB 1,290,219,000 as of June 30, 2020, from RMB 1,238,533,000 as of December 31, 2019, reflecting a growth of 4.2%[12]. - The total assets related to property, plant, and equipment increased to RMB 147,617,000 as of June 30, 2020, from RMB 145,242,000 at the end of 2019[32]. - Inventory as of June 30, 2020, was RMB 48,020,000, down from RMB 51,239,000 as of December 31, 2019[41]. - Trade receivables as of June 30, 2020, totaled RMB 247,670,000, a decrease from RMB 260,154,000 as of December 31, 2019[43]. Shareholder Information - As of June 30, 2020, Mr. Zhang Hong holds 101,937,000 shares, representing 26.29% of domestic shares and 18.19% of total registered capital[58]. - Mr. Zhang Xiaoguang owns 42,315,000 shares, accounting for 10.91% of domestic shares and 7.55% of total registered capital[58]. - Huinan County Financial Investment Co., Ltd. holds 81,975,000 shares, which is 21.14% of domestic shares and 14.63% of total registered capital[62]. - Mr. Chen Jingwei owns 29,520,000 H shares, representing 17.11% of total registered capital[64]. Corporate Governance - The company has adopted a code of conduct for securities trading that meets or exceeds the standards set by GEM Listing Rules[65]. - The audit committee consists of three independent non-executive directors, ensuring oversight of financial procedures and internal controls[67]. - The company has not established any arrangements for directors to acquire rights through the purchase of shares or bonds[59]. - The chairman and CEO roles are held by Mr. Zhang Hong, which the board believes does not affect accountability or independent decision-making[66]. Employee Information - The company had 856 employees as of June 30, 2020, a decrease from 870 employees on June 30, 2019[70]. Dividends and Reinvestment - The company has not declared any dividends for the current period, maintaining a focus on reinvestment[5]. - The company did not recommend any interim dividend for the six months ended June 30, 2020, consistent with the previous year[31]. Operational Focus - The company’s operations are solely focused on the production and distribution of traditional Chinese medicine and pharmaceutical products within China[21]. - The company upgraded production facilities, enhancing capacity to meet market demand, and completed the construction and commissioning of a new solid dosage drug workshop[50]. - The company is focused on developing potential business opportunities to drive growth and achieve better results in the future[57].