GENSCRIPT BIO(HK:01548)2023-09-26 09:10Company Operations and Growth - The company operates four main platforms: Life Sciences Services and Products, CDMO, Industrial Synthesis Products, and Global Cell Therapy, all of which achieved growth in R&D and commercialization by June 30, 2023[5]. - The professional team consists of approximately 6,414 members, supporting operations in over 100 countries, including China, the USA, and several European nations[5]. - The CDMO platform focused on expanding global capacity and commercialization networks during the reporting period[5]. - The company emphasizes optimizing operational processes to ensure high-quality end-to-end delivery, enhancing customer competitiveness[5]. - Legend Biotech, a subsidiary, is developing a CAR-T cell therapy for multiple myeloma in collaboration with Janssen Biotech, with cilta-cel as the lead candidate[5]. - The Life Sciences Services and Products division provides essential services such as gene synthesis and antibody development, contributing significantly to global life sciences research[5]. - The company aims to establish a healthy biotechnology ecosystem through strategic collaborations with business partners[5]. - The report period ended on June 30, 2023, indicating a focus on continuous improvement and innovation in biotechnology[5]. - The company is committed to making people and nature healthier through its proprietary gene synthesis technology[5]. Financial Performance - The group's revenue for the six months ended June 30, 2023, was approximately $391.3 million, an increase of 26.4% compared to approximately $309.6 million for the same period in 2022[11]. - The gross profit for the same period was approximately $175.0 million, up 3.9% from approximately $168.5 million in 2022[11]. - The adjusted net loss for the six months ended June 30, 2023, was approximately $162.0 million, compared to an adjusted net loss of approximately $134.8 million for the same period in 2022[11]. - The external revenue from the non-cell therapy business was approximately $281.8 million, a 13.8% increase from approximately $247.7 million in 2022, while the cell therapy business generated external revenue of approximately $109.5 million, a significant increase of 76.9% from approximately $61.9 million[11]. - The adjusted operating profit for the life sciences services and products segment was approximately $39.2 million, an increase of 16.7% from approximately $33.6 million in 2022[17]. - The revenue from the biopharmaceutical development services segment was approximately $65.1 million, a slight increase of 3.8% from approximately $62.7 million in 2022[18]. - The adjusted gross profit for the biopharmaceutical development services segment decreased by 18.4% to approximately $19.5 million, down from approximately $23.9 million in 2022[18]. - The cell therapy business reported an adjusted operating loss of approximately $205.9 million for the period[16]. - The life sciences services and products accounted for approximately 50.8% of the total revenue, while cell therapy accounted for approximately 28.0%[15]. - The loss attributable to the company's owners was approximately $93.6 million, compared to approximately $135.5 million for the same period in 2022[11]. Investments and Financial Position - As of June 30, 2023, the group's cash and bank balances were approximately $1.4 billion, an increase from about $941.9 million as of December 31, 2022[34]. - The group held significant investments valued at approximately $259.4 million as of June 30, 2023, compared to $222.5 million as of December 31, 2022[38]. - The group invested in wealth management products with expected yields ranging from 1.4% to 5.2%, with maturities from 1 day to about 1 year, all of which were non-defaulting as of June 30, 2023[39]. - The fair value of the equity portion of Probio B preferred shares was assessed at approximately $1.6 million, while the debt portion was valued at about $37.9 million, including interest of approximately $1.1 million[32]. - The group had approximately $335.3 million in available but undrawn bank credit as of June 30, 2023, compared to about $146.9 million as of December 31, 2022[34]. - The company reported a foreign exchange loss of $15,777 thousand for the period, a decrease from a loss of $24,581 thousand in the previous year, indicating an improvement of about 35.7%[127]. - The company’s total liabilities decreased to $1,298,277 thousand from $1,091,715 thousand, indicating a reduction of about 18.9%[130]. - The company's equity increased to $2,086,044 thousand as of June 30, 2023, compared to $1,362,668 thousand at the end of 2022, reflecting a growth of approximately 53.0%[130]. Research and Development - Research and development expenses increased by 16.7% to approximately $207.3 million from $177.6 million in the same period of 2022[27]. - The company aims to enhance R&D efficiency and cost-effectiveness through investments in CGT-related services and products[65]. - The company plans to continue advancing its pipeline projects in cell therapy and evaluate external collaboration opportunities[68]. - The company is focusing on optimizing pipelines and improving R&D success rates in response to the slowdown in biotech investment[65]. Employee and Management Compensation - The total employee compensation expense for the group was approximately $260.9 million, accounting for about 66.7% of total revenue[69]. - The company invests in continuous education and training programs for employees to enhance their skills and knowledge[71]. - The compensation policy for directors and senior management is based on the company's performance and market data[71]. - The adjusted annual remuneration for Dr. Zhang Fangliang is $572,000, based on individual and overall group performance[115]. - The adjusted annual remuneration for Mr. Meng Jiange is $465,139, reflecting personal and group performance adjustments[116]. - The adjusted annual remuneration for Ms. Wang Ye is $668,109, based on performance metrics[116]. Corporate Governance and Compliance - The company has a strong commitment to environmental, social, and governance (ESG) practices, as indicated by its risk management and governance committees[8]. - The company is committed to maintaining high standards of corporate governance to protect shareholder interests and enhance corporate value[111]. - The audit committee reviewed the unaudited interim results for the six months ended June 30, 2023, ensuring compliance with relevant accounting standards and regulations[113]. - The company has adopted a self-developed code for securities trading, ensuring compliance with the standards set forth in the listing rules[110]. Market Strategy and Future Outlook - The company plans to actively establish production capacity globally to meet strong future customer demand[56]. - Investment will continue in molecular biology and protein business capacity in both China and overseas markets, including expanding GMP production capacity for key reagents[56]. - The company aims to enhance CARVKI production capacity in North America and Europe to expand the treatable patient population following anticipated approval of a supplemental biologics license application[56]. - The company plans to continue expanding its market presence and investing in new technologies and product development[1]. - Future guidance indicates a focus on enhancing operational efficiency and exploring potential mergers and acquisitions to drive growth[1].