Financial Performance - Total revenue for 2019 was RMB 407.388 million, a decrease of 11.8% compared to RMB 462.061 million in 2018[9] - Gross profit for 2019 was RMB 212.488 million, down from RMB 251.317 million in 2018, reflecting a gross margin of 52.1%[9] - Operating profit decreased to RMB 66.148 million in 2019 from RMB 136.067 million in 2018, representing a decline of 51.4%[9] - Net profit for the year was RMB 52.259 million, a decrease of 48.7% compared to RMB 101.909 million in 2018[9] - The company's revenue for the year ended December 31, 2019, was approximately RMB 407.4 million, a decrease of about 11.8% compared to RMB 462.1 million for the year ended December 31, 2018[22] - Sales cost decreased from approximately RMB 210.7 million in the year ended December 31, 2018, to approximately RMB 194.9 million in the year ended December 31, 2019, a reduction of about RMB 15.8 million or 7.5%[28] - Gross profit decreased from approximately RMB 251.3 million in the year ended December 31, 2018, to approximately RMB 212.5 million in the year ended December 31, 2019, with gross margin declining from 54.4% to 52.2%[29] - Other income increased from approximately RMB 23.6 million in 2018 to approximately RMB 25.2 million in 2019, primarily due to the cancellation of long-term payables[31] - Selling and distribution expenses rose from approximately RMB 89.6 million in 2018 to approximately RMB 112.8 million in 2019, an increase of about RMB 23.2 million or 25.9%[32] - General and administrative expenses increased from approximately RMB 49.3 million in 2018 to approximately RMB 58.7 million in 2019, a rise of about RMB 9.4 million or 19.1%[33] - Net profit decreased from approximately RMB 101.9 million in the year ended December 31, 2018, to approximately RMB 52.3 million in the year ended December 31, 2019, a decline of about RMB 49.7 million or 48.7%[35] Assets and Liabilities - Total assets increased to RMB 1,176.229 million in 2019 from RMB 1,163.262 million in 2018[10] - Total liabilities decreased to RMB 494.689 million in 2019 from RMB 547.163 million in 2018, indicating improved financial stability[10] - As of December 31, 2019, the group's current assets were approximately RMB 213.6 million, down from RMB 432.8 million in 2018, and cash and bank balances were approximately RMB 331.0 million, down from RMB 561.1 million in 2018[37] - The group’s debt-to-equity ratio as of December 31, 2019, was approximately 30.8%, unchanged from 2018[38] Research and Development - The company plans to increase investment in research and development, particularly in the area of First Generics Drugs and quality standards for traditional Chinese medicine products[13] - The company has invested in Beijing Sanyeming Pharmaceutical Technology Co., Ltd. and Jiangxi Yongfeng Kande Pharmaceutical Co., Ltd. to enhance its R&D and sales capabilities in prescription drugs[14] - The company is closely monitoring the application of traditional Chinese medicine in the treatment of COVID-19 and may increase investment in this area[13] - The company continues to collaborate with research institutions to enhance the quality and stability of its core products, such as Shuanghuanglian Oral Liquid[13] - The company is progressing with the consistency evaluation of its chemical drug products, with some applications submitted to the National Medical Products Administration[13] - Investment in R&D increased by 25%, totaling 150 million, aimed at developing new pharmaceutical products and enhancing existing ones[16] - The company achieved GMP certification for five new product lines, including small volume injections and oral solutions, enhancing its production capabilities[16] Market and Sales - The main products, including Shuanghuanglian Oral Liquid (10ml), accounted for 38.3% of total revenue in 2019, with sales of RMB 156.1 million, down 19.6% from the previous year[27] - The sales of Shuanghuanglian Injection decreased by 25.0% in 2019, contributing RMB 64.6 million, which represented 15.9% of total revenue[27] - The company has recognized the challenges posed by the COVID-19 pandemic but reports stable production and strong market demand for its products[17] - The overall market uncertainty due to policy adjustments has impacted product sales, but the company has seen a stabilization in sales volumes since the second half of 2019[22] - The management anticipates that the national volume-based procurement will accelerate, leading to broader coverage and more comprehensive supervision mechanisms in the pharmaceutical industry[24] - The company plans to continue enriching its product offerings through acquisitions and collaborations, particularly focusing on clinical essential drugs and over-the-counter products[24] Corporate Governance - The company has adopted the corporate governance code as per the listing rules and has complied with all applicable code provisions since its listing on July 11, 2018, except for the attendance of the chairman and all committee chairpersons at the annual general meeting[106] - The board of directors is responsible for overseeing the company's overall strategy and business performance, including financial performance and risk management[112] - The company has confirmed that all directors have complied with the standards of the securities trading code as of December 31, 2019[107] - The independent non-executive directors have confirmed their independence and the board composition meets the requirement of having at least one-third independent directors[116] - The roles of the chairman and the CEO are separated, with clear written responsibilities for each[117] - The company has obtained directors' and officers' liability insurance to cover any legal liabilities arising from their duties[113] - The board retains decision-making authority on major matters, including policies, strategies, budgets, and significant transactions[109] - The company has ensured that there are no competing interests from directors or their associates as of December 31, 2019[108] - The company has a clear management structure to facilitate effective operations and decision-making[109] - The company has a commitment to good corporate governance practices to enhance accountability and transparency[106] Environmental and Social Responsibility - The company is a leading manufacturer of traditional Chinese medicine for cold treatment, focusing on the core product, Shuanghuanglian, and also engages in R&D, production, and sales of various pharmaceutical products[174] - The company has not experienced any environmental pollution incidents during the reporting period[180] - The company strictly adheres to national and local environmental regulations, including the Air Pollution Prevention Law and the Water Pollution Prevention Law[180] - The company aims to build a green and environmentally friendly pharmaceutical brand, ensuring product safety and sustainable operations[175] - The company has implemented a waste management system to effectively manage waste generated during production[190] - The company is committed to improving its environmental, social, and governance (ESG) performance while pursuing growth in its business[175] - The company has established multiple communication channels with stakeholders, including employees, consumers, suppliers, and the community, to enhance transparency and gather feedback[178] - The company emphasizes the importance of maintaining stable and effective cooperation with stakeholders for sustainable development[175] - The company invested a total of RMB 32.67 million in wastewater treatment projects since its establishment, with a daily wastewater treatment capacity of 1,200 tons after expansion[191] - The total wastewater discharge for the year ended December 31, 2019, was 107,900 tons, with no instances of exceeding discharge standards[191] - The company generated 0.5 tons of hazardous waste and 166,400 tons of non-hazardous waste in 2019[194] - Total electricity consumption for 2019 was 5.4545 million kWh, with an average electricity consumption of 126.78 kWh per ten thousand yuan of output[195] - Total water consumption for 2019 was 107,880 tons, with an average water consumption of 10.8 tons per ten thousand yuan of output[196] - The company consumed 435,669 cubic meters of natural gas, 17,587 cubic meters of steam, and 3,219 tons of coal in the production process[199] - The company used a total of 5,072 tons of packaging materials during the reporting period, averaging 0.12 tons per ten thousand yuan of output[199] - The company has established an energy management system to enhance resource management and reduce waste[195] - The company has implemented measures to minimize environmental impact and improve energy efficiency in its operations[200] - The company has not caused any significant adverse effects on the environment or natural resources[200]
福森药业(01652) - 2019 - 年度财报