Financial Performance - In the first half of 2020, Fusen Pharmaceutical achieved significant growth in both operating revenue and net profit compared to the same period in 2019[13]. - The company's revenue for the first half of 2020 was approximately RMB 247.5 million, representing a 26.0% increase compared to RMB 196.4 million in the same period of 2019[27]. - Gross profit for the first half of 2020 was approximately RMB 132.8 million, an increase of 24.3% from RMB 106.8 million in the first half of 2019[27]. - The company reported a net profit attributable to equity holders of approximately RMB 34.9 million, a significant increase of 47.7% compared to the same period in 2019[27]. - Total comprehensive income for the period was RMB 34,271 thousand, up from RMB 24,357 thousand in the same period last year, representing an increase of 40.7%[142]. - Basic earnings per share for the period was RMB 4, compared to RMB 3 in 2019, reflecting a growth of 33.3%[142]. - Profit before tax rose to RMB 41,877 thousand, up from RMB 27,574 thousand in the previous year, marking a significant increase of 51.8%[139]. - The company’s net profit for the period was RMB 33,430 thousand, compared to RMB 23,732 thousand in 2019, indicating a growth of 40.9%[139]. Sales and Market Strategy - Sales expenses were effectively controlled while operating revenue increased, contributing to the company's profitability in the first half of 2020[15]. - Fusen Pharmaceutical is building a specialized academic marketing team to adapt to market changes in the prescription drug sector[18]. - The company is actively engaging with major chain pharmacies to increase its market share in the rapidly growing OTC market[18]. - Sales of the main product, Shuanghuanglian Oral Liquid (10ml), increased by 56.3% to RMB 112.6 million, accounting for 45.5% of total revenue[32]. - Sales revenue of Shuanghuanglian oral solution increased by approximately 55% from RMB 99.9 million in the first half of 2019 to RMB 154.8 million in the first half of 2020, driven by a surge in domestic market demand[33]. - Sales revenue of Shuanghuanglian injection decreased by approximately 33.4% from RMB 36.9 million in the first half of 2019 to RMB 24.6 million in the first half of 2020, primarily due to ongoing regulatory impacts[33]. Research and Development - Fusen Pharmaceutical aims to enrich its product pipeline through R&D investments and potential acquisitions while managing risks and seizing market opportunities[18]. - The company is focusing on the development of generic drugs, including the ongoing projects for Metformin Extended-Release Tablets and other products undergoing consistency evaluation[28]. - The company has initiated the development of a generic version of Buwasit injection and raw materials, targeting high-end products with market potential[24]. - The company plans to continue investing in product research and development, particularly in traditional Chinese medicine and consistency evaluation projects[29]. - The company continues to collaborate with research institutions on traditional Chinese medicine research, focusing on drug efficacy and mechanisms[71]. - Research and development expenses increased to RMB 7,321,000 for the six months ended June 30, 2020, from RMB 6,496,000 in the same period of 2019[177]. Financial Management and Expenses - The average gross margin slightly decreased from 54.4% in the first half of 2019 to 53.7% in the first half of 2020 due to rising raw material costs[27]. - Selling and distribution expenses slightly decreased from RMB 56.9 million in the first half of 2019 to RMB 56.4 million in the first half of 2020, representing approximately 29.0% and 22.8% of revenue respectively[38]. - General and administrative expenses increased by approximately RMB 21.8 million, mainly due to the financial impact of stock options granted, with a slight increase of RMB 4.2 million excluding this effect[39]. - Net financing costs decreased from RMB 4.9 million in the first half of 2019 to RMB 4.0 million in the first half of 2020, primarily due to reduced foreign exchange losses[40]. - Employee costs totaled approximately RMB 43.1 million in the first half of 2020, compared to RMB 33.0 million in the same period of 2019[57]. Capital Expenditure and Investments - As of June 30, 2020, total capital expenditure amounted to approximately RMB 53.6 million, a decrease from RMB 140.2 million in the first half of 2019, mainly due to the construction of new production facilities[44]. - The company is actively seeking opportunities for product acquisition, focusing on mature imported drugs with clinical and market value[24]. - The company plans to increase acquisition efforts, focusing on essential clinical varieties and over-the-counter products, although no formal acquisition agreements have been signed during the reporting period[71]. - The company has utilized HKD 183.3 million of the net proceeds as of the reporting date, with HKD 213.7 million remaining[71]. Shareholder Information and Corporate Governance - The company announced an interim dividend of RMB 0.45 per ordinary share, compared to RMB 0.30 per ordinary share for the same period in 2019[125]. - The company’s independent non-executive director, Mr. He, resigned on July 10, 2020, which resulted in a temporary non-compliance with listing rules regarding the minimum number of independent directors[121]. - The company appointed Dr. Du as an independent non-executive director on August 13, 2020, restoring compliance with listing rules[123]. - The company has complied with all applicable corporate governance code provisions from January 1, 2020, to June 30, 2020[106]. - The company has a commitment to good corporate governance to achieve effective accountability[106]. - The company’s share repurchase program aims to enhance shareholder value by increasing earnings per share[120]. Assets and Liabilities - As of June 30, 2020, the company's total liabilities increased to approximately RMB 548.8 million from RMB 494.7 million as of December 31, 2019[48]. - The debt-to-equity ratio increased from 30.8% as of December 31, 2019, to 34.0% as of June 30, 2020, mainly due to increased bank borrowings[55]. - Cash and cash equivalents increased to RMB 402,629 thousand from RMB 331,044 thousand, showing a growth of 21.6%[147]. - Trade receivables decreased to RMB 133,628 thousand from RMB 170,164 thousand, a decline of 21.5%[147]. - Total equity decreased to RMB 673,886,000 from RMB 681,540,000, a decline of about 1.9% compared to the previous period[151]. - The total bank and other loans as of June 30, 2020, amounted to RMB 229,290,000, up from RMB 210,000,000 as of December 31, 2019[200].
福森药业(01652) - 2020 - 中期财报