Huasun(SZ:000790)2018-08-30 16:00Financial Performance - The company's operating revenue for the first half of 2018 was CNY 263,778,127.50, representing a 1.21% increase compared to CNY 260,615,631.15 in the same period last year[17]. - The net profit attributable to shareholders decreased by 15.00% to CNY 9,521,109.49 from CNY 11,201,527.97 year-on-year[17]. - The net profit after deducting non-recurring gains and losses dropped by 58.13% to CNY 7,772,421.02 compared to CNY 18,562,229.59 in the previous year[17]. - The basic earnings per share were CNY 0.0170, down 15.00% from CNY 0.0200 in the same period last year[17]. - The diluted earnings per share also stood at CNY 0.0170, reflecting a 15.00% decrease compared to CNY 0.0200 in the previous year[17]. - The company reported a net cash outflow from financing activities of CNY 146,697,551.97, a drastic increase of 5,570.74% due to repayment of bank loans amounting to CNY 130,000,000[37]. - The total profit for the period was CNY 19,084,935.38, slightly lower than CNY 19,517,020.80, reflecting a decrease of approximately 2.2%[116]. Cash Flow and Assets - The net cash flow from operating activities was CNY 10,620,846.72, a significant improvement from a negative CNY 40,199,493.81 in the same period last year[17]. - The company's total assets decreased from CNY 1,326,057,825.47 at the beginning of the year to CNY 1,058,709,532.01 by June 30, 2018, representing a decline of approximately 20.2%[109]. - Cash and cash equivalents decreased from CNY 443,400,371.44 to CNY 290,504,170.28, reflecting a decline of approximately 34.5%[106]. - Total liabilities decreased from CNY 487,194,375.56 to CNY 244,806,682.53, a decline of approximately 49.7%[108]. - The company's equity attributable to shareholders decreased from CNY 838,863,449.91 to CNY 813,902,849.48, a reduction of about 3%[109]. Revenue Breakdown - The revenue from the pharmaceutical manufacturing sector was CNY 249,551,821.17, with a gross margin of 68.39%, showing a year-on-year increase of 20.55% in revenue[39]. - The biopharmaceutical sector reported a revenue decline of 44.54% year-on-year, amounting to a loss of 3.30 million yuan[33]. - The revenue from Chengdu Traditional Chinese Medicine University Huasheng Pharmaceutical Co., Ltd. was 132.58 million yuan, accounting for 50.26% of the group's total revenue, a year-on-year decrease of 21.07%[54]. - Sichuan Huasheng Steel Structure Co., Ltd. achieved revenue of 13.07 million yuan, representing 4.95% of the group's total revenue, a year-on-year decrease of 75.49%[55]. Research and Development - The company has established a collaborative platform with over 30 universities and research institutions, enhancing its R&D capabilities in modern Chinese medicine and biopharmaceuticals[29]. - The company holds 23 invention patents, 35 utility model patents, and 4 design patents, reflecting its commitment to innovation[29]. - Research and development investment rose by 4.14% to CNY 16,925,193.27, reflecting the company's commitment to innovation[37]. Shareholder Information - The company plans not to distribute cash dividends or issue bonus shares for this period[5]. - The total number of shares increased from 431,021,374 to 560,327,786 due to a stock dividend distribution of 3 shares for every 10 shares held[89]. - The total number of common shareholders at the end of the reporting period was 57,875[92]. - Sichuan Huashen Group held 18.08% of shares, amounting to 101,301,165 shares[92]. - The top ten shareholders did not engage in any repurchase transactions during the reporting period[93]. Risks and Challenges - The company faces risks including drug price reductions, channel risks due to the two-invoice system, and increased operational costs due to stricter environmental regulations[57]. - The company has not engaged in any significant asset or equity sales during the reporting period[50][51]. - The semi-annual financial report was not audited, indicating a potential area of concern for investors[104]. Financial Policies and Practices - The company classifies joint arrangements into joint operations and joint ventures based on structure, legal form, and contractual terms[159]. - Cash and cash equivalents are defined as cash on hand and deposits that are readily available for payment, with cash equivalents having a maturity of no more than 3 months[161]. - The company recognizes gains or losses from the transfer of financial assets based on specific conditions, including the termination of cash flow rights or the transfer of risks and rewards[167]. - The company assesses the carrying value of financial assets at the balance sheet date and recognizes impairment losses if there is objective evidence of impairment[172]. Inventory and Asset Management - Inventory increased by 49.90% to 32.71 million yuan, driven by procurement of raw materials and production preparations[26]. - The company uses a weighted average method for inventory cost calculation[176]. - Inventory is valued at the lower of cost and net realizable value, with provisions for inventory write-downs based on specific criteria[177]. - The company employs a perpetual inventory system for stock management[178].