特一药业(002728) - 2025 Q2 - 季度财报

Important Notes, Table of Contents, and Definitions Important Notes The company's board and management confirm the report's accuracy and will not issue dividends for the period - The company's Board of Directors, directors, and senior management guarantee the truthfulness, accuracy, and completeness of the semi-annual report, and bear individual and joint legal liabilities[3] - Company head Xu Ronghuang, chief accounting officer Chen Xiliang, and head of the accounting department Cai Bijian affirm the truthfulness, accuracy, and completeness of the financial report[3] - The company does not plan to distribute cash dividends, issue bonus shares, or increase share capital from the capital reserve[4] Table of Contents This section lists the report's complete structure, providing quick navigation to its nine main chapters - The report's table of contents includes nine main chapters covering key areas such as company profile, management discussion, corporate governance, and financial statements[6] List of Reference Documents This section provides a list of reference documents available for inspection, including signed financial statements and original public filings - Reference documents include financial statements signed and sealed by the company head, chief accounting officer, and head of the accounting department[8] - Reference documents also include originals of all company documents and announcements publicly disclosed during the reporting period[9] Definitions This section defines key terms used in the report, including company names, subsidiaries, and regulatory bodies - "The Company, This Company, TEYI Pharmaceutical" refers to TEYI Pharmaceutical Group Co, Ltd[11] - The reporting period refers to January 1, 2025, to June 30, 2025[11] - Major subsidiaries include Hainan Haili Pharmaceutical Co, Ltd, Guangdong Teyi Haili Pharmaceutical Co, Ltd, and Taishan Xinning Pharmaceutical Co, Ltd[11] Company Profile and Key Financial Indicators Company Profile This section provides basic company information, confirming no significant changes during the reporting period - The company's stock short name is "TEYI Pharmaceutical," stock code is "002728," and it is listed on the Shenzhen Stock Exchange[13] - The company's legal representative is Xu Ronghuang[13] Contacts This section lists the contact information for the company's Board Secretary and Securities Affairs Representative - The Board Secretary is Xu Zilan, and the Securities Affairs Representative is Xu Shaohua[14] - The contact address is No 9 & 11, Changxing Road, Taicheng, Taishan City, and the phone number is 0750-5627588[14] Other Information This section confirms that the company's registered address, office address, and information disclosure channels remained unchanged - The company's registered address, office address, website, and email remained unchanged during the reporting period[15] - The information disclosure and document repository locations remained unchanged during the reporting period[16] Key Accounting Data and Financial Indicators The company's H1 2025 financial performance was strong, with significant growth in revenue and net profit Key Accounting Data and Financial Indicators for H1 2025 (YoY) | Indicator | Current Period (CNY) | Prior Year Period (CNY) | YoY Change | | :--- | :--- | :--- | :--- | | Operating Revenue | 491,142,874.06 | 313,748,456.95 | 56.54% | | Net Profit Attributable to Shareholders | 38,007,729.88 | 2,689,430.91 | 1,313.23% | | Net Profit Attributable to Shareholders (Excluding Non-recurring Items) | 38,085,250.72 | 614,721.94 | 6,095.52% | | Net Cash Flow from Operating Activities | 146,206,331.36 | -42,669,893.26 | 442.65% | | Basic Earnings Per Share (CNY/Share) | 0.0800 | 0.005 | 1,500.00% | | Diluted Earnings Per Share (CNY/Share) | 0.0800 | 0.005 | 1,500.00% | | Weighted Average Return on Equity | 2.13% | 0.14% | 1.99% | Key Accounting Data and Financial Indicators at the End of H1 2025 (vs Year-End 2024) | Indicator | End of Current Period (CNY) | End of Prior Year (CNY) | Change vs Prior Year-End | | :--- | :--- | :--- | :--- | | Total Assets | 2,274,766,119.19 | 2,400,875,824.19 | -5.25% | | Net Assets Attributable to Shareholders | 1,773,410,928.25 | 1,764,933,238.57 | 0.48% | Differences in Accounting Data under Domestic and Foreign Accounting Standards The company confirms no discrepancies in net profit or net assets between Chinese and international accounting standards - There are no differences in net profit or net assets between financial reports prepared under IFRS and Chinese Accounting Standards[19] - There are no differences in net profit or net assets between financial reports prepared under foreign accounting standards and Chinese Accounting Standards[20] Non-recurring Profit and Loss Items and Amounts Non-recurring items had a minor negative impact on net profit, totaling -77,520.84 CNY in H1 2025 Non-recurring Profit and Loss Items and Amounts for H1 2025 | Item | Amount (CNY) | | :--- | :--- | | Gains/Losses on Disposal of Non-current Assets | -83,374.88 | | Government Grants Recognized in Current Profit/Loss (Excluding those with continuous impact) | 315,474.95 | | Gains/Losses from Entrusted Investments or Asset Management | 299,726.03 | | Other Non-operating Income and Expenses | -610,436.81 | | Less: Income Tax Impact | -1,089.87 | | Total | -77,520.84 | - The company has no other items that meet the definition of non-recurring profit and loss, nor has it reclassified any non-recurring items as recurring[24] Management Discussion and Analysis Principal Business Activities During the Reporting Period The company focuses on pharmaceuticals, achieving significant revenue and profit growth through marketing reforms and brand building - The pharmaceutical industry is in a key transition phase from traditional to innovative medicine, with R&D as the new growth engine[27] - The company is primarily engaged in the R&D, production, and sales of traditional Chinese medicines, chemical preparations, and active pharmaceutical ingredients (APIs)[33] - The core product, Zhi Ke Bao Pian, has a century-long history, is listed as a Lingnan cultural heritage, and is a top-10 brand in its category[29][30][42] - Marketing reforms yielded positive results, with sales of the core product recovering to 61.29% of the same period in 2023 and rapid growth in online business[43] - In H1 2025, the company achieved operating revenue of 491.14 million CNY, a YoY increase of 56.54%, and net profit attributable to shareholders of 38.01 million CNY, a YoY increase of 1313.23%[43] Industry Overview, Development Stage, Cyclicality, and Company's Position The pharmaceutical industry is transitioning towards innovation, with the company's core product maintaining a strong market position - The pharmaceutical industry is in a key transition phase from traditional to innovative medicine, with R&D as the new growth engine[27] - The industry is characterized by policy adjustments and innovation-driven transformation, with policies like medical insurance cost control and volume-based procurement promoting standardized development[28] - The company's products are mainly sold in pharmacies and clinics, with limited exposure to policies like centralized procurement and medical insurance negotiations[28] - The core product, Zhi Ke Bao Pian, has a history of over 100 years and has been ranked among the top ten brands for cough, expectorant, and anti-asthmatic traditional Chinese medicines for many years[29][30] Impact of New Laws, Regulations, and Policies on the Industry National policies supporting traditional Chinese medicine (TCM) create both opportunities and challenges for the company's development - The State Council issued opinions on deepening drug and medical device regulatory reform and promoting high-quality development of the TCM industry[31] - Supported by national policies, the TCM industry is expected to see significant development opportunities, which also presents challenges for the company's operations[32] Principal Business Activities During the Reporting Period The company's core business involves pharmaceuticals, with marketing reforms driving significant growth in revenue and profit - The company's main products include Zhi Ke Bao Pian, Ganmaoling Granules, Xuesaitong Dispersible Tablets, and Ginkgo Leaf Dispersible Tablets[34][36][38] - The company deepened its marketing organization reform, adopting a hybrid model of self-operation and promotion service providers for OTC products, leading to rapid online business growth[40] - As of the end of the reporting period, the company had 19 products that passed the consistency evaluation and held 37 invention patents, 25 design patents, and 8 utility model patents[41] - During the reporting period, sales of the core product "TEYI" brand Zhi Ke Bao Pian reached 331 million tablets, recovering to 61.29% of the same period in 2023[43] - The company continued to increase brand-building investment, with a cumulative investment of 172 million CNY during the period, effectively enhancing brand awareness[43] Core Competitiveness Analysis The company's core strengths lie in its historic products, strong brand, diverse portfolio, and integrated production capabilities - The core product, Zhi Ke Bao Pian, has a century-long history, proven efficacy, high market recognition, and nationwide sales coverage[44] - The company's brand is recognized as a "Leading Brand in Guangdong's TCM and Herbal Slices Industry" and is included in the provincial key trademark protection list[45] - The company has a rich product portfolio covering traditional Chinese medicines, chemical drug preparations, and active pharmaceutical ingredients (APIs)[46] - The company possesses an integrated "API + Preparation" advantage, with its subsidiary Xinning Pharmaceutical supplying APIs to reduce production costs[47] - The company and its subsidiaries are recognized as high-tech enterprises, with the company also being a provincial-level enterprise technology center holding 37 invention patents[50] Main Business Analysis Revenue grew 56.54% YoY, driven by high-margin traditional Chinese medicine sales, while sales expenses rose due to brand investment YoY Changes in Key Financial Data (H1 2025 vs H1 2024) | Indicator | Current Period (CNY) | Prior Year Period (CNY) | YoY Change | Reason for Change | | :--- | :--- | :--- | :--- | :--- | | Operating Revenue | 491,142,874.06 | 313,748,456.95 | 56.54% | Primarily due to significant YoY growth in sales of high-margin TCM products | | Sales Expenses | 191,003,573.05 | 70,264,094.22 | 171.84% | Primarily due to increased investment in brand building | | Finance Expenses | 1,597,915.76 | -546,772.39 | 392.25% | Primarily due to a YoY decrease in interest income | | Income Tax Expense | 10,048,595.98 | -1,593,103.74 | 730.76% | Primarily due to increased profitability from high-margin TCM product sales | | Net Cash Flow from Operating Activities | 146,206,331.36 | -42,669,893.26 | 442.65% | Primarily due to increased cash inflows from sales of high-margin TCM products | Operating Revenue Breakdown (H1 2025) | Category | Current Period Amount (CNY) | % of Revenue | Prior Year Amount (CNY) | % of Revenue | YoY Change | | :--- | :--- | :--- | :--- | :--- | :--- | | By Product: | | | | | | | Chemical Drug Preparations | 160,158,470.88 | 32.61% | 197,202,048.85 | 62.85% | -18.78% | | Traditional Chinese Medicine (TCM) | 299,618,501.95 | 61.00% | 83,895,259.38 | 26.74% | 257.13% | | Active Pharmaceutical Ingredients (APIs) | 28,359,038.17 | 5.78% | 28,982,764.36 | 9.24% | -2.15% | | By Region: | | | | | | | South China | 272,940,501.41 | 55.57% | 196,455,107.63 | 62.62% | 38.93% | | Southwest China | 34,559,054.68 | 7.04% | 13,893,705.96 | 4.43% | 148.74% | | Northeast China | 38,226,814.27 | 7.78% | 8,626,450.29 | 2.75% | 343.13% | - The gross profit margin for the pharmaceutical industry was 60.59%, an increase of 20.88 percentage points YoY[54] - The gross profit margin for traditional Chinese medicine was 80.80%, an increase of 23.94 percentage points YoY[54] Non-core Business Analysis The company had no non-core business activities during the reporting period - The company had no non-core business activities during the reporting period[55] Analysis of Assets and Liabilities Total assets slightly decreased, while cash and short-term borrowings fell significantly due to debt repayment Significant Changes in Asset Composition (Period-End vs Prior Year-End) | Item | End of Current Period (CNY) | % of Total Assets | End of Prior Year (CNY) | % of Total Assets | Change in % | Reason for Significant Change | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Cash and Cash Equivalents | 286,258,083.96 | 12.58% | 457,414,315.11 | 19.05% | -6.47% | Primarily due to repayment of short-term borrowings | | Short-term Borrowings | 310,000,000.00 | 13.63% | 516,093,372.63 | 21.50% | -7.87% | Primarily due to the repayment of matured borrowings | | Accounts Payable | 71,053,369.56 | 3.12% | 34,502,828.32 | 1.44% | 1.68% | Primarily due to an increase in payables for marketing and engineering | - As of the end of the reporting period, restricted assets mainly consisted of a property maintenance fund of 452,591.62 CNY[58] Investment Analysis Investment decreased by 40.24% YoY, with several fundraising projects underway but some experiencing delays Investment Amount During the Reporting Period | Investment in Reporting Period (CNY) | Investment in Prior Year Period (CNY) | Change | | :--- | :--- | :--- | | 37,445,391.99 | 62,655,307.48 | -40.24% | Overall Use of Raised Funds (as of June 30, 2025) | Fundraising Year | Net Proceeds (1) (CNY 10k) | Cumulative Amount Used (2) (CNY 10k) | Utilization Rate (3)=(2)/(1) | | :--- | :--- | :--- | :--- | | 2017 | 34,635.74 | 32,347.1 | 93.39% | | 2021 | 18,490.54 | 16,460.97 | 89.02% | | 2023 | 26,889.13 | 20,889.13 | 77.69% | | Total | 80,015.41 | 54,808.07 | 68.50% | - The "TEYI Pharmaceutical Employee Dormitory Construction Project" is expected to be fully operational by June 30, 2026, and is currently in the interior decoration phase[74] - The "Xinning Pharmaceutical GMP Expansion Project" is fully operational but has not yet reached its projected benefits due to pre-market compliance inspections[74] - The company reallocated funds from the "Pharmaceutical Warehousing and Logistics Center and Information System Project" to the "Employee Dormitory Construction Project"[81] - The company changed the use of some 2023 fundraising proceeds from the "Modern TCM Slices Project" to the "Modern TCM Product Line Expansion and Technical Upgrade Project"[83] Overall Situation The company's investment amount for the reporting period was 37,445,391.99 CNY, a decrease of 40.24% year-on-year Investment Amount During the Reporting Period | Investment in Reporting Period (CNY) | Investment in Prior Year Period (CNY) | Change | | :--- | :--- | :--- | | 37,445,391.99 | 62,655,307.48 | -40.24% | Significant Equity Investments Acquired During the Reporting Period The company did not make any significant equity investments during the reporting period - The company had no securities investments during the reporting period[60] Significant Non-equity Investments in Progress During the Reporting Period The company had no significant ongoing non-equity investments during the reporting period - The company had no derivative investments during the reporting period[61] Financial Asset Investments The company did not engage in securities or derivative investments during the reporting period - The company had no securities investments during the reporting period[60] - The company had no derivative investments during the reporting period[61] Use of Raised Funds Fundraising projects from 2017, 2021, and 2023 are progressing, though some face delays and have had funds reallocated Overall Use of Raised Funds (as of June 30, 2025) | Fundraising Year | Net Proceeds (1) (CNY 10k) | Cumulative Amount Used (2) (CNY 10k) | Utilization Rate (3)=(2)/(1) | | :--- | :--- | :--- | :--- | | 2017 | 34,635.74 | 32,347.1 | 93.39% | | 2021 | 18,490.54 | 16,460.97 | 89.02% | | 2023 | 26,889.13 | 20,889.13 | 77.69% | | Total | 80,015.41 | 54,808.07 | 68.50% | - The "TEYI Pharmaceutical Employee Dormitory Construction Project" is expected to be fully operational by June 30, 2026[74] - The "Xinning Pharmaceutical GMP Expansion Project" is fully operational but has not yet reached its projected benefits due to pre-market compliance inspections[74] - The company reallocated funds from the "Pharmaceutical Warehousing and Logistics Center and Information System Project" to the "Employee Dormitory Construction Project"[81] - The company changed the use of some 2023 fundraising proceeds from the "Modern TCM Slices Project" to the "Modern TCM Product Line Expansion and Technical Upgrade Project"[83] Sale of Major Assets and Equity The company did not sell any major assets or equity during the reporting period - The company did not sell any major assets during the reporting period[84] - The company did not sell any major equity during the reporting period[85] Analysis of Major Holding and Participating Companies The company's main subsidiaries contributed significantly to its net profit Net Profit Contribution of Major Subsidiaries (H1 2025) | Company Name | Net Profit (CNY) | | :--- | :--- | | Haili Pharmaceutical | 13,647,695.68 | | Xinning Pharmaceutical | 9,152,162.16 | | Teyi Haili | 18,423,667.53 | - The company did not acquire or dispose of any subsidiaries during the reporting period[86] Structured Entities Controlled by the Company The company did not control any structured entities during the reporting period - The company did not control any structured entities during the reporting period[87] Risks and Countermeasures The company faces risks from industry policies, pricing pressure, and operations, which it addresses through strategic management and R&D - The company faces industry policy risks and will closely monitor changes, enhance core competitiveness, and actively participate in centralized procurement bidding[87] - To counter drug pricing risks, the company will expand sales scale, reduce costs, and develop high-value-added products[88] - The company addresses operational risks by deepening marketing reforms, strengthening brand building, optimizing financial strategies, and increasing R&D investment[91][92] - The company will continue to deepen its industrial chain layout and explore new business channels to enhance its overall competitiveness and resilience to market fluctuations[93] Development and Implementation of Market Value Management and Valuation Enhancement Plans The company has not formulated a market value management system or disclosed a valuation enhancement plan - The company did not formulate a market value management system during the reporting period[94] - The company did not disclose a valuation enhancement plan during the reporting period[94] Implementation of the "Dual Improvement in Quality and Returns" Action Plan The company did not disclose a "Dual Improvement in Quality and Returns" action plan during the reporting period - The company did not disclose a "Dual Improvement in Quality and Returns" action plan announcement during the reporting period[94] Corporate Governance, Environment, and Society Changes in Directors, Supervisors, and Senior Management Two independent directors resigned and were replaced during the reporting period due to personal reasons and work adjustments - Independent directors Cao Yanming and Li Guisheng resigned for personal reasons[96] - Zhao Xiaobo and Lai Hanqi were elected as new independent directors due to work adjustments[96] Profit Distribution and Capitalization of Capital Reserve for the Reporting Period The company does not plan to distribute dividends or issue bonus shares for the first half of the year - The company plans not to distribute cash dividends, issue bonus shares, or increase share capital from the capital reserve for the semi-annual period[97] Implementation of Equity Incentive Plans, Employee Stock Ownership Plans, or Other Employee Incentive Measures The 2021 stock option incentive plan is ongoing, with adjustments to exercise price and quantity made during the period - The company's 2021 stock option incentive plan is still in effect, with several adjustments made to the exercise price and quantity[98][100][102][104] - As of December 9, 2024, there were 2,521,030 outstanding stock options for 101 participants, with an exercise price of 6.24 CNY/share[105] - During the reporting period, some stock options were canceled due to the departure or retirement of incentive recipients[102][104][105] Environmental Information Disclosure The company and its main subsidiaries are included in the list of enterprises required to disclose environmental information - The company and its main subsidiaries (Taishan Xinning Pharmaceutical Co, Ltd, Hainan Haili Pharmaceutical Co, Ltd) are included in the list of enterprises required to disclose environmental information by law[107] Social Responsibility The company actively fulfills its social responsibilities, focusing on stakeholder rights, environmental protection, and community engagement - The company adheres to laws and regulations, maintains a sound governance structure, and ensures timely and accurate information disclosure to protect stakeholder rights[108] - The company values employee rights, providing systematic human resources management, addressing employee needs, and encouraging training and growth[110][111] - Adhering to a "Quality First, Integrity Foremost" philosophy, the company fosters win-win relationships with suppliers, customers, and consumers[112] - The company prioritizes product quality by establishing a comprehensive quality control system and safety assurance mechanism[113] - The company is committed to environmental protection and sustainable development, investing in environmental facilities to ensure compliant emissions[114][115] - The company actively participates in social welfare, pays taxes legally, and contributes to local economic development through donations of cash and products[116][117] Significant Matters Commitments Fulfilled or Overdue by Controlling Shareholders, Related Parties, and the Company There were no commitments fulfilled or overdue by the company's controlling shareholders or related parties during the period - There were no commitments fulfilled or overdue by the company's actual controller, shareholders, related parties, or the company itself during the reporting period[119] Non-operating Fund Occupation by Controlling Shareholders and Other Related Parties There was no non-operating fund occupation by controlling shareholders or other related parties during the reporting period - There was no non-operating fund occupation by controlling shareholders and other related parties during the reporting period[120] Irregular External Guarantees The company had no irregular external guarantees during the reporting period - The company had no irregular external guarantees during the reporting period[121] Appointment and Dismissal of Accounting Firm The company's semi-annual financial report has not been audited - The company's semi-annual report has not been audited[122] Board's Explanation on "Non-standard Audit Report" for the Current Period This section is not applicable as there was no non-standard audit report for the current period - There was no non-standard audit report for the current period[123] Board's Explanation on "Non-standard Audit Report" for the Previous Year This section is not applicable as there was no non-standard audit report for the previous year - There was no non-standard audit report for the previous year[123] Bankruptcy and Reorganization Matters The company was not involved in any bankruptcy or reorganization matters during the reporting period - The company was not involved in any bankruptcy or reorganization matters during the reporting period[123] Litigation Matters The company had no major litigation but settled a technology development contract dispute involving 2.52 million CNY - The company had no major litigation or arbitration matters during the reporting period[124] - The company and its subsidiary Haili Pharmaceutical filed a lawsuit over a technology development contract dispute involving 2.52 million CNY[126] - As of the disclosure date, a settlement was reached, and the company received a refund of 2.52 million CNY, resolving the legal dispute[126] Penalties and Rectifications The company was not subject to any penalties or rectifications during the reporting period - The company was not subject to any penalties or rectifications during the reporting period[127] Integrity Status of the Company, its Controlling Shareholders, and Actual Controller There were no issues concerning the integrity of the company, its controlling shareholders, or actual controller - There were no issues concerning the integrity of the company, its controlling shareholders, or actual controller during the reporting period[128] Major Related-Party Transactions The company did not engage in any major related-party transactions during the reporting period - The company had no related-party transactions related to daily operations during the reporting period[128] - The company had no related-party transactions involving the acquisition or sale of assets or equity[129] - There were no related-party credit or debt transactions during the reporting period[131] - The company had no other major related-party transactions during the reporting period[134] Major Contracts and Their Performance The company had no major contracts for custody, contracting, leasing, guarantees, or wealth management during the period - The company had no custody arrangements during the reporting period[135] - The company had no major guarantees during the reporting period[138] - The company had no entrusted wealth management during the reporting period[139] - The company had no other major contracts during the reporting period[140] Explanation of Other Significant Matters There were no other significant matters to be disclosed for the reporting period - There were no other significant matters to be disclosed for the reporting period[142] Significant Matters of Subsidiaries There were no significant matters concerning the company's subsidiaries during the reporting period - There were no significant matters concerning subsidiaries during the reporting period[143] Share Capital Changes and Shareholder Information Changes in Share Capital Total shares increased due to stock option exercises, and the company completed a share buyback plan totaling 13.73 million shares - In H1 2025, the total number of shares increased by 414,807 due to the exercise of options from the 2021 stock option incentive plan[148] - The company completed its share buyback plan on June 10, 2025, repurchasing a total of 13,729,618 shares, representing 2.68% of the total share capital[151] - The total cost of the buyback was 101,185,418.4 CNY, with the shares intended for future equity incentive or employee stock ownership plans[151] - Based on the new share count, the basic and diluted earnings per share for H1 2025 were 0.07 CNY, and the net assets per share attributable to common shareholders were 3.48 CNY[152] Changes in Restricted Shares (as of June 30, 2025) | Shareholder Name | Restricted Shares at Period Start | Increase in Restricted Shares | Restricted Shares at Period End | Reason for Restriction | | :--- | :--- | :--- | :--- | :--- | | Zhang Yongzhao | 44,100 | 0 | 44,100 | Executive Lock-up Shares | | Xu Songqing | 30,429,000 | 0 | 30,429,000 | Executive Lock-up Shares | | Xu Danqing | 104,980,050 | 0 | 104,980,050 | Executive Lock-up Shares | | Chen Xiliang | 676,200 | 58,800 | 735,000 | Executive Lock-up Shares | | Total | 136,129,350 | 58,800 | 136,188,150 | -- | Securities Issuance and Listing The company did not issue or list any securities during the reporting period - The company did not issue or list any securities during the reporting period[154] Number of Shareholders and Shareholding Status The company had 52,800 common shareholders, with the top four related shareholders collectively holding 38.83% - Total number of common shareholders at the end of the reporting period: 52,800[155] Shareholding of Top 10 Shareholders or Those Holding Over 5% (as of June 30, 2025) | Shareholder Name | Shareholder Type | Shareholding Ratio | Number of Shares | Number of Restricted Shares | Number of Unrestricted Shares | | :--- | :--- | :--- | :--- | :--- | :--- | | Xu Danqing | Domestic Individual | 27.31% | 139,973,400 | 104,980,050 | 34,993,350 | | Xu Songqing | Domestic Individual | 7.91% | 40,572,000 | 30,429,000 | 10,143,000 | | Xu Lifang | Domestic Individual | 2.32% | 11,907,000 | 0 | 11,907,000 | | HKSCC NOMINEES LIMITED | Foreign Legal Entity | 1.71% | 8,791,324 | 0 | 8,791,324 | | Xu Hengqing | Domestic Individual | 1.29% | 6,594,977 | 0 | 6,594,977 | - Xu Danqing, Xu Songqing, Xu Hengqing, and Xu Lifang are related parties and members of the same family[157] - The company's special repurchase account is not included in the list of top 10 shareholders or those holding over 5%[159] Changes in Shareholdings of Directors, Supervisors, and Senior Management Director Chen Xiliang increased his holdings, while Vice General Manager Zhang Yongzhao decreased his holdings Changes in Shareholdings of Directors, Supervisors, and Senior Management (H1 2025) | Name | Position | Status | Shares at Period Start | Shares Increased | Shares Decreased | Shares at Period End | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Xu Danqing | Chairman, General Manager | Current | 139,973,400 | 0 | 0 | 139,973,400 | | Xu Songqing | Vice Chairman, Vice GM | Current | 40,572,000 | 0 | 0 | 40,572,000 | | Chen Xiliang | Director, Board Sec, CFO, Vice GM | Current | 901,600 | 78,400 | 0 | 980,000 | | Zhang Yongzhao | Vice General Manager | Current | 58,800 | 0 | 58,800 | 0 | Changes in Controlling Shareholder or Actual Controller There were no changes to the company's controlling shareholder or actual controller, which remains the Xu family - The company's controlling shareholder did not change during the reporting period[163] - The company's actual controller did not change during the reporting period[163] - The ultimate controlling party of the enterprise is the Xu family[150] Information on Preferred Shares The company does not have any preferred shares - The company does not have any preferred shares[164] Bond-related Matters Bond-related Matters The company had no bond-related matters during the reporting period - The company had no bond-related matters during the reporting period[166] Financial Report Audit Report The company's semi-annual financial report has not been audited - The company's semi-annual financial report has not been audited[168] Financial Statements This section presents the consolidated and parent company financial statements for H1 2025 - This section includes the Consolidated Balance Sheet, Parent Company Balance Sheet, Consolidated Income Statement, Parent Company Income Statement, Consolidated Cash Flow Statement, Parent Company Cash Flow Statement, Consolidated Statement of Changes in Equity, and Parent Company Statement of Changes in Equity[169][173][180][186][189][196][206] Company Basic Information The company is registered in Taishan City with a registered capital of 510.79 million CNY and focuses on pharmaceuticals - The company's registered and head office address is No 9 & 11, Changxing Road, Taicheng, Taishan City[213] - As of June 30, 2025, the company's registered capital was 510,788,782 CNY[213] - The company is primarily engaged in the R&D, production, and sales of traditional Chinese medicines, chemical preparations, and APIs, with main products including Zhi Ke Bao Pian and Roxithromycin Capsules[214] Basis of Preparation of Financial Statements The financial statements are prepared on a going concern basis in accordance with Chinese Accounting Standards - The financial statements are prepared on a going concern basis in accordance with the "Enterprise Accounting Standards" issued by the Ministry of Finance[216] - The company has assessed its ability to continue as a going concern for the 12 months from June 30, 2025, and found no significant uncertainties[217] Significant Accounting Policies and Estimates This section details the key accounting policies and estimates used in preparing the financial statements - Financial assets are classified into three categories: measured at amortized cost, at fair value through other comprehensive income, or at fair value through profit or loss[239] - The company accounts for impairment of financial assets such as accounts receivable based on expected credit losses and recognizes a provision for bad debts[247] - Inventories are valued at the lower of cost (determined by the weighted average method) and net realizable value, with provisions made for inventory write-downs[258][261] - Fixed assets are depreciated using the straight-line method, and intangible assets are amortized using the straight-line method, with reviews conducted annually[269][276] - R&D expenditures are expensed during the research phase and capitalized during the development phase if specific criteria are met[278][279] - Revenue is recognized when the customer obtains control of the goods or services, at the transaction price allocated to the performance obligation[293] Taxes The company and its subsidiaries benefit from various tax incentives, including a reduced 15% corporate income tax rate for high-tech enterprises Main Taxes and Rates | Tax Type | Tax Basis | Tax Rate | | :--- | :--- | :--- | | Value-Added Tax (VAT) | Taxable Revenue | 13%, 9%, 6%, 5%, 3%, 1% | | Urban Maintenance and Construction Tax | Payable Turnover Tax | 7%, 5% | | Corporate Income Tax | Taxable Income | 25%, 20%, 15% | - The company and its subsidiaries Hainan Haili Pharmaceutical and Taishan Xinning Pharmaceutical are qualified as high-tech enterprises and are subject to a reduced corporate income tax rate of 15%[316][317] - The subsidiary Teyi Drug Research (Guangdong) Co, Ltd is eligible for a reduced VAT rate of 1% as a small-scale taxpayer[316] - The company and its subsidiaries Taishan Xinning Pharmaceutical and Hainan Haili Pharmaceutical are eligible for an additional 5% VAT deduction as advanced manufacturing enterprises[316] - Some subsidiaries qualify as small and micro enterprises, enjoying a reduced corporate income tax rate of 20% on 25% of their annual taxable income up to 3 million CNY[318] Notes to Consolidated Financial Statements This section provides detailed notes on items in the consolidated financial statements, covering assets, liabilities, equity, and income statement accounts Key Items from Consolidated Balance Sheet at Period-End (CNY) | Item | Closing Balance | | :--- | :--- | | Cash and Cash Equivalents | 286,258,083.96 | | Trading Financial Assets | 75,000,000.00 | | Notes Receivable | 71,589,420.53 | | Accounts Receivable | 67,970,396.27 | | Inventories | 286,205,647.15 | | Fixed Assets | 541,588,272.18 | | Construction in Progress | 184,645,723.95 | | Intangible Assets | 139,074,849.07 | | Goodwill | 517,600,671.30 | | Short-term Borrowings | 310,000,000.00 | | Notes Payable | 15,839,387.42 | | Accounts Payable | 71,053,369.56 | | Contract Liabilities | 21,105,271.52 | | Share Capital | 512,625,018.00 | | Capital Reserve | 846,299,636.22 | | Treasury Stock | 101,192,257.35 | | Undistributed Profits | 366,555,157.02 | Key Items from Consolidated Income Statement for the Current Period (CNY) | Item | Current Period Amount | | :--- | :--- | | Total Operating Revenue | 491,142,874.06 | | Total Operating Costs | 448,261,210.66 | | Sales Expenses | 191,003,573.05 | | Administrative Expenses | 34,673,875.06 | | R&D Expenses | 19,155,895.20 | | Finance Expenses | 1,597,915.76 | | Other Income | 3,266,371.35 | | Investment Income | 299,726.03 | | Credit Impairment Loss | 2,302,376.77 | | Net Profit | 38,007,729.88 | | Income Tax Expense | 10,048,595.98 | Key Items from Consolidated Cash Flow Statement for the Current Period (CNY) | Item | Current Period Amount | | :--- | :--- | | Net Cash Flow from Operating Activities | 146,206,331.36 | | Net Cash Flow from Investing Activities | -111,945,665.96 | | Net Cash Flow from Financing Activities | -51,416,896.55 | | Net Increase in Cash and Cash Equivalents | -17,156,231.15 | - At the end of the reporting period, the company's restricted assets primarily consisted of a property maintenance fund of 452,591.62 CNY[500] R&D Expenditures Total R&D investment in H1 2025 was 25.17 million CNY, an increase of 10.42% YoY, with 6.01 million CNY capitalized R&D Expenditure Details (H1 2025) | Item | Current Period Amount (CNY) | Prior Period Amount (CNY) | | :--- | :--- | :--- | | Materials and Testing Fees | 5,566,565.11 | 9,478,079.66 | | Outsourced R&D Expenses | 6,245,997.12 | 1,137,896.99 | | Employee Compensation | 9,628,795.68 | 9,057,598.75 | | Depreciation and Amortization | 1,815,065.81 | 1,956,794.12 | | Office Expenses | 757,655.58 | 467,007.55 | | Other Expenses | 1,155,381.94 | 696,767.46 | | Total | 25,169,461.24 | 22,794,144.53 | | Of which: Expensed R&D | 19,155,895.20 | 21,656,247.54 | | Capitalized R&D | 6,013,566.04 | 1,137,896.99 | - For R&D projects subject to clinical filing or exemption, expenditures are capitalized after the completion of pilot process handover or industrial-scale process validation[630] Changes in Consolidation Scope The company's consolidation scope remained unchanged as there were no business combinations or disposals of subsidiaries - There were no business combinations under non-common control during the reporting period[631] - There were no business combinations under common control during the reporting period[635] - There were no transactions or events leading to a loss of control over subsidiaries during the reporting period[640] Interests in Other Entities This section discloses the company's interests in its subsidiaries, with no significant interests in non-wholly-owned subsidiaries or joint ventures Composition of the Enterprise Group | Subsidiary Name | Registered Capital (CNY) | Principal Place of Business | Business Nature | Ownership (Direct) | | :--- | :--- | :--- | :--- | :--- | | Hainan Haili Pharmaceutical Co, Ltd | 60,000,000.00 | Haikou City | Production & Sales | 100.00% | | Guangdong Teyi Haili Pharmaceutical Co, Ltd | 150,000,000.00 | Taishan City | Sales | 100.00% | | Taishan Xinning Pharmaceutical Co, Ltd | 100,000,000.00 | Taishan City | Production & Sales | 100.00% | | Teyi Drug Research (Guangdong) Co, Ltd | 10,000,000.00 | Taishan City | R&D | 100.00% | | Guangdong Temei Health Technology Industry Co, Ltd | 100,000,000.00 | Taishan City | Investment Management | 100.00% | - The company has no significant non-wholly-owned subsidiaries[644] - The company has no significant interests in joint ventures or associates[647] Government Grants The company recognized 3.27 million CNY in government grants in the current period, primarily recorded as other income - The company had no government grants recognized based on receivable amounts at the end of the reporting period[653] Liability Items Related to Government Grants (Deferred Income) | Account | Opening Balance (CNY) | Decrease in Current Period (CNY) | Closing Balance (CNY) | Asset/Income Related | | :--- | :--- | :--- | :--- | :--- | | Deferred Income | 20,568,580.93 | 1,670,686.86 | 18,897,894.07 | Asset-related | - The total amount of government grants recognized in the current period's profit or loss was 3,266,371.35 CNY, primarily recorded as other income[658] Risks Related to Financial Instruments The company manages credit, liquidity, and market risks by balancing risk and return through established policies - The company's risk management objective is to achieve an appropriate balance between risk and return, minimizing the negative impact of risks on operating performance[658] - Credit risk, mainly from accounts receivable, is mitigated through credit limit management and bad debt provisions, with no significant concentration of credit risk[659] - Liquidity risk is managed by maintaining and monitoring sufficient cash and cash equivalents[662] - The company has no foreign exchange operations and thus no significant exchange rate risk; with zero floating-rate bank borrowings, interest rate risk is not material[664][666] Fair Value Disclosure Assets measured at fair value totaled 88.5 million CNY, primarily comprising bank wealth management products and other equity investments Fair Value of Assets and Liabilities at Period-End | Item | Level 2 Fair Value (CNY) | Level 3 Fair Value (CNY) | Total (CNY) | | :--- | :--- | :--- | :--- | | Bank Wealth Management Products | 75,000,000.00 | 0 | 75,000,000.00 | | Other Equity Instrument Investments | 0 | 13,500,000.00 | 13,500,000.00 | | Total Assets at Fair Value | 75,000,000.00 | 13,500,000.00 | 88,500,000.00 | - The carrying amounts of financial assets and liabilities not measured at fair value are a reasonable approximation of their fair values[672] - The investment in Beijing Tongkanghui Network Technology Co, Ltd is measured at cost as a reasonable estimate of its fair value[671] Related Parties and Related-Party Transactions The ultimate controlling party is the Xu family, and the company had no significant related-party transactions during the period - The company's ultimate controlling party is the Xu family, with major shareholders including Xu Danqing, Xu Songqing, Xu Lifang, and Xu Hengqing, who are related parties[673][674] - The company had no related-party transactions involving the sale or purchase of goods or services during the reporting period[679] - The company had no related-party management/contracting, leasing, guarantees, fund lending, or asset transfers/debt restructuring during the reporting period[681][682][686][688][690] - Key management personnel compensation for the current period amounted to 1,359,222.44 CNY[692] Share-based Payments Under the 2021 stock option plan, 414,807 options were exercised, and the cumulative amount in capital reserve is 4.66 million CNY - During the period, 414,807 stock options were exercised, with a corresponding value of 2,588,395.68 CNY[699] - The cumulative amount of equity-settled share-based payments recognized in the capital reserve is 4,664,994.60 CNY[701] - The company uses the Black-Scholes model to calculate the fair value of options, with parameters including grant date stock price, exercise price, vesting period, historical volatility, risk-free rate, and dividend yield[701][702] - The number of exercisable equity instruments is estimated based on employee stability and the likelihood of achieving performance targets[701] Commitments and Contingencies The company had no significant commitments or contingencies to disclose as of June 30, 2025 - As of June 30, 2025, the company had no significant commitments to disclose[703] - As of June 30, 2025, the company had no significant contingencies, such as pending litigation or external guarantees, to disclose[704] Post-Balance Sheet Events There were no significant post-balance sheet events to disclose as of the financial report's approval date - As of the financial report's approval date, the company had no other significant post-balance sheet events to disclose[708] Other Significant Matters The company had no other significant transactions or events to report for the period - The company had no prior period accounting error corrections during the reporting period[709] - The company had no debt restructuring, asset swaps, annuity plans, discontinued operations, segment information, or other significant transactions affecting investor decisions[713][714][715][716][720] Notes to Parent Company Financial Statements This section provides detailed notes on the parent company's financial statement items, including receivables, investments, and revenue Parent Company Accounts Receivable at Period-End (CNY) | Aging | Closing Book Balance | | :--- | :--- | | Within 1 year | 39,790,566.57 | | 1 to 2 years | 2,878.80 | | Over 3 years | 50,779.80 | | Total | 39,844,225.17 | Parent Company Long-term Equity Investments at Period-End (CNY) | Item | Closing Book Value | | :--- | :--- | | Investments in Subsidiaries | 1,133,214,624.88 | | Total | 1,133,214,624.88 | Parent Company Operating Revenue and Costs (H1 2025) | Item | Revenue (CNY) | Cost (CNY) | | :--- | :--- | :--- | | Main Business | 317,650,340.59 | 134,126,612.12 | | Other Business | 2,282,869.43 | 4,597,450.91 | | Total | 319,933,210.02 | 138,724,063.03 | - The parent company's investment income for the period, amounting to 170,849.32 CNY, was primarily from trading financial assets held during the period[774] Supplementary Information This section provides details on non-recurring items and return on equity, with a weighted average ROE of 2.13% for H1 2025 Details of Non-recurring Profit and Loss for H1 2025 | Item | Amount (CNY) | | :--- | :--- | | Gains/Losses on Disposal of Non-current Assets | -83,374.88 | | Government Grants Recognized in Current Profit/Loss (Excluding those with continuous impact) | 315,474.95 | | Gains/Losses from Entrusted Investments or Asset Management | 299,726.03 | | Other Non-operating Income and Expenses | -610,436.81 | | Less: Income Tax Impact | -1,089.87 | | Total | -77,520.84 | Return on Equity and Earnings Per Share for H1 2025 | Profit for the Period | Weighted Average ROE | Earnings Per Share (Basic/Diluted) (CNY/Share) | | :--- | :--- | :--- | | Net profit attributable to common shareholders | 2.13% | 0.0800 | | Net profit attributable to common shareholders (excluding non-recurring items) | 2.14% | 0.08 | - The company has no differences in net profit or net assets between financial reports prepared under IFRS and Chinese Accounting Standards[777] Other Submitted Data Other Major Social Safety Issues The company and its subsidiaries had no major social safety issues or administrative penalties during the reporting period - The company and its subsidiaries had no other major social safety issues[779] - The company was not subject to administrative penalties during the reporting period[779] Record of Investor Relations Activities The company engaged with various institutions and media through online platforms to discuss its profile and development - During the period, the company engaged with institutions such as Huaan Securities, Bosera Funds, and Jianxin Funds, as well as media outlets[779] - Engagement methods included online meetings and written inquiries, focusing on the company's profile and development[779] Fund Transfers between the Company and Related Parties The company had non-operating fund transfers with a subsidiary, which were fully settled by the period's end Fund Transfers between the Company and Related Parties (CNY 10k) | Counterparty | Nature of Transfer | Opening Balance | Amount Transferred In | Amount Repaid | Closing Balance | | :--- | :--- | :--- | :--- | :--- | :--- | | Guangdong Teyi Haili Pharmaceutical Co, Ltd | Non-operating | 116.29 | 19,913.95 | 20,030.24 | 0 | - These fund transfers are considered normal business transactions, have undergone internal approval processes, and have ensured the safety of company funds[784]