江中药业(600750) - 2025 Q2 - 季度财报

Important Notice The company's board of directors, supervisory board, and senior management guarantee the truthfulness, accuracy, and completeness of the semi-annual report, with no false records, misleading statements, or major omissions - The company's board of directors, supervisory board, and senior management guarantee the truthfulness, accuracy, and completeness of the semi-annual report, with no false records, misleading statements, or major omissions[3] - This semi-annual report has not been audited[5] 2025 Semi-Annual Profit Distribution Plan | Indicator | Content | | :--- | :--- | | Distribution Method | Cash dividend of 5 yuan (tax inclusive) per 10 shares | | Total Distribution Amount | 317.50 million yuan | | Percentage of Net Profit Attributable to Parent Company | 60.78% | | Approval Status | Approved by the Board of Directors, pending approval by the Shareholders' Meeting | Section I Definitions This section provides definitions for key terms used throughout the report, including the reporting period and industry-specific acronyms - The reporting period refers to January 1, 2025, to June 30, 2025[14] - OTC: Over-the-counter drugs, purchasable without a physician's prescription[13] - GMP: Good Manufacturing Practice, a mandatory standard in the pharmaceutical industry[13] Section II Company Profile and Key Financial Indicators This section outlines the company's basic information, contact details, changes in fundamental situation, information disclosure, stock overview, and key financial performance for the first half of 2025 I. Company Information This section provides basic company information for Jiangzhong Pharmaceutical, including its Chinese name, abbreviation, and legal representative - The company's Chinese name is Jiangzhong Pharmaceutical Co., Ltd., and its legal representative is Liu Weiquan[16] II. Contact Person and Contact Information This section provides contact details for the company's Board Secretary and Securities Affairs Representative, including names, addresses, phone numbers, fax, and email - The Board Secretary is Tian Yongjing, and the Securities Affairs Representative is Tang Yang, both reachable at 0791-88169323[17] III. Brief Introduction to Changes in Basic Information This section describes the company's registered address, office address, and website, noting no historical changes to the registered address - The company's registered and office address is No. 788 Torch Avenue, High-tech Zone, Nanchang City, Jiangxi Province, and its website is www.jzjt.com[18](index=18&type=chunk) IV. Brief Introduction to Changes in Information Disclosure and Document Storage Locations This section specifies the company's designated newspapers and website for information disclosure, along with the location for storing semi-annual reports - The company's designated information disclosure newspapers are Shanghai Securities News, China Securities Journal, with the semi-annual report published on www.sse.com.cn[19](index=19&type=chunk) V. Company Stock Overview This section provides information on the company's stock, including its listing exchange, ticker symbol, stock code, and previous ticker symbol - The company's A-shares are listed on the Shanghai Stock Exchange, with the stock abbreviation Jiangzhong Pharmaceutical and stock code 600750[20] VII. Key Accounting Data and Financial Indicators This section presents the company's key accounting data and financial indicators for the first half of 2025, comparing them with the previous year and highlighting a 5.80% increase in net profit attributable to shareholders 2025 Semi-Annual Key Accounting Data | Indicator | Current Period (Jan-Jun) (yuan) | Prior Year (Adjusted) (yuan) | Period-on-Period Change (%) | | :--- | :--- | :--- | :--- | | Operating Revenue | 2,141,118,142.51 | 2,272,613,029.88 | -5.79 | | Total Profit | 703,240,322.65 | 627,823,858.67 | 12.01 | | Net Profit Attributable to Listed Company Shareholders | 522,337,503.28 | 493,690,887.80 | 5.80 | | Net Profit Attributable to Listed Company Shareholders (Excluding Non-Recurring Gains/Losses) | 482,103,086.76 | 471,234,354.53 | 2.31 | | Net Cash Flow from Operating Activities | 651,787,675.27 | 504,971,088.70 | 29.07 | | Net Assets Attributable to Listed Company Shareholders (Period-End) | 3,946,031,763.56 | 3,862,808,649.61 | 2.15 | | Total Assets (Period-End) | 6,635,628,257.43 | 6,507,939,655.60 | 1.96 | 2025 Semi-Annual Key Financial Indicators | Indicator | Current Period (Jan-Jun) | Prior Year (Adjusted) | Period-on-Period Change (%) | | :--- | :--- | :--- | :--- | | Basic Earnings Per Share (yuan/share) | 0.82 | 0.79 | 3.80 | | Diluted Earnings Per Share (yuan/share) | 0.82 | 0.79 | 3.80 | | Basic EPS Excluding Non-Recurring Gains/Losses (yuan/share) | 0.76 | 0.75 | 1.33 | | Weighted Average Return on Net Assets (%) | 12.89 | 11.87 | Increased by 1.02 percentage points | | Weighted Average Return on Net Assets Excluding Non-Recurring Gains/Losses (%) | 11.90 | 11.77 | Increased by 0.13 percentage points | IX. Non-Recurring Gains and Losses and Amounts This section lists the company's non-recurring gains and losses for the first half of 2025, totaling 40.23 million yuan 2025 Semi-Annual Non-Recurring Gains and Losses Items | Non-Recurring Gains and Losses Item | Amount (yuan) | | :--- | :--- | | Gains/losses from disposal of non-current assets | 992.41 | | Government grants included in current profit/loss (excluding those closely related to normal business operations) | 49,026,207.38 | | Gains/losses from changes in fair value of financial assets and liabilities held by non-financial enterprises, and disposal gains/losses | -1,229,232.53 | | Other non-operating income and expenses | 2,373,106.73 | | Other non-recurring gains/losses as defined (personal income tax handling fee refunds) | 698,543.40 | | Less: Income tax impact | 8,125,692.49 | | Minority interest impact (after tax) | 2,509,508.38 | | Total | 40,234,416.52 | - 8.89 million yuan in industrial support funds for plant active ingredient extraction and health food projects were recognized as recurring gains/losses due to their close relation to the company's normal operations, compliance with national policies, and continuous impact on company profit/loss[29] Section III Management Discussion and Analysis This section provides a comprehensive discussion and analysis of the company's operations, industry trends, business segments, and future plans for the first half of 2025 I. Industry and Main Business Overview during the Reporting Period This section details the pharmaceutical industry's development in the first half of 2025, particularly the Traditional Chinese Medicine (TCM) sector, including policy reforms, market trends, and the company's three main business segments: OTC, health consumer products, and prescription drugs (I) Industry Development Overview In the first half of 2025, the pharmaceutical industry deepened reforms under the "three medical" coordinated development framework, with increased national medical insurance coverage, price governance, and refined supervision, while the TCM industry received high attention, promoting centralized procurement and R&D of new TCM drugs - From January to June 2025, the operating revenue of pharmaceutical manufacturing enterprises above designated size was 1.23 trillion yuan, a 1.2% year-on-year decrease, with total profits of 176.69 billion yuan, a 2.8% year-on-year decrease[32] - The National Healthcare Security Administration issued policies, requiring efforts to address participation barriers for flexible employment personnel and consolidate medical insurance benefit levels[33] - The National Medical Products Administration approved 63 Class 1 new drugs, with domestic drugs surpassing imports in proportion; China's innovative drug BD outbound transactions exceeded 50 cases, with a total cooperation value approaching 50 billion USD[36] (II) Main Business Overview The company's main business remains unchanged, encompassing OTC drugs, health consumer products, and prescription drugs, with products covering digestive, intestinal, and throat health, and operating through tender procurement, lean production, and multi-channel sales - The company's main OTC products include Jianwei Xiaoshi Tablets, Lactic Acid Bacteria Tablets, and Compound Caoshanhu Lozenges[38] - Health consumer products are represented by the "Shenlingcao" series (tonic) and "Chuyuan" series (rehabilitation nutrition)[38] - Prescription drugs primarily include Shenbao Capsules, Paishi Granules, and Lumbrokinase Enteric-coated Capsules[38] - In terms of sales models, OTC drugs and health consumer products mainly use distributor coverage, while prescription drugs primarily adopt an agency sales model[42] II. Discussion and Analysis of Operations In the first half of 2025, the company achieved a 5.80% year-on-year increase in net profit attributable to the parent company to 522 million yuan, driven by its "strengthen OTC, develop health consumer products, and strategically position prescription drugs" strategy, brand building, business restructuring, and compliant operations, with continued investment in R&D, intelligent manufacturing, and digitalization, and plans for further reforms, M&A, and product BD in the second half (I) Adhering to Strategic Focus and Enhancing Operational Resilience The company focused on large-scale and strong categories in its OTC business, consolidating its advantages in digestive and intestinal health while expanding into throat, cough, asthma, and tonic/vitamin/mineral categories; health consumer products underwent deep restructuring, focusing on tonic, rehabilitation, and gastrointestinal health; prescription drug business strengthened compliant operations, actively integrated into the new centralized procurement landscape, and developed TCM decoction pieces - OTC business generated 1.55 billion yuan in operating revenue, a 10.14% year-on-year decrease, affected by changes in terminal demand[44] - Health consumer products business achieved 228 million yuan in operating revenue, a 17.35% year-on-year increase, benefiting from e-commerce team building and multi-channel expansion[46] - Prescription drug business generated 360 million yuan in operating revenue, a 7.44% year-on-year increase, through enhanced refined recruitment and academic marketing[46] (II) Cultivating New Productive Forces and Empowering High-Quality Development The company continued to invest in R&D, securing 11 authorized TCM invention patents and establishing innovation consortia with universities, while advancing digital, intelligent, and green transformation in intelligent manufacturing, with Jinsheng Pharmaceutical recognized as an "Advanced Intelligent Factory" in Jiangxi Province, and leveraging digitalization for marketing and R&D project management - During the reporting period, the company obtained 11 authorized TCM invention patents[47] - The company's project, "Patent Analysis and Research on Key Technologies for Innovative Traditional Chinese Medicine of Classic Prescriptions," was approved as a 2025 National Intellectual Property Administration patent special research project[47] - Controlling subsidiary Jinsheng Pharmaceutical was selected for the "2025 Jiangxi Province Advanced Intelligent Factory List"[48] (III) Enhancing Organizational Efficiency and Strengthening Talent Foundation The company upgraded its talent management mechanism, strengthening talent support through a second-phase incentive plan covering 165 core employees (over 50% R&D talent), and optimizing organizational efficiency to support business development - The company completed the initial grant registration for the second-phase incentive plan, covering 165 core employees, with over 50% being R&D talent[48] Second Half Plan In the second half, the company plans to strengthen strategic leadership through integrated brand and communication operations, deepen consumer insights with digital intelligence technology, and stabilize core product market positions, while pursuing external M&A to integrate quality industry resources and enrich its product matrix, accelerating key technology breakthroughs through R&D innovation and national key laboratory construction, and advancing modern factory construction and digital intelligence system implementation for lean production - In the second half, the company will build an integrated brand and communication operation system, optimize media and public relations communication strategies, and deepen consumer insights[49] - The company will continue to use external M&A as a key engine for quality and efficiency improvement, exploring the integration of high-quality industry resources[49] - In R&D innovation, the company will strengthen national key laboratory construction and focus on classic prescriptions and new TCM drug R&D pipeline layout[50] III. Analysis of Core Competitiveness during the Reporting Period The company's core competitiveness remained stable, primarily driven by its strong brand, intelligent manufacturing, R&D innovation, and extensive distribution channels, with "Jiangzhong" and "Chuyuan" recognized as China's well-known trademarks, Jianwei Xiaoshi Tablets consistently ranking first in TCM digestive category, and continuous enhancement of product quality and market competitiveness through digital transformation and national-level R&D platforms - The "Jiangzhong" brand has been on the "China's 500 Most Valuable Brands" list for 22 consecutive years, ranking sixth in the pharmaceutical industry by brand value[52] - Jiangzhong Jianwei Xiaoshi Tablets have ranked first in the Traditional Chinese Medicine digestive category on the "China Non-Prescription Drug Product List" for 21 consecutive years[52] - The company possesses national-level R&D platforms, including the National Key Laboratory of Modern Traditional Chinese Medicine and the National Engineering Research Center for Traditional Chinese Medicine Solid Preparations[53] - The company's products cover over 700,000 retail terminals nationwide and are continuously expanding into O2O platforms and major e-commerce channels like Taobao, JD, and Douyin[54] IV. Major Operating Conditions during the Reporting Period This section analyzes the company's major operating conditions for the first half of 2025, including reasons for changes in financial statement items and the breakdown of main business revenue, costs, and gross profit margins by industry, product, and region (I) Main Business Analysis The company's operating revenue decreased by 5.79% year-on-year, but total profit and net profit attributable to the parent company increased, with net cash flow from operating activities significantly growing by 29.07%, while OTC revenue declined, and health consumer products and prescription drug revenues increased, with revenue growth in East China offsetting declines in other regions Analysis of Changes in Financial Statement Items (2025 Semi-Annual) | Item | Current Period Amount (yuan) | Prior Year Period Amount (yuan) | Change (%) | | :--- | :--- | :--- | :--- | | Operating Revenue | 2,141,118,142.51 | 2,272,613,029.88 | -5.79 | | Operating Cost | 715,154,026.27 | 749,296,097.53 | -4.56 | | Selling Expenses | 636,796,962.47 | 788,572,423.30 | -19.25 | | Administrative Expenses | 97,162,815.49 | 89,676,104.95 | 8.35 | | R&D Expenses | 67,429,291.79 | 68,657,691.64 | -1.79 | | Net Cash Flow from Operating Activities | 651,787,675.27 | 504,971,088.70 | 29.07 | | Net Cash Flow from Investing Activities | -328,023,413.71 | 137,231,172.06 | -339.03 | | Other Income | 58,618,345.54 | 25,271,432.56 | 131.95 | | Credit Impairment Losses | 1,015,738.38 | 23,509,832.65 | -95.68 | | Asset Impairment Losses | 9,673,397.62 | -9,062,775.33 | 206.74 | | Non-Operating Income | 17,804,733.99 | 4,864,140.20 | 266.04 | | Non-Operating Expenses | 15,431,627.26 | 1,177,907.45 | 1,210.09 | Main Business by Product (2025 Semi-Annual) | By Product | Operating Revenue (yuan) | Operating Cost (yuan) | Gross Profit Margin (%) | Year-on-Year Change in Operating Revenue (%) | | :--- | :--- | :--- | :--- | :--- | | OTC Drugs | 1,550,271,538.65 | 369,864,366.27 | 76.14 | -10.14 | | Prescription Drugs | 359,963,542.04 | 204,987,465.01 | 43.05 | 7.44 | | Health Consumer Products & Others | 228,495,056.61 | 139,796,927.85 | 38.82 | 17.35 | Main Business by Region (2025 Semi-Annual) | Region | Operating Revenue (yuan) | Year-on-Year Change in Operating Revenue (%) | | :--- | :--- | :--- | | East China | 887,216,530.08 | 5.87 | | West China | 450,810,174.09 | -11.46 | | South China | 453,669,553.99 | -9.39 | | North China | 347,033,879.14 | -14.77 | V. Other Disclosures This section discloses potential market and policy risks, such as drug centralized procurement, price governance, industry structural adjustments, raw material price and supply risks, and R&D innovation risks, along with corresponding mitigation strategies - The company's products may face dual challenges of declining中标 prices and market share restructuring, with countermeasures including optimizing competitive strategies, strengthening terminal coverage, and academic promotion[70] - Drug price governance leads to cross-regional price comparison pressure in traditional retail channels and pricing space compression on online platforms, prompting the company to improve its price monitoring system and strengthen online-offline price coordination and compliance management[71] - TCM raw material prices may fluctuate significantly due to various factors, and the company will adopt strategies such as comprehensive monitoring, data analysis, proactive planning, and strategic reserves to control costs[72] - Drug R&D involves long cycles and high investment, posing risks of R&D innovation falling short of expectations, which the company addresses by establishing short, medium, and long-term R&D plans and regularly supervising and evaluating R&D projects[74] Section IV Corporate Governance, Environment, and Society This section covers changes in the company's directors, supervisors, and senior management, profit distribution plans, equity incentive schemes, environmental information disclosure, and efforts in poverty alleviation and rural revitalization I. Changes in Directors, Supervisors, and Senior Management This section discloses changes in the company's senior management during the reporting period, primarily concerning the appointment and resignation of the Chief Financial Officer - The company appointed Ms. Zhou Weili as Chief Financial Officer, following the resignation of former CFO Mr. Li Xiaojun due to work changes[76] II. Profit Distribution or Capital Reserve Conversion Plan This section details the company's 2025 semi-annual profit distribution plan, proposing a cash dividend of 5 yuan (tax inclusive) per 10 shares, representing 60.78% of the net profit attributable to the parent company's owners 2025 Semi-Annual Profit Distribution Plan | Indicator | Content | | :--- | :--- | | Distribution Method | Cash dividend of 5 yuan (tax inclusive) per 10 shares | | Total Distribution Amount | 317.50 million yuan | | Percentage of Net Profit Attributable to Parent Company | 60.78% | | Approval Status | Approved by the Board of Directors, pending approval by the Shareholders' Meeting | III. Company Equity Incentive Plans, Employee Stock Ownership Plans, or Other Employee Incentive Measures and Their Impact This section outlines the progress of the company's equity incentive plans, including the repurchase and cancellation of some restricted shares, the unlocking of the second vesting period for the 2021 incentive plan's reserved grant, and the initial grant registration for the second phase of the restricted stock incentive plan - The company repurchased and canceled 149,602 restricted shares[80] - The second vesting period for the 2021 Restricted Stock Incentive Plan's reserved grant was met, unlocking 139,938 shares[81] - The second phase of the Restricted Stock Incentive Plan initially granted 6.128 million shares to 165 grantees[81] IV. Environmental Information of Listed Companies and Their Major Subsidiaries Included in the List of Enterprises Required to Disclose Environmental Information by Law This section lists the environmental information disclosure report indices for the company and its three major subsidiaries: Jiangzhong Pharmaceutical, Jinsheng Pharmaceutical, and Haishi Pharmaceutical - The company and its subsidiaries, Jiangxi Nanchang Jinsheng Pharmaceutical Co., Ltd. and Jincheng Haishi Pharmaceutical Co., Ltd., are included in the list of enterprises required to disclose environmental information by law[83] V. Specific Progress in Consolidating and Expanding Poverty Alleviation Achievements, Rural Revitalization, and Other Work In the first half of 2025, the company actively participated in rural revitalization efforts by promoting industrial development (e.g., Codonopsis pilosula cultivation, study tours), improving livelihoods (e.g., installing AEDs, repairing irrigation canals), and implementing assistance measures (e.g., health village public welfare projects, consumption assistance) to consolidate poverty alleviation achievements, earning recognition as a "2024 Listed Company Rural Revitalization Best Practice Case" - The company in Lianhua County's Baidu Village developed a "one main, four auxiliary" industrial pattern, with Codonopsis pilosula cultivation as the main industry, and provided consumption assistance by purchasing agricultural products worth over 400,000 yuan[85] - The company assisted Jinggangshan CR Hope Town in completing the special improvement project for wasteland reclamation and carried out activities to promote rural civilization[86] - The company, in collaboration with China Resources Pharmaceutical and the China Women's Development Foundation, continued to carry out public welfare projects for healthy villages[87] - The company was awarded the "2024 Listed Company Rural Revitalization Best Practice Case" by the China Association for Public Companies[84] Section V Important Matters This section covers the fulfillment of commitments, non-operating fund occupation by controlling shareholders and related parties, illegal guarantees, major litigation and arbitration, significant related party transactions, and other important matters I. Fulfillment of Commitments This section discloses the fulfillment of commitments made by the company's actual controller, controlling shareholder, and other related parties during or continuing into the reporting period, primarily concerning avoiding horizontal competition, regulating related party transactions, and maintaining the company's independence, with all commitments being timely and strictly fulfilled - China Resources and China Resources Pharmaceutical Holdings committed to avoiding horizontal competition and prioritizing business opportunities for Jiangzhong Pharmaceutical[91] - China Resources and China Resources Pharmaceutical Holdings committed to minimizing and regulating related party transactions, ensuring fair pricing[91] - China Resources and China Resources Pharmaceutical Holdings committed to maintaining separation from Jiangzhong Pharmaceutical in terms of assets, personnel, finance, organization, and business, and not occupying company funds[92] - All commitments were timely and strictly fulfilled[91][92] II. Non-Operating Fund Occupation by Controlling Shareholders and Other Related Parties during the Reporting Period This section states that there was no non-operating fund occupation by controlling shareholders and other related parties during the reporting period III. Irregular Guarantees This section states that there were no external guarantees provided in violation of decision-making procedures during the reporting period VII. Major Litigation and Arbitration Matters This section states that there were no major litigation or arbitration matters for the company during the reporting period X. Significant Related Party Transactions This section discloses the company's related party transactions in daily operations, including purchases and sales of goods, and provision and acceptance of services, and notes matters already disclosed in temporary announcements (I) Related Party Transactions Related to Daily Operations The company engaged in related party transactions for purchasing goods or accepting services with China Resources and its subsidiaries, Jiangyao Group and its subsidiaries, and Jiangzhong Shiliao and its subsidiaries, totaling 12.13 million yuan for the current period, and sold goods to these entities and Jiangxi Bencao Tiangong Technology Co., Ltd., totaling 242.69 million yuan for the current period Related Party Transactions for Purchasing Goods/Accepting Services | Related Party | Related Transaction Content | Current Period Amount (yuan) | Approved Transaction Limit (yuan) | Exceeded Transaction Limit | | :--- | :--- | :--- | :--- | :--- | | China Resources and its subsidiaries | Purchase of goods or acceptance of services | 9,021,041.12 | 25,000,000.00 | No | | Jiangyao Group and its subsidiaries | Purchase of goods or acceptance of services | 2,762,173.15 | 15,000,000.00 | No | | Jiangzhong Shiliao and its subsidiaries | Purchase of goods or acceptance of services | 349,402.36 | 500,000.00 | No | Related Party Transactions for Selling Goods/Providing Services | Related Party | Related Transaction Content | Current Period Amount (yuan) | | :--- | :--- | :--- | | China Resources and its subsidiaries | Sale of goods | 139,237,303.40 | | Jiangyao Group and its subsidiaries | Sale of goods | 103,349,083.52 | | Jiangzhong Shiliao and its subsidiaries | Sale of goods | 85,159.31 | | Jiangxi Bencao Tiangong Technology Co., Ltd. | Sale of goods | 13,550.68 | XIII. Explanation of Other Significant Matters The company plans to participate in the establishment of China Resources Pharmaceutical Industry Investment Fund Phase II, committing 40 million yuan for a 4% stake, with limited liability restricted to its own funds - The company plans to jointly establish China Resources Pharmaceutical (Chengdu) Innovation Investment Fund Partnership (Limited Partnership) with China Resources Pharmaceutical (Chengdu) Enterprise Management Partnership and 10 other limited partners[98] - The fund size is 1 billion yuan, with the company as a limited partner committing 40 million yuan, holding a 4% stake[98] Section VI Changes in Shares and Shareholder Information This section details the company's share capital changes during the reporting period, including increases and decreases in restricted and unrestricted shares, and specific reasons for changes in restricted shares, along with shareholder information at the end of the reporting period I. Changes in Share Capital This section details the company's share capital changes during the reporting period, including increases and decreases in restricted and unrestricted tradable shares, and specific reasons and circumstances for changes in restricted shares (I) Share Capital Change Table The company's total share capital increased from 629.02 million shares at the beginning of the period to 635.00 million shares at the end of the period, primarily due to the initial grant of the second phase of the restricted stock incentive plan Share Capital Change Table (2025 Semi-Annual) | Share Category | Quantity Before Change (shares) | Proportion Before Change (%) | Increase/Decrease in Current Change (shares) | Quantity After Change (shares) | Proportion After Change (%) | | :--- | :--- | :--- | :--- | :--- | :--- | | I. Restricted Shares | 1,865,146 | 0.30 | +5,838,460 | 7,703,606 | 1.21 | | II. Unrestricted Tradable Shares | 627,152,478 | 99.70 | +139,938 | 627,292,416 | 98.79 | | III. Total Shares | 629,017,624 | 100 | +5,978,398 | 634,996,022 | 100 | (II) Changes in Restricted Shares During the reporting period, the company's restricted shares decreased by 149,602 shares due to the repurchase and cancellation of some restricted shares, and by 139,938 shares due to the unlocking of the 2021 incentive plan's reserved grant, while increasing by 6.128 million shares due to the initial grant of the second phase incentive plan Changes in Restricted Shares (2025 Semi-Annual) | Shareholder Name | Restricted Shares at Period Start (shares) | Unlocked Shares in Reporting Period (shares) | Increased Restricted Shares in Reporting Period (shares) | Restricted Shares at Period End (shares) | Reason for Restriction | | :--- | :--- | :--- | :--- | :--- | :--- | | 2021 Restricted Stock Incentive Plan First Grantee | 1,569,017 | 133,335 | 0 | 1,435,682 | Equity Incentive | | 2021 Restricted Stock Incentive Plan Reserved Grantee | 296,129 | 156,205 | 0 | 139,924 | Equity Incentive | | Second Phase Restricted Stock Incentive Plan First Grantee | 0 | 0 | 6,128,000 | 6,128,000 | Equity Incentive | - The company repurchased and canceled 149,602 restricted shares in May 2025[102] - In May 2025, 139,938 shares from the second vesting period of the 2021 Restricted Stock Incentive Plan's reserved grant were unlocked[102] II. Shareholder Information This section discloses the total number of shareholders at the end of the reporting period, the shareholding status of the top ten shareholders and top ten unrestricted tradable share shareholders, and the number and conditions of restricted shares held by the top ten restricted shareholders - As of the end of the reporting period, the total number of common shareholders was 39,013 households[106] Top Ten Shareholders' Shareholding (2025 Semi-Annual) | Shareholder Name | Shares Held at Period End (shares) | Proportion (%) | Share Status | Quantity (shares) | | :--- | :--- | :--- | :--- | :--- | | China Resources Jiangzhong Pharmaceutical Group Co., Ltd. | 272,010,336 | 42.84 | Unrestricted | 0 | | Orient Securities Co., Ltd. | 18,508,615 | 2.91 | Frozen | 17,609,515 | | National Social Security Fund 115 Portfolio | 17,300,000 | 2.72 | Unrestricted | 0 | | Central Huijin Asset Management Co., Ltd. | 15,551,120 | 2.45 | Unrestricted | 0 | | Industrial and Commercial Bank of China - GF Stable Growth Securities Investment Fund | 15,000,000 | 2.36 | Unrestricted | 0 | Top Ten Restricted Shareholders' Shareholding and Restriction Conditions (2025 Semi-Annual) | No. | Restricted Shareholder Name | Number of Restricted Shares Held (shares) | Restriction Conditions | | :--- | :--- | :--- | :--- | | 1 | Liu Weiquan | 192,000 | Equity Incentive | | 2 | Liu Lixin | 138,334 | Equity Incentive | | 3 | Luo Xiaorong | 138,334 | Equity Incentive | | 4 | Xiao Wenbin | 106,000 | Equity Incentive | | 5 | Xu Yongqian | 101,000 | Equity Incentive | III. Directors, Supervisors, and Senior Management Information This section discloses the shareholding changes of current and resigned directors, supervisors, and senior management during the reporting period, as well as their equity incentive grants Shareholding Changes of Directors, Supervisors, and Senior Management (2025 Semi-Annual) | Name | Position | Shares Held at Period Start (shares) | Shares Held at Period End (shares) | Change in Shares during Reporting Period (shares) | Reason for Change | | :--- | :--- | :--- | :--- | :--- | :--- | | Liu Weiquan | Chairman | 219,000 | 338,000 | 119,000 | Equity Incentive | | Xu Yongqian | Director | 69,666 | 170,666 | 101,000 | Equity Incentive | | Liu Lixin | Director | 116,667 | 196,667 | 80,000 | Equity Incentive | | Xiao Wenbin | General Manager | 96,300 | 171,300 | 75,000 | Equity Incentive | | Tian Yongjing | Board Secretary | 71,000 | 121,000 | 50,000 | Equity Incentive | | Zhou Weili | Chief Financial Officer | 44,000 | 84,000 | 40,000 | Equity Incentive | Equity Incentive Grants to Directors, Supervisors, and Senior Management (2025 Semi-Annual) | Name | Position | Restricted Shares Held at Period Start (shares) | New Restricted Shares Granted in Reporting Period (shares) | Restricted Shares Held at Period End (shares) | | :--- | :--- | :--- | :--- | :--- | | Liu Weiquan | Chairman | 73,000 | 119,000 | 192,000 | | Xu Yongqian | Director | 0 | 101,000 | 101,000 | | Liu Lixin | Director | 58,334 | 80,000 | 138,334 | | Xiao Wenbin | General Manager | 31,000 | 75,000 | 106,000 | | Tian Yongjing | Board Secretary | 23,667 | 50,000 | 73,667 | | Zhou Weili | Chief Financial Officer | 22,000 | 40,000 | 62,000 | Section VII Bond-Related Information This section confirms that the company had no corporate bonds (including enterprise bonds) or non-financial enterprise debt financing instruments during the reporting period - During the reporting period, the company had no corporate bonds (including enterprise bonds) or non-financial enterprise debt financing instruments[118] - During the reporting period, the company had no convertible corporate bonds[118] Section VIII Financial Report This section presents the company's unaudited financial statements for the first half of 2025, including balance sheets, income statements, cash flow statements, and statements of changes in owners' equity, along with detailed notes on accounting policies, tax items, and financial statement items I. Audit Report This section states that this semi-annual report has not been audited II. Financial Statements This section provides the company's consolidated and parent company balance sheets, income statements, cash flow statements, and statements of changes in owners' equity for the first half of 2025 Consolidated Balance Sheet As of June 30, 2025, the company's consolidated total assets were 6.636 billion yuan, total liabilities were 2.057 billion yuan, and total owners' equity was 4.578 billion yuan Parent Company Balance Sheet As of June 30, 2025, the parent company's total assets were 5.806 billion yuan, total liabilities were 1.907 billion yuan, and total owners' equity was 3.899 billion yuan Consolidated Income Statement For the first half of 2025, the company's consolidated total operating revenue was 2.141 billion yuan, net profit was 559.42 million yuan, and net profit attributable to parent company shareholders was 522.34 million yuan Parent Company Income Statement For the first half of 2025, the parent company's operating revenue was 1.017 billion yuan, and net profit was 511.27 million yuan Consolidated Cash Flow Statement For the first half of 2025, the company's consolidated net cash flow from operating activities was 651.79 million yuan, net cash flow from investing activities was -328.02 million yuan, and net cash flow from financing activities was -374.83 million yuan Parent Company Cash Flow Statement For the first half of 2025, the parent company's net cash flow from operating activities was 479.25 million yuan, net cash flow from investing activities was -219.21 million yuan, and net cash flow from financing activities was -328.33 million yuan Consolidated Statement of Changes in Owners' Equity For the first half of 2025, the company's consolidated total owners' equity increased by 106.51 million yuan, with an ending balance of 4.578 billion yuan Parent Company Statement of Changes in Owners' Equity For the first half of 2025, the parent company's total owners' equity increased by 72.78 million yuan, with an ending balance of 3.899 billion yuan III. Company Basic Information This section provides an overview of Jiangzhong Pharmaceutical's registration information, listing status, headquarters address, business scope, and ultimate controlling party - The company was listed on the Shanghai Stock Exchange on August 29, 1996, primarily engaged in the production and sale of pharmaceuticals and health products[149] - The ultimate parent company of the Group is China Resources Co., Ltd., established in China[149] IV. Basis of Financial Statement Preparation This section states that the company's financial statements are prepared on a going concern basis and comply with the Accounting Standards for Business Enterprises issued by the Ministry of Finance and the information disclosure requirements of the China Securities Regulatory Commission - The company prepares its financial statements on a going concern basis and possesses the ability to continue as a going concern[151][152] - The financial statements comply with the Accounting Standards for Business Enterprises and the requirements of CSRC's "Information Disclosure Compilation Rules for Companies Issuing Securities to the Public No. 15"[154] V. Significant Accounting Policies and Accounting Estimates This section details the significant accounting policies and estimates followed by the company in preparing its financial statements, covering business combinations, financial instruments, inventories, fixed assets, intangible assets, revenue recognition, government grants, deferred income tax, and leases 11. Financial Instruments This section elaborates on the company's recognition, initial measurement, classification, and subsequent measurement methods for financial instruments, as well as impairment accounting for financial assets, including the measurement of expected credit losses and criteria for bad debt provision - Financial assets are classified as measured at amortized cost, at fair value through other comprehensive income, or at fair value through profit or loss[170] - The company performs impairment accounting for financial assets measured at amortized cost, debt investments measured at fair value through other comprehensive income, and lease receivables, based on expected credit losses[181] - For notes receivable, accounts receivable, and financing receivables arising from daily operating activities such as sales of goods and provision of services, the company consistently measures loss provisions at an amount equal to the expected credit losses over the entire lifetime[183] 16. Inventories This section describes the company's inventory classification, valuation method for issuance (weighted average method at month-end), inventory system (perpetual inventory system), and criteria and methods for recognizing and providing for inventory impairment - Inventories include raw materials, work-in-progress, finished goods, self-made semi-finished products, revolving materials, entrusted processing materials, and goods in transit[199] - The actual cost of issued inventories is measured using the weighted average method at month-end[201] - On the balance sheet date, inventories are measured at the lower of cost and net realizable value, with provision made for inventory impairment[204] 21. Fixed Assets This section outlines the recognition criteria for fixed assets, the composition of initial cost, and depreciation methods, including depreciation periods, residual value rates, and annual depreciation rates for buildings, machinery, transportation equipment, office equipment, and other categories - The initial cost of purchased fixed assets includes the purchase price, related taxes, and expenditures incurred to bring the asset to its intended usable condition[214] Fixed Asset Depreciation Methods | Category | Depreciation Method | Depreciation Period (years) | Residual Value Rate | Annual Depreciation Rate | | :--- | :--- | :--- | :--- | :--- | | Buildings and Structures | Straight-line method | 20-45 | 0-5% | 2.11%-5.00% | | Machinery and Equipment | Straight-line method | 10-15 | 0-5% | 6.33%-10.00% | | Transportation Equipment | Straight-line method | 4-10 | 0-5% | 9.50%-25.00% | | Office Equipment | Straight-line method | 3-5 | 0-5% | 19.00%-33.33% | | Other | Straight-line method | 5-15 | 0-5% | 6.33%-20.00% | 26. Intangible Assets This section describes the amortization methods and useful life determination for intangible assets with finite useful lives, and differentiates the accounting treatment for research and development expenditures during the research and development phases Intangible Asset Useful Life and Amortization Methods | Item | Useful Life (years) | Basis for Determination | Amortization Method | | :--- | :--- | :--- | :--- | | Land Use Rights | 50 | Shortest of estimated useful life, contractually stipulated benefit period, and legally stipulated effective period | Straight-line method | | Software Use Rights | 5 | Shortest of estimated useful life, contractually stipulated benefit period, and legally stipulated effective period | Straight-line method | | Non-Patent Technology | 10 | Shortest of estimated useful life, contractually stipulated benefit period, and legally stipulated effective period | Straight-line method | | Patent Rights | 10 | Shortest of estimated useful life, contractually stipulated benefit period, and legally stipulated effective period | Straight-line method | | Trademark Rights | 10 | Shortest of estimated useful life, contractually stipulated benefit period, and legally stipulated effective period | Straight-line method | - Expenditures during the research phase of internal R&D projects are recognized as current profit or loss when incurred[224] - Expenditures during the development phase are capitalized if technically and commercially feasible, with sufficient resources and intent to complete development, and reliably measurable[224] 34. Revenue This section outlines the company's accounting policies for revenue recognition and measurement, including identifying performance obligations, determining transaction prices, timing of revenue recognition, and accounting treatment for sales returns and rebates - The company recognizes revenue when it satisfies a performance obligation in the contract, i.e., when the customer obtains control of the related goods or services[240] - For sales with a right of return, the company recognizes revenue when the customer obtains control of the related goods, at an amount that does not include the expected amount to be returned due to sales returns[242] - Revenue from the sale of pharmaceuticals is recognized when control of the goods has been transferred to the customer, typically when the pharmaceuticals are delivered to the customer's designated warehouse or handed over to the carrier[243] VI. Taxes This section discloses the main tax categories and rates applicable to the company and its subsidiaries, along with detailed explanations of tax incentives enjoyed, such as corporate income tax benefits for high-tech enterprises and simplified VAT collection for biological products Main Tax Categories and Rates | Tax Category | Tax Rate | | :--- | :--- | | Value-Added Tax | 3% (simplified collection), 6%, 9%, 13% | | Consumption Tax | 20% plus 0.5 yuan/500g (or 500ml) | | Urban Maintenance and Construction Tax | 1%, 5%, 7% | | Education Surcharge | 3% | | Local Education Surcharge | 2% | | Corporate Income Tax | 15%, 20%, 25% | - The company and its subsidiary, Jiangxi Jiangzhong Traditional Chinese Medicine Decoction Pieces Co., Ltd., enjoy a 15% preferential tax rate as high-tech enterprises[264] - Subsidiary Jincheng Haishi Pharmaceutical Co., Ltd.'s Befida products are subject to a simplified VAT collection method at a 3% levy rate[263] VII. Notes to Consolidated Financial Statement Items This section provides detailed notes for each item in the consolidated financial statements, including cash and bank balances, notes receivable, accounts receivable, inventories, fixed assets, construction in progress, intangible assets, goodwill, deferred income tax assets/liabilities, notes payable, contract liabilities, employee compensation payable, taxes payable, other payables, deferred income, share capital, capital reserves, treasury stock, undistributed profits, operating revenue and costs, selling expenses, administrative expenses, R&D expenses, financial expenses, other income, investment income, fair value change gains, credit impairment losses, asset impairment losses, asset disposal gains, non-operating income and expenses, income tax expenses, cash flow statement items, and leases 1. Cash and Bank Balances As of June 30, 2025, the company's cash and bank balances amounted to 1.529 billion yuan, an increase of 51.78% from the beginning of the period, primarily due to an increase in bank large-denomination certificates of deposit maturing within one year Cash and Bank Balances Composition | Item | Period-End Balance (yuan) | Period-Start Balance (yuan) | | :--- | :--- | :--- | | Bank Deposits | 1,528,416,155.18 | 995,106,508.05 | | Other Cash and Bank Balances | 539,102.60 | 12,272,992.69 | | Total | 1,528,955,257.78 | 1,007,379,500.74 | - The period-end balance of bank time deposits was 2.515 billion yuan, of which 1.356 billion yuan were time deposits maturing within one year[267] - There were no restricted cash and bank balances at the period-end[268] 5. Accounts Receivable As of June 30, 2025, the company's accounts receivable had a period-end book balance of 525.09 million yuan, with a bad debt provision of 24.71 million yuan, resulting in a book value of 500.38 million yuan, where bad debt provisions are mainly calculated by portfolio, and the top five debtors at period-end are disclosed Accounts Receivable by Aging | Aging | Period-End Book Balance (yuan) | | :--- | :--- | | Within 1 year | 513,085,505.69 | | 1 to 2 years | 6,004,458.52 | | 2 to 3 years | 4,337,237.93 | | Over 3 years | 1,661,713.63 | | Total | 525,088,915.77 | Accounts Receivable Classified by Bad Debt Provision Method | Category | Book Balance (yuan) | Proportion (%) | Bad Debt Provision (yuan) | Provision Rate (%) | Book Value (yuan) | | :--- | :--- | :--- | :--- | :--- | :--- | | Provision for bad debts on an individual basis | 6,339,615.33 | 1.21 | 6,339,615.33 | 100.00 | 0.00 | | Provision for bad debts on a portfolio basis | 518,749,300.44 | 98.79 | 18,373,132.79 | 3.54 | 500,376,167.65 | | Total | 525,088,915.77 | / | 24,712,748.12 | / | 500,376,167.65 | Top Five Accounts Receivable by Debtor at Period-End | Entity Name | Accounts Receivable Period-End Balance (yuan) | Proportion of Total Accounts Receivable and Contract Assets Period-End Balance (%) | Bad Debt Provision Period-End Balance (yuan) | | :--- | :--- | :--- | :--- | | Jiangxi University of Traditional Chinese Medicine Affiliated Hospital | 168,515,065.47 | 32.09 | 5,055,451.96 | | Jiangxi Hailiqi Pharmaceutical Co., Ltd. | 29,202,400.00 | 5.56 | 876,072.00 | | Fengwoda Pharmaceutical Logistics (Hunan) Co., Ltd. | 12,645,223.82 | 2.41 | 379,356.71 | | Jiangxi Nanhua (Shanghai Pharma) Pharmaceutical Co., Ltd. | 10,053,194.04 | 1.91 | 301,595.82 | | Henan Mulan Pharmaceutical Co., Ltd. | 9,282,622.10 | 1.77 | 278,478.66 | 10. Inventories As of June 30, 2025, the company's inventories had a period-end book value of 510.13 million yuan, an increase from the beginning of the period, primarily comprising raw materials, finished goods, and revolving materials, with 22.81 million yuan in inventory impairment provision reversed during the current period Inventory Classification (2025 Semi-Annual) | Item | Book Balance (yuan) | Inventory Impairment Provision/Contract Performance Cost Impairment Provision (yuan) | Book Value (yuan) | | :--- | :--- | :--- | :--- | | Raw Materials | 255,448,930.72 | 41,396,304.11 | 214,052,626.61 | | Work-in-Progress | 8,859,126.07 | 7,408.30 | 8,851,717.77 | | Finished Goods | 272,192,329.02 | 7,643,572.08 | 264,548,756.94 | | Revolving Materials | 15,584,554.79 | 2,454,768.92 | 13,129,785.87 | | Entrusted Processing Materials | 494,460.56 | 0 | 494,460.56 | | Goods in Transit | 9,048,100.52 | 0 | 9,048,100.52 | | Total | 561,627,501.68 | 51,502,053.41 | 510,125,448.27 | Changes in Inventory Impairment Provision and Contract Performance Cost Impairment Provision | Item | Period-Start Balance (yuan) | Provision in Current Period (yuan) | Reversal or Write-off in Current Period (yuan) | Period-End Balance (yuan) | | :--- | :--- | :--- | :--- | :--- | | Raw Materials | 58,228,618.37 | 414,923.96 | 17,247,238.22 | 41,396,304.11 | | Work-in-Progress | 0 | 7,408.30 | 0 | 7,408.30 | | Finished Goods | 10,963,161.09 | 2,214,497.43 | 5,534,086.44 | 7,643,572.08 | | Revolving Materials | 2,480,067.09 | 0 | 25,298.17 | 2,454,768.92 | | Total | 71,671,846.55 | 2,636,829.69 | 22,806,622.83 | 51,502,053.41 | 22. Construction in Progress As of June 30, 2025, the company's construction in progress had a period-end balance of 141.69 million yuan, an increase of 42.67% from the beginning of the period, primarily due to increased investment in the Jinjiang Industrial Park project Construction in Progress Overview | Item | Period-End Balance (yuan) | Period-Start Balance (yuan) | | :--- | :--- | :--- | | Construction in Progress | 141,690,842.66 | 99,313,382.54 | | Total | 141,690,842.66 | 99,313,382.54 | Changes in Important Construction in Progress Projects during the Current Period | Project Name | Budget (yuan) | Period-Start Balance (yuan) | Amount Increased in Current Period (yuan) | Amount Transferred to Fixed Assets in Current Period (yuan) | Period-End Balance (yuan) | | :--- | :--- | :--- | :--- | :--- | :--- | | Jiangzhong Sci-Tech City Modern TCM Production Base Phase I | 616,000,000.00 | 4,568,673.92 | 866,491.30 | 4,800,580.84 | 634,584.38 | | Jinjiang Industrial Park Project | 400,000,000.00 | 68,772,339.91 | 50,035,502.73 | 0 | 118,807,842.64 | 38. Contract Liabilities As of June 30, 2025, the company's contract liabilities had a period-end balance of 140.94 million yuan, a decrease of 51.15% from the beginning of the period, primarily due to a reduction in received advance payments for goods Contract Liabilities Overview | Item | Period-End Balance (yuan) | Period-Start Balance (yuan) | | :--- | :--- | :--- | | Within 1 year | 136,378,465.60 | 282,935,666.66 | | Over 1 year | 4,556,667.13 | 5,545,779.25 | | Total | 140,935,132.73 | 288,481,445.91 | - Contract liabilities at period-end decreased by 147.55 million yuan, a 51.15% decrease from the end of the previous year, mainly due to a reduction in received advance payments for goods[64] 61. Operating Revenue and Operating Cost For the first half of 2025, the company's consolidated operating revenue was 2.141 billion yuan, and operating cost was 715.15 million yuan, with revenue typically recognized when goods are delivered to the customer's designated warehouse or handed over to the carrier Operating Revenue and Operating Cost Overview | Item | Current Period Revenue (yuan) | Current Period Cost (yuan) | Prior Period Revenue (yuan) | Prior Period Cost (yuan) | | :--- | :--- | :--- | :--- | :--- | | Main Business | 2,138,730,137.30 | 714,648,759.13 | 2,254,996,965.59 | 740,435,946.35 | | Other Business | 2,388,005.21 | 505,267.14 | 17,616,064.29 | 8,860,151.18 | | Total | 2,141,118,142.51 | 715,154,026.27 | 2,272,613,029.88 | 749,296,097.53 | - The company typically collects payments from some customers through advance receipts, with contract prices usually due within 3 months after goods delivery[401] 78. Cash Flow Statement Items This section details cash flow items related to operating, investing, and financing activities, including other cash received and paid related to operating activities, cash recovered from and used for purchasing wealth management products and large-denomination certificates of deposit, and various cash payments in financing activities Other Cash Received Related to Operating Activities | Item | Current Period Amount (yuan) | Prior Period Amount (yuan) | | :--- | :--- | :--- | | Demand deposit interest income, government grants, and others | 79,528,800.26 | 112,660,528.99 | | Non-operating income | 682,690.08 | 3,309,860.18 | | Total | 80,211,490.34 | 115,970,389.17 | Important Cash Received Related to Investing Activities | Item | Current Period Amount (yuan) | Prior Period Amount (yuan) | | :--- | :--- | :--- | | Recovery of wealth management products | 627,000,000.00 | 180,000,000.00 | | Recovery of large-denomination certificate of deposit principal | 120,000,000.00 | 495,000,000.00 | | Total | 747,000,000.00 | 675,000,000.00 | Important Cash Paid Related to Investing Activities | Item | Current Period Amount (yuan) | Prior Period Amount (yuan) | | :--- | :--- | :--- | | Purchase of large-denomination certificates of deposit | 220,854,031.58 | 354,684,872.28 | | Purchase of wealth management products | 767,000,000.00 | 130,000,000.00 | |