尔康制药(300267) - 2025 Q2 - 季度财报

Part I Important Notice, Table of Contents, and Definitions This section provides essential disclaimers, outlines the report's structure, and defines key terms for clarity Important Notice The company's board, supervisory board, and senior management guarantee the truthfulness, accuracy, and completeness of the semi-annual report, and the financial report - The company's board of directors, supervisory board, and senior management guarantee the truthfulness, accuracy, and completeness of the semi-annual report content[3] - The company's responsible person, head of accounting work, and head of accounting department declare and guarantee the truthfulness, accuracy, and completeness of the financial report[3] - The company plans not to distribute cash dividends, bonus shares, or convert capital reserves into share capital for the semi-annual period[4] Table of Contents This section lists the overall structure of the report, including eight main chapters covering company operations and financial aspects - The report is divided into eight main chapters, covering various aspects of the company's operations and finances[6] Definitions This section provides definitions for common terms and abbreviations of the company and its main subsidiaries used in the report to ensure clear understanding - This section defines the company, subsidiaries, and key terms such as "Company," "Erkang Pharmaceutical," and "Reporting Period" involved in the report[9] Part II Company Profile and Key Financial Indicators This section presents the company's fundamental information and a summary of its key financial performance metrics 1. Company Profile This section introduces the company's basic information, including stock abbreviation, code, listing exchange, Chinese and English names, and legal representative Company Basic Information | Indicator | Content | | :--- | :--- | | Stock Abbreviation | Erkang Pharmaceutical | | Stock Code | 300267 | | Listing Stock Exchange | Shenzhen Stock Exchange | | Chinese Name | Hunan Erkang Pharmaceutical Co., Ltd. | | Legal Representative | Sun Qingrong | 2. Contact Persons and Information This section provides contact information for the company's Board Secretary and Securities Affairs Representative, including names, addresses, phone numbers, faxes, and email addresses - The company's Board Secretary is Gu Jishun, and the Securities Affairs Representative is Wang Rong, with the contact address for both being No. 1 Industrial Road, Kaiyuan Avenue, North Park, Liuyang Economic Development Zone, Changsha City[12] 3. Other Information During the reporting period, there were no changes in the company's registered address, office address, website, email, information disclosure and document storage locations, or registration status - The company's contact information, information disclosure and document storage locations, and registration status remained unchanged during the reporting period[13][14][15] 4. Key Accounting Data and Financial Indicators This section discloses the company's key accounting data and financial indicators for the first half of 2025, showing a 9.74% year-over-year increase in operating revenue, a significant 497.36% increase in net profit attributable to shareholders, but a 64.08% year-over-year decrease in net cash flow from operating activities Key Accounting Data and Financial Indicators (Current Reporting Period vs. Prior Year Period) | Indicator | Current Reporting Period (RMB) | Prior Year Period (RMB) | Year-over-year Change | | :--- | :--- | :--- | :--- | | Operating Revenue | 681,881,688.38 | 621,346,708.93 | 9.74% | | Net Profit Attributable to Shareholders of the Listed Company | 37,634,642.58 | 6,300,155.19 | 497.36% | | Net Profit Attributable to Shareholders of the Listed Company After Deducting Non-recurring Gains and Losses | 33,018,734.45 | 2,264,705.88 | 1,357.97% | | Net Cash Flow from Operating Activities | 45,842,247.53 | 127,628,976.65 | -64.08% | | Basic Earnings Per Share (RMB/share) | 0.0182 | 0.0031 | 487.10% | | Diluted Earnings Per Share (RMB/share) | 0.0182 | 0.0031 | 487.10% | | Weighted Average Return on Net Assets | 0.85% | 0.13% | 0.72% | | Total Assets (Period-end) | 5,049,890,880.73 | 5,199,734,491.19 (Prior Year-end) | -2.88% | | Net Assets Attributable to Shareholders of the Listed Company (Period-end) | 4,469,540,895.52 | 4,447,425,532.36 (Prior Year-end) | 0.50% | 5. Differences in Accounting Data Under Domestic and Overseas Accounting Standards During the reporting period, the company had no differences in net profit and net assets disclosed under International Accounting Standards or overseas accounting standards compared to Chinese Accounting Standards - The company had no differences in accounting data under domestic and overseas accounting standards during the reporting period[17][18] 6. Non-recurring Gains and Losses Items and Amounts This section lists the company's non-recurring gains and losses items and their amounts for the reporting period, totaling RMB 4.62 million, primarily including gains/losses from disposal of non-current assets, government grants, and entrusted investment gains/losses Non-recurring Gains and Losses Items and Amounts | Item | Amount (RMB) | | :--- | :--- | | Gains and Losses from Disposal of Non-current Assets | 323,099.98 | | Government Grants Recognized in Current Profit or Loss | 1,334,436.61 | | Gains and Losses from Entrusted Investments or Asset Management | 2,898,851.97 | | Other Non-operating Income and Expenses Apart from the Above | -58,665.88 | | Less: Income Tax Impact | -98,574.01 | | Impact on Minority Interests (after tax) | -19,611.44 | | Total | 4,615,908.13 | Part III Management Discussion and Analysis This section provides an in-depth analysis of the company's business operations, financial performance, and strategic outlook 1. Principal Business Activities During the Reporting Period The company's main business covers the production and sales of excipients, APIs, finished drugs, and new energy materials, with stable pharmaceutical performance and significant new energy growth - The company's main business includes the production and sales of excipients, APIs, finished drugs, and new energy materials[23] - In the first half of 2025, the company's pharmaceutical industry performance remained relatively stable, while the new energy industry performance significantly increased year-over-year[33] - The company officially launched the Tanzania comprehensive formulation production project, planning to invest USD 10 million to expand its business reach and create new profit growth points[52] - The Nigerian first beneficiation plant continuously increased capacity, with daily raw ore processing capacity and overall lithium recovery rate further improved during the reporting period, achieving new energy sector operating revenue of RMB 126.60 million[53] 1.1. General Situation The company's business covers pharmaceutical excipients, active pharmaceutical ingredients, finished drugs, and new energy materials production and sales - The company is the supporting unit for the National Engineering Research Center for Pharmaceutical Excipients, with a product line covering pharmaceutical solvents, stabilizers, sucrose, starch, starch capsules, and compound excipients[24] - The company's main API products are sulfadiazine and resorcinol[26] - The finished drug business involves production and circulation, with products including antibacterial, hemostatic, antitussive, and antiasthmatic injections, as well as traditional Chinese medicines for kidney disease, stomach ailments, and nourishing and calming purposes[27] - The company's new energy material varieties are primarily lithium carbonate and spodumene concentrate, continuously expanding its upstream layout in the lithium carbonate industry chain[28] 1.2. Business Model The company adopts a "production-to-order" model, with procurement handled by the supply department and business unit procurement centers, implementing proactive stocking strategies to counter rising raw material prices, and sales are primarily direct, supplemented by distribution - The company adopts a "production-to-order" model for production planning, with the quality department supervising and inspecting the production process[30] - The procurement model is managed by the supply department and various business unit procurement centers, which monitor market conditions and adjust procurement strategies accordingly[31] - The company's products are sold primarily through direct sales, supplemented by distribution[32] 1.3. Performance Drivers The company's performance is primarily driven by product structure optimization and sales model improvements in the pharmaceutical industry, as well as the commissioning, production process improvements, and capacity enhancements of the Nigerian beneficiation plant in the new energy industry - The company maintained stable performance in the pharmaceutical industry by optimizing its sales organizational structure, improving sales models, and adjusting product structure[33] - Following the commissioning of Erkang Mining's first beneficiation plant in Nigeria, production efficiency and output continuously improved through enhanced production processes, strengthened management, and training, driving significant performance growth in the new energy industry[33] 1.4. Industry Overview The pharmaceutical industry faces overall pressure but policy dividends are accelerating, with the pharmaceutical excipient industry moving towards high-quality development, and long-term energy storage demand expected to be the main engine for new energy materials - In the first half of 2025, operating revenue in the pharmaceutical manufacturing industry decreased by 1.2% year-over-year, and total profit decreased by 2.8% year-over-year, indicating overall industry pressure[34] - Guided by policies, the pharmaceutical excipient industry is developing towards "high standards, strong innovation, and rapid integration," with technological innovation and domestic substitution as core drivers[36] - In the first half of 2025, lithium carbonate prices fluctuated sharply, but China's lithium battery shipments increased by 68% year-over-year, with power batteries growing by 49% and energy storage batteries by 128%[37][38] - Pharmaceutical industry policies supporting innovative drug development will stimulate demand for high-end excipients, promote industry quality upgrades, and accelerate industry differentiation[39] - AI technology is expected to profoundly reshape the pharmaceutical excipient field, enabling efficient and intelligent screening and formulation optimization[43] - The new energy materials industry faces short-term capacity rationalization, but in the long term, driven by new energy vehicles and energy storage demand, core industry competition will shift towards resource endowment and technological barriers[45] 1.5. Company's Industry Position The company holds a significant position in the pharmaceutical excipient industry with 127 varieties covering common excipients and a national-level research platform, demonstrating strong market scale and R&D capabilities, and aims to become a high-quality new energy material supplier through its overseas lithium mine resource布局 - The company possesses 127 pharmaceutical excipient varieties, accounting for 32.87% of the varieties included in the "Chinese Pharmacopoeia" (2025 edition), essentially covering all commonly used pharmaceutical excipient varieties[48] - The company owns national-level scientific research platforms such as the "National Engineering Research Center for Pharmaceutical Excipients" and actively participates in the revision and establishment of pharmaceutical excipient standards[48] - Erkang Mining, the company's wholly-owned subsidiary in Nigeria, has officially commenced operation of its beneficiation plant project, striving to become a "high-quality new energy material supplier"[49] 1.6. Business Operations In the first half of 2025, the company deepened its focus on pharmaceutical excipients, strengthened quality control and customer service; expanded into the African Tanzania pharmaceutical market by launching a comprehensive formulation production project; achieved stable production and increased efficiency in the new energy sector, improving daily raw ore processing capacity and overall lithium recovery rate; and strengthened talent management to support overseas operations - The company's pharmaceutical excipient segment established a strict quality control system, deepened customer service and technical collaboration, and strengthened its sales team development[50][51] - The company launched a comprehensive formulation production project in Tanzania, planning to invest USD 10 million to build an international standard solid formulation production line[52] - The new energy materials business team enhanced personnel training and equipment inspection, continuously increasing capacity, with the new energy sector achieving operating revenue of RMB 126.60 million during the reporting period[53] - The company strengthened the introduction, training, and allocation of overseas talent, improved its incentive system, and built an online learning platform to provide talent support for its overseas business[54] 2. Core Competitiveness Analysis The company's core competitiveness lies in its R&D platforms, rich product portfolio, continuous technological innovation, comprehensive marketing network, and "pharmaceutical + new energy" dual-industry synergistic development strategy - The company possesses national-level scientific research platforms such as the "National Engineering Research Center for Pharmaceutical Excipients," dedicated to in-depth development of pharmaceutical excipients and research into new excipients[55] - The company boasts a rich product portfolio, including 127 pharmaceutical excipient varieties, 73 approved API varieties, and 283 finished drug approval numbers[56] - The company has significant technological innovation advantages, having independently developed products like hydroxypropyl starch empty capsules, which won first and second prizes in the Hunan Provincial Science and Technology Progress Awards[57] - The company has established a sales and distribution network with its headquarters as the marketing center and various offices as hubs, providing customized solutions and full-process technical support[58] - The company actively promotes an integrated "API + excipient + formulation" business ecosystem and expands into the new energy materials sector, achieving synergistic development of "pharmaceutical + new energy" dual industries[59] 3. Main Business Analysis The company's main business analysis shows that during the reporting period, operating revenue increased by 9.74% year-over-year, but operating costs increased by 14.29%, while selling expenses significantly decreased by 50.66%, with the new energy sector showing outstanding revenue and gross profit margin performance Key Financial Data Year-over-year Change | Indicator | Current Reporting Period (RMB) | Prior Year Period (RMB) | Year-over-year Change | Reason for Change | | :--- | :--- | :--- | :--- | :--- | | Operating Revenue | 681,881,688.38 | 621,346,708.93 | 9.74% | - | | Operating Cost | 494,458,519.80 | 432,636,194.26 | 14.29% | - | | Selling Expenses | 23,743,816.68 | 48,118,814.41 | -50.66% | Primarily due to reduced finished drug promotion expenses in this period | | Financial Expenses | 1,427,758.57 | -1,637,240.58 | 187.21% | Primarily due to reduced exchange gains in this period | | Net Cash Flow from Operating Activities | 45,842,247.53 | 127,628,976.65 | -64.08% | Primarily due to reduced net purchases and sales of goods in this period | Products or Services Accounting for Over 10% of Revenue | Product or Service Segment | Operating Revenue (RMB) | Operating Cost (RMB) | Gross Profit Margin | Year-over-year Change in Operating Revenue | | :--- | :--- | :--- | :--- | :--- | | Pharmaceutical Industry | 541,286,135.82 | 403,136,695.11 | 25.52% | -10.96% | | New Energy Industry | 126,602,224.59 | 80,703,326.37 | 36.25% | - | | Excipients | 455,795,458.91 | 358,347,363.68 | 21.38% | -4.66% | | New Energy Materials | 126,602,224.59 | 80,703,326.37 | 36.25% | - | | APIs | 46,736,991.76 | 25,512,237.08 | 45.41% | 15.44% | | Finished Drugs | 38,753,685.15 | 19,277,094.35 | 50.26% | -56.64% | 4. Non-Principal Business Analysis The company had no non-principal business analysis during the reporting period - The company had no non-principal business analysis during the reporting period[65] 5. Analysis of Assets and Liabilities At the end of the reporting period, the company's total assets decreased by 2.88% year-over-year, while net assets attributable to shareholders increased by 0.50%, with monetary funds, trading financial assets, and short-term borrowings decreasing, and accounts receivable, other current assets, and lease liabilities increasing Significant Changes in Asset Composition | Item | Amount at End of Current Reporting Period (RMB) | Percentage of Total Assets at End of Current Reporting Period | Amount at End of Prior Year (RMB) | Percentage of Total Assets at End of Prior Year | Change in Proportion | | :--- | :--- | :--- | :--- | :--- | :--- | | Monetary Funds | 492,515,859.62 | 9.75% | 698,537,949.74 | 13.43% | -3.68% | | Accounts Receivable | 162,703,385.26 | 3.22% | 103,181,869.28 | 1.98% | 1.24% | | Other Current Assets | 177,773,363.42 | 3.52% | 72,417,167.53 | 1.39% | 2.13% | | Short-term Borrowings | 310,082,500.00 | 6.14% | 488,198,472.23 | 9.39% | -3.25% | | Lease Liabilities | 28,693,744.25 | 0.57% | 17,375,180.58 | 0.33% | 0.24% | - The company's major overseas assets include Erkang Cambodia, Fenghuang Industrial, Wangkang Biochemical, and Erkang Mining, with Fenghuang Industrial having the largest asset scale, accounting for 25.75% of the company's net assets[67] - As of the end of the reporting period, the company had restricted monetary funds of RMB 129.18 million and frozen land, properties, etc., with a book value of RMB 404.83 million[72] 6. Investment Analysis During the reporting period, the company's investment amounted to RMB 27.48 million, with entrusted wealth management totaling RMB 175 million and no overdue unrecovered amounts, and no derivative investments or entrusted loans Investment Amount for the Reporting Period | Indicator | Amount (RMB) | | :--- | :--- | | Investment Amount for the Reporting Period | 27,475,415.00 | | Investment Amount for the Prior Year Period | 0.00 | Entrusted Wealth Management | Specific Type | Entrusted Wealth Management Amount (RMB 10,000) | Outstanding Balance (RMB 10,000) | Overdue Unrecovered Amount (RMB 10,000) | | :--- | :--- | :--- | :--- | | Bank Wealth Management Products | 17,500 | 17,500 | 0 | - The company had no significant equity investments, significant non-equity investments, derivative investments, or entrusted loans during the reporting period[74][77][79][80] 7. Significant Asset and Equity Disposals The company did not have any significant asset or equity disposals during the reporting period - The company did not dispose of significant assets or equity during the reporting period[81][82] 8. Analysis of Major Holding and Participating Companies This section lists the financial information of the company's major holding and participating companies, including total assets, net assets, operating revenue, and net profit, and notes the deregistration of one subsidiary and establishment of two new ones Major Subsidiaries and Participating Companies with Over 10% Impact on Company's Net Profit | Company Name | Company Type | Registered Capital | Total Assets (RMB) | Net Assets (RMB) | Operating Revenue (RMB) | Net Profit (RMB) | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Xiangyikang | Subsidiary | RMB 10 million | 740,797,461.42 | 672,798,933.37 | 91,469,200.31 | 16,827,961.30 | | Hong Kong Erkang | Subsidiary | HKD 10,000 | 2,145,113,609.11 | 4,665,187.47 | 362,471,241.32 | 35,592,478.48 | | Wangkang Biochemical | Sub-subsidiary | USD 10 million | 100,579,415.18 | -58,878,503.70 | 7,466,985.55 | -8,218,642.36 | | Fenghuang Industrial | Sub-subsidiary | USD 10 million | 1,158,588,992.24 | -852,275,619.49 | 17,132,658.21 | -30,524,936.51 | | Guangyu Limin | Subsidiary | RMB 6.6 million | 176,249,318.99 | -51,794,756.31 | 13,521,672.92 | -8,628,867.52 | - During the reporting period, the company deregistered Yiyang Datonghu Suyikang Pharmaceutical Co., Ltd. and invested in establishing Hunan Guanhe Technology Co., Ltd. and Hangzhou Langde Intelligent Technology Co., Ltd.[84] 9. Structured Entities Controlled by the Company The company had no structured entities under its control during the reporting period - The company had no structured entities under its control during the reporting period[84] 10. Risks Faced by the Company and Countermeasures The company faces risks such as economic policy changes in individual countries, strategic layout management, raw material price fluctuations, and exchange rate volatility, and actively responds through various mitigation measures - The company's lithium mine beneficiation plant and comprehensive formulation production project in Africa may be affected by local economic policies and environmental changes[85] - The company's dual-main business transformation to "pharmaceutical industry + new energy industry" and business expansion into the African continent have increased strategic layout management risks[86] - Increased raw material procurement volume and cycles, influenced by macroeconomic and monetary policies, pose a risk of significant price fluctuations[87] - Increased international business volume leads to a larger scale of foreign exchange settlement, exposing the company to exchange rate fluctuation risks[88] - The company addresses risks through regular risk assessments, establishing government and community relations, introducing professional talent, optimizing the supply chain, and conducting hedging activities[85][86][87][89] 11. Registration Form for Research, Communication, Interview, and Other Activities During the Reporting Period During the reporting period, the company hosted on-site research from various institutions and participated in online performance briefings, discussing strategic planning, operational plans, R&D investment, project progress, and overseas business development - On April 24, 2025, the company hosted on-site research from institutions such as Huayuan Securities and Huachuang Securities, discussing the company's strategic planning, operational plans, R&D investment, and project progress[90] - On May 12, 2025, the company participated in an online performance briefing via a network platform, discussing its strategic planning, operational goals and plans, and overseas business development[90] 12. Formulation and Implementation of Market Value Management System and Valuation Enhancement Plan The company's board of directors approved the "Market Value Management System" on April 22, 2025, but no valuation enhancement plan was disclosed - The company has formulated a "Market Value Management System" but has not disclosed a valuation enhancement plan[91] 13. Implementation of "Quality and Return Dual Improvement" Action Plan The company did not disclose an announcement regarding the "Quality and Return Dual Improvement" action plan - The company did not disclose an announcement regarding the "Quality and Return Dual Improvement" action plan[92] Part IV Corporate Governance, Environment, and Society This section outlines the company's governance structure, environmental disclosures, and social responsibility initiatives 1. Changes in Directors, Supervisors, and Senior Management During the reporting period, the company's employee representative supervisor, Wang Hong, resigned due to personal reasons, and Ma Li was elected as the new employee representative supervisor Changes in Directors, Supervisors, and Senior Management | Name | Position Held | Type | Date | Reason | | :--- | :--- | :--- | :--- | :--- | | Wang Hong | Employee Representative Supervisor | Resignation | January 06, 2025 | Personal reasons | | Ma Li | Employee Representative Supervisor | Election | January 06, 2025 | Job transfer | 2. Profit Distribution and Capital Reserve Conversion to Share Capital for the Current Reporting Period The company plans not to distribute cash dividends, bonus shares, or convert capital reserves into share capital for the semi-annual period - The company plans not to distribute cash dividends, bonus shares, or convert capital reserves into share capital for the semi-annual period[95] 3. Implementation of Equity Incentive Plans, Employee Stock Ownership Plans, or Other Employee Incentive Measures The company had no equity incentive plans, employee stock ownership plans, or other employee incentive measures and their implementation during the reporting period - The company had no equity incentive plans, employee stock ownership plans, or other employee incentive measures during the reporting period[96] 4. Environmental Information Disclosure The company and its main subsidiaries, Hunan Erkang Pharmaceutical Co., Ltd. and Hunan Xiangyikang Pharmaceutical Co., Ltd., have been included in the list of enterprises required to disclose environmental information by law and have disclosed environmental information as required - The company and Hunan Xiangyikang Pharmaceutical Co., Ltd. have been included in the list of enterprises required to disclose environmental information by law, and their reports can be queried in the designated system[97] 5. Social Responsibility Adhering to its core values of "harmony, loyalty, diligence, and performance," the company actively fulfills its responsibilities to shareholders, employees, customers, suppliers, and society, promoting harmonious development with all stakeholders - The company safeguards shareholder rights by establishing sound internal management and control systems, strictly disclosing information, and standardizing general meeting procedures[99] - The company values employee career development, provides equal opportunities, ensures safe production and physical and mental health, improves human resource management systems, and offers diverse cultural and recreational activities[100] - Adhering to its mission of "everything for drug safety," the company strictly controls product quality, establishes a comprehensive supplier evaluation system, and protects the rights and interests of customers and suppliers[101] - The company places high importance on environmental protection and safety, implementing a "safety and environmental protection" year-end veto system, paying taxes in accordance with the law, and actively participating in public welfare activities[102] Part V Significant Matters This section details significant events, including commitments, related party transactions, litigation, and other material developments 1. Commitments Fulfilled and Overdue Unfulfilled by Controlling Shareholder, Shareholders, Related Parties, Acquirers, and the Company During and as of the End of the Reporting Period During the reporting period, there were no commitments fulfilled or overdue unfulfilled by the company's actual controller, shareholders, related parties, acquirers, or the company itself - The company had no commitments fulfilled or overdue unfulfilled during the reporting period[104] 2. Non-Operating Funds Occupied by Controlling Shareholder and Other Related Parties from the Listed Company During the reporting period, there were no non-operating funds occupied by the controlling shareholder and other related parties from the listed company - The company had no non-operating funds occupied by the controlling shareholder and other related parties during the reporting period[105] 3. 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[106] 4. Appointment and Dismissal of Accounting Firms The company's semi-annual report was not audited - The company's semi-annual report was unaudited[107] 5. Explanations by the Board of Directors, Supervisory Board, and Audit Committee on the Accounting Firm's "Non-Standard Audit Report" for the Current Reporting Period During the reporting period, there were no explanations by the board of directors, supervisory board, or audit committee regarding a "non-standard audit report" from the accounting firm for the current reporting period - The company had no "non-standard audit report" explanations during the reporting period[108] 6. Explanations by the Board of Directors on Matters Related to the "Non-Standard Audit Report" for the Prior Year During the reporting period, there were no explanations by the board of directors regarding matters related to the "non-standard audit report" for the prior year - The company had no prior year "non-standard audit report" explanations during the reporting period[108] 7. Bankruptcy Reorganization Matters The company had no bankruptcy reorganization matters during the reporting period - The company had no bankruptcy reorganization matters during the reporting period[108] 8. Litigation Matters The company had no significant litigation or arbitration matters during the reporting period, though other litigation matters include multiple contract disputes, some settled or won, others ongoing, involving significant amounts - The company had no significant litigation or arbitration matters during the reporting period[109] Other Litigation Matters Overview | Litigation Type | Amount Involved (RMB 10,000) | Progress | Outcome and Impact | | :--- | :--- | :--- | :--- | | Plaintiff Cases (1 case) | 46.80 | Concluded | Contract dispute settled through mediation, both parties fulfilled obligations | | Plaintiff Cases (8 cases) | 6,283.96 | Concluded | 3 contract disputes won; 5 contract disputes settled through mediation, defendant compensated | | Defendant Cases (7 cases) | 10.53 | Concluded | 1 contract dispute won on retrial; 2 contract disputes settled through mediation and paid; 1 labor dispute settled through mediation and paid; 3 disputes withdrawn by plaintiff | | Defendant Cases (3 cases) | 187.06 | 2 concluded | 2 contract disputes settled through mediation; 1 bill recourse dispute concluded by judgment | | Defendant Cases (1 case) | 1,299.35 | Trial stage | 1 liability dispute under second-instance trial | 9. Penalties and Rectification The company had no penalties or rectification situations during the reporting period - The company had no penalties or rectification situations during the reporting period[111] 10. Integrity Status of the Company, its Controlling Shareholder, and Actual Controller During the reporting period, there were no integrity issues concerning the company, its controlling shareholder, or actual controller - The company had no integrity issues during the reporting period[112] 11. Significant Related Party Transactions During the reporting period, the company had no related party transactions related to daily operations, asset or equity acquisitions/disposals, joint external investments, related party creditor-debtor relationships, or dealings with affiliated financial companies - The company had no related party transactions related to daily operations during the reporting period[112] - The company had no related party transactions involving asset or equity acquisitions/disposals during the reporting period[113] - The company had no related party transactions involving joint external investments during the reporting period[114] - The company had no related party creditor-debtor relationships during the reporting period[115] - The company and its controlled financial companies had no deposits, loans, credit lines, or other financial business with related parties[116][117] - The company had no other significant related party transactions during the reporting period[118] 12. Significant Contracts and Their Performance The company had no entrustment, contracting, or leasing matters during the reporting period, but provided a total guarantee limit of RMB 1.5 billion for its subsidiaries, with an actual amount of RMB 95.75 million, of which RMB 55.75 million was provided to guaranteed entities with a debt-to-asset ratio exceeding 70% - The company had no entrustment, contracting, or leasing situations during the reporting period[119][120][121] Company Guarantees for Subsidiaries | Guaranteed Entity Name | Guaranteed Limit (RMB 10,000) | Actual Guaranteed Amount (RMB 10,000) | Guarantee Type | Fulfilled | | :--- | :--- | :--- | :--- | :--- | | Sukang Bio | 10,000 | 3,000 | Joint and several liability guarantee | No | | Xianglilai | 60,000 | 5,575 | Joint and several liability guarantee | No | | Hong Kong Erkang | 20,000 | 0 | - | - | | Xiangyikang | 25,000 | 0 | - | - | | Suerkang | 10,000 | 0 | - | - | | Guangyu Limin | 25,000 | 0 | - | - | | Total Approved Guarantee Limit for Subsidiaries at Period-end | 150,000 | - | - | - | | Total Actual Guarantee Balance for Subsidiaries at Period-end | - | 9,575 | - | - | | Proportion of Total Actual Guarantee to Company's Net Assets | - | 2.14% | - | - | | Of which: Debt Guarantees Provided Directly or Indirectly to Guaranteed Entities with Debt-to-Asset Ratio Exceeding 70% | - | 5,575 | - | - | - The company had no significant contracts related to daily operations or other significant contracts during the reporting period[126][127] 13. Explanation of Other Significant Matters The preliminary preparation work for the comprehensive formulation production project invested by the company's controlling subsidiary, Erkang Tanzania Co., Ltd., has been completed, with trial production expected in the fourth quarter of 2025, and drug registration applications to be submitted concurrently, while equipment for the roasting project invested by Fenghuang Industrial has arrived at the plant and is being installed - Erkang Tanzania Co., Ltd.'s comprehensive formulation production project has completed preliminary preparations, with drug workshop design drawings approved, and trial production is expected in the fourth quarter of 2025[128] - The company has selected 200 solid formulation varieties and is preparing drug registration materials, intending to submit applications concurrently with project completion[128] - Equipment for the roasting project invested by Fenghuang Industrial has arrived at the plant and is being installed[128] 14. Significant Matters of Company Subsidiaries The company established a wholly-owned subsidiary, Hunan Guanhe Technology Co., Ltd., which in turn established a controlling subsidiary, Hangzhou Langde Intelligent Technology Co., Ltd., primarily engaged in investments in new quality productive forces and AI application software development, and the subsidiary Yiyang Datonghu Suyikang Pharmaceutical Co., Ltd. has completed its deregistration - The company established a wholly-owned subsidiary, Hunan Guanhe Technology Co., Ltd., with a registered capital of RMB 10 million, primarily engaged in investments in new quality productive forces[129] - Hunan Guanhe Technology Co., Ltd. established a controlling subsidiary, Hangzhou Langde Intelligent Technology Co., Ltd., holding 51% of its shares, primarily engaged in AI application software development and intelligent robot R&D[129] - The company's subsidiary, Yiyang Datonghu Suyikang Pharmaceutical Co., Ltd., has completed its deregistration[130] Part VI Share Changes and Shareholder Information This section details changes in the company's share capital, shareholder structure, and information on directors, supervisors, and senior management shareholdings 1. Share Changes During the reporting period, the company's total share capital remained unchanged, and the proportions of restricted and unrestricted shares remained constant, with no changes in restricted shares held by directors, supervisors, and senior management Share Changes | Item | Number of Shares Before This Change (shares) | Proportion Before This Change | Increase/Decrease in This Change (＋，－) | Number of Shares After This Change (shares) | Proportion After This Change | | :--- | :--- | :--- | :--- | :--- | :--- | | I. Restricted Shares | 640,212,979 | 31.04% | 0 | 640,212,979 | 31.04% | | II. Unrestricted Shares | 1,422,391,891 | 68.96% | 0 | 1,422,391,891 | 68.96% | | III. Total Shares | 2,062,604,870 | 100.00% | 0 | 2,062,604,870 | 100.00% | Changes in Restricted Shares | Shareholder Name | Restricted Shares at Beginning of Period (shares) | Restricted Shares Released in Current Period (shares) | Restricted Shares Increased in Current Period (shares) | Restricted Shares at End of Period (shares) | Reason for Restriction | | :--- | :--- | :--- | :--- | :--- | :--- | | Shuai Fangwen | 640,181,179 | 0 | 0 | 640,181,179 | Restricted during tenure as Director, Supervisor, or Senior Management | | Gu Jishun | 26,850 | 0 | 0 | 26,850 | Restricted during tenure as Director, Supervisor, or Senior Management | | Luo Haijian | 4,950 | 0 | 0 | 4,950 | Restricted during tenure as Director, Supervisor, or Senior Management | | Total | 640,212,979 | 0 | 0 | 640,212,979 | - | 2. Securities Issuance and Listing The company had no securities issuance or listing during the reporting period - The company had no securities issuance or listing during the reporting period[136] 3. Number of Shareholders and Shareholding Information At the end of the reporting period, the total number of common shareholders was 42,746, with Shuai Fangwen holding 41.38% and Hunan Shuaijia Investment Co., Ltd. holding 6.45%, and shares held by both are pledged - The total number of common shareholders at the end of the reporting period was 42,746[137] Shareholding Information of Shareholders Holding 5% or More or Top 10 Shareholders | Shareholder Name | Shareholder Nature | Shareholding Percentage | Number of Shares Held at End of Reporting Period (shares) | Number of Restricted Shares Held (shares) | Number of Unrestricted Shares Held (shares) | Share Status | Quantity (shares) | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Shuai Fangwen | Domestic Natural Person | 41.38% | 853,574,906 | 640,181,179 | 213,393,727 | Pledged | 834,664,800 | | Hunan Shuaijia Investment Co., Ltd. | Domestic Non-State-Owned Legal Person | 6.45% | 132,951,004 | 0 | 132,951,004 | Pledged | 131,515,200 | | Peng Xingni | Domestic Natural Person | 2.54% | 52,427,048 | 0 | 52,427,048 | Frozen | 52,427,048 | - Mr. Shuai Fangwen and Ms. Cao Zaiyun, the controlling shareholder, legal representative, chairman, and general manager of Hunan Shuaijia Investment, are married[138] 4. Changes in Shareholdings of Directors, Supervisors, and Senior Management There were no changes in the shareholdings of the company's directors, supervisors, and senior management during the reporting period - There were no changes in the shareholdings of the company's directors, supervisors, and senior management during the reporting period[140] 5. Changes in Controlling Shareholder or Actual Controller The company's controlling shareholder and actual controller remained unchanged during the reporting period - The company's controlling shareholder remained unchanged during the reporting period[141] - The company's actual controller remained unchanged during the reporting period[141] 6. Preferred Share Information The company had no preferred shares during the reporting period - The company had no preferred shares during the reporting period[142] Part VII Bond-Related Information The company had no bond-related information during the reporting period - The company had no bond-related information during the reporting period[144] Part VIII Financial Report This section presents the company's comprehensive financial statements, including balance sheets, income statements, cash flow statements, and statements of changes in owners' equity 1. Audit Report The company's semi-annual financial report was unaudited - The company's semi-annual financial report was unaudited[146] 2. 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, comprehensively presenting the company's financial position, operating results, and cash flow situation - The consolidated balance sheet shows total assets of RMB 5.05 billion and owners' equity attributable to the parent company of RMB 4.47 billion at period-end[150] - The consolidated income statement shows total operating revenue of RMB 681.88 million and net profit attributable to parent company shareholders of RMB 37.63 million for the current period[157] - The consolidated cash flow statement shows net cash flow from operating activities of RMB 45.84 million, net cash flow from investing activities of negative RMB 104.94 million, and net cash flow from financing activities of negative RMB 65.92 million[163] 2.1. Consolidated Balance Sheet As of June 30, 2025, the company's consolidated total assets were RMB 5.05 billion, total liabilities were RMB 634.44 million, and total owners' equity was RMB 4.42 billion, of which RMB 4.47 billion was attributable to parent company owners Consolidated Balance Sheet Key Data (June 30, 2025) | Item | Period-end Balance (RMB) | Beginning Balance (RMB) | | :--- | :--- | :--- | | Total Assets | 5,049,890,880.73 | 5,199,734,491.19 | | Total Liabilities | 634,442,919.26 | 797,540,680.70 | | Total Owners' Equity Attributable to Parent Company | 4,469,540,895.52 | 4,447,425,532.36 | | Minority Interests | -54,092,934.05 | -45,231,721.87 | | Total Owners' Equity | 4,415,447,961.47 | 4,402,193,810.49 | 2.2. Parent Company Balance Sheet As of June 30, 2025, the parent company's total assets were RMB 4.93 billion, total liabilities were RMB 1.03 billion, and total owners' equity was RMB 3.89 billion Parent Company Balance Sheet Key Data (June 30, 2025) | Item | Period-end Balance (RMB) | Beginning Balance (RMB) | | :--- | :--- | :--- | | Total Assets | 4,925,253,026.10 | 5,276,951,518.42 | | Total Liabilities | 1,034,319,116.13 | 1,422,643,905.83 | | Total Owners' Equity | 3,890,933,909.97 | 3,854,307,612.59 | 2.3. Consolidated Income Statement For the first half of 2025, the company's consolidated total operating revenue was RMB 681.88 million, a year-over-year increase of 9.74%, and net profit attributable to parent company shareholders was RMB 37.63 million, a significant year-over-year increase of 497.36% Consolidated Income Statement Key Data (First Half of 2025) | Item | First Half of 2025 (RMB) | First Half of 2024 (RMB) | | :--- | :--- | :--- | | Total Operating Revenue | 681,881,688.38 | 621,346,708.93 | | Operating Profit | 32,112,145.26 | 11,734,714.77 | | Total Profit | 32,053,479.38 | 8,634,864.55 | | Net Profit | 28,810,557.54 | 6,338,336.65 | | Net Profit Attributable to Parent Company Shareholders | 37,634,642.58 | 6,300,155.19 | | Minority Interests | -8,824,085.04 | 38,181.46 | | Basic Earnings Per Share (RMB/share) | 0.0182 | 0.0031 | 2.4. Parent Company Income Statement For the first half of 2025, the parent company's operating revenue was RMB 268.84 million, and net profit was RMB 36.34 million, a year-over-year decrease Parent Company Income Statement Key Data (First Half of 2025) | Item | First Half of 2025 (RMB) | First Half of 2024 (RMB) | | :--- | :--- | :--- | | Operating Revenue | 268,843,590.10 | 288,246,851.78 | | Operating Profit | 37,230,901.08 | 46,366,994.69 | | Total Profit | 37,228,946.08 | 46,441,023.45 | | Net Profit | 36,337,500.49 | 45,231,142.85 | 2.5. Consolidated Cash Flow Statement For the first half of 2025, the company's net cash flow from operating activities was RMB 45.84 million, a year-over-year decrease of 64.08%, net cash flow from investing activities was negative RMB 104.94 million, and net cash flow from financing activities was negative RMB 65.92 million, resulting in a net decrease in cash and cash equivalents of negative RMB 126.57 million Consolidated Cash Flow Statement Key Data (First Half of 2025) | Item | First Half of 2025 (RMB) | First Half of 2024 (RMB) | | :--- | :--- | :--- | | Net Cash Flow from Operating Activities | 45,842,247.53 | 127,628,976.65 | | Net Cash Flow from Investing Activities | -104,941,146.23 | -197,337,778.52 | | Net Cash Flow from Financing Activities | -65,915,412.21 | 141,354,713.02 | | Net Increase in Cash and Cash Equivalents | -126,569,773.22 | 63,727,424.61 | | Cash and Cash Equivalents at End of Period | 363,339,251.56 | 574,365,150.97 | 2.6. Parent Company Cash Flow Statement For the first half of 2025, the parent company's net cash flow from operating activities was RMB 44.77 million, net cash flow from investing activities was negative RMB 50.83 million, and net cash flow from financing activities was negative RMB 4.67 million, resulting in a net decrease in cash and cash equivalents of negative RMB 11.88 million Parent Company Cash Flow Statement Key Data (First Half of 2025) | Item | First Half of 2025 (RMB) | First Half of 2024 (RMB) | | :--- | :--- | :--- | | Net Cash Flow from Operating Activities | 44,765,812.46 | 169,535,791.96 | | Net Cash Flow from Investing Activities | -50,826,357.15 | -110,534,141.26 | | Net Cash Flow from Financing Activities | -4,673,772.23 | 98,465,899.99 | | Net Increase in Cash and Cash Equivalents | -11,878,737.90 | 157,203,197.18 | | Cash and Cash Equivalents at End of Period | 73,606,508.39 | 234,759,099.94 | 2.7. Consolidated Statement of Changes in Owners' Equity For the first half of 2025, the company's consolidated total owners' equity increased by RMB 13.25 million, primarily due to an increase in total comprehensive income attributable to parent company owners and changes in minority interests - Total comprehensive income attributable to parent company owners for this period was RMB 21.83 million, and total comprehensive income attributable to minority interests was negative RMB 8.86 million[168] - Consolidated total owners' equity at period-end was RMB 4.42 billion, an increase of RMB 13.25 million from the beginning of the period[169] 2.8. Parent Company Statement of Changes in Owners' Equity For the first half of 2025, the parent company's total owners' equity increased by RMB 36.63 million, primarily due to an increase in total comprehensive income - Total comprehensive income for the parent company in this period was RMB 36.34 million[173] - Parent company total owners' equity at period-end was RMB 3.89 billion, an increase of RMB 36.63 million from the beginning of the period[174] 3. Company Overview Hunan Erkang Pharmaceutical Co., Ltd. was registered on November 8, 2010, and listed on the Shenzhen Stock Exchange on September 27, 2011, primarily engaged in the production and sales of APIs, chemical products, food additives, chemical pharmaceutical preparations, starch and starch products, as well as pharmaceutical raw materials, excipients, medicinal capsules, and health foods - The company was registered on November 8, 2010, and listed on the Shenzhen Stock Exchange on September 27, 2011[178] - The company belongs to the pharmaceutical manufacturing industry, with main business activities including the production and sales of APIs, excipients, finished drugs, and new energy materials[178] 4. Basis of Financial Statement Preparation The company's financial statements are prepared on a going concern basis, and there are no matters or circumstances that would cause significant doubt about its ability to continue as a going concern within 12 months from the end of the reporting period - The company's financial statements are prepared on a going concern basis[179] - There are no matters or circumstances that would cause significant doubt about the company's ability to continue as a going concern within 12 months from the end of the reporting period[180] 5. Significant Accounting Policies and Accounting Estimates This section details the company's compliance with enterprise accounting standards, accounting period, operating cycle, functional currency, materiality criteria, business combinations, consolidated financial statement preparation, financial instruments, various receivables, inventories, asset impairment, revenue recognition, government grants, deferred income tax, leasing, and other significant accounting policies and estimates, noting a change in accounting estimate for the expected credit loss rate of accounts receivable during the reporting period - The company's financial statements comply with enterprise accounting standards, accurately and completely reflecting its financial position, operating results, and cash flows[182] - The company has formulated specific accounting policies and estimates for financial instrument impairment, inventory, fixed asset depreciation, and revenue recognition based on its actual production and operating characteristics[181] - The company changed its accounting estimate for the expected credit loss rate of accounts receivable on January 1, 2025, to more objectively and fairly reflect its financial position[260] 6. Taxation This section discloses the company's main tax categories and rates, including VAT, urban maintenance and construction tax, and corporate income tax, with the company and some subsidiaries enjoying high-tech enterprise income tax preferential policies, and some overseas subsidiaries and small-profit enterprises also enjoying local or national tax incentives Main Tax Categories and Rates | Tax Category | Tax Rate | | :--- | :--- | | Value-Added Tax | 13%, 9%, 6%, 5% | | Urban Maintenance and Construction Tax | 7%, 5% | | Corporate Income Tax | 30%, 25%, 20%, 16.50%, 15% | | Property Tax | 12%, 1.2% | | Education Surcharge | 3% | | Local Education Surcharge | 2% | - The company, Hunan Xiangyikang Pharmaceutical Co., Ltd., and Hunan Sunang Health Technology Co., Ltd. are recognized as high-tech enterprises and enjoy a 15% corporate income tax preferential rate[263] - Tibet Changdu Guangyu Limin Pharmaceutical Co., Ltd. enjoys the Western Development policy, with corporate income tax levied at a 15% rate[264] - Fenghuang Industrial Co., Ltd. is in a profit tax exemption period, Xulongqi Co., Ltd. is in a critical period, and Changsha Lushengyuan International Trade Co., Ltd. enjoys corporate income tax benefits for small and micro enterprises[265] 7. Notes to Consolidated Financial Statement Items This section provides detailed information on each item in the consolidated financial statements, including monetary funds, various receivables, inventories, fixed assets, intangible assets, goodwill, short-term borrowings, accounts payable, employee compensation payable, operating revenue and costs, various expenses, investment income, asset impairment losses, etc., with explanations for significant changes - Period-end monetary funds totaled RMB 492.52 million, including restricted funds such as bank acceptance bill deposits of RMB 80 million and letter of credit deposits of RMB 30.66 million[267] - Accounts receivable period-end balance was RMB 162.70 million, an increase of 57.69% from the beginning of the period, primarily due to increased sales revenue in the current period[283][287] - Inventory period-end balance was RMB 625 million, an increase of 4.09% from the beginning of the period, including development costs of RMB 154 million[349] - Short-term borrowings period-end balance was RMB 310.08 million, a decrease of 36.48% from the beginning of the period, primarily due to repayment of maturing bank short-term borrowings[437] - Operating revenue was RMB 681.88 million, operating cost was RMB 494.46 million, selling expenses decreased by 50.66% year-over-year, and financial expenses increased by 187.21% year-over-year[498][507][510] 8. Research and Development Expenses The company's total R&D expenditure for the current period was RMB 19.94 million, all expensed, primarily for material consumption and employee compensation, with no R&D projects meeting capitalization criteria R&D Expenditure Details | Item | Amount for Current Period (RMB) | Amount for Prior Period (RMB) | | :--- | :--- | :--- | | Material Consumption | 11,316,566.66 | 11,038,419.66 | | Employee Compensation | 6,453,762.71 | 6,494,682.17 | | Intangible Asset Amortization | 1,066,826.24 | 1,322,480.70 | | Depreciation Expense | 1,055,987.15 | 1,158,330.22 | | Other | 43,480.06 | 1,181,943.40 | | Total | 19,936,622.82 | 21,195,856.15 | | Of which: Expensed R&D Expenditure | 19,936,622.82 | 21,195,856.15 | - All R&D expenditure for this period was expensed, with no R&D projects meeting capitalization criteria[561][562] 9. Changes in Consolidation Scope During the reporting period, the company's consolidation scope increased due to the establishment of new subsidiaries Hunan Guanhe Technology Co., Ltd. and its controlling subsidiary Hangzhou Langde Intelligent Technology Co., Ltd., and decreased due to the deregistration of Yiyang Datonghu Suyikang Pharmaceutical Co., Ltd. - The company established a wholly-owned subsidiary, Hunan Guanhe Technology Co., Ltd., and a controlling subsidiary, Hangzhou Langde Intelligent Technology Co., Ltd., increasing the consolidation scope[129][571] - The company deregistered Yiyang Datonghu Suyikang Pharmaceutical Co., Ltd., reducing the consolidation scope[130][571] 10. Interests in Other Entities This section discloses the company's interests in subsidiaries, joint ventures, and associates, noting that the company owns multiple wholly-owned or controlling subsidiaries and holds interests in associates, with some important non-wholly-owned subsidiaries having minority interests and losses - The company owns multiple wholly-owned or controlling subsidiaries, including Hunan Xianglilai Chemical Co., Ltd., Hunan Xiangyikang Pharmaceutical Co., Ltd., and Hunan Erkang (Hong Kong) Co., Ltd.[573][574] Important Non-Wholly-Owned Subsidiaries | Subsidiary Name | Minority Shareholding Percentage | Profit or Loss Attributable to Minority Shareholders in Current Period (RMB) | Minority Interests Balance at Period-end (RMB) | | :--- | :--- | :--- | :--- | | Wangkang Biochemical | 30.00% | -2,465,592.71 | -17,663,551.11 | | Guangyu Limin | 49.00% | -4,228,145.08 | -25,379,430.59 | - The company holds a 48.00% stake in Yiyang Tongyi Pharmaceutical Partnership (Limited Partnership), accounted for using the equity method[581] 11. Government Grants At the end of the reporting period, the company's deferred income included government grants related to assets totaling RMB 12.46 million, and government grants recognized in other income for the current period amounted to RMB 3.80 million Liability Items Involving Government Grants | Accounting Account | Beginning Balance (RMB) | Decrease in Current Period (RMB) | Period-end Balance (RMB) | Asset/Income Related | | :--- | :--- | :--- | :--- | :--- | | Deferred Income | 14,929,804.05 | 2,466,499.71 | 12,463,304.34 | Asset Related | - Government grants recognized in other income for the current period amounted to RMB 3.80 million, compared to RMB 9.67 million in the prior period[591] 12. Risks Related to Financial Instruments The company faces credit risk, liquidity risk, and market risk (including interest rate risk and foreign exchange risk), which it manages through credit assessment, customer diversification, bank credit lines, optimizing financing structure, and monitoring foreign currency exposure, and transferred some financial assets through bill endorsement during the reporting period - The company faces credit risk, liquidity risk, and market risk (interest rate