ZZPZH(SH:600436)2019-04-12 16:00Financial Performance - The company's operating revenue for 2018 was CNY 4,766,156,893.31, representing a 28.33% increase compared to CNY 3,713,953,975.95 in 2017[15]. - The net profit attributable to shareholders for 2018 was CNY 1,142,932,917.56, which is a 41.62% increase from CNY 807,018,675.04 in 2017[15]. - The basic earnings per share for 2018 were CNY 1.89, up 41.04% from CNY 1.34 in 2017[16]. - The weighted average return on equity for 2018 was 24.98%, an increase of 3.82 percentage points from 21.16% in 2017[16]. - The company achieved total revenue of RMB 476,615.69 million in 2018, an increase of 28.33% compared to the previous year[46]. - The net profit for the year was RMB 112,872.70 million, reflecting a growth of 44.63% year-on-year[46]. - The company reported a net profit margin of 12%, reflecting improved operational efficiency[167]. - The company reported a significant increase in revenue, achieving a total of 1.5 billion in 2018, representing a growth of 15% compared to the previous year[168]. Cash Flow and Assets - The net cash flow from operating activities for 2018 was CNY 612,310,818.61, showing a decrease of 9.55% compared to CNY 676,933,316.36 in 2017[15]. - The total assets at the end of 2018 were CNY 6,657,757,885.18, an increase of 17.87% from CNY 5,648,277,442.58 at the end of 2017[15]. - The company's cash and cash equivalents at the end of the period were ¥2,786,533,726.03, accounting for 41.85% of total assets, up from 37.48% in the previous period[64]. - The total assets of the company increased by 8% to 3 billion RMB, indicating strong financial health[167]. Research and Development - R&D expenses increased to CNY 5,509.76 million in Q4, representing 4.67% of total revenue, compared to 0.98% in Q1[20]. - The total R&D investment for the period amounted to ¥100,814,212.73, representing 2.12% of the operating revenue[60]. - The company successfully launched 4 new drug research projects, including innovative drugs for pain treatment and non-alcoholic fatty liver disease[40]. - The company has established a three-tier R&D platform to strengthen its research capabilities and focus on the development of new products in traditional Chinese medicine and health products[78]. - The company is focusing on research in major diseases such as cancer and liver diseases, aiming for breakthroughs in treatment[103]. Market and Sales Strategy - The company plans to enhance its product portfolio and expand into health and wellness sectors, including health foods and cosmetics[25]. - The company's main sales model includes regional distribution and direct sales through its own experience centers, enhancing brand recognition and customer loyalty[29]. - The company is actively expanding its market presence through strategic partnerships and exploring new sales channels to enhance its competitive edge[29]. - The company aims for a revenue growth of over 20% and a net profit growth of over 10% in 2019[101]. - Market expansion plans include entering two new provinces, projected to increase market share by 10%[167]. Procurement and Supply Chain - The company relies heavily on key raw materials such as musk, bezoar, snake gall, and Sanqi, with significant procurement amounts for musk and snake gall requiring administrative licenses from national forestry authorities[27]. - The procurement prices for key medicinal materials are subject to market fluctuations, with the company adapting its purchasing strategies accordingly[31]. - The company has established standardized breeding bases for musk in Shaanxi and Sichuan to ensure a stable supply of musk raw materials[32]. - Cow bile prices have continued to rise compared to 2017, and the company is actively managing strategic reserves of cow bile resources[32]. Risk Management and Compliance - The company reported no significant risks that could materially affect its operations during the reporting period[5]. - The company has implemented strict quality management practices in compliance with GMP and GSP standards to ensure product quality amidst increasing regulatory scrutiny[110]. - The company is committed to maintaining compliance with evolving national drug regulatory policies to enhance quality management and reduce potential risks[110]. - The company faces potential risks from policy changes and stricter regulations in the pharmaceutical industry[108]. Corporate Social Responsibility - The company donated a total of RMB 226.28 million for social poverty alleviation efforts in 2018[147]. - The company aims to actively participate in targeted poverty alleviation efforts, aligning with national and local policies[144]. - The company has established two deer farming bases in Shaanxi and Sichuan to support local farmers and enhance income[146]. Shareholder and Governance - The total number of ordinary shareholders at the end of the reporting period was 73,273, an increase from 64,052 at the end of the previous month[157]. - The company has a clear communication channel between shareholders and the board, ensuring that all shareholders can exercise their rights effectively[180]. - The board of directors held 10 meetings during the year, with all members attending and no instances of absenteeism for two consecutive meetings[186]. - The company received an unqualified audit opinion for its financial statements, reflecting a fair presentation of its financial position as of December 31, 2018[193].