SPAS(SH:603168)2019-04-26 16:00Financial Performance - The company's operating revenue for 2018 was ¥607,437,969.19, a decrease of 35.30% compared to ¥938,883,499.80 in 2017 [24]. - The net profit attributable to shareholders for 2018 was -¥126,474,321.41, representing a decline of 186.42% from ¥146,356,420.23 in 2017 [24]. - The cash flow from operating activities increased by 120.25% to ¥100,373,495.63 in 2018, compared to ¥45,572,205.17 in 2017 [24]. - The company's total assets decreased by 11.81% to ¥1,648,594,028.08 at the end of 2018, down from ¥1,869,408,347.88 at the end of 2017 [24]. - The basic earnings per share for 2018 was -¥0.39, a decrease of 186.67% from ¥0.45 in 2017 [25]. - The weighted average return on equity for 2018 was -8.06%, a decrease of 17.10 percentage points from 9.04% in 2017 [25]. - The company reported a significant decline in revenue from eye drops by 52.58% and traditional Chinese medicine by 68.95% due to negative media coverage in December 2017 [26]. - The company recognized goodwill impairment losses of ¥178,157,200 related to its subsidiary, which significantly impacted the net profit for the reporting period [26]. Audit and Compliance - The company received a standard unqualified audit report from Tianjian Accounting Firm, ensuring the accuracy and completeness of the financial report [5]. - The company has not engaged in any non-operational fund occupation by controlling shareholders or related parties during the reporting period [8]. - The company has not reported any violations of decision-making procedures regarding external guarantees [8]. - The company emphasizes the importance of investor awareness regarding investment risks associated with forward-looking statements in the report [7]. Business Operations - The company expanded its business scope to include the production and sale of disinfectant products, as approved in meetings held in August and September 2018 [32]. - The company maintains stable relationships with multiple suppliers to ensure the stability of raw material supply and pricing [37]. - The company's marketing network covers most provinces and municipalities in China, enhancing its market responsiveness [47]. - The company opened a flagship store on Tmall to enhance online sales of its products [55]. Research and Development - The company emphasizes R&D and has established partnerships with universities to strengthen its product development capabilities [48]. - The company invested CNY 26.56 million in R&D, a decrease of 9.14% year-on-year [63]. - The company has obtained 6 invention patents and 14 design patents by the end of 2018, indicating a strong focus on innovation [130]. - The company is actively developing multiple generic drug consistency evaluation projects, including the consistency evaluation of Benzalkonium Chloride Eye Drops [129]. - The company is focusing on ophthalmic drugs as its main research line, aiming to develop proprietary pharmaceutical products [128]. Market and Industry Trends - The pharmaceutical industry in China achieved a main business income of CNY 2,398.63 billion in 2018, with a year-on-year growth of 12.6% [41]. - The total profit of the pharmaceutical industry was CNY 309.42 billion, with a year-on-year growth of 9.5% [41]. - The company’s core product, Shapu Aisi eye drops, held a market share of 21.58% in the cataract medication market in China [43]. - The projected market size for cataract eye drops in China over the next five years is estimated to be between 1.5 billion and 3 billion yuan [111]. Future Outlook - The company anticipates achieving a revenue of 705 million yuan and a net profit of 53 million yuan in 2019, focusing on internal efficiency and cost reduction [176]. - The company plans to enhance market expansion by adjusting sales strategies, increasing marketing efforts, and improving collaboration with key pharmacy chains [177]. - The company aims to accelerate new product development, prioritizing the consistency evaluation of Benzalkonium Chloride Eye Drops and advancing other products like Cefixime Granules and Levofloxacin Tablets [178]. - The company recognizes the ongoing challenges and opportunities in the pharmaceutical industry due to regulatory changes and market dynamics, which will require strategic adjustments [173]. Profit Distribution - The company has established a continuous and stable profit distribution policy, committing to distribute at least 30% of the annual distributable profits in cash dividends [199]. - The company emphasizes the importance of considering the opinions of independent directors and public investors when adjusting profit distribution policies [199]. - The company’s profit distribution plan aligns with its articles of association and commitments made during the IPO, benefiting shareholders, especially small and medium investors [200].