SINOMED(SH:688108)2022-05-23 16:00Financial Performance - Sino Medical reported no cash dividends for 2021 due to significant adverse impacts from the centralized procurement policy for coronary stents, prioritizing future development funding needs[5]. - The company's operating revenue for 2021 was CNY 194,356,081.09, a decrease of 40.64% compared to the previous year[21]. - The net profit attributable to shareholders was CNY -130,765,690.12, representing a decline of 681.36% year-on-year[23]. - The cash flow from operating activities was CNY -60,133,405.36, down 185.28% from the previous year, primarily due to reduced revenue[23]. - Basic and diluted earnings per share were both CNY -0.32, a decrease of 740% compared to the previous year[22]. - The weighted average return on equity was -13.08%, a decrease of 15.15 percentage points year-on-year[22]. - The net profit after deducting non-recurring gains and losses was CNY -134,507,245.16, a decrease of 1,317.29% year-on-year[23]. - The company experienced a significant decline in main business income due to the implementation of centralized procurement policies for coronary stents, leading to a substantial drop in product prices[23]. - The company's main business revenue decreased by 40.51% year-on-year, primarily due to a 69.42% decline in stent product revenue, with sales volume dropping by 78.05%[160]. - The overall gross profit margin decreased by 6.08 percentage points, attributed to lower sales prices and reduced production scale due to the impact of centralized procurement policies[162]. Research and Development - The company is focused on product research and development, particularly in the area of biodegradable drug-coated coronary stent systems[5]. - Research and development expenses accounted for 95.37% of operating revenue, an increase of 46.75 percentage points from the previous year[22]. - The company invested CNY 185 million in R&D during the reporting period, an increase of 16.44% year-on-year, representing 95.37% of the 2021 revenue, up 46.75 percentage points from the previous year[36]. - The company added 16 new invention patents during the reporting period, with a total of 199 invention patents authorized and exclusive licenses globally[38]. - The company’s R&D personnel increased by 79.41% year-on-year, totaling 183 individuals by the end of the reporting period[36]. - The company has developed 8 key technologies and 18 product pipelines, with 16 new invention patents and 55 other intellectual property rights granted during the reporting period[71]. - The company is advancing the development of a unique thorn balloon that combines micro-cutting technology with balloon dilation, aimed at enhancing pre-dilation effects and treatment outcomes in coronary interventions[75]. - The company has established a complete independent core technology system in the cardiovascular and cerebrovascular intervention treatment fields, focusing on breakthroughs in key technologies and products[117]. Market Environment and Challenges - The company faced a challenging external operating environment, which was detailed in the risk factors section of the report[4]. - The national volume-based procurement policy initiated in October 2020 has altered the competitive landscape, impacting the company's market share due to its products not qualifying for the procurement[64]. - The company is focused on expanding its market presence in the coronary stent sector, despite facing challenges from national procurement policies[64]. - The domestic coronary intervention market is relatively mature, with significant room for domestic product substitution, driven by increased penetration of local manufacturers[62]. - The company faces risks related to new product development failures or delays, which could impact revenue and profitability growth[133][142]. - The company’s ability to maintain or improve market competitiveness is challenged by the ongoing centralized procurement policies and intense market competition[136][137]. - The company is exposed to risks from national procurement policies that could lead to significant price reductions for its products[146]. Governance and Compliance - The annual report includes a standard unqualified audit opinion from the accounting firm, ensuring the accuracy and completeness of the financial statements[5]. - The board of directors approved a profit distribution plan that reflects the company's current operational situation and future funding requirements for product development and market promotion[5]. - The board of directors consists of all members present at the meeting, affirming governance and decision-making processes[5]. - The company has not reported any non-operating fund occupation by controlling shareholders or related parties, ensuring financial integrity[7]. Product Development and Innovation - The new generation drug-eluting stent system HT Supreme received EU approval and is undergoing clinical research in collaboration with National University of Ireland, Galway, involving 2,540 participants across six European countries[39]. - The company received regulatory approval for the world's first drug-eluting stent specifically designed for intracranial artery stenosis treatment, establishing a leading position in the ischemic neurology field[42]. - The company reported a significant breakthrough in the design of the Accufit interventional mitral valve replacement system, with improved survival rates and heart function recovery during animal trials[44]. - The company is developing a retractable, dual-stent, self-locking intervention mitral valve replacement technology, with multiple patents granted globally[78]. - The company’s NOVA intracranial drug-eluting stent system, the first of its kind for treating intracranial artery stenosis, received regulatory approval in July 2021, showing significant advantages in vascular healing and reducing restenosis compared to bare stents[77]. - The company has completed clinical trials for its new drug-eluting stent technology, which is expected to enhance treatment efficacy[26]. Human Resources - The company added 206 employees during the reporting period, a 43.19% increase year-over-year, including 81 new R&D personnel, reflecting a 79.41% growth in R&D staff[46]. - The number of R&D personnel increased by 81, a year-on-year growth of 79.41%, with master's degree and above personnel increasing by 13, a growth of 65%[116]. - Total compensation for R&D personnel reached 40.18 million RMB, compared to 27.40 million RMB in the previous period, with average compensation decreasing to 21.96 thousand RMB from 26.86 thousand RMB[118]. - The company emphasizes the importance of building a talent pool through internal training and high-level talent recruitment to support its rapid development[198]. Investment and Financial Strategy - The company invested $4 million to acquire an 18.2% stake in eLum Technologies, enhancing its innovation and R&D capabilities in the neurovascular intervention sector[45]. - The company plans to increase R&D and innovation efforts, aiming to enrich its product pipeline and accelerate the speed of new product launches[129]. - The company aims to balance domestic market risks by actively expanding into overseas markets, particularly for the HT Supreme stent in the US and Japan over the next two years[70]. - The company has invested RMB 10.50 million in working capital, exceeding the planned amount of RMB 10 million[194].