Shenqi(SH:600613)2024-04-29 09:02Financial Performance - The company's operating revenue for 2023 was CNY 2,340,945,518, a decrease of 2% compared to CNY 2,388,617,678 in 2022[21]. - Net profit attributable to shareholders increased by 17.41% to CNY 57,000,674.55 from CNY 48,548,121.74 in the previous year[23]. - Cash flow from operating activities decreased by 32.47% to CNY 215,590,355.95, down from CNY 319,232,403.36 in 2022[23]. - Basic and diluted earnings per share rose by 22.22% to CNY 0.11, compared to CNY 0.09 in 2022[22]. - The weighted average return on equity increased by 0.35 percentage points to 2.42% from 2.07% in the previous year[22]. - Total assets decreased by 3.15% to CNY 3,279,335,678.82 from CNY 3,386,135,812.03 in 2022[21]. - The net asset attributable to shareholders increased slightly by 0.36% to CNY 2,335,387,196.13 from CNY 2,327,112,527.12 in 2022[21]. - The net profit after deducting non-recurring gains and losses increased by 0.84% to CNY 49,103,973.11[23]. - The total profit for 2023 was 83.41 million yuan, representing a year-on-year increase of 31.92%[32]. - The company reported a significant decline in cash flow due to reduced sales revenue and slower cash collection[23]. Dividend Distribution - The company plans to distribute a cash dividend of 1 RMB per 10 shares, totaling 53,407,162.8 RMB based on a total share capital of 534,071,628 shares as of December 31, 2023[5]. - The company distributed a cash dividend of 1 RMB per 10 shares, totaling 53,407,162.80 RMB, which represents 93.70% of the net profit attributable to ordinary shareholders in the consolidated financial statements[193]. Audit and Compliance - The company has received a standard unqualified audit report from Lixin Certified Public Accountants[4]. - There are no non-operating fund occupations by controlling shareholders or related parties[7]. - The company has not violated decision-making procedures for external guarantees[8]. - The company has not faced any issues with more than half of the directors being unable to ensure the authenticity and completeness of the annual report[9]. - The company has confirmed that the financial report is true, accurate, and complete as stated by the responsible persons[5]. - The company has not disclosed any significant changes in its registered address or office location[16]. - The company has conducted self-inspections regarding fund occupation and illegal guarantees, confirming compliance with regulations and no violations found[159]. - The internal control audit report received a standard unqualified opinion[197]. - There were no significant deficiencies in internal control during the reporting period[197]. Risk Management - The company has detailed potential risks in the section discussing future development in the annual report[9]. - The company emphasizes the importance of investor awareness regarding the risks associated with forward-looking statements in the annual report[6]. - The company has established mechanisms for environmental protection[200]. - The company recognizes quality control risks stemming from complex production processes and has established measures to enhance quality management capabilities, including ongoing training and process monitoring[152]. - The company will enhance its internal control management system to improve operational efficiency and risk management capabilities[141]. Research and Development - Continuous investment in R&D led to multiple technological innovations and quality standard improvements, with some results achieving domestic leading levels[40]. - The company is actively working on enhancing the quality standards of traditional Chinese medicine and ethnic medicine, aiming to include more varieties in the Chinese Pharmacopoeia[41]. - The company has made progress in the technical enhancement and quality standard improvement of potential products, opening new sales growth points[42]. - The company has increased its R&D investment in traditional Chinese medicine, achieving multiple technological innovations and quality standard improvements, with some results already applied in production and pending national patent applications[97]. - The company’s R&D projects include the development of new indications for existing drugs, with ongoing basic research in various therapeutic areas[110]. - The company has a research and development team of 203 personnel, with over 56% holding bachelor's degrees or higher, focusing on various pharmaceutical disciplines[107]. - The company applied for 5 invention patents and 9 utility model patents in 2023, reinforcing its commitment to intellectual property protection[70]. - The total R&D expenditure for the company was RMB 90,940.92 million, which is 38.85% of its revenue, a decrease of 3.13 percentage points year-on-year[120]. Market and Industry Trends - The pharmaceutical industry in China experienced a decline in overall growth, with the industrial added value of large-scale pharmaceutical enterprises approximately 1.3 trillion yuan, a year-on-year decrease of 5.2%[51]. - The revenue of pharmaceutical industrial enterprises reached 2.95525 trillion yuan, down 4% year-on-year, while profits fell to 412.72 billion yuan, a decrease of 16.2%[51]. - Different sub-industries showed varied performance, with traditional Chinese medicine (TCM) and Chinese patent medicines maintaining positive growth rates of 14.6% and 6.5% respectively, while chemical raw materials and biological products saw significant declines[52]. - The overall pharmaceutical market in China is projected to grow at a compound annual growth rate (CAGR) of 9.6% from 2020 to 2025[130]. - The company anticipates a decline in revenue and profit due to ongoing policy changes in the pharmaceutical industry, with a focus on adapting to these changes to maintain profitability[143]. Corporate Governance - The company has a governance structure that complies with the latest regulations, ensuring effective operation and protection of shareholder rights, particularly for minority shareholders[156]. - The board of directors consists of 9 members, including 3 independent directors, meeting the requirement for independent oversight[157]. - The company has established transparent performance evaluation and incentive mechanisms for senior management to promote long-term stability and development[158]. - The company has maintained a stable governance structure with independent directors and a supervisory board that operates independently[160]. - The company has a structured approach to evaluating and compensating its directors and senior management[175]. Environmental Responsibility - The company has implemented a strict environmental responsibility system, including an "environmental veto" policy and increased investment in environmental protection measures[150]. - The company invested 2.6165 million yuan in environmental protection during the reporting period[200]. - There were no administrative penalties related to environmental issues during the reporting period[200]. - The company adheres to various environmental discharge standards for air and water pollutants[200]. Strategic Initiatives - The company implemented a strategy of "focus, optimization, and integration" to enhance operational efficiency and adapt to industry changes[36]. - The company aims to enhance its brand value and market influence, having received multiple awards in 2023, including "Top 100 Chinese Traditional Medicine Enterprises" and "Outstanding Brand Enterprise in Chinese Medicine" for its loquat cough series products[46][47]. - The company plans to focus on innovation and quality, aiming to enhance brand value and market influence while expanding into various business areas including manufacturing and e-commerce[133]. - The company will enhance R&D and innovation capabilities, focusing on core products in oncology and cardiovascular areas, utilizing both "internal growth and external expansion" strategies for new vitality[134]. - The company aims to develop a series of single products with over 100 million in sales, focusing on traditional Chinese medicine as a new profit growth point[140].