SL PHARM(SZ:002038) Zheng Quan Zhi Xing·2025-08-26 23:09Core Viewpoint - Double Deer Pharmaceutical (002038) reported a decline in total revenue for the first half of 2025, while net profit saw a significant increase, indicating a mixed financial performance amid industry challenges [1][2]. Financial Performance Summary - Total revenue for the first half of 2025 was 305 million yuan, a decrease of 22.24% compared to the same period in 2024 [1]. - Net profit attributable to shareholders reached 121 million yuan, an increase of 309.08% year-on-year [1]. - The gross profit margin was 62.73%, down 18.61% year-on-year, while the net profit margin increased to 39.57%, up 438.93% [1]. - The total of selling, administrative, and financial expenses (three expenses) accounted for 39.57% of total revenue, an increase of 40.69% year-on-year [1]. - Earnings per share rose to 0.12 yuan, a 300% increase compared to the previous year [1]. Revenue and Cost Analysis - The decline in revenue was attributed to price reductions from drug procurement, intensified industry competition, and decreased demand for certain drugs due to disease prevalence [1]. - Operating costs increased by 26.41%, driven by expanded production scale and rising raw material and labor costs [1][2]. Cash Flow and Investment - Net cash flow from operating activities decreased by 153.3%, primarily due to increased cash payments for purchased goods [2]. - Net cash flow from investing activities increased by 94.24%, attributed to higher cash receipts from investment recoveries [3]. - The net increase in cash and cash equivalents saw a significant decline of 167.93% due to the drop in operating cash flow [3]. Business Evaluation - The company's historical return on invested capital (ROIC) has been moderate, with a median of 8.77% over the past decade, and a notably poor ROIC of -1.47% in 2024 [4]. - The company has maintained a relatively stable financial history, with only one loss year since its listing [4]. - Recent discussions highlighted the company's focus on R&D progress and the impact of procurement changes on its operations [4].