Event: the company released its semi-annual report in 2023. From January to June in 2023, the company realized income of 1.381 billion yuan (- 22.51%), net profit of 172 million yuan (- 56.91%), deduction of non-net profit of 178 million yuan (- 55.41%), and operating cash flow of 410 million yuan (- 2.92%). In 2023, Q2 realized operating income of 704 million yuan (- 17.82%), net profit of 58 million yuan (- 71.58%) and non-net profit of 58 million yuan (- 70.85%).
Self-produced molecules and agent products declined, and the apparent performance was under short-term pressure. 1) Independent products: 2023H1 realized sales revenue of 867 million yuan (- 23.69%), accounting for 62.76% ((- 0.97pct)), mainly due to the decline in sales of COVID-19 molecular diagnostic products. The company's molecular diagnostic reagent income decreased by 98.55% to 5.7104 million yuan compared with 2022H1's 393 million yuan. In addition, affected by the decline in gross profit margin of molecular diagnostic products and the provision for impairment of inventory assets, the company's apparent return net profit has declined significantly, and the company's overall profitability is expected to be repaired gradually as the short-term impact fades in the future. 2) Agent products: the company has taken the initiative to adjust its business structure since 2022, and the agency business has been further reduced. 2023H1 has achieved an income of 496 million yuan (- 20.81%), which is in line with the company's overall strategic plan to drive growth with self-produced products.
The installation of large-scale equipment is progressing smoothly, and the rapid installation of assembly line is expected to drive the long-term growth of reagents. The company continues to promote the intelligent inspection and analysis line in the whole laboratory, and installs the machine in cooperation with the stand-alone terminals of each platform. 2023H1 independent large-scale instrument products are out of the warehouse (1601), of which there are 169biological immunity and blood production lines. 2023H1 achieved sales revenue of 805 million yuan (+ 12.9%) with independent routine reagents. At present, the users of the company's independent products have covered 8000 customers at all levels of medical institutions, of which the product coverage rates of secondary and tertiary hospitals have reached 24% and 57% respectively, and have reached cooperation with 528 dealers in 118 countries to continue to expand overseas markets. We believe that the rapid installation of the assembly line in the first half of the year is expected to lead to further growth in sales of follow-up reagent products.
A number of R & D projects make steady progress, and continue to build the core competitiveness of independent products. At present, the company has established a research and development platform covering biochemical, immune, temporary testing, molecular, pathological, rapid testing, IVD raw materials and other products. 2023H1 invested 164 million yuan (+ 32.76%) in R & D, 41 new R & D projects (including 5 biochemical items / 6 temporary tests / 6 molecular tests / 2 quick tests / 12 raw materials / 10 instruments) and 38 new domestic registration certificates, totaling 495. Among them, the certified instrument in July 2023: ① automatic blood cell analyzer F680/F680P: blood routine detection speed is 80 samples / hour, F680P integrates the functions of blood cell analysis and specific protein analysis, and can realize simultaneous detection of one sample injection. ② automatic Blood Coagulation Analyzer H5000/H5200: the highest detection speed can reach 500test / hour, and it supports closed cover puncture, online loading of reagents and consumables and splicing assembly line, which can meet the needs of medium and large laboratories.
Investment suggestion: the company is the head IVD enterprise with leading technical strength and comprehensive product layout. The rapid landing of high-speed machines and assembly line solutions provides the company with long-term growth power. Taking into account the impairment provision and other effects, we downgrade the company's 2023-2025 homing net profit forecast to 479 million yuan, 699 million yuan and 894 million yuan, year-on-year-32.39% Universe 45.97% Universe 28.01%, per share EPS is 0.78,1.14,1.46 yuan respectively, the current stock price corresponds to 479 million-2025 PE 20-13-11 times, maintaining the "recommended" rating.
Risk tips: the risk that the price reduction of chemiluminescence reagent collection is higher than expected, the risk that the assembly line installation progress is not as expected, and the risk that overseas expansion is not as expected.