Items:
The company announced its three-quarter report in 2023, with income of 969 million yuan (+ 2.65%), net profit of-54 million (+ 4.24%) and net profit of-80 million (- 34.45%). The performance is basically in line with expectations.
Among them, Q3 achieved revenue of 320 million (+ 1.72%) in a single quarter, net profit of-7 million (+ 88.67%), and non-return net profit of-8 million (+ 87.12%). Profitability accelerated repair.
Peace viewpoint:
The pressure on the profit side of the company slowed down in the first three quarters, and the repair of profitability accelerated. The company's revenue grew steadily in the first three quarters of 2023, and the pressure on the profit side slowed down through internal fee control. 2023Q3 single-quarter profit-end loss further narrowed, profitability accelerated repair. In terms of period expenses, by adjusting the sales strategy and other fee control measures, the company's sales expense rate in the first three quarters was 55.38% (- 7.76pp), and the management expense rate was 6.18% (- 1.15pp), which improved significantly. At the same time, the company continues to accelerate the promotion of projects under research, with a R & D expenditure rate of 17.38% (+ 4.28pp), a significant increase. Due to the increase in the balance of the loan stock, the financial expense rate increased by 2.36% (+ 1.92pp). The company's gross profit margin in the first three quarters was 71.51% (- 3.76pp), which was mainly affected by factors such as collection and collection in some areas, and the unit price of individual products decreased.
Successfully passed the on-site inspection of GMP in Egypt, and the biomedicine went out to sea. In September 2023, the Egyptian Drug Regulatory Administration completed an on-site GMP audit of the company's partner Maybotak's infliximab products and Dongyao Pharmaceutical's bevazumab products. Egypt is the largest pharmaceutical market in North Africa, and the two biopharmaceuticals successfully passed the on-site review, which opened the prelude to the overseas commercialization of the company's biopharmaceuticals.
Continue to push forward in the research and development of pipelines to help the company's future development. During the reporting period, the company continued to promote a number of projects of clinical trials, including polyethylene glycol human granulocyte stimulating factor injection (long-acting white medicine, has successfully completed Phase I clinical, is actively preparing for domestic phase III clinical and overseas registration), human interferon α 1b inhalation solution (for pediatric respiratory syncytial virus lower respiratory tract infection, all subjects who have completed Ib clinical administration) Human growth hormone injection (actively promote phase I clinical preparation).
Investment suggestion: considering the remarkable effect of fee control in the first three quarters of the company, and the profit end is expected to speed up the repair, we raise the company's net profit forecast of 2023-2025 to-0.72 pesque 0.47 / 52 million yuan (originally-1.03 pound). Considering that the company will continue to promote clinical and overseas commercialization of a number of products under research and introduction in the future, the pipeline valuation is expected to be further improved and the "recommended" rating will be maintained.
Risk tips: 1) the progress of product research and development is not as good as expected risk. The company has a large number of research projects, and there is a risk that the progress of research and development is lower than expected. 2) the progress of overseas commercialization is not as good as expected. The company has introduced a large number of varieties, and there is a risk that the progress of overseas listing is lower than expected. 3) the risk of industry policy change. The national catalogue of base drugs and the catalogue of medical insurance will be adjusted irregularly.