Coren Pharmaceutical released its third quarterly report for 2023. In the first three quarters of 2023, the company achieved operating income of 15.743 billion yuan, an increase of 12.93% over the same period last year, and a net profit of 1.963 billion yuan, an increase of 39.70% over the same period last year. The non-net profit of 1.922 billion yuan was deducted from the mother, an increase of 40.14% over the same period last year.
Q3's operating income in a single quarter was 5.009 billion yuan, an increase of 4.02% over the same period last year. The net profit returned to the mother was 561 million yuan, an increase of 4.43% over the same period last year. The non-net profit deducted by the mother was 572 million yuan, an increase of 1.02% over the same period last year.
Global innovation is officially launched, the value is about to be realized, and the main business continues to grow at a high level.
On the revenue side, the company's 2023Q1-3 realized operating income of 5.602 billion yuan, 5.132 billion yuan and 5.009 billion yuan respectively, up 24.98%, 10.54% and 4.02% respectively over the same period last year, and maintained a year-on-year growth trend in each quarter; on the profit side, the company's 2023Q1-3 realized net profit of 810 million yuan, 592 million yuan and 561 million yuan respectively, up 178.10%, 2.63% and 4.43% respectively.
Among them, 2022Q3 Colombo received US $35 million from MSD to pay for the cooperation project, which increased the net profit by 129 million yuan. After deducting this part, the actual year-on-year growth rate of 2023Q3 net profit was 35.5%, and the rapid growth of the main business was in line with expectations.
The research and development of innovative drugs has been continuously advanced, and SKB264 has achieved multi-line layout in the field of lung and breast cancer.
2023Q3, clenbuterol submitted an application for the listing of cetuximab bioanalogue A140 and was accepted by NMPA; the phase 3 clinical study of SKB264 for locally advanced, recurrent and metastatic triple negative breast cancer of 3L and above has reached the main end point, and we expect to submit a listing application within 2023; in addition, phase 3 clinical trials of SKB264 for EGFRm TKI-resistant nsqNSCLC and phase 3 clinical studies for 2LHR+/HER2 metastatic breast cancer have been approved. In addition, partner Merck & Co Inc registered in October to launch a global phase 3 clinical study of SKB264 monotherapy for advanced EGFRm TKI drug resistance or metastatic nsqNSCLC, marking a milestone in SKB264 global research and development.
In terms of financial indicators, the company's 2023Q1-3 sales expense rate was 20.64%, down 3.65 pct from 24.28% in the same period in 2022; the absolute amount was 3.249 billion yuan, down 4.02% from the same period last year; the management expense rate was 4.49%, down 1.72 pct from 6.21% in the same period in 2022; the absolute amount was 707 million yuan, down 18.31% from the same period last year
The company's long-term investment logic combs: the company still chooses high R & D investment in difficult times, and generic drugs have gradually entered the harvest period from the products approved in 2019-2021. The company's long-term logic remains unchanged, large infusion industry upgrading, structural adjustment, Coren profitability increased. The domestic environmental protection standard is high, and the profit of Chuanning full production has improved. Imitation leads innovation and provides power for the company's high performance growth in the future; innovative drugs have gradually entered the harvest period and look forward to the promotion of more innovative varieties in the future.
Profit forecast and valuation: the company's generics achievements to further promote rapid growth, follow-up will give the company revenue continuous power, innovative drug research and development into the harvest period, the pace of transformation is more and more stable. We estimate that the net profit from 2023 to 2025 will be 2.32 billion yuan, 2.61 billion yuan and 3.1 billion yuan, respectively, with a corresponding growth rate of 35.5%, 12.9%, 18.5%, 1.57 yuan, 1.77 yuan, 2.10 yuan, respectively, and 18x, 16x, 13x, respectively, with a "buy" rating.
Risk hints: industry policy change risk; Chuanning project does not meet the expected risk; generic drug consistency evaluation schedule lag risk; new drug research and development failure risk.