On October 27, [incident: mm20a2ry3], the company released its report for the third quarter of 2023: The company's operating income for the first three quarters was 2,926 billion yuan, up 4.48% year on year, net profit from the mother was 473 million yuan, up 0.18% year on year, and net profit after deducting 437 million yuan from the previous year, down 2.19% year on year.
Among them, operating income for the third quarter of 2023 was 989 million yuan, up 6.65% year on year, net profit from the mother was 157 million yuan, down 10.31% year on year, and net profit from non-return mother was 146 million yuan, down 14.68% year on year.
An innovative drug for major insomnia is about to be approved, and central nervous system product capabilities continue to be strengthened. The company's product capabilities in the central nervous system field continue to be strengthened. Drugs such as the antiepileptic drug levetiracetam, the drug praxol used to treat Parkinson's, and the antidepressant sertraline hydrochloride rank high in the national hospital market. The company's new class 1.1 drug, Antasinib capsules, for treating insomnia disorder, are currently in the technical review stage and are expected to be approved for marketing within the year. The product is positioned over 20 billion in the insomnia disorder market, which is expected to change the domestic insomnia market pattern.
There are few drugs approved and marketed in China to treat insomnia, and there is a large number of clinical unmet needs in the market. Currently, drugs for insomnia mainly include benzodiazepine sedative hypnotics such as diazepam, esazolam, and clonazepam (with some dependency), as well as non-benzodiazepine sedative hypnotics such as zolpidem, zaleplon, and dexzopiclone.
Andashinib selectively acts on the α1 subunit of the gamma-aminobutyric acid A receptor, which not only rapidly activates this receptor and inhibits neurological activity, but also avoids excessive activation of this receptor from causing related side effects. The elimination half-life of andacinib is about 3-4 hours, which is longer than the short-acting sleep aids zolpidem and zaleplon (average half-life of 1-3 hours), so it has a relatively longer effect on maintaining sleep; at the same time, it is shorter than moderate-acting sleep aids such as dexzopiclone (average half-life of about 6 hours), so it is less likely to cause adverse effects due to residual effects.
The profit side is basically stable, and the profit side is basically stable
The company's main varieties of levetiracetam, sertraline hydrochloride, and the main varieties of roservastatin in the cardiovascular field, calcium, simvastatin, and pivastatin have all passed a consistent evaluation and entered national or provincial alliances for collection. The impact of collecting large stocks of varieties has been basically clarified.
The company's gross profit margin for the first three quarters of 2023 was 51.00%, down 3.16 pct year on year; the company's sales expenses were 606 million yuan, down 10.79% year on year, sales expenses were 20.71%, down 3.55 pct year on year; management expenses were 142 million yuan, up 16.91% year on year, management expense ratio 4.86%, up 0.52pct year on year; R&D expenses were 259 million yuan, up 5.30% year on year, R&D cost rate 8.87%, up 0.07pct year on year. Financial expenses - 38 million yuan, a year-on-year increase of 35.60%, a year-on-year increase of -1.31%, a year-on-year increase of 0.81pct; net profit margin of 16.27%, a year-on-year decrease of 0.71 pct.
Among them, the comprehensive gross profit margin, sales expense ratio, management expense ratio, R&D expense ratio, financial expense ratio, and overall net interest rate for the third quarter of 2023 were 51.95%, 20.99%, 5.63%, 8.93%, -0.56%, and 15.93%, respectively, with changes of -1.63pct, -2.97pct, +1.03pct, +0.71pct, +2.72pct, and -3.06pct.
Profit forecast and investment rating: Based on the analysis of the company's core business segments, we expect the company's net profit from 2023-2025 to be 6.73/8.18/992 billion yuan, respectively, with a year-on-year difference of +1.64%/+21.51%/+21.27%, corresponding to EPS of 0.80/0.98/1.18 yuan, corresponding to the current stock price of PE, 16/13/11 times. First coverage, giving a “buy” rating.
Risk warning: the risk of price reduction of stock products; drug approval falls short of expectations; new drug release falls short of expectations; and product development progress falls short of expectations.