When facing thousands of listed company announcements every day, which ones should you read? What are the key points to take away from the dozens or hundreds of pages of material announcements? Are the many professional terms in the announcements bullish or bearish? Check out Caixin's "Quick Read Announcement" column, where our reporters across the country will provide you with accurate, fast and professional interpretations on the night of the announcement.

According to the report by Cailian Press on July 24th, "Yao Mao" Zhangzhou Pientzehuang's net profit in the second quarter of this year declined year-on-year, and the company intends to accelerate the creation of new growth points.

Zhangzhou Pientzehuang Pharmaceutical released its performance report tonight, with a revenue of CNY 5.65 billion in the first half of 2024, up 11.99% year-on-year; net income attributable to shareholders of the listed company was CNY 1.72 billion, up 11.61% year-on-year. If only the second quarter is calculated, revenue was CNY 2.479 billion, net income attributable to shareholders of the listed company was CNY 0.745 billion, the year-on-year growth rate of revenue was only 2.61%, and the net profit decreased by 3.37% year-on-year.

The decline in performance in the second quarter, coupled with a net profit growth rate of only 11.61% in the first half of the year, has led to industry expectations that Zhangzhou Pientzehuang's performance growth rate for the full year may be weaker than previously expected. After Zhangzhou Pientzehuang's first-quarter report was released this year, several brokerages gave the company an expected performance growth rate of more than 20%. Among them, Wanlian Securities expected the company's net profit for the full year of 2024 to be CNY 3.465 billion, a year-on-year increase of 23.88%; Southwest Securities expected the company's net profit for the full year to be CNY 3.434 billion, a year-on-year increase of 22.77%.

Due to the significant increase in the price of the company's main product, Pientzehuang tablets, in May of last year, it is expected that sales volume of the product will decline in the second quarter of this year. Pientzehuang tablets have been the company's most important "driving engine" for more than a decade.

Some funds have previously made predictions about this. Looking at the holding positions of the Central European Medical and Health Hybrid Fund by Geroan at the end of the second quarter, it has already reduced the holding positions of Pientzehuang.

Regarding the change in performance, the company explained that the sales revenue of the core Pientzehuang series products and cosmetics achieved significant growth, but the rise in the cost of important raw materials has compressed the profit margin.

At present, the price of natural cow bezoar, the main raw material of Pientzehuang, has increased significantly compared to the same period of last year. The market price of high-quality natural ox bezoar is about CNY 1.7 million/kg to CNY 1.8 million/kg, but on July 1st this year, the country opened up a pilot imports of cow bezoar, and industry insiders expect that the implementation of this policy will break the situation of insufficient supply of natural cow bezoar, and raw material prices are expected to rebound, gradually reducing the pressure on the company's raw material costs.

The company also released the "Improving Efficiency and Quality, Returning Value" action plan for 2024 to further improve the company's operating quality, enhance market competitiveness, and increase investor returns. This action plan elaborated on key points for accelerating the creation of new engines for the company's development.

In the "action plan," Pientzehuang stated that it will promote the construction of a new product matrix, drive new vitality in the marketing link, and create a new engine for sales growth. In 2024, the company will concentrate its efforts on cultivating series products such as Fu Fang Pianzehuang tablets, Yindanpinggan capsules, and Chuanbei Qingfei syrup to enrich the Pientzehuang series "big single product" matrix; help achieve sales of more than CNY 100 million for Pientzehuang Pai'angan Niuhuang pills, Yindanpinggan capsules, Fu Fang Pianzehuang tablets, and Ganbao; focus on developing multiple billion-Yuan sales single products such as Pearl Cream, Pearl Paste, and Whitening and Spot Removing Cream; enhance the market share of its own "blue hat" products, expand the beverage product series, and form a large health product matrix; build a new brand position and constantly explore more diverse and effective communication methods; empower research and development technology, lead industry innovation, focus on new drug development and secondary development of Chinese patent medicine, and cultivate new high-quality development momentum with high-level technological innovation.

From the above description, the company has made a development layout for exploring the "second growth curve" beyond Pientzehuang tablets. Among them, An Gong Niuhuang pills, Pianzehuang tablets, Ganbao, and Huanghou Pianzehuang Pearl Cream have achieved sales revenue of over CNY 100 million in 2023, forming a certain scale advantage, but the overall scale is still relatively small.

In addition, the company has accelerated its layout for external extension development. In July of this year, Zhangzhou Pientzehuang Pharmaceutical's wholly-owned subsidiary, Zhangzhou Pientzehuang Investment Management Co., Ltd., participated in the Zhangzhou Yuanshan Da Health Industry Investment Fund (Limited Partnership), with a total fund amount of 0.5 billion yuan. In March of last year, Pientzehuang Pharmaceutical Investment, together with Yingke Capital and Jiangxi Jiangtou, jointly invested 1 billion yuan to establish the "Pientzehuang Yingke Life and Health Industry Fund," which invested in equity in projects in traditional Chinese medicine, biomedical, medical equipment, medical services and other industries.