Performance continues to grow, and high-margin products perform excellently. 2024H1 achieved revenue of 0.59 billion yuan (+5.6% year over year). The increase in sales was due to the increase in reagents driven by the sales and stock of in vitro diagnostic instruments, as well as sales of dermatological and aesthetic devices in the treatment and rehabilitation business. By business, 24H1's in-vitro diagnosis business achieved revenue of 0.468 billion yuan (+21.7% YoY), accounting for 79.4%; the treatment and rehabilitation business achieved revenue of 0.114 billion yuan (-32.0% YoY), accounting for 19.4%. On the profit side, 24H1 achieved net profit of 0.172 billion yuan (+27.8% year over year). The company's product sales structure changed, and the share of high-margin products increased, which led to an increase in total profit. At 24H1, the company's gross margin was 69.82% (+4.6pct year over year).
Persist in innovation and explore the value of differentiated products. The company attaches importance to technological innovation. 2024H1 R&D expenses were 98.77 million yuan, +1.43% year-on-year, accounting for 16.74% of revenue. In the field of in vitro diagnostics, the company launched the fully automated electrochemiluminescence immunoassay line LiFOLAS 8000 and the full-laboratory automated assembly line LiFOLAS9000 in 2024H1. LiFOLAS 8000 can realize automatic pre-treatment operations such as centrifugation, which can effectively save laboratory space; LiFOLAS 9000 can achieve customized services through flexible configuration of modules (pre-treatment, tracks, etc.). In the field of treatment and rehabilitation, the company continues to iteratively upgrade its clinical medical product line. High-flow medical respiratory humidifiers add the CPAP model, which can provide patients with better respiratory treatment plans; in the dermatology and aesthetic product line, the company is expanding the application of contact sensing technology to semiconductor laser hair removal devices, further improving safety.
Consolidate the domestic marketing structure and build local operation capabilities internationally. By region, 24H1's revenue in the domestic market was 0.429 billion yuan (+1.6% year over year); revenue in the international market was 0.161 billion yuan (+18.3% year over year).
In the in-vitro diagnosis business, the company achieved revenue of 0.319/0.149 billion yuan domestically and overseas respectively, +19.4%/+26.9% year-on-year respectively. At home, the company is committed to building an academic platform, organized and participated in the formulation of emergency testing team standards and the drafting and preparation of expert consensus, and organized the preparation of the People's Health Press's “Clinical and Application of Emergency Testing Technology” monograph. Overseas, the company focuses on improving the local operating capabilities of core countries, and has set up subsidiaries in Russia and Indonesia to strengthen overseas business development capabilities. At present, the company's products have been exported to more than 100 countries, including Russia, Italy, and India.
According to the company's mid-year report, we lowered our revenue forecast and raised our gross margin forecast, predicting that the company's EPS for 24-26 will be 0.95/1.19/1.51 yuan, respectively (the previous value was 1.02 yuan in 2024 and 1.30 yuan in 2025). Based on comparable company valuations, PE was given 18 times in 24 years, and the target price was 17.10 yuan, maintaining a “buy” rating.
Risk warning
There is a risk that R&D will not progress as expected, product sales will fall short of expectations, and the risk of increased competition in the industry.