Performance Overview: Revenue of 1.653 billion yuan (+4.26%) for the first half of '24, net profit of 0.44 billion yuan (-16.42%), net profit of 0.363 billion yuan (-8.73%) after deducting non-net profit of 0.363 billion yuan (-8.73%). Of these, 24Q2 achieved revenue of 0.865 billion yuan (+22.82%) and net profit of 0.178 billion yuan (+1.97%) to mother. The company's gross margin for the first half of '24 was 50.69%, and the sales/management/R&D expense ratios were 7.40%/10.00%/8.75%, respectively.

Revenue split: Blood products revenue of 1.614 billion yuan (+12.83%), gross profit margin of 50.10% (-3.26pcts); human blood albumin revenue of 0.644 billion yuan (+24.97%), gross profit margin 49.26% (-3.23pcts); revenue from intravenous ambuterol 0.459 billion yuan (-2.41%), gross profit margin 51.13% (-5.29pcts); revenue from other blood products 0.511 billion yuan (+14.91%), Gross profit margin 50.23% (-2.06 pcts). Revenue from vaccine products was 0.029 billion yuan (-80.13%). Mainly due to the outbreak of influenza A in many parts of the country in the first quarter of 2023, vaccine sales increased significantly compared to previous years. The influenza epidemic was relatively stable in the first half of '24. At the same time, price adjustments for the quadrivalent influenza vaccine affected the current sales progress, so vaccine sales revenue declined sharply year on year.

The amount of pulp collected is growing rapidly, and the expansion of new pulp stations is being actively promoted. The company is actively promoting the construction of single plasma collection stations. The Dengzhou Single Plasma Collection Station, the Xiangcheng Single Plasma Collection Station, and the Qixian Single Plasma Collection Station passed the inspection, obtained a pulp collection license, and successfully mined. On August 23, the Chongqing Company was approved to set up single plasma collection stations in Fengdu County and Wushan County. The Chongqing Company will speed up construction and strive to obtain a single plasma collection license as soon as possible. 24H1's raw plasma collection volume increased by 22.47% over the same period last year. The construction of the new plasma station and the expansion of the original plasma station laid a solid foundation for the company's blood products business to maintain steady growth.

Strengthen vaccine quality management and do a good job in the production and sale of vaccine products. In the first half of the year, the company obtained 4 batches of rabies vaccine batches. A total of 66 batches of influenza vaccine were issued, including 60 batches of quadrivalent influenza vaccine and 6 batches of trivalent influenza vaccine.

Profit forecast and rating: Considering that Hualan Vaccine will adjust the price of quadrivalent vaccine products starting June 5, the company's profit forecast for the whole year was lowered. The company is expected to achieve net profit of 1.469/1.666/1.839 billion yuan in 24-26, an increase of -0.9%/13.4%/10.4% year-on-year. Maintain a “buy” rating.

Risk warning: Pulp station development falls short of expectations, product development progress is slow, industry policy risks