In the first half of 2022, the company achieved revenue of 5.737 billion yuan, a decrease of 4.46% over the same period last year, and a net profit of 319 million yuan, an increase of 13.88% over the same period last year, deducting 188 million yuan of non-return net profit, an increase of 19.32% over the same period last year. The performance is basically in line with expectations, and with the gradual recovery of the domestic epidemic in the second half of the year, the company is expected to continue to maintain the growth trend and maintain the overweight rating.
Support the main points of rating
The company remains profitable and its performance is expected to improve as the epidemic alleviates. The company's performance basically maintained steady growth in the first half of 2022, and the company's performance fluctuated due to the repeated influence of the domestic epidemic, but through cost control and the improvement of operating turnover efficiency, the company's overall operating cash flow continued to grow. the scale of interest-bearing liabilities effectively reduced, the financial expenses related to financing decreased compared with the same period last year, and the overall financial situation remained in good operation.
With the weakening of negative growth factors such as the relief of the epidemic, it is expected that the company's performance will gradually accelerate in the second half of the year.
The performance of subsidiaries has developed steadily and the ability of pipeline management has been further improved. Hanhui Pharmaceutical's profit level has increased steadily, deeply covering the grade hospitals in the core market, Haibo Maibu tablets have been listed in more than a thousand hospitals, omacycline has been successfully listed, and the sales business has been rolled out in an all-round way; the localization of Pfizer Inc's products has been carried out smoothly according to the plan. the gross profit margins of the three varieties that have completed the transfer and entered commercial production have increased significantly; Haisheng Pharmaceutical Co., Ltd. has collected and implemented insulin collection, and the actual supply is expected to exceed the reported volume. Haizheng Animal Insurance and Li Li Kang have introduced strategic investors to complete the internal restructuring; Hainan and Japanese companies are also accelerating the preparation of new business. The overall development of the holding subsidiary is relatively rapid, which helps to speed up the improvement of the company's performance.
The progress of product research and development has been accelerated, and phased results have been achieved in EU rectification and reform. The company focuses on independent research and development of innovative drugs, accelerating new drug pipeline and clinical capacity building, a number of existing projects are promoting preclinical research, HS301 tablets, HS248 tablets get drug clinical trial approval notice; in terms of biological drugs, Degu Insulin, Glargine Insulin, double Insulin and other products are progressing steadily as planned. Adenosylsuccinylmethionine for injection and fludarabine phosphate for injection are the first to pass the national generic drug consistency evaluation, the approved acarbose tablets add 100mg specifications, and the company's product reserve is further expanded. In February 2022, EU officials issued an inspection report and decided to partially cancel the "declaration of GMP non-conformity" of the Taizhou factory. The CEP certificates of the products involved in the first phase of rectification and reform have been fully restored, and the follow-up work of the second phase of rectification and reform will continue to be promoted. Now the design tender for the second phase of the transformation has been completed, and the renovation project has been officially launched in the second half of the year. The process of lifting the ban in the EU is accelerated, which is expected to have a positive impact on the API business.
Valuation
It is expected that the company's net profit from 2022 to 2024 will be 595 million yuan, 718 million yuan and 875 million yuan, and the EPS will be 0.50,0.60,0.73 yuan respectively.
Main risks faced by rating
The situation of winning the bid is lower than the expected risk, the change of medical insurance policy, the repeated risk of domestic epidemic situation.