CSPC PHARMACEUTICAL(1093.HK):4Q RESULTS MISSED; OPTIMISTIC 2024 GUIDANCE OF DOUBLE-DIGIT GROWTH
CSPC PHARMACEUTICAL(1093.HK):4Q RESULTS MISSED; OPTIMISTIC 2024 GUIDANCE OF DOUBLE-DIGIT GROWTH
CSPC announced results with revenue up by 1.7% YoY to RMB31.5bn and adjusted net profit up by 2.8% YoY to RMB6.28bn in 2023, 1.1%/1.4% below BOCI estimates/consensus, mainly due to (i) impacts from industry rectification activities and soft API price, partially offset by rapid growth in anti-infective and respiratory segment. Looking into 2024, the management was upbeat on double-digit growth in both top line and bottom line. Post results, we fine tune our 2024/25 estimates and introduce our 2026 estimates, slightly revised down TP to HK$10 and maintain BUY rating.
CSPC公佈業績，收入同比增長1.7％，至315億元人民幣，2023年調整後的淨利潤同比增長2.8％，至人民幣62.8億元，比中銀國際的預期/共識低1.1％/1.4％，這主要是由於（i）行業整改活動和軟API價格的影響，但部分被抗感染和呼吸領域的快速增長所抵消。展望2024年，管理層對收入和利潤的兩位數增長持樂觀態度。公佈業績後，我們微調了2024/25年的估計，並推出了2026年的估計，略微下調了目標價至10港元，維持買入評級。
Key Factors for Rating
評級的關鍵因素
4Q results missed: CSPC delivered 4Q23 results with RMB7.6bn of sales (- 2.6% QoQ or +1.9% YoY), 4.4% below BOCI estimates, which we attributed to impacts from industry rectification activities and soft API price of vitamin C and caffeine. Finished drugs recorded revenue of RMB6.3bn, up 6.6% YoY but down 1.6% QoQ with nervous system disease/oncology/anti-infective/ cardiovascular/respiratory/digestion and metabolism/others delivering QoQ changes of -8.8%/-7.4%/+9.3%/+10.0%/+40.7%/-7.7%/-6.0%, respectively. We believe QoQ decline in nervous system and oncology was due to decreasing prescription amidst industry rectification while rapid growth of anti-infective and respiratory drugs was owing to (i) sales ramp up of Anfulike (+100% YoY per management) and (ii) outbreak of respiratory tract infection in China. The performance of oncology segment was still dragged by the price cut of Keaili, while we see positive YoY growth (+0.6%) in oncology business in 4Q23. Pressure from API remained, with revenue from vitamin C products/antibiotics dropping by 12.0%/19.1% QoQ but caffeine up by 9.5% QoQ. Core profits increased by 5.3% YoY due to (i) improved gross margin and (ii) save in selling expenses.
第四季度業績未達預期：CSPC公佈了23年第四季度業績，銷售額爲76億元人民幣（環比下降2.6％，同比增長1.9％），比中銀國際的預期低4.4％，我們將其歸因於行業整改活動以及維生素C和咖啡因軟原料藥價格的影響。成品藥收入爲63億元人民幣，同比增長6.6％，但環比下降1.6％，其中神經系統疾病/腫瘤學/抗感染/心血管/呼吸系統/消化和新陳代謝/其他藥物的季度變化分別爲-8.8％/ -7.4％/ +9.3％/ +10.0％/ +40.7％/-7.7％/ -6.0％。我們認爲，神經系統和腫瘤學環比下降是由於在行業整頓中處方減少，而抗感染和呼吸道藥物的快速增長是由於（i）Anfulike的銷售增長（每位管理層同比增長100％）以及（ii）中國爆發呼吸道感染。腫瘤學板塊的表現仍然受到Keaili降價的拖累，而我們預計腫瘤業務在23年第四季度同比正增長（+ 0.6％）。來自原料藥的壓力依然存在，維生素C產品/抗生素的收入環比下降了12.0％/19.1％，但咖啡因的收入環比增長了9.5％。由於（i）毛利率提高和（ii）節省銷售費用，核心利潤同比增長5.3％。
2024 outlook: during the call, the management provided 2024 guidance of double-digit growth in topline and bottom line, not less than 30% dividend payout ratio, and at least sales of RMB3bn from new and sub-new products (hospital level, or sales of RMB3.5bn-3.6bn in ex-factory level). The management was upbeat on the guidance given (i) good sales/ hospital admission momentum of new and sub-new products, (ii) favourable policies towards hospital entry and pricing of innovative drugs, including actively held drug management committee meetings, etc., (iii) normalised academic conferences and physician prescription volume as the industry rectification activities now mainly target at key person in hospitals, and (iv) importance that government attaches to pharmaceutical industry.
2024年展望：在電話會議上，管理層提供了2024年的收入和利潤增長兩位數的指導，股息支付率不低於30％，新產品和次新產品（醫院層面，或出廠銷售額爲35億至36億元人民幣）的銷售額至少爲30億元人民幣。管理層對給出的指導意見持樂觀態度：（i）新產品和次新產品的銷售/入院勢頭良好；（ii）對創新藥物的准入和定價的有利政策，包括積極舉行的藥物管理委員會會議等；（iii）學術會議和醫生處方量正常化，因爲行業整改活動現在主要針對醫院的關鍵人物；（iv）政府對製藥行業的重視。
Valuation
估價
Post result, we fine tune our 2024/25E revenue on higher contribution from new and sub-new products given the hospital entry momentum seen in 1Q24, and lower revenues from APIs. Besides, we expect gross margin to recover in 2024 given higher contribution from finished drug, while we also expect increased selling expense ratio considering new products to be launched in 2024/25. Overall, we revise our 12-month TP to HK$10.0, and maintain BUY (WACC: 10.2% and terminal growth: 2.5%)
業績公佈後，鑑於24年第一季度醫院進入勢頭以及API收入減少，我們對2024/25財年的收入進行了微調，原因是新產品和次新產品的貢獻有所增加。此外，由於成品藥的貢獻增加，我們預計毛利率將在2024年恢復，同時考慮到新產品將於2024/25年推出，我們還預計，銷售費用比率將增加。總體而言，我們將12個月目標上調至10.0港元，並維持買入（WACC：10.2％，終端增長：2.5％）
Key Risks for Rating
評級的主要風險
(i) Slower-than-expected ramp-up of newly launched drugs; (ii) failure of R&D and (iii) price cut on core drugs.
(i) 新上市藥品的上漲速度低於預期；(ii) 研發失敗以及 (iii) 核心藥物降價。
譯文內容由第三人軟體翻譯。