Performance Overview: In 2023, we achieved revenue of 7.384 billion yuan (+4.21%), net profit attributable to mother of 2,025 billion yuan (+0.91%), deducting non-net profit of 1,477 billion yuan (-4.05%); single Q4 revenue of 1,734 million yuan, less non-net profit of 279 million yuan. The company's domestic main business revenue was 4.163 billion yuan (+17.51%), benefiting from the leading position in the domestic clinical CRO market; overseas main business revenue was 3.127 billion yuan (-9.62%), mainly due to a decrease in overseas vaccine revenue.
Clinical trial technical service revenue of 4.168 billion yuan (+1.04%), gross profit of 1,592 billion yuan (+2.59%), gross profit margin 38.21%. Mainly due to the decline in clinical trials of vaccine programs. The number of ongoing drug clinical research projects as of the end of '23 was 752 (680 at the end of '22). Revenue and orders in the US region have increased significantly, and business service capabilities such as real-world research and pharmacovigilance have continued to be strengthened.
Revenue from clinical trial-related services and laboratory services was $3.121 billion (+8.51%), gross profit of $1,191 billion (basically flat), and gross margin fell to 38.16%, mainly due to the slowdown in Fangda's revenue and the relatively rapid growth rate of its low-gross SMO business. The number of employees in the digital system business exceeded 850 in 23 years, and the number of global customers increased 31.27% year over year, from 259 at the end of last year to 340; the number of CRCs in the SMO business was more than 2,700, and the number of ongoing field management projects increased from 1,621 at the end of last year to 1,952.
The 24Q1 order trend resumed and overseas business expansion was strengthened. As of the end of 2023, the amount of contracts to be executed was 14.08 billion yuan (+2.1%), and the company added 7.85 billion yuan (-18.8%) for the whole year, mainly due to the decline in contract changes and additional handling fee orders for some customers in 23Q4. The company actively explores overseas markets, and has achieved rapid growth in new orders and business in the North American market. The BD side emphasizes MNC and major domestic Pharma, or may increase overseas operating share of mergers and acquisition-related targets, and continue to invest in European and American BD and operating capabilities.
Profit forecast and rating: The company's revenue for 2024 to 2026 is expected to be 84.86/98.61 billion yuan, respectively, up 14.9%/16.2%/17.1% year on year; net profit to mother will be 22.81/25.97 billion/3.030 billion yuan, respectively, up 12.6%/13.9%/16.7% year on year. Maintain a “buy” rating.
Risk warning: industry competition intensifies, uncertainty in the international environment intensifies, overseas business development falls short of expectations