Chongqing Zhifei Biological Products Co (300122) Q2 2024 earnings summary

Executive summary

• Revenue for H1 2024 was ¥18.26 billion, down 25.31% year-over-year; net profit attributable to shareholders was ¥2.23 billion, down 47.55% year-over-year.

• Main products' sales volume declined compared to the same period last year, but market share remained high.

• Company completed a share buyback and cancellation of 6.21 million shares, reducing total share capital to 2.394 billion shares.

• R&D investment reached ¥570 million, with 979 R&D staff and multiple pipeline projects advancing.

• Expanded cooperation with Merck (MSD) and GSK, including new product launches and broader market coverage.

Financial highlights

• Operating income: ¥18.26 billion, down 25.31% year-over-year.

• Net profit attributable to shareholders: ¥2.23 billion, down 47.55% year-over-year.

• Operating cash flow: -¥307 million, compared to ¥2.18 billion in H1 2023.

• Basic and diluted EPS: ¥0.9322, down 47.48% year-over-year.

• Gross margin for self-developed products: 85.38%; for agency products: 24.74%.

• Total assets: ¥54.85 billion, up 9.18% from year-end 2023.

Outlook and guidance

• Management will focus on optimizing market strategies, accelerating R&D, and strengthening risk controls in H2 2024.

• Emphasis on expanding market share for new products and improving operational structure.

• Continued implementation of the "Quality and Return Dual Enhancement" action plan and commitment to sustainable growth.