China Net Finance, April 23 Tasly recently disclosed its 2023 annual report. In 2023, Tasly will achieve operating income of 8.674 billion yuan, a year-on-year increase of 0.42%, net profit attributable to the parent company of 1.071 billion yuan, a year-on-year increase of 505.34%, and non-net profit of 1.181 billion yuan, a year-on-year increase of 60.11%, and plans to distribute 3.3 yuan (tax included) to all shareholders for every 10 shares.
As for the reasons for the turnaround, Tasly said that it was mainly due to the fact that the fair value change loss of financial assets during the reporting period was lower than that of the previous year. During the period, the company's operating costs were 2.88 billion yuan, down 7.72% year-on-year, management expenses decreased by 8.46% year-on-year to 342 million yuan, financial expenses decreased by 161.76% year-on-year to -19 million yuan, but sales expenses increased by 3.11% to 2.984 billion yuan.
Compound Danshen Dripping Pill sells 140 million boxes a year
In terms of business types, most of Tasly's revenue in 2023 will come from the pharmaceutical industry business, with a revenue of 7.421 billion yuan, a year-on-year increase of 3.22%. Among them, the revenue of traditional Chinese medicine business was 5.971 billion yuan, the revenue of chemical preparations was 1.203 billion yuan, the revenue of chemical raw materials was 57 million yuan, and the revenue of biological drugs was 190 million yuan.
Behind the high income of Tasly's traditional Chinese medicine business is the high production and sales of "Compound Danshen Dripping Pill". According to the production and sales table, the annual production volume of this product in 2023 will reach 150 million boxes, a year-on-year increase of 26.15%, accounting for nearly 60% of the output of all products of Tianlishi, and the sales volume will be 140 million boxes, a year-on-year increase of 9.89%, accounting for more than half. At the end of the period, the inventory of this product was 27 million boxes, a year-on-year increase of 60.25%.
Tasly pointed out that Compound Danshen Dripping Pill is the company's exclusive product and flagship product, and the market share of Compound Danshen Dripping Pill in 2023 ranks first in the country in the market of traditional Chinese medicine for ischemic heart disease. However, it should be noted that this product is still a product of 20 years ago, and the success of a drug has brought rich returns to Tasly, and the development of the product to the extreme is a reflection of ingenuity, but at the same time, it has also made the company's ability to rely on single products to be questioned.
Tasly said in the annual report that during the reporting period, on the basis of the cardiovascular and cerebrovascular brand advantages formed by compound Danshen Dripping Pills, the company continued to lay out a multi-level product portfolio, and continuously strengthened the secondary development of large varieties and the research and development of innovative traditional Chinese medicines.
From 2021 to 2023, Tasly's R&D investment will be 761 million yuan, 1.016 billion yuan and 1.315 billion yuan respectively. As of the end of the Reporting Period, Tasly had a R&D pipeline covering 98 products under development, of which 19 were modern Chinese medicines, 41 were Class 1 innovative drugs, 36 were in clinical trials, and 26 were in phase II and III clinical trials. In 2022, Tasly has a total of 92 R&D pipelines of products under development, including 41 Class 1 innovative drugs, and 39 of them have entered clinical trials.
In the past three years, Tasly has only approved the marketing of three traditional Chinese medicine products, namely Paeonia Antispasmodic Granules, Kunxinning Granules and Compound Danshen Dripping Pills, for the new indication of diabetic retinopathy. Regarding the assessment of R&D investment and output, Su Jing, general manager of Tasly, said at the performance meeting that due to the high-tech and high-risk characteristics of pharmaceutical products, the early R&D of drugs and the long cycle and many links of products from development, clinical trial approval to production are easily affected by many uncertain factors, and the follow-up company will further strengthen and improve the risk control of R&D projects to ensure the interests of the company and shareholders.
Selling the chain of retail pharmacies failed
In 2023, Tasly's pharmaceutical business revenue will be 1.215 billion yuan, a year-on-year decrease of 14.21%. According to the announcement, Tasly Pharmaceutical is mainly a retail chain business, with chain pharmacies in Liaoning, Tianjin and other places. The decline in Tasly Pharmaceutical's commercial business was mainly due to the company's initiative to shrink the front.
Following the announcement in June 2020 that it would sell 99.94% of its Tasly Marketing equity to Chongqing Pharmaceutical for 1.489 billion yuan in cash, Tasly announced again in September 2023 that it intends to sell 90% of the equity of Liaoning Tasly Pharmacy Chain Co., Ltd. and 60% of the equity of Jinan Pingjia Pharmacy Co., Ltd. held by Tianjin Tasly Pharmaceutical Commercial Co., Ltd., a wholly-owned subsidiary, to Shuyu Civilian Pharmacy Chain Co., Ltd. at a transaction price of 660 million yuan. At that time, Tasly said that this move was to further focus on the development of the pharmaceutical industry and build an innovative pharmaceutical R&D cluster, and after the completion of the sale, the company will no longer engage in retail chain business and will focus on pharmaceuticals.
However, at the end of the reporting period, Tasly's sale of two chain pharmacies temporarily failed, the company said: "In the process of advancing the transaction, the parties further communicated on the transaction plan, but finally did not reach an agreement on supplementary matters, combined with the external and actual situation of the transaction, it is believed that the conditions for continuing to promote the material asset restructuring at this stage are not fully mature, and decided to terminate the transaction." ”
In addition, Tasly's securities investment has also lost money for three consecutive years. During the reporting period, the company's fair value change profit and loss of financial assets was -172 million yuan, of which the fair value change profit and loss of securities investment was -109 million yuan, and four of the five stocks it invested in were floating losses. In 2022, the fair value of Tasly's financial assets decreased by 1.104 billion yuan, of which the profit and loss on securities investment was -34.732 million yuan.
However, at the performance meeting, Tasly said that from the perspective of the investment project as a whole, the company has disposed of 36.46% of the I-MAB equity held by the end of 2023, the investment cost has been fully recovered, and the disposal proceeds attributable to the parent company are 591 million, and the fair value as of December 31, 2023 is 47 million, and the investment cost of CARsgen is 65 million, and 34.20% has been disposed of as of December 31, 2023 received a disposal price of $51 million, and the fair value of the remainder as of December 31, 2023 was $43 million. As of December 31, 2023, the static ROI of I-MAB and CARsgen were 189% and 44%, respectively.
In terms of finance, as of the end of the reporting period, Tasly's cash on the books reached 4.451 billion yuan, a year-on-year increase of 42.68%, short-term borrowings were 723 million yuan, a year-on-year increase of 291%, and the asset-liability ratio was 24.08%.
(Editor in charge: Zhang Ziyi)