Producer: Sina Finance Listed Company Research Institute
Author: Tianli
On the evening of April 25, Matilda Biotech released its 2023 annual report. According to the report, the company achieved a total operating income of 750 million yuan last year, a year-on-year decrease of 92.88%, a net profit attributable to shareholders of listed companies of 74.9259 million yuan, a year-on-year decrease of 98.22%, and a net profit attributable to shareholders of listed companies after deducting non-recurring gains and losses of -124 million yuan, from a profit of 4.158 billion yuan in the same period in 2022.
According to public information, Mingde Biotech is mainly engaged in the research and development, production, sales and service of in vitro diagnostic reagents and diagnostic instruments. Judging from the performance of previous years, the performance of Mingde Biotech will reach a high point in recent years in 2022. Among them, the operating income increased from 176 million yuan in 2018 to 10.53 billion yuan in 2022, and the net profit attributable to the parent company increased from 61 million yuan in 2018 to 4.208 billion yuan in 2022. However, during the same period, the expenses did not increase significantly, and the reason for the performance blowout was that the blowout of testing demand caused by the new crown epidemic drove the rapid increase of the company's products.
As the new crown epidemic became a thing of the past, the performance of Matilda Biotech also fell rapidly. Compared with 2019, although the company's revenue has increased to a certain extent, the net profit level has hardly improved, and the non-net profit will be the first loss in nearly a decade in 2023.
At the same time, after relying on the "dividends" of the epidemic to make a lot of money, the company's asset scale has also been rising, but the company does not seem to have been able to grasp the opportunity for further development, and the return on equity has been declining, and the diluted return on equity will be as low as 1.24% in 2023. In fact, judging from the data of the past ten years, the company's return on net assets has shown a downward trend year by year before the epidemic, but the surge in market demand brought about by the epidemic has temporarily covered up the company's own problems.
The unsustainable performance and the lack of clear growth expectations have led to a decline in the company's share price since its peak during the epidemic, from 143.45 yuan/share in May 2022 to 19.91 yuan/share at present. At present, the company's market value is only 4.629 billion yuan, which is lower than the company's net assets.
It is worth noting that at the same time as the release of the 2023 annual report, Mingde Biotech also issued an announcement on the use of idle own funds for entrusted financial management. According to the announcement, on April 25, 2024, the company deliberated and passed the "Proposal on the Use of Idle Own Funds for Entrusted Wealth Management", and agreed to use no more than 4 billion yuan of idle own funds to purchase low-risk wealth management products.
The meeting of the Political Bureau of the CPC Central Committee on July 24, 2023 made important arrangements for the work of the capital market, clearly proposing that "it is necessary to activate the capital market and boost investor confidence". In an interview with the media on the implementation of the situation, the relevant person in charge of the China Securities Regulatory Commission said that share repurchase is an important means to maintain the company's investment value, improve the corporate governance structure, and enrich the return mechanism for investors, and is a basic institutional arrangement in the capital market. We will work with relevant parties to further optimize the share repurchase system, support more listed companies to stabilize and boost stock prices through share repurchases, safeguard shareholders' rights and interests, and consolidate the foundation for the smooth operation of the market.
However, when Mingde Biotech has abundant funds, no large-scale capital expenditure, its stock price has plunged since 2022, and its market value has broken into the net, it still has no repurchase action, but it has taken out a large amount of 4 billion to purchase financial management, and its rationality is debatable.