After trading on April 25, Jinyu Medical (603882. SH) announced its 2023 annual report and 2024 first quarter report.
According to the data, the company's annual revenue last year was 8.540 billion yuan, a year-on-year decrease of 44.82%, the net profit attributable to the parent company was 643 million yuan, a year-on-year decrease of 76.64%, and the net profit attributable to the parent company was 365 million yuan, a year-on-year decrease of 86.53%.
This is the first time that Jinyu Medical has handed over an annual report card with both revenue and net profit declining, but compared with the financial performance of the latest quarter, it can be said that it is not too bad.
In Q1 2024, the company's revenue was 1.841 billion yuan, a year-on-year decrease of 13.5%, with a net loss attributable to the parent of 18.6371 million yuan and a net loss of 29.2948 million yuan after deducting non-attributable to the parent company, both of which turned into losses year-on-year, with a net profit attributable to the parent of 150 million yuan and a net profit of 141 million yuan in the same period last year.
Titanium Media App Mapping Data source: Wind
In the nine years from 2015 to 2023, Jinyu Medical has never had a single-quarter loss, and this turnaround has created history. For the loss, Jinyu Medical said that the main reason was the high year-on-year data base of the previous year, the first quarter was the traditional off-season, and the company's business returned to normal in the reporting period.
On the one hand, even before the epidemic, the company has never recorded a loss in the first quarter, and on the other hand, although the company has a credit impairment loss of 140 million yuan in the first quarter of this year, which will affect profits, in the first quarter of 2023, which is also the off-season, the company has a higher credit impairment loss of 148 million yuan, but it is profitable.
In this way, the performance of Jinyu Medical's main business in the first quarter of this year was not outstanding, with a net cash flow of -345 million yuan during the period. In addition, according to the latest disclosed data, compared with the end of the previous year, the number of institutional holdings held by the company at the end of the first quarter has decreased significantly.
The next day after the results, Jinyu Medical opened low and went low, and once hit the fall limit in the intraday, closing at 38.1 yuan, down 9.61%, with the latest total market value of 17.86 billion yuan. It is worth noting that the market trend was good on Friday, with all three major indexes closing in the red, with the Shanghai Composite Index up 1.17%, the Shenzhen Component Index up 2.15%, and the ChiNext Index up 3.34%.
Institutional shareholders "fled", and the hidden worries of bad debts have not been eliminated
Before Jinyu Medical disclosed its worst quarterly report, institutional shareholders had already begun to sell intensively.
Wind data shows that as of March 31, 2024, the total number of institutional shares held by Jinyu Medical was 220 million shares, accounting for 47.26%, while the total number of institutional shareholders held 306 million shares, accounting for 65.78%, at the end of the previous year. In other words, in the first quarter of this year, institutional shareholders sold nearly a third of the company's shares.
According to the changes in the top ten liquid shareholders, in the first quarter, Bank of Communications Schroder New Growth Mixed Securities Investment Fund reduced its holdings by 745,300 shares, Fuguo Tianhui Select Growth Mixed Securities Investment Fund reduced its holdings by 1,902,700 shares, and China Universal Innovative Pharmaceutical Theme Mixed Securities Investment Fund reduced its holdings by 368,400 shares.
According to Jinyu Medical's announcement on April 25, as of April 15, 2024, in the half month ending April 15, 2024, Fuguo Tianhui Select Growth Mixed Securities Investment Fund reduced its holdings by another 1.1 million shares, while Bank of Communications Schroder New Growth Mixed Securities Investment Fund increased its holdings by 745,200 shares.
After all, since the beginning of the year, the share price of Jinyu Medical has fallen by 39.11%, and it has fallen 77.78% from its high.
In the short term, it has become difficult to boost the confidence of the capital market through performance growth, and the risk of bad debts from huge accounts receivable continues to disrupt the company's earnings performance.
As of March 31, 2024, Jinyu Medical's accounts receivable are still as high as 5.461 billion yuan, and it is unknown when the provision of large bad debts will end.
Titanium Media App Mapping Data source: Wind
According to the Titanium Media App, from 2021 to the first quarter of 2024, Jinyu Medical has accumulated a loss of 955 million yuan in accounts receivable, of which 256 million yuan and 489 million yuan in 2022 and 2023 respectively.
2022 is still a big year for the epidemic, the demand for new crown nucleic acid testing is huge, and the impact is not obvious under the high base of performance, but 2023 is the first year to return to regular operation, and the high base of the previous year is superimposed on the provision of large bad debt losses receivable, which has weakened the company's profitability performance, and the net profit has decreased by more than 70% year-on-year.
Jinyu Medical pointed out in the annual report that from the perspective of the industry, the receivables of the business are generally less than expected, the amount of accounts receivable is large, and the number of days of payment collection has a further growth trend due to the increase in the proportion of reagent trade and co-construction business in the industry. Failure to effectively manage the collection of funds may bring certain capital risks.
In contrast, Dean Diagnosis (300244. SZ) is also a beneficiary of the new crown nucleic acid test, and its accounts receivable once exceeded 10 billion yuan, and in 2023, nearly 400 million yuan of asset impairment provisions will be made, of which 372 million yuan will be provided for bad debts of accounts receivable, and there will be accounts receivable of up to 8.054 billion yuan as of the end of the year.
As of December 31, 2023, the accounts receivable aged more than 2 years by Dian Diagnostics were 535 million yuan, and that of Jinyu Medical was 358 million yuan.
In addition to the impact of bad debts, it is worth paying more attention to what Jinyu Medical will rely on to support the future after the disappearance of the new crown nucleic acid testing dividend.
Reduced the number of employees by more than 2,000 people to expand the C-end market
Jinyu Medical is the leading enterprise of ICL (third-party medical testing laboratory), which previously mainly provided nucleic acid testing services for hospitals, but the three-year new crown epidemic has greatly increased its business volume, and the company's performance and stock price have both taken off.
In 2021 and 2022, Jinyu Medical's revenue will continue to exceed 10 billion yuan, reaching 11.943 billion yuan and 15.476 billion yuan respectively, and from 2020 to 2022, its net profit attributable to the parent company will be in double digits, 1.510 billion yuan, 2.220 billion yuan and 2.753 billion yuan respectively. The company's share price reached a record high of 171.46 yuan per share in January 2021, and its market value crossed the 80 billion yuan mark.
But all this came to an abrupt end in 2023, and after the new crown nucleic acid testing dividend disappeared, Jinyu Medical was "beaten back to its original shape", with its annual revenue returning to double digits and net profit returning to the level of 100 million yuan. The company said that during the reporting period, due to the decrease in demand for testing related to public health events, the company's medical diagnostic service revenue decreased significantly.
This year, Jinyu Medical has significantly reduced its staff, from 14,411 at the end of 2022 to 11,586, with a reduction of 2,825 people in a year. A considerable number of these employees may disappear with the disappearance of the demand for nucleic acid testing.
Jinyu Medical's revenue mainly comes from two major sectors, third-party medical diagnosis services and others, the latter includes sales of diagnostic products, health examination business, cold chain logistics services and other businesses, among which third-party medical diagnosis services are the absolute main force, with a revenue of 7.726 billion yuan in 2023, accounting for 90.47% of total revenue.
In 2023, the direct labor cost of its third-party medical diagnostic service laboratory will decrease from 1.048 billion yuan in 2022 to 563 million yuan in 2023, and the labor cost of other business segments will decrease by 10.54% year-on-year to 48.2319 million yuan.
However, it is worth noting that Jinyu Medical said that it will introduce about 300 master's and doctoral talents in 2023, covering key positions such as clinical services, digitalization, research and development, and laboratory technology, including nearly 20 interdisciplinary talents with overseas backgrounds and interdisciplinary talents, in addition, the company has further promoted the "medical examination 4.0" digital transformation strategy and established a professional digital team of more than 150 people.
With the large-scale introduction of talents and the reduction of the total number of employees, 2023 may also be a year of "big change" for Jinyu Medical employees.
Of course, not only to reduce the scale of employees, one of the main themes of Jinyu Medical in the past year is to reduce expenses, and its sales expenses, management expenses, and R&D expenses decreased by 32.79%, 28.22%, and 26.16% year-on-year respectively.
Focusing on business development, in the 2023 annual report, Jinyu Medical mentioned that with the return to normal medical order in mainland China, patients' medical needs have been gradually released, and the company's routine medical diagnosis service revenue is recovering. However, judging from the data of the decline in revenue in the first quarter of 2024, the recovery of regular business may not be as expected.
In order to seek more growth points, in 2024, Jinyu Medical's business began to target the C-end market, and jointly launched the "home rapid inspection" service model with the leading Internet platforms (Meituan, JD.com, Alibaba, etc.), which has been carried out in four cities: Beijing, Shanghai, Guangzhou, and Shenzhen, with a total of nearly 30,000 person-times.
(This article was first published in Titanium Media App Author丨Yang Yaru Editor丨Sun Cheng)