Just finished a wave of weight loss pills hot spots, on the evening of April 28, Changshan Pharmaceutical (300255. SZ) handed over its worst annual report in history.
On April 24, Changshan Pharmaceutical disclosed information on the acceptance of the marketing authorization application for ebenatide injection. Since May last year, Changshan Pharmaceutical has continued to speculate on ebenatide for the treatment of type 2 diabetes, and its stock price has also taken off from below 5 yuan. At its peak, the company's share price touched 17.98 yuan per share, an increase of more than 300%. Under the cover of high stock prices, many major shareholders frequently reduced their holdings and cashed out.
Behind the soaring stock price of the concept of weight loss drugs, Changshan Pharmaceutical has to face the hidden concern of insufficient ability to continue operating as a heparin company. According to the financial report, in 2023, Changshan Pharmaceutical's revenue will further shrink by nearly 40% year-on-year, and the net profit attributable to the parent company will turn from profit to loss, with a loss of more than 1.2 billion yuan, almost losing the total profit of the seven years since 2016. Behind the sharp decline is the company's main business of heparin preparations and API sales revenue and net profit both plummeted. In the first quarter of this year, the year-on-year loss still has a widening trend.
Lose seven years of profit in one year
On the evening of April 28, Changshan Pharmaceutical disclosed its 2023 annual report and 2024 first quarter report.
In 2023, the company's net profit loss attributable to the parent company will be 1.24 billion yuan, compared with 17.5135 million yuan in the same period of the previous year, turning from profit to loss, and operating income will be 1.41 billion yuan, a year-on-year decrease of 39.63%. According to the data, since 2016~2022, the total net profit attributable to the parent company of Changshan Pharmaceutical is about 1.24 billion yuan. This means that Changshan Pharmaceutical will lose the total profit of the previous 7 years in 2023 alone.
Not only that, the first quarterly report shows that the basic business situation of Changshan Pharmaceutical has not improved in the first quarter of this year. In the first quarter of this year, the net profit loss attributable to the parent company was 61.6651 million yuan, compared with the net profit of 4.5415 million yuan in the same period last year, turning from profit to loss, and the operating income was 294 million yuan, a year-on-year decrease of 41.36%.
Wind data shows that Changshan Pharmaceutical's profitability began to deteriorate in 2021, and the non-net profit fell for three consecutive years, and the decline expanded. In 2021, the revenue was 25.56% year-on-year, the net profit attributable to the parent company was -7.62% year-on-year, and the non-net profit was -10.72% year-on-year. In 2022, the revenue will be -21.29% year-on-year, the net profit attributable to the parent company will be -92.50% year-on-year, and the non-net profit will be -96.14% year-on-year. In 2023, the revenue will be -39.63% year-on-year, the net profit attributable to the parent company will be -7181.47% year-on-year, and the non-net profit will be -14608.07% year-on-year. The company's net profit before and after deducting non-recurring gains and losses in the last three fiscal years is negative, and the audit report of the most recent year shows that there is uncertainty about the company's ability to continue operations.
Changshan Pharmaceutical said that during the reporting period, due to the competition in the domestic heparin preparation product market and the decrease in demand from the foreign heparin API industry, the company's low molecular weight heparin injection sales unit price and heparin API sales volume both declined. Together, these two factors led to a year-on-year decline in the company's operating income in the reporting period. In addition, due to the decline in demand from the heparin industry and the decline in the market price of crude heparin products, the company made a provision of 632 million yuan for the decline in inventory price.
Specifically, in terms of the three main varieties of heparin preparations, low molecular weight heparin calcium injection achieved sales revenue of 403 million yuan, a year-on-year decrease of 46.51%. Nadroparin calcium injection achieved sales revenue of 184 million yuan under the condition of substantial increase in sales, a year-on-year decrease of 16.36%. The sales volume of dalteparin sodium injection increased significantly year-on-year, but the sales revenue was 177 million yuan due to the impact of price decline, a year-on-year decrease of 12.74%.
In the API business, the sales volume and price fell together, and the company's common heparin API achieved sales revenue of 335 million yuan, a year-on-year decrease of 43.90%.
Take off with weight loss pills stock price
As a heparin company, the theme of Changshan Pharmaceutical's singing in the capital market in 2023 is weight loss drugs, and its stock price has soared. Before climbing to the concept of weight loss drugs, Changshan Pharmaceutical's share price hovered below 10 yuan for many years, and hit a recent low of 4.30 yuan per share at the end of August 2023.
In 2023, GLP-1 receptor agonists are one of the hottest topics in the global capital market. Due to its good performance in weight loss and driven by celebrity effects such as Musk, the hypoglycemic drug GLP-1 designed for patients with type 2 diabetes has opened up imagination.
Since the second quarter of that year, Changshan Pharmaceutical has begun to frequently release the relationship between ebenatide and GLP-1. However, the drug is only for type 2 diabetes and does not involve an indication for weight loss.
On May 24, 2023, Changshan Pharmaceutical replied on the investor relations platform that "ebenatide and semaglutide are both GLP-1 drugs". Since then, Changshan Pharmaceutical has continued to release the R&D process of ebenatide and has interacted with investors on the subject of ebenatide many times.
Since the third quarter of this year, under the dual factors of the company's continuous speculation and the sharp rise of weight loss drug concept stocks in the capital market, the share price of Changshan Pharmaceutical began to take off, and touched a high of 17.98 yuan per share on September 16, with a share price increase of more than 300%.
At the end of January this year, Changshan Pharmaceutical disclosed a performance forecast of a loss of 1 billion ~ 1.2 billion yuan, and the stock price fell back below 8 yuan again.
On the evening of April 24, Changshan Pharmaceutical disclosed information about the acceptance of the marketing authorization application for ebenatid injection, saying that the marketing authorization application for ebenatitide injection submitted by its holding subsidiary Changshan Kaijiejian was accepted by the State Food and Drug Administration. On the one hand, the announcement said that the accepted indication is for the treatment of type 2 diabetes, and the company has not yet carried out clinical trials of ebenatide for obesity or weight loss, and on the other hand, it said that ebenatide is a long-acting glucagon-like peptide-1 receptor agonist (GLP-1RA), which can inhibit gastric emptying and suppress appetite.
After the opening of the market on April 25, Changshan Pharmaceutical recorded a 20cm daily limit, and the stock price closed at 11.77 yuan per share on the same day.
Major shareholders reduced their holdings at a high level
After the stock price took off, the actual controller and major shareholders took the step of reducing their holdings.
After the market on February 23 this year, Changshan Pharmaceutical announced that Gao Shuhua, the controlling shareholder and actual controller, intends to transfer 53 million shares of Changshan Pharmaceutical (accounting for 5.77% of the total share capital of the listed company) to Yang Minghuan, a natural person, through agreement transfer, with a unit price of 9.2 yuan per share and a total amount of 488 million yuan.
On March 14, the transfer of ownership by agreement was completed. The number of shares held by Gao Shuhua decreased from 334 million to 281 million, and the shareholding ratio decreased from 36.43% to 30.64%.
For Changshan Pharmaceutical, the equity pledge of the actual controller is also worth paying attention to. According to the first quarterly report, as of the reporting period, Gao Shuhua had 199 million shares in a pledged state, accounting for 71.06% of the 281 million shares he held.
SDIC Hi-Tech, the second largest shareholder, is also continuing to reduce its holdings.
According to the announcement on March 19 this year, from November 21, 2022 to the announcement date, the number of shares held by SDIC Hi-Tech decreased from 84.827 million shares to 45.953 million shares, and the number of shares reduced was 38.874 million shares. Among them, from October 11, 2023 to the announcement date, SDIC Hi-Tech reduced its holdings of 17.45 million shares through block trading, with an average price of 10.34 yuan per share, and a profit of 180 million yuan. As of March 31, SDIC Hi-Tech's shareholding has fallen to less than 5%.
In addition, in the third quarter when the stock price rose sharply, five shareholders including Hebei Huaxu Chemical and JPMorgan Chase reduced their holdings by a total of 11.609 million shares. The largest number of reductions was Hebei Huaxu Chemical, which reduced its holdings by a total of 9.343 million shares in the third quarter.
(This article is from Yicai)
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