[Editor's note]
The financial report is the "report card" of the production and operation activities of listed companies, and it is also an important basis for investors to make decisions.
As the fixing star and ballast stone of China's economy, what is the operating status of listed companies, what is the gold content of their performance, and what will be their layout in the future?
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To this end, China Fund News has launched a special plan of "Financial Reports" to interpret financial report data, focus on popular industries, prompt potential risks, gain insight into core values, provide reference for investors to understand the real situation of the company, and better help listed companies improve the quality of information disclosure.
China Fund News reporter Lu Yuan
The trillion-dollar pharmaceutical sector is quietly changing.
On the one hand, the pharmaceutical anti-corruption storm that began in July 2023 seems to be having a subtle impact on the industry.
On the other hand, the average R&D expenses of listed pharmaceutical companies will increase by 7.74% year-on-year in 2023. Among them, the listed pharmaceutical companies on the Science and Technology Innovation Board dare to spend the most money, and BeiGene ranks first with 12.8 billion yuan in R&D expenses, which is more than twice that of Hengrui Pharmaceutical, which ranks second.
Although in general, innovative drug companies are still in the stage of "burning money", there are also individual pharmaceutical companies on the Science and Technology Innovation Board, due to the sharp increase in product sales, which has led to a continuous increase in net profit, which in turn has caused the stock price to rise several times against the trend.
This may mean a new beginning.
Average selling expenses decreased slightly
For the pharmaceutical industry, the most shocking thing in 2023 is the national pharmaceutical anti-corruption storm.
In July 2023, the Central Commission for Discipline Inspection and the National Health Commission held a meeting to deploy a nationwide rectification of pharmaceutical corruption. Subsequently, a number of listed pharmaceutical companies announced that the actual controller or senior executives were detained.
According to WIND statistics, there are 89 listed pharmaceutical companies with sales expenses of more than 1 billion yuan in 2022, and 39 companies with sales expenses accounting for more than 50%, and 81 listed pharmaceutical companies with sales expenses of more than 1 billion yuan in 2023 have been disclosed, and 35 companies have sales expenses accounting for more than 50%, which is a slight decrease compared with previous years.
From the perspective of arithmetic average, the average sales expenses of listed pharmaceutical companies in 2022 will be 667 million yuan, and the average sales expenses of listed pharmaceutical companies in 2023 will be 665 million yuan, a slight decrease of 0.3% year-on-year.
In 2023, there will be 4 companies with sales expenses accounting for more than 100% of total operating income, and all of them are listed pharmaceutical companies on the Science and Technology Innovation Board.
Among the listed pharmaceutical companies with revenues of more than 100 million yuan, the companies whose sales expenses account for more than 50% of the total operating income include Rongchang Biologics, Junshi Biosciences, Tibet Pharmaceutical, Wohua Pharmaceutical, Tonghua Jinma, etc., among which there are also many companies on the Science and Technology Innovation Board.
Among them, although the total operating income of Remegen in 2023 will increase by 40% year-on-year, the sales expenses in the same period will also soar from 441 million yuan to 775 million yuan, a year-on-year increase of 76%, which is much higher than the revenue growth. This resulted in an increase in the company's selling expenses from 57% in 2022 to 72% in 2023.
However, among the top 20 listed pharmaceutical companies in terms of sales expenses, only BeiGene is a company on the STAR Market. Among them, Buchang Pharmaceutical's sales expenses from 2020 to 2022 have always accounted for more than 50%, and in 2023, it will be slightly reduced, to 48%.
Innovative drugs are still "burning money" in general
According to WIND statistics, the average R&D expenses of listed companies in Shanghai and Shenzhen Pharmaceutical in 2023 will be 334 million yuan, a year-on-year increase of 7.74% compared with the average R&D expenses of 310 million yuan in 2022.
In 2023, 19 of the top 20 listed companies in Shanghai and Shenzhen Pharma will account for R&D expenses on the Science and Technology Innovation Board, accounting for more than 50% of revenue, including BeiGene and Junshi Biosciences, two large-capitalization companies.
Among the top 10 companies in R&D expenses of Shanghai and Shenzhen pharmaceutical listed companies, 4 are listed companies on the Science and Technology Innovation Board, accounting for 40%, and BeiGene, a company on the Science and Technology Innovation Board, ranks first with 12.8 billion yuan, more than twice that of Hengrui Pharmaceutical, which ranks second.
However, among the 20 most profitable pharmaceutical listed companies, none of them are companies on the Science and Technology Innovation Board. Among the top 20 listed pharmaceutical companies that lost the most money, 10 were companies on the Science and Technology Innovation Board, and 6 of the top 10 were companies on the Science and Technology Innovation Board.
Among them, BeiGene and Junshi Biosciences ranked among the top 2 most loss-making pharmaceutical companies with losses of 6.716 billion yuan and 2.283 billion yuan respectively.
The "old cow" is gone, and the "new cow" seems to be rising
During the new crown epidemic, due to the soaring performance caused by the big sales of related epidemic prevention products, the stock prices of listed companies with related epidemic prevention products in the pharmaceutical sector rose sharply, and bull stocks were frequent. Among them, the most typical is Jiu'an Medical, whose share price rose as much as 35 times during the epidemic.
However, after the epidemic subsided, the performance of related pharmaceutical listed companies represented by Jiu'an Medical fell sharply, and the stock price also plummeted.
For example, in 2023, Jiu'an Medical will achieve operating income of 3.231 billion yuan, a year-on-year decrease of 87.72%, a net profit attributable to the parent company of 1.252 billion yuan, a year-on-year decrease of 92.19%, and a non-net profit of 1.004 billion yuan, a year-on-year decrease of 93.86%.
During the same period, the net profit of similar companies such as Shuoshi Biotechnology, Zhijiang Biotechnology, Dongfang Biotechnology, and Hotjing Biotechnology also fell by more than 90%.
However, there will always be new investment opportunities in the market, and the same is true for the pharmaceutical sector. Although the pharmaceutical companies on the Science and Technology Innovation Board, which are mainly innovative drugs, are still in the stage of "burning money", the "innovative bulls" of the performance of individual science and technology innovation board companies brought about by the sales of new drugs seem to have begun to take shape.
In 2023, the total operating income of Allist, a pharmaceutical listed company on the Science and Technology Innovation Board, will be 2.018 billion yuan, a year-on-year increase of 155.14%, mainly due to the fact that the first-line and second-line treatment indications of the company's related innovative drug products have been included in the national medical insurance catalogue during the reporting period, and the product sales volume has increased significantly, and the net profit attributable to the parent company will be 644 million yuan, a year-on-year increase of 393.54%, mainly due to the significant increase in operating income and the effective control of various expenses.
From the perspective of historical performance, while the revenue has increased sharply year by year, Allist's net profit has also risen year by year, and its stock price has risen by 346% in the past year, and in the past year, the overall trend of the WIND healthcare sector has been on a downward trend.
So far in 2024, the top two gainers in the pharmaceutical sector are Twining Biotech and Allist. Among them, Twining Biotech was mainly stimulated by short-term policies and rose sharply.
After continuing to spend a lot of money on research and development, BeiGene has surpassed Hengrui Pharmaceutical for two consecutive years and ranked as the "first brother" of innovative drugs. Although its revenue in 2023 will increase sharply while still losing money, the total loss has narrowed significantly, from a loss of 13.82 billion yuan in 2022 to a loss of 6.716 billion yuan.
Editor: Captain
Review: Muyu