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UNAUDITED HALF YEAR FINANCIAL STATEMENT AND DIVIDEND ANNOUNCEMENT FOR THE PERIOD ENDED 30 JUNE 2017
In 2Q2017 the Group posted net profit attributable to equity holders of RMB1.3million and on revenue of RMB17.6 million.
Group revenue increased 28% from RMB13.7 million in 2Q2016 to RMB17.6 million in 2Q2017 caused to higher sales of Other specialized drugs, even the sales of Antibiotics and Cardiovasular drugs and Cerebovascular drugs were lower in 2Q2017.
Antibiotics sales decreased 26% to RMB4.2 million in 2Q2017 due to lower demand for Cefepime hydrochloride for Injection and Aztreonam for Injection. Antibiotics accounted for 24% of Group revenue in 2Q2017 as the second largest revenue contributor to the Group.
Cardiovascular drugs and cerebrovascular drugs sales decreased 5% to RMB0.9 million due to sales dropped of Vinpocetine for Injection. Cardiovascular drugs and cerebrovascular drugs represented 5% of Group revenue in 2Q2017.
Other specialized drug increased 74% to RMB12.5 million in 2Q2017 mainly casused by higher sales of Potassium Sodium Dehydroandrographolide Succinate for Injection, Amoxicillin Sodium Tablets and Bocobal Mecobalamin Injection. Other specialized drugs was still the largest revenue contributor, accounting for 71% of Group revenue in 2Q2017.
Gross profit increased 106% to RMB8.3 million in 2Q2017 mainly due to higher sales revenues.
Other operating income reduced to RMB0.3 million in 2Q2017 caused by no government subsidy received in this quater.
Selling and distribution expenses dropped 11% to RMB1.0 million in 2Q2017 due to the improvement of the selling and distribution networks of the Group.
Administrative expenses increased 22% to RMB4.1 million in 2Q2017 caused by increase of staff costs and products assessment costs in this quarter.
Other expenses raised 115% to RMB1.4 million in 2Q2017 mainly due to foreign exchange loss incurred in 2Q2017.
Finance income declined 97% to RMB0.02 million due to no foreign exchange gain in 2Q2017 compared with 2Q2016.
Finance expenses increased 9.4 times to RMB0.1 million in 2Q2017 compared with 2Q2016 due to short-term loan interest.
As a result, the Group achieved net profit attributable to equity holders of RMB1.3 million in 2Q2017 compared with RMB0.6 million in 2Q2016.
(30 June 2017 vs. 31 December 2016)
Non-current assets dropped from RMB86.6 million to RMB85.8 million. Property, plant and equipment decreased from RMB54.0 million to RMB53.9 million due to depreciation. Intangibles assets reduced from RMB6.1 million to RMB5.6 million caused by amortization.
Current assets decreased from RMB104.9 million to RMB98.3 million. Inventories level raised from RMB22.3 million to RMB24.0 million. Trade & bills receivables decreased from RMB2.2 million to RMB1.2 million. Other receivables, prepayments and deposits dropped from RMB10.7 million to RMB4.2 million results from received of RMB7 million refundable deposits in 1Q2017 due to a R&D agreement termination. RMB5.5 million of Available-for-sale financial assets was purchased on 1Q2017 and RMB4 million was disposed on 2Q2017, so the net increase of available-for-sale financial assets in 1H2017 was RMB1.5 million. Cash and bank balances decreased from RMB69.7 million to RMB67.4 million in 1H2017.
Non-current liabilities comprise of deferred tax liabilities declined to RMB3.0 thousand.
Current liabilities dropped from RMB35.8 million to RMB23.2 million. Trade and other payables decreased slightly from RMB23.8 million to RMB23.2 million. Short term borrowing was fully settled in 1H2017.
Cash Flow Statement
The Group's net cash inflow from operating activities in 2Q2017 was RMB5.0 million. This was mainly due to the operating profit from Group's usual operating business during the reported financial period.
Net cash generated from investing activities in 2Q2017 amounted to RMB3.8 million. This was mainly caused by the disposal of available-for-sale financial assets during 2Q2017.
Net cash used in financing activities in 2Q2017 was RMB6.0 million. This was used for settlement of short term borrowing.
Finally, the net increase in cash and cash equivalent in 2Q2017 was RMB2.8 million.
The Group will maintain the cautions attitude to deal with the highly competitive and challenging environment of pharmaceutical market in China.
The Group will continue to focus on diversifying sales strategies, improvement operations and continuous new products development to achieve further growth and expansion of the business.