Security code: 000963 Stock abbreviation: Huadong Medicine Announcement No.: 2024-041
Huadong Medicine Co., Ltd.First Quarterly Report 2024
The Company and all members of the Board of Directors hereby guarantee that the information presentedin this report is authentic, accurate and complete and free of any false records, misleading statements or materialomissions.Important Declaration:
1. The Board of Directors, Board of Supervisors, directors, supervisors and senior management of HuadongMedicine Co., Ltd. (hereinafter referred to as the "Company") hereby guarantee that the information presentedin this report is authentic, accurate and complete and free of false records, misleading statements or materialomissions, and shall undertake individual and joint legal liabilities.
2. The Company's legal representative, the officer in charge of accounting, and the head of accountingdepartment (accounting supervisor) hereby declare that the financial information in this quarterly report isauthentic, accurate and complete.
3. Has the First Quarterly Report been audited?
□Yes ?No
According to “Stock Listing Rules of the Shenzhen Stock Exchange”, if listed companies have both Chineseand other language version of public notice, they should ensure the content of both versions are the same. In thecase of discrepancy, the original version in Chinese shall prevail.
I. Key Financial Data(I) Key accounting data and financial indicators
Does the Company need to retroactively adjust or restate the accounting data of previous years?
□Yes ?No
| Current reporting period | Same period last year | Increase or decrease during the current reporting period compared with the same period of last year (%) | |
| Operating revenue (RMB) | 10,410,809,128.72 | 10,114,531,331.77 | 2.93% |
| Net profit attributable to shareholders of the listed company (RMB) | 862,411,560.96 | 755,284,976.47 | 14.18% |
| Net profit attributable to shareholders of the listed company after deduction of non-recurring profits and losses (RMB) | 838,303,551.41 | 757,542,618.01 | 10.66% |
| Net cash flow from operating activities (RMB) | -484,522,666.13 | -246,152,770.16 | -96.84% |
| Basic earnings per share (RMB/share) | 0.4929 | 0.4316 | 14.20% |
| Diluted earnings per share (RMB/share) | 0.4928 | 0.4315 | 14.21% |
| Weighted average return on equity | 4.01% | 3.99% | 0.02% |
| End of the current reporting period | End of the last year | Increase or decrease at the end of the current reporting period compared with the end of the last year (%) | |
| Total assets (RMB) | 34,467,844,280.37 | 33,509,361,816.98 | 2.86% |
| Owners' equity attributable to shareholders of listed companies (RMB) | 21,955,243,888.90 | 21,047,609,756.66 | 4.31% |
(II) Non-recurring profit and loss items and amounts?Applicable □Not applicable
Unit: RMB
| Item | Amount during the current reporting period | Description |
| Profit and loss on disposal of non-current assets (including the write-off of provision for impairment of assets) | 1,521,275.31 | |
| Government grants included in the current profits and losses (except those that are closely related to the normal business operation of the Company, comply with national policies and regulations, are enjoyed in accordance with the defined criteria, and have a lasting impact on the Company's profits and losses) | 28,822,099.15 | |
| Profits and losses from changes in fair value arising from financial assets and financial liabilities held by non-financial corporations, and profits and losses from the disposal of financial assets and liabilities, except for the effective hedging business related to the normal business operation of the Company | -25,364.49 |
| Other non-operating revenue and expenses other than those mentioned above | -1,436,525.67 | |
| Minus: Amount affected by income tax | 4,281,616.36 | |
| Amount affected by minority interests (after tax) | 491,858.39 | |
| Total | 24,108,009.55 | -- |
Details of other profit and loss items conforming to the definition of non-recurring profits and losses
□Applicable ?Not applicableThe Company has no other specific circumstances of profit and loss items that meet the definition of non-recurring profits andlosses.An explanation of the fact that the non-recurring profit and loss items listed in the Explanatory Announcement No.1 onInformation Disclosure by Companies that Offer Securities to the Public - Non-recurring Profits and Losses are defined asrecurring profit and loss items
□Applicable ?Not applicableThe Company did not define the non-recurring profit and loss items listed in the Explanatory Announcement No.1 on InformationDisclosure by Companies that Offer Securities to the Public - Non-recurring Profits and Losses as recurring profit and loss items.(III) Details and reasons for changes in key accounting data and financial indicators
?Applicable □Not applicable
| Items in the balance sheet | Amount at the end of the period | Amount at the beginning of the period | Percentage change | Reasons for changes |
| Notes receivable | 0.00 | 681.21 | -100.00% | Mainly attributable to the decrease in commercial acceptance bills receivable during the current period |
| Receivables financing | 84,325.79 | 143,436.63 | -41.21% | Mainly attributable to discounting of bank acceptance bills during the current period |
| Other accounts receivable | 47,383.63 | 29,113.51 | 62.75% | Mainly attributable to an increase in provisional payment receivable |
| Short-term borrowings | 108,359.71 | 82,238.03 | 31.76% | Mainly attributable to an increase in loans during the current period |
Advance receipts
| Advance receipts | 40.52 | 139.36 | -70.92% | Mainly attributable to a decrease in rental received in advance |
| Employee compensation payable | 21,539.69 | 35,914.85 | -40.03% | Mainly attributable to remuneration paid during the current period |
| Non-current liabilities due within one year | 20,941.37 | 35,934.26 | -41.72% | Mainly attributable to the payment of long-term payables and long-term borrowings due within one year during the current period |
| Lease liabilities | 8,300.63 | 5,669.52 | 46.41% | Mainly attributable to additional leases during the current period |
| Long-term accounts payable | 2,480.53 | 10,725.12 | -76.87% | Mainly attributable to the transfer of outstanding acquisition amounts to non-current liabilities due within one year |
| Other comprehensive income | 24.80 | -4,034.15 | 100.61% | Mainly attributable to an increase in foreign currency translation differences |
Items in the profitstatement
| Items in the profit statement | Amount in the current period | Amount in the previous period | Percentage change | Reasons for changes |
| Financial expenses | 755.50 | 2,915.08 | -74.08% | Mainly attributable to an increase in net interest income |
| Other income | 3,831.17 | 1,458.25 | 162.72% | Mainly attributable to an increase in revenue-related government grants |
| Proceeds from disposal of assets | 152.13 | -219.99 | 169.15% | Mainly attributable to an increase in proceeds from disposal of fixed assets |
| Items in the cash flow | Amount in the | Amount in the | Percentage | Reasons for changes |
| statement | current period | previous period | change | |
| Net cash flow from operating activities | -48,452.27 | -24,615.28 | -96.84% | Mainly attributable to the increase in purchases of goods and cash paid to employees |
| Net cash flows from investing activities | -70,737.61 | -44,005.53 | -60.75% | Mainly attributable to added investment during the current period |
| Net cash flow from financing activities | 7,149.63 | -84,941.26 | 108.42% | Mainly attributable to the year-on-year increase in loans during the current period |
II. Shareholder Information(I) Total number of common shareholders, number of preferred shareholders with restored voting rightsand shareholdings of top 10 shareholders
Unit: Shares
| Total number of common shareholders at the end of the reporting period | 93,834 | Total number of preferred shareholders with restored voting rights at the end of the reporting period (if any) | 0 | |||
| Shareholdings of top 10 shareholders (excluding shares lent through refinancing) | ||||||
| Name of shareholder | Nature of shareholder | Shareholding ratio (%) | Number of shares held | Number of shares held with restricted sale conditions | Pledged, marked or locked-up status | |
| Status of shares | Quantity | |||||
| China Grand Enterprises, INC. | Domestic non-state-owned legal person | 41.66% | 730,938,157.00 | 0.00 | Pledged | 147,070,000.00 |
| Hangzhou Huadong Medicine Group Co., Ltd. | State-owned legal person | 16.42% | 288,000,000.00 | 0.00 | Not applicable | 0.00 |
| Hong Kong Securities Clearing Company Limited | Overseas legal person | 2.75% | 48,286,883.00 | 0.00 | Not applicable | 0.00 |
| China Securities Finance Corporation Limited | Domestic non-state-owned legal person | 1.26% | 22,186,818.00 | 0.00 | Not applicable | 0.00 |
| Industrial and Commercial Bank of China Limited - Zhong Ou AMC Medical and Health Hybrid Securities Investment Fund | Others | 1.15% | 20,099,373.00 | 0.00 | Not applicable | 0.00 |
| China Construction Bank Corporation - E Fund CSI 300 Medical and Health Trading Open Index Securities Investment Fund | Others | 0.72% | 12,696,732.00 | 0.00 | Not applicable | 0.00 |
| China Construction Bank Corporation - ICBC Credit Suisse Frontier Medical Equity Securities | Others | 0.68% | 12,000,000.00 | 0.00 | Not applicable | 0.00 |
| Investment Fund | ||||||
| National Social Security Fund - Portfolio 110 | Others | 0.63% | 10,983,604.00 | 0.00 | Not applicable | 0.00 |
| Industrial and Commercial Bank of China Limited - Huatai-PB CSI 300 Open-ended Index Fund | Others | 0.54% | 9,494,245.00 | 0.00 | Not applicable | 0.00 |
| China Life Insurance (Group) Company - Traditional - General Insurance Products - 005L-CT001 Shanghai | Others | 0.50% | 8,819,214.00 | 0.00 | Not applicable | 0.00 |
| Shareholdings of the top 10 shareholders without restricted sales conditions | ||||||
| Name of shareholder | Number of shares held without restricted sale conditions | Type of shares | ||||
| Type of shares | Quantity | |||||
| China Grand Enterprises, INC. | 730,938,157.00 | RMB-denominated ordinary share | 730,938,157.00 | |||
| Hangzhou Huadong Medicine Group Co., Ltd. | 288,000,000.00 | RMB-denominated ordinary share | 288,000,000.00 | |||
| Hong Kong Securities Clearing Company Limited | 48,286,883.00 | RMB-denominated ordinary share | 48,286,883.00 | |||
| China Securities Finance Corporation Limited | 22,186,818.00 | RMB-denominated ordinary share | 22,186,818.00 | |||
| Industrial and Commercial Bank of China Limited - Zhong Ou AMC Medical and Health Hybrid Securities Investment Fund | 20,099,373.00 | RMB-denominated ordinary share | 20,099,373.00 | |||
| China Construction Bank Corporation - E Fund CSI 300 Medical and Health Trading Open Index Securities Investment Fund | 12,696,732.00 | RMB-denominated ordinary share | 12,696,732.00 | |||
| China Construction Bank Corporation - ICBC Credit Suisse Frontier Medical Equity Securities Investment Fund | 12,000,000.00 | RMB-denominated ordinary share | 12,000,000.00 | |||
| National Social Security Fund - Portfolio 110 | 10,983,604.00 | RMB-denominated ordinary share | 10,983,604.00 | |||
| Industrial and Commercial Bank of China Limited - Huatai-PB CSI 300 Open-ended Index Fund | 9,494,245.00 | RMB-denominated ordinary share | 9,494,245.00 | |||
| China Life Insurance (Group) Company - Traditional - General Insurance Products - 005L-CT001 Shanghai | 8,819,214.00 | RMB-denominated ordinary share | 8,819,214.00 | |||
| Description of affiliation or concerted action of the above shareholders | The Company did not know whether there was any relationship among the above shareholders, or whether they were parties acting in concert. | |||||
| Description of the participation in securities margin trading business of top 10 shareholders (if any) | As of the end of the current reporting period, none of the top 10 common shareholders of the Company held shares of the Company through securities margin trading accounts. | |||||
Participation in the lending of shares through refinancing business of shareholders holding more than 5% of shares, top 10shareholders and top 10 shareholders holding tradable shares without restricted sale conditions?Applicable □Not applicable
Unit: Shares
| Participation in the lending of shares through refinancing business of shareholders holding more than 5% of shares, top 10 shareholders and top 10 shareholders holding tradable shares without restricted sale conditions | ||||||||
| Name of shareholder (full name) | Shares held in ordinary accounts and credit accounts at the beginning of the period | Shares lent through refinancing and not yet returned at the beginning of the period | Shares held in ordinary accounts and credit accounts at the end of the period | Shares lent through refinancing and not yet returned at the end of the period | ||||
| Total number of shares | Proportion in share capital | Total number of shares | Proportion in share capital | Total number of shares | Proportion in share capital | Total number of shares | Proportion in share capital | |
| China Grand Enterprises, INC. | 730,938,157 | 41.66% | 0 | 0.00% | 730,938,157 | 41.66% | 0 | 0.00% |
| Hangzhou Huadong Medicine Group Co., Ltd. | 288,000,000 | 16.42% | 0 | 0.00% | 288,000,000 | 16.42% | 0 | 0.00% |
| Hong Kong Securities Clearing Company Limited | 47,954,932 | 2.73% | 0 | 0.00% | 48,286,883 | 2.75% | 0 | 0.00% |
| China Securities Finance Corporation Limited | 22,186,818 | 1.26% | 0 | 0.00% | 22,186,818 | 1.26% | 0 | 0.00% |
| Industrial and Commercial Bank of China Limited - Zhong Ou AMC Medical and Health Hybrid Securities Investment Fund | 31,080,515 | 1.77% | 0 | 0.00% | 20,099,373 | 1.15% | 0 | 0.00% |
| China Construction Bank Corporation - E Fund CSI 300 Medical and Health Trading Open Index Securities Investment Fund | 12,896,932 | 0.74% | 328,500 | 0.02% | 12,696,732 | 0.72% | 0 | 0.00% |
| China | 19,000,000 | 1.08% | 0 | 0.00% | 12,000,000 | 0.68% | 0 | 0.00% |
| Construction Bank Corporation - ICBC Credit Suisse Frontier Medical Equity Securities Investment Fund | ||||||||
| National Social Security Fund - Portfolio 110 | 13,619,804 | 0.78% | 0 | 0.00% | 10,983,604 | 0.63% | 0 | 0.00% |
| Industrial and Commercial Bank of China Limited - Huatai-PB CSI 300 Open-ended Index Fund | 6,639,145 | 0.38% | 17,500 | 0.00% | 9,494,245 | 0.54% | 4,600 | 0.00% |
| China Life Insurance (Group) Company - Traditional - General Insurance Products - 005L-CT001 Shanghai | 7,582,314 | 0.43% | 0 | 0.00% | 8,819,214 | 0.50% | 0 | 0.00% |
Change in top 10 shareholders and top 10 shareholders holding tradable shares without restricted sale conditions due tolending/returning of shares through refinancing as compared to the previous period?Applicable □Not applicable
Unit: Shares
| Changes in top 10 shareholders and top 10 shareholders holding tradable shares without restricted sale conditions due to lending/returning of shares through refinancing as compared to the previous period | |||||
| Name of shareholder (full name) | Addition/withdrawal during the current reporting period | Number of shares lent through refinancing and not yet returned at the end of the period | Number of shares held in shareholders' ordinary accounts and credit accounts and shares lent through refinancing and not yet returned at the end of the period | ||
| Total number of shares | Proportion in share capital | Total number of shares | Proportion in share capital | ||
| Industrial and Commercial Bank of China Limited - Huatai-PB CSI 300 Open-ended Index Fund | Addition | 4,600 | 0.00% | 9,498,845 | 0.54% |
| China Life Insurance (Group) Company - Traditional - General Insurance Products - 005L-CT001 Shanghai | Addition | 0 | 0.00% | 8,819,214 | 0.50% |
| New China Life Insurance Co., Ltd. - Traditional - General Insurance Products - 018L-CT001 Shenzhen | Withdrawal | 0 | 0.00% | 6,920,836 | 0.39% |
| Bank of Shanghai Co., Ltd. - Yinhua CSI Innovative Pharmaceutical Industry Traded Open-ended Index Securities Investment Fund | Withdrawal | 0 | 0.00% | 7,318,298 | 0.42% |
(II) Total number of preferred shareholders and shareholding list of top 10 preferred shareholders of theCompany
□Applicable ?Not applicable
Ⅲ. Other Important Matters?Applicable □Not applicable(I) Overview of the Company's overall operations during the reporting periodIn 2024, the reform of the domestic pharmaceutical industry continued to be expanded, which,coupled with market competition, drove the intensification of the differentiation of pharmaceuticalenterprises. By focusing on the overall strategic planning and annual business objectives, theCompany actively promoted the implementation of various operational management work, andachieved a good start in the first quarter. During the reporting period, the Company achievedoperating income in the amount of RMB 10.411 billion, up 2.93% year-on-year; net profitattributable to parent company in the amount of RMB 862 million, up 14.18% year-on-year; netprofit attributable to the parent company after deducting non-recurring profits and losses in theamount of RMB 838 million, up 10.66% year-on-year; and realized a positive growth in operatingincome and net profit compared with the fourth quarter of 2023. After deducting the equityincentive expenses and the profits and losses of participating and holding R&D institutions, netprofit attributable to shareholders of the listed company upon deduction of non-recurring profits andlosses during the reporting period was amounted to RMB 928 million, representing an increase of
22.45% compared with the net profit attributable to shareholders of the listed company upondeduction of non-recurring profits and losses in the first quarter of 2023.
During the reporting period, the overall operation of the core subsidiary Zhongmei Huadongcontinued to maintain a stable growth trend, achieved operating income (including CSO business)in the amount of RMB 3.399 billion, showing a year-on-year increase of 10.53%; and achievedconsolidated net profit attributable to the parent company in the amount of RMB 751 million, with a
year-on-year increase of 11.67%.During the reporting period, the Company's pharmaceutical business segment achieved anoverall operating income of RMB 6.717 billion, down 1.86% year-on-year, and a net profit of RMB107 million, up 1.51% year-on-year. The decreasing operating income of the Company'spharmaceutical business segment was mainly affected by the higher base in the first quarter of2023. It is expected that the pharmaceutical business segment will return to show positive growth inthe second quarter.
The Company's aesthetic medicine business continued to maintain a good growth momentumduring the reporting period. Its aesthetic medicine segment realized a consolidated operatingincome of RMB 630 million (excluding internal offsets), representing a year-on-year increase of
25.30%. Sinclair UK, a wholly-owned subsidiary, continued to expand the global aesthetic medicinemarket, realized a consolidated operating income of approximately RMB 272 million during thereporting period. Due to fluctuations in demands caused by the impact of the slowdown in globalmacro-economic growth, it underwent a year-on-year decline of 4.40%, with the overall incomereaching the operating target for the first quarter. Growth rate is expected to gradually pick up fromthe second quarter. Sinclair (Shanghai), a wholly-owned subsidiary engaging in domestic aestheticmedicine, was actively expanding the domestic market. During the reporting period, it achievedoperating income of RMB 257 million, representing a year-on-year increase of 22.65%, and aquarter-on-quarter increase of 13.38% compared with the fourth quarter of 2023.
During the reporting period, the income of the Company's industrial microbiology businessmaintained a stable growth, up 23.00% year-on-year. Subsequently, along with the active expansionof the overseas market, increasing online and offline marketing promotion for the domestic animalhealth business and the launching of products of Hubei Magic Health, it is expected that the growthof industrial microbiology business will accelerate.
(II) Important R&D progress of the Company during the reporting period
During the reporting period, the Company accelerated its R&D efforts and continued toincrease its R&D investment. The Company's R&D investment in the pharmaceutical industry(excluding equity investment) amounted to RMB 588 million during the reporting period, of which,direct R&D expenditure amounted to RMB 349 million, representing a year-on-year increase of
13.96%. The Company's innovative drugs and biosimilar business ushered in a number of importantmilestones. The main progress is described as follows:
1. The Company's BLA application in China for the recurrent pericarditis indication ofRilonacept (ARCALYST?) for injection, a global innovative product introduced from Kiniksa,USA, was accepted in March 2024;
2. The Company's Chinese IND application for HDM1005, which is the GLP-1R/GIPR dual-target, long-acting peptide agonist product independently developed by the Company, intended forweight management among overweight or obese people and for Type 2 diabetes, was approved inMarch 2024. The first subject was enrolled and administered in the phase Ia clinical study in Chinain March 2024. In addition, the US IND application of HDM1005 for overweight or obesityindications was approved in April 2024;
3. Chinese IND Application for HDM2005, the first ADC program that is independentlydeveloped by the Company and intended for the treatment of advanced solid tumors andhematological tumors, was submitted and accepted in March 2024;
4. In March 2024, the Company's U.S. partner announced that ELAHERE? (MirvetuximabSoravtansine Injection), an ADC drug intended for the treatment of platinum-resistant ovariancancer, has been converted from accelerated approval to full approval in the United States. In April2024, the Company was approved to join the international multi-center PSOC (platinum-sensitiveovarian cancer) Phase III clinical study, to promote this product for the frontline treatment ofovarian cancer. It is being developed as maintenance therapy for the treatment of subjects withrecurrent platinum-sensitive, epithelial ovarian, primary peritoneal, or fallopian tube cancers withpositive folate receptor alpha (FRα) in combination with bevacizumab;
5. The NDA application for Relmapirazin Injection in China, which is an innovative drug usedin conjunction with a glomerular filtration rate dynamic monitoring system, was accepted inJanuary 2024;
6. On March 1, 2024, CARsgen's CAR-T product Zevorcabtagene Autoleucel Injection (tradename: Saikaize?, R&D code: CT053), has received notification from the National MedicalProducts Administration (NMPA) that it has been granted conditional approval for the treatment ofadult patients with relapsed or refractory multiple myeloma, who have previously progressed afterat least 3 lines of therapy (including a proteasome inhibitor and immunomodulator agent). TheCompany was granted the exclusive right to commercialize zevorcabtagene autoleucel in mainlandChina, and has set up a dedicated commercialization team. The first prescription was issued on theday when such product was approved for marketing.
In addition, the Company's generic drug registration was proceeded as planned. TacrolimusExtended-Release Capsules with a specification of 5mg were approved by the NMPA for marketingin February 2024.
During the reporting period, the Company continued to promote the registration andimplementation of key aesthetic medicine in China:
1. The Chinese clinical trial of MaiLi Extreme, the Company's new high-end lidocaine-
containing sodium hyaluronate for injection, successfully reached the primary study endpoint andshowed good product safety data. The application for registration of this product as a Class IIImedical device in China has recently been accepted;
2. Two innovative botulinum toxin products under development, i.e., ATGC-110 (Type Abotulinum toxin) and YY001 (Type A recombinant botulinum toxin), which were introduced by theCompany in cooperation with South Korea ATGC and Chongqing Claruvis, have made significantprogress respectively: the marketing application of ATGC-110 has been accepted by the Ministry ofFood and Drug Safety (MFDS) of Korea. The declared indication is to improve the moderate tosevere frown lines between eyebrows among adult patients. YY001 has completed the enrollment ofPhase III clinical subjects in China.
(III) Other important matters
The Company held the 20th Meeting of the 10th Session of the Board of Directors on February7, 2024, reviewed and approved the Proposal on Investment in Construction of Bio-Innovation andIntelligent Manufacturing Center Project, which agreed that Hangzhou Zhongmei HuadongPharmaceutical Co., Ltd., a wholly-owned subsidiary of the Company, would invest in constructionof the Bio-Innovation and Intelligent Manufacturing Center Project in accordance with its owndevelopment plan and new product launch plan. The total investment amount of this project isexpected to be RMB 2 billion. This project would be carried out in stages. The investment amountof Phase I is about RMB 1.188 billion (the final investment amount is subject to the actualinvestment expenditure of the project construction) (for details, please refer to the relevantannouncements disclosed by the Company at www.cninfo.com.cn, with the Announcement No.:
2024-006).
(IV) Registration form of receptions, including research, communication, interviewand other activities during the reporting period
| Reception date | Reception location | Reception mode | Reception object type | Reception object | Main topics discussed and information provided | Basic information index of the survey |
| January 9 and 10, 2024 | Meeting room of the Company | Site survey and online meeting | Institution | New China Asset Management, Industrial Securities, Guotai Junan Securities, etc. | Investor communication | For details, please refer to the Record Sheet of Investor Relations Activities on January 9 and 10, 2024 published by the Company at https://irm.cninfo.com.cn/ and at www.cninfo.com.cn. |
| January 16 and 17, | Meeting room of the | On-site survey | Institution | Haitong Securities, | Investor communicatio | For details, please refer to the Record |
| 2024 | Company | Origin Asset Management, SWS MU Fund, etc. | n | Sheet of Investor Relations Activities on January 16 and 17, 2024 published by the Company at https://irm.cninfo.com.cn/ and at www.cninfo.com.cn. | ||
| March 4, 2024 | Meeting room of the Company | Online meeting | Institutions and individuals | Soochow Securities, Zhong Ou Asset Management, Perseverance Asset Management, etc. | Exchange Meeting for Launching New Drug Saikaize? of Huadong Medicine and CARsgen Therapeutics | For details, see the Record Sheet of Investor Relations Activities on March 4, 2024, which was published by the Company at https://irm.cninfo.com.cn/ and at www.cninfo.com.cn. |
| April 18, 2024 | Meeting room of the Company | Online meeting | Institutions and individuals | CICC, China Securities, TF Securities, etc. | 2023 Annual Performance Exchange Meeting of Huadong Medicine | For details, see the Record Sheet of Investor Relations Activities on April 18, 2024, which was published by the Company at https://irm.cninfo.com.cn/ and at www.cninfo.com.cn. |
IV. Quarterly Financial Statements
(I) Financial statements
1. Consolidated balance sheet
Prepared by: Huadong Medicine Co., Ltd.
March 31, 2024
Unit: RMB
| Item | Closing balance | Opening balance |
| Current assets: | ||
| Monetary funds | 3,563,064,869.46 | 4,663,378,011.64 |
| Deposit reservation for balance | ||
| Lendings to banks and other financial institutions | ||
| Trading financial assets | ||
| Derivative financial assets | 16,409,129.45 | 16,434,493.97 |
| Notes receivable | 6,812,089.97 | |
| Accounts receivable | 9,677,692,232.29 | 7,455,250,690.83 |
| Receivables financing | 843,257,932.30 | 1,434,366,300.69 |
| Prepayments | 362,069,336.43 | 279,207,655.40 |
| Premium receivable | ||
| Reinsurance accounts receivable | ||
| Reinsurance contract reserve receivable | ||
| Other accounts receivable | 473,836,282.59 | 291,135,104.33 |
| Including: Interest receivable |
| Dividends receivable | 2,623,608.84 | 2,623,608.84 |
| Financial assets purchased for resale | ||
| Inventory | 4,224,074,951.91 | 4,290,214,266.03 |
| Including: Data resources | ||
| Contract assets | ||
| Assets held for sale | ||
| Non-current assets due within one year | ||
| Other current assets | 51,878,760.17 | 59,881,757.08 |
| Total current assets | 19,212,283,494.60 | 18,496,680,369.94 |
| Non-current assets: | ||
| Loans and advances issued | ||
| Debt investments | ||
| Other debt investments | ||
| Long-term receivables | ||
| Long-term equity investment | 1,529,526,141.05 | 1,535,907,809.85 |
| Investment in other equity instruments | 565,223,872.68 | 565,223,872.68 |
| Other non-current financial assets | ||
| Investment real estate | 12,485,783.85 | 12,746,181.87 |
| Fixed assets | 4,050,202,967.46 | 4,140,144,817.51 |
| Works in progress | 927,713,584.81 | 913,147,212.17 |
| Productive biological assets | ||
| Oil and gas assets | ||
| Right-of-use assets | 139,021,674.64 | 151,175,007.16 |
| Intangible assets | 2,527,437,482.39 | 2,333,787,357.62 |
| Including: Data resources | ||
| Development expenses | 1,068,480,143.55 | 992,532,091.86 |
| Including: Data resources | ||
| Goodwill | 2,596,809,693.91 | 2,598,696,062.31 |
| Long-term unamortized expenses | 19,291,856.38 | 20,053,854.34 |
| Deferred income tax assets | 187,808,574.44 | 187,808,574.44 |
| Other non-current assets | 1,631,559,010.61 | 1,561,458,605.23 |
| Total non-current assets | 15,255,560,785.77 | 15,012,681,447.04 |
| Total assets | 34,467,844,280.37 | 33,509,361,816.98 |
| Current liabilities: | ||
| Short-term borrowings | 1,083,597,089.07 | 822,380,292.37 |
| Borrowings from the central bank | ||
| Borrowings from other banks and other financial institutions | ||
| Trading financial liabilities | ||
| Derivative financial liabilities | ||
| Notes payable | 1,437,934,424.82 | 1,727,420,960.30 |
| Accounts payable | 4,326,094,692.22 | 4,374,832,979.95 |
| Advance receipts | 405,231.33 | 1,393,551.48 |
| Contract liabilities | 170,289,424.40 | 135,459,275.17 |
| Expense for financial assets sold for repurchase | ||
| Deposits from customers and interbank | ||
| Receivings from vicariously traded securities | ||
| Receivings from vicariously underwriting securities | ||
| Employee compensation payable | 215,396,862.69 | 359,148,474.25 |
| Taxes and dues payable | 547,143,131.41 | 489,385,055.57 |
| Other accounts payable | 2,910,002,629.17 | 2,518,621,382.87 |
| Including: Interests payable | ||
| Dividends payable | 143,024,219.60 | 143,024,219.60 |
| Fees and commissions payable | ||
| Reinsurance accounts payable | ||
| Liabilities held for sale |
| Non-current liabilities due within one year | 209,413,662.46 | 359,342,623.38 |
| Other current liabilities | 18,040,693.69 | 14,621,494.85 |
| Total current liabilities | 10,918,317,841.26 | 10,802,606,090.19 |
| Non-current liabilities: | ||
| Reinsurance contract reserves | ||
| Long-term borrowings | 519,383,524.08 | 520,759,460.07 |
| Bonds payable | ||
| Including: Preferred share | ||
| Perpetual bonds | ||
| Lease liabilities | 83,006,313.46 | 56,695,158.59 |
| Long-term accounts payable | 24,805,289.23 | 107,251,248.59 |
| Long-term employee compensation payable | ||
| Estimated liabilities | 38,460,444.39 | 37,184,074.06 |
| Deferred income | 167,391,739.98 | 171,056,435.34 |
| Deferred income tax liabilities | 182,493,233.05 | 184,373,974.04 |
| Other non-current liabilities | 46,192,650.00 | 47,170,650.00 |
| Total non-current liabilities | 1,061,733,194.19 | 1,124,491,000.69 |
| Total liabilities | 11,980,051,035.45 | 11,927,097,090.88 |
| Owners’ equity: | ||
| Share capital | 1,754,327,548.00 | 1,754,425,348.00 |
| Other equity instruments | ||
| Including: Preferred share | ||
| Perpetual bonds | ||
| Capital reserve | 2,448,599,611.00 | 2,446,313,774.82 |
| Minus: Treasury stock | 82,074,369.07 | 84,519,369.07 |
| Other comprehensive income | 247,990.92 | -40,341,544.18 |
| Special reserves | ||
| Surplus reserves | 1,277,779,972.18 | 1,277,779,972.18 |
| General risk reserves | ||
| Undistributed profit | 16,556,363,135.87 | 15,693,951,574.91 |
| Total owners' equity attributable to the parent company | 21,955,243,888.90 | 21,047,609,756.66 |
| Minority interests | 532,549,356.02 | 534,654,969.44 |
| Total owners’ equity | 22,487,793,244.92 | 21,582,264,726.10 |
| Total liabilities and owners’ equity | 34,467,844,280.37 | 33,509,361,816.98 |
Legal Representative: Lv Liang Officer In Charge of Accounting: Lv Liang Head of Accounting Department: Qiu Renbo
2. Consolidated profit statement
Unit: RMB
| Item | Amount incurred in the current period | Amount incurred in the previous period |
| I. Total operating revenue | 10,410,809,128.72 | 10,114,531,331.77 |
| Including: Operating revenue | 10,410,809,128.72 | 10,114,531,331.77 |
| Interest revenue | ||
| Premiums earned | ||
| Fees and commissions revenue | ||
| II. Total operating costs | 9,331,357,509.92 | 9,111,221,456.77 |
| Including: Operating costs | 7,076,397,110.06 | 6,790,724,204.77 |
| Interest expense | ||
| Fees and commissions expenditures | ||
| Surrender value | ||
| Net payments for insurance claims | ||
| Net provision for insurance liabilities |
| Policy dividend expenditures | ||
| Reinsurance expenses | ||
| Taxes and surcharges | 56,334,556.14 | 53,150,033.98 |
| Selling expenses | 1,574,261,928.29 | 1,642,616,610.16 |
| Management expenses | 335,169,160.39 | 330,086,070.32 |
| R&D expenses | 281,639,751.64 | 265,493,695.70 |
| Financial expenses | 7,555,003.40 | 29,150,841.84 |
| Including: Interest expense | 23,050,131.41 | 34,466,716.93 |
| Interest revenue | 24,409,865.24 | 12,491,377.82 |
| Plus: Other incomes | 38,311,729.18 | 14,582,456.30 |
| Investment income (loss expressed with “-”) | -47,163,448.93 | -61,752,708.66 |
| Including: Investment income in associates and joint ventures | -37,504,466.74 | -52,816,907.73 |
| Income from derecognition of financial assets measured on the basis of amortization costs | ||
| Exchange earnings (loss expressed with “-”) | ||
| Net income of exposure hedge (loss expressed with “－”) | ||
| Income from changes in fair value (loss expressed with “-”) | -25,364.49 | |
| Credit impairment loss (loss expressed with “-”) | ||
| Asset impairment loss (loss expressed with “-”) | ||
| Proceeds from disposal of assets (loss expressed with “-”) | 1,521,275.31 | -2,199,859.71 |
| III. Operating profit (loss expressed with “-”) | 1,072,095,809.87 | 953,939,762.93 |
| Plus: Non-operating incomes | 1,295,600.39 | 1,389,195.74 |
| Minus: Non-operating expenses | 5,202,610.91 | 6,049,187.60 |
| IV. Total profit (total loss expressed with “-”) | 1,068,188,799.35 | 949,279,771.07 |
| Minus: Income tax expense | 207,943,278.46 | 189,354,280.74 |
| V. Net profit (net loss expressed with “-”) | 860,245,520.89 | 759,925,490.33 |
| (I) Classification by continuity of operation | ||
| 1. Net profits from continuing operations (net loss expressed with “-”) | 860,245,520.89 | 759,925,490.33 |
| 2. Net profit from discontinued operations (net loss expressed with “-”) | ||
| (II) Classification by ownership | ||
| 1. Net profit attributable to the owners of the parent company | 862,411,560.96 | 755,284,976.47 |
| 2. Minority interest income | -2,166,040.07 | 4,640,513.86 |
| VI. Net of tax of other comprehensive income | 40,589,535.10 | -31,351,409.53 |
| Net of tax of other comprehensive income attributable to the owner of the parent company | 40,589,535.10 | -31,351,409.53 |
| (I) Other comprehensive income that cannot be reclassified into the profits and losses | 693,671.15 | |
| 1. Change from re-measurement of |
| defined benefit plan | ||
| 2. Other comprehensive income that cannot be included in the profits and losses under the equity method | ||
| 3. Changes in fair value of investment in other equity instruments | 693,671.15 | |
| 4. Changes in fair value by the enterprise’s credit risks | ||
| 5. Others | ||
| (II) Other comprehensive income that can be reclassified into the profits and losses | 40,589,535.10 | -32,045,080.68 |
| 1. Other comprehensive income that can be transferred to the profit and loss under the equity method | ||
| 2. Changes in fair value of investments in other debt investments | ||
| 3. Financial assets reclassified into other comprehensive income | ||
| 4. Provision for credit impairment of other debt investments | ||
| 5. Cash flow hedging reserves | ||
| 6. Converted difference in foreign currency financial statements | 40,589,535.10 | -32,045,080.68 |
| 7. Others | ||
| Net of tax of other comprehensive income attributable to minority shareholders | ||
| VII. Total Comprehensive Income | 900,835,055.99 | 728,574,080.80 |
| Total comprehensive income attributable to the owner of the parent company | 903,001,096.06 | 723,933,566.94 |
| Total comprehensive income attributable to minority shareholders | -2,166,040.07 | 4,640,513.86 |
| VIII. Earnings per share: | ||
| (I) Basic earnings per share | 0.4929 | 0.4316 |
| (II) Diluted earnings per share | 0.4928 | 0.4315 |
If there is a business combination under common control in this period, the net profit of the combined party before thecombination is RMB 0.00, and the net profit of the combined party in the previous period is RMB 0.00.Legal Representative: Lv Liang Officer In Charge of Accounting: Lv Liang Head of Accounting Department: Qiu Renbo
3. Consolidated cash flow statement
Unit: RMB
| Item | Amount incurred in the current period | Amount incurred in the previous period |
| I. Cash flows from operating activities: | ||
| Cash received from selling goods and providing services | 9,896,088,428.64 | 9,958,329,191.55 |
| Net increase in deposits from customers as well as banks and other financial institutions | ||
| Net increase in borrowings from the central bank | ||
| Net increase in borrowings from other financial institutions | ||
| Cash received from the original insurance contract premium | ||
| Net cash received from reinsurance |
| business | ||
| Net increase in savings and investment funds of policyholders | ||
| Cash for interest, fees and commissions | ||
| Net increase in borrowings from banks and other financial institutions | ||
| Net increase in funds from repurchase business | ||
| Net cash received from securities trading agency | ||
| Refund of taxes and fees received | 3,909,537.24 | 1,207,680.51 |
| Other cash received related to business activities | 179,167,865.43 | 166,606,563.49 |
| Subtotal of cash inflow from operating activities | 10,079,165,831.31 | 10,126,143,435.55 |
| Cash paid for purchases of goods and services | 7,688,555,061.58 | 7,268,626,176.06 |
| Net increase in customer loans and advance payments | ||
| Net increase in deposits with the central bank and interbank | ||
| Cash for payment of the original insurance contract | ||
| Net increase in lendings to banks and other financial institutions | ||
| Cash for interest, handling fees and commissions | ||
| Cash for payment of dividends on policies | ||
| Cash paid to and for employees | 1,232,560,542.55 | 845,672,966.99 |
| Various taxes and fees paid | 606,028,807.91 | 609,699,664.95 |
| Payment of other cash related to business activities | 1,036,544,085.40 | 1,648,297,397.71 |
| Subtotal of cash outflows from operating activities | 10,563,688,497.44 | 10,372,296,205.71 |
| Net cash flow from operating activities | -484,522,666.13 | -246,152,770.16 |
| II. Cash flows arising from investment activities: | ||
| Cash received from investment recovery | 1,000,000.00 | |
| Cash received from obtaining investment income | 2,000,000.00 | |
| Net cash recovered from disposal of fixed assets, intangible assets and other long-term assets | 2,328,201.94 | 149,204.89 |
| Net cash received from disposal of subsidiaries and other business units | ||
| Other cash received related to investment activities | 44,313,052.83 | |
| Subtotal of cash inflows from investing activities | 5,328,201.94 | 44,462,257.72 |
| Cash paid for the purchase and construction of fixed assets, intangible assets and other long-term assets | 472,272,778.22 | 398,081,956.46 |
| Cash paid for investment | 65,861,678.42 | 51,794,250.00 |
| Net increase in pledged loans | ||
| Net cash paid for acquisition of subsidiaries and other business entities | 17,006,187.32 | 34,641,364.12 |
| Payments of other cash related to investing activities | 157,563,682.87 | |
| Subtotal of cash outflows from investing activities | 712,704,326.83 | 484,517,570.58 |
| Net cash flows from investing activities | -707,376,124.89 | -440,055,312.86 |
| III. Cash flows arising from financing activities: | ||
| Cash received by absorbing investment | ||
| Including: Cash received by subsidiaries from minority shareholders' investment | ||
| Cash received from obtaining loans | 1,510,044,486.23 | 907,116,269.61 |
| Other cash received related to financing activities | 62,459,038.61 | 59,222,104.05 |
| Subtotal of cash inflows from financing activities | 1,572,503,524.84 | 966,338,373.66 |
| Cash paid for debt repayment | 1,202,198,901.63 | 1,652,722,088.75 |
| Cash paid to distribute dividends, profits or pay interest | 36,432,249.03 | 64,853,544.08 |
| Including: Dividends and profits paid by subsidiaries to minority shareholders | 13,328,000.00 | |
| Payment of other cash related to financing activities | 262,376,106.69 | 98,175,384.50 |
| Subtotal of cash outflows from financing activities | 1,501,007,257.35 | 1,815,751,017.33 |
| Net cash flow from financing activities | 71,496,267.49 | -849,412,643.67 |
| IV. Impact of exchange rate changes on cash and cash equivalents | 17,392,454.16 | 4,528,971.51 |
| V. Net increase in cash and cash equivalents | -1,103,010,069.37 | -1,531,091,755.18 |
| Plus: Opening balance of cash and cash equivalents | 4,208,160,010.91 | 3,416,910,702.33 |
| VI. Closing balance of cash and cash equivalents | 3,105,149,941.54 | 1,885,818,947.15 |
(II) Situation of relevant items of financial statements at the beginning of the currentyear after the initial implementation of adjustment of the New Accounting Standards in2024
□Applicable ?Not applicable
(III) Audit reportHas the First Quarterly Report been audited?
□Yes ?No
The First Quarterly Report of the Company has not been audited.
Board of Directors of Huadong Medicine Co., Ltd.
April 26, 2024