Q3 performance inventory of Chinese medicine enterprises! Revenue reached 54.8 billion; The highest increase in net profit was 395%, Baiyun Mountain, Yunnan Baiyao, Pian Tsai, China Resources Sanjiu...

Golden autumn and October are the harvest season
for the peasant uncle.

However, this may not be the case
for A-share listed Chinese medicine companies.

As of October 30, 75 A-share Chinese medicine companies have fully disclosed their third quarterly reports for 2022, with a total revenue of 256.
789 billion yuan and a total net profit of 24.
115 billion yuan
.

Among them, 64 companies made profits and 11 achieved net profit losses; In addition, 39 companies experienced a decline in net profit, accounting for half
of the total.

Net profit fell for 39 companies

Jiaying Pharmaceutical's net profit growth rate is the highest

● Year-on-year growth rate of total revenue

Among the companies that announced the third quarterly report in 2022, 11 companies have a year-on-year revenue growth rate of more than 20%, of which TusPharma ranks first with a growth rate of 71.
81%; It was followed by Jiangzhong Pharmaceutical Industry and Guangyuyuan, achieving 48.
33% and 38.
09%
respectively.

2022Q3 ranking of TOP10 in the year-on-year growth rate of total revenue of traditional Chinese medicine enterprises

Data source: company financial report, flush money

The reason for the high year-on-year growth rate of TusPharma's total revenue is mainly due to the increase in
the company's operating income.

However, due to the rise in the price of raw materials for major products, the year-on-year growth rate of operating costs was higher, reaching 159.
63%, and the sales expenses increased year-on-year (39.
2%), resulting in the company's net profit attributable to the parent only achieving 15.
699 million yuan, a significant decrease of 59.
81%
year-on-year.

In the first three quarters of 2022, Guangyuyuan achieved a total revenue of 821 million yuan, a year-on-year increase of 38.
09%, and the growth rate ranked in the forefront of the industry, mainly due to the impact of the domestic epidemic and the overall economic downturn last year, the impact of the gross profit margin, etc.
, resulting in a decline in performance and a low base
.

During the same period, the net profit of Guangyuyuan lost 49.
82 million yuan, a year-on-year growth rate of 55.
01%, from a profit of 7.
8254 million yuan in the first half of the year to a loss, but the loss was significantly narrowed
compared with the loss of 111 million yuan in the same period last year.

The reason for the net profit loss of 57.
6459 million yuan in the third quarter is that the sales expenses in the third quarter increased at a higher rate (50.
7%) than the revenue growth rate (42.
5%), and the proportion of sales expenses in total revenue was as high as 61.
7%, coupled with the decrease in government subsidies received in a single quarter and the loss
of invested associates.

● Year-on-year growth rate of net profit

Among the companies that released the three quarterly reports in 2022, 36 achieved year-on-year net profit growth, of which 16 companies increased by more than 20%; The net profit of 39 companies fell year-on-year, accounting for half of the Chinese medicine sector, of which 26 fell by more than 20%.

Specifically, Jiaying Pharmaceutical, Fangsheng Pharmaceutical, Longshen Rongfa and Rhein Biotech are the top four enterprises with year-on-year net profit growth rate, and the growth rate is more than 100%, as high as 395.
25%, 317.
5%, 166.
56% and 100.
71%
respectively.

2022Q3 ranking of the top 10 net profit growth rate of traditional Chinese medicine enterprises year-on-year

Data source: company financial report, flush money

In the first three quarters of 2022, Jiaying Pharmaceutical achieved a net profit of 22.
2593 million yuan, an increase of 17.
7647 million yuan, or 395.
25%, over the same period of the previous year of 4.
4946 million yuan, mainly due to the increase in total operating income in the current period (2.
94%), the decrease in total operating costs (-0.
54%), and the decrease in investment losses
.

The reasons for the high growth rate of Fangsheng Pharmaceutical's net profit are: First, because the company focuses on the main business, continues to optimize the business structure, and effectively implements the development strategy of "naturalization", the pharmaceutical manufacturing industry performs well, with a year-on-year increase of 32.
76%; Second, during the reporting period, the company confirmed the investment income of 183.
9895 million yuan from the disposal of 36.
80% of the equity of Baijun Medical, and from October 1, 2022, Baijun Medical will no longer be included in the scope of
the company's consolidated statements.

According to the financial report, from January to September 2022, Fangsheng Pharmaceutical achieved a net profit of 259 million yuan, a year-on-year increase of 317.
5%, but if non-recurring profits and losses are deducted, the non-net profit deducted is 71.
6305 million yuan, a year-on-year increase of 22.
29%.

The reason for the high growth rate of Longshen Rongfa's net profit is mainly due to the performance loss affected by the epidemic in the same period last year, resulting in
a low base.

In the first three quarters of 2022, Rhein Biotech's revenue and net profit both achieved rapid growth, reaching 37.
44% and 100.
71% respectively, and its main business is natural health products and plant extraction business
.

According to the third quarterly report, the strong consumer demand for natural and healthy terminal products has strongly driven the development of the upstream plant extraction industry, and the market demand for the company's various plant extract products has continued to grow, coupled with the company's continuous improvement of endogenous growth momentum during the reporting period, with technological transformation, process optimization, and expense rate control during the period as breakthroughs, thereby promoting the company's revenue and performance to maintain a high growth trend
.

The net profit of 8 enterprises exceeded 1 billion

Baiyun Mountain has the highest revenue scale

● Revenue scale

Among the companies that released the three quarterly reports in 2022, 6 have a total revenue of more than 10 billion yuan
.
Among them, Baiyun Mountain has the highest revenue scale, reaching 54.
806 billion yuan, followed by Yunnan Baiyao and China Resources Sanjiu, with total revenue of 26.
916 billion yuan and 12.
111 billion yuan
respectively.

2022Q3 ranking of TOP10 total revenue of Chinese medicine enterprises

Data source: company financial report, flush money

● Net profit

Among the companies that announced the three quarterly reports in 2022, 64 achieved profits and 11 made net profit losses, of which 8 had net profits of more than 1 billion yuan
.

Specifically, Baiyun Mountain ranked first with a net profit of 3.
474 billion yuan, followed by Yunnan Baiyao and Pian Tsai, with net profits of more than 2 billion yuan, 2.
305 billion yuan and 2.
052 billion yuan
respectively.

2022Q3 ranking of top 10 net profits of Chinese medicine enterprises

Data source: company financial report, flush money

Although Baiyun Mountain and Yunnan Baiyao ranked first and second in terms of total revenue and net profit, the year-on-year growth was not ideal
.

Among them, in the first three quarters of 2022, the year-on-year growth rates of Baiyun Mountain's total revenue and net profit were 2.
37% and 4.
91%, respectively, both of which increased
slightly.

According to the third quarterly report, as of the end of September, the net cash flow generated by Baiyunshan's operating activities decreased by 42.
97% year-on-year, mainly due to the fact that Guangzhou Wanglaoji health industry was earlier than the 2021 Spring Festival due to the 2022 Spring Festival, and the 2022 Spring Festival stocking collection time occurred at the end of 2021, resulting in a year-on-year decrease in net cash flow from operating activities, and a year-on-year decrease in cash received by the Company's subsidiaries for the sale of goods and the provision of services
.

During the same period, Yunnan Baiyao's revenue and net profit both declined, down 5.
1% and 5.
94%
year-on-year respectively.
According to the third quarterly report, as of the end of September, the fair value change gain and loss of the company's trading financial assets during the holding period was -752 million yuan, mainly due to the change in the net value of the securities and funds held by the company, and this value compared with the fair value change profit and loss of -417 million yuan in the first half of the year, which means that the loss of stock speculation is still expanding
.

It is worth mentioning that Pian Tsai ranked 8th in the total revenue of 6.
616 billion yuan in the company released in the third quarterly report in 2022, but ranked 3rd in the net profit ranking, indicating that the company's profitability is strong
.

● Revenue composition

The businesses with the highest gross profit margin are liver disease drugs, cosmetics and daily chemicals, reaching 80.
34% and 61.
68% respectively, and the combined sales revenue of the two businesses accounts for half of the company's total revenue, accounting for 51.
9%.

Moreover, the gross profit margin of the sales of Pian Tsai is 47.
65%, which is higher than Baiyunshan (19.
77%), Yunnan Baiyao (28.
21%) and Taiji Group (45%)
, which are the top companies in the third quarter of 2022.

2022Q3 ranking of profitability and total market value of Chinese medicine enterprises

Data source: company financial report, flush money

In addition, the net profit margin is the strongest comprehensive indicator, reflecting the company's comprehensive profitability
.

In contrast, the net profit margin of the sales of Pian Tsai is 31.
64%, ranking 3rd among the 75 A-share companies that announced the third quarterly report of 2022, second only to Jilin Ao Dong (46.
38%) and Shin Kong Pharmaceutical (34.
06%)
.
It can be seen that compared with most Chinese medicine enterprises, the products of Pian Tsai have strong profitability and high
operating efficiency.

Based on this, Pian Tsai has been favored by the capital market, becoming the first enterprise in the total market value of the A-share Chinese medicine sector, and is currently the only enterprise with a total market value of more than 100 billion yuan, with a total market value of 137.
695 billion yuan (as of the close of October 28).

Yunnan Baiyao and Pian Tsai are actively transformed

Baiyun Mountain and Tasly are most willing to invest in research and development

In recent years, affected by various factors, Chinese medicine enterprises have begun to adjust their business strategies and expand new businesses, either gradually entering a variety of consumer goods fields, or developing innovative Chinese medicines or intervening in the field of
innovative drugs.

Take a Chinese medicine company that expands its consumer goods business as an example
.

For example, Yunnan Baiyao focuses on the development of oral health care (toothpaste, mouthwash, oral spray, dental cleaner and other daily oral cleaning products), dermatology (through products, services, and instruments), bone injury (acquisition of orthopedic upstream equipment and material enterprises, such as sports medicine equipment and endoplants, etc.
) and women's care (research and development of gynecological Chinese medicine, women's dietary supplements, private parts care) on the basis of "1" deep cultivation in the field of traditional Chinese medicine"4.
fields
.

Yunnan Baiyao's "1+4+1" strategy

Source: Company announcement, CSC

In addition, after years of business expansion, Ma Yinglong is no longer limited to hemorrhoidal treatment products, and can now provide consumers with anorectal, skin, ophthalmic, gynecological and other drugs and functional cosmetics, functional care products (including maternal and child care and home care), functional foods, equipment and other health products
.

After years of transformation, Pian Tsai has formed a pattern
of multi-format aggregation in the health field.
Among them, in the pharmaceutical business, it has launched a series of products covering liver disease drugs, cold medicines, dermatology drugs and many other fields; In terms of cosmetics and daily chemical industry, it has a number of brands
such as "Pian Tsai" brand cosmetics (special effect skin care product line and men's clean and refreshing oil control series, etc.
), and "Queen" (anti-wrinkle, whitening, soothing three light luxury herbal skin care product lines).

In addition, there are currently many Chinese medicine companies in the field of
R&D and innovative Chinese medicine or intervention.

● R&D expenses

Among the companies that released their three quarterly reports in 2022, the top five companies are: Baiyunshan (664 million yuan), Tasly (591 million yuan), Yiling Pharmaceutical (5.
52%), Kangyuan Pharmaceutical (437 million yuan), and China Resources Sanjiu (353 million yuan).

In addition, the top 5 enterprises with the highest proportion of R&D investment in operating income are: Longjin Pharmaceutical (14.
72%), Kangyuan Pharmaceutical (14%), Zixin Pharmaceutical (9.
96%), Tasly (9.
69%), and Guilin Sanjin (8.
85%)
.

In the third quarter of 2022, the top 10 R&D investment of Chinese medicine enterprises will be ranked

Data source: company financial report, flush money

Tasly continues to focus on the three major disease areas of cardiovascular and cerebrovascular, digestion and metabolism, and oncology, which are the largest and fastest growing in the Chinese market, and uses the advantages of the coordinated development of modern traditional Chinese medicine, biological medicine and chemical drugs to carry out the strategic layout
of innovative drugs.

In the patented traditional Chinese medicine sector, Yiling Pharmaceutical Co.
, Ltd.
mainly focuses on six major categories of diseases with cardiovascular and cerebrovascular diseases, diabetes, respiratory, tumor, high incidence of nerves and urology, and large market drug use, and has developed a series of patented traditional Chinese medicines with independent intellectual property rights, and currently has 13 patented new drugs, forming a relatively rich product group; In the new drug business of the chemical and biochemical drug sector, the research and development of a number of chemical first-class new drugs is progressing smoothly, and one of the projects has completed phase III clinical trials and prepared for NDA
.

As of the first half of 2022, Kangyuan Pharmaceutical has a research team composed of about 400 scientific researchers to continuously promote the research and development of new products, with 4 clinical trial notices approved for traditional Chinese medicines and 1 production approval document; 2 phase II clinical trials of chemical drug innovative drugs; Biopharmaceuticals submitted 1 CDE pre-IND communication application; Promote a number of projects to carry out druggability research, preclinical research and clinical research respectively
.

Attached: The performance of 75 A-share Chinese medicine enterprises in the third quarter of 2022

Data source: iAsk Finance website

Total market capitalization data as of: 2022.
10.
28

Other data as of 2022.
9.
30