qatar2022worldcupqualifiersasia| The gross profit margin of Xinguang Pharmaceutical's core products has dropped by 30% in three years, and its R & D expenses ranks among the top in the industry, but it has no new products for seven years.

After the trading on April 22, Xinguang Pharmaceutical issued a correction notice, correcting some of the data in the 2022 and 2023 annual reports, and issuing corrections at the same time.Qatar2022worldcupqualifiersasia2022 annual report and 2023 annual report.

Among them, the data involved is to strengthen the average return on net assets. In the previously disclosed annual report for 2022, the weighted average return on net assets in 2020 was 0.Qatar2022worldcupqualifiersasia.12%, 12.26% after correction. In the previous version of the 2023 annual report, the weighted average return on equity in 2021 was 0.14%, which was corrected to 13.8%.

Regarding this disclosure error, Xinguang Pharmaceutical explained to the media that it was an operational error and the original system was not perfect.

In addition to the mistakes made by Xinguang, Xinguang Pharmaceutical Industry is facing more serious problems.

The gross profit margin of the leading product fell sharply.

Although in the company introduction, Xinguang Pharmaceutical said that its products cover cardio-cerebrovascular system, orthopaedics, respiratory system, digestive system, urinary system, health food and other areas. But in fact, the company's main products are Huangqi Shengmai Yin, Sheng Jin Dan capsule and American ginseng oral liquid.

Among them, Huangqi Shengmai drink is the revenue pillar. From 2021 to 2023, this product accounted for 77.27%, 77.02% and 76.09% of revenue.

However, Huangqi Shengmai drink, as a pillar of revenue, has seen its net profit decline for many years in a row. The gross profit margin of the product was as high as 61.84% in 2021, 56.39% in 2022, and dropped sharply to 43.76% in 2023.

To make matters worse, the gross margins of the other two leading products are not very optimistic. In 2023, the gross profit margin of American ginseng oral liquid fell 6.11% compared with the same period last year. The gross profit margin of Shenjindan capsule fell by 3.31% and 0.36% respectively in the past two years.

Affected by this, in 2023, Xinguang Pharmaceutical's revenue was 270 million yuan, down 23.07% from the same period last year, and its net profit was 64.3565 million yuan, down 40.86% from the same period last year.

Xinguang Pharmaceutical's Huangqi Shengmai Yin in-hospital and out-of-hospital sales proportion of about 20:80. Xinguang Pharmaceutical said it was stepping up its efforts to promote the domestic market.

This may have something to do with increased competition in the market. According to the official website of the State Drug Administration, only Xinguang Pharmaceutical Co., Ltd. and Jiangxi Nanchang Jisheng Pharmaceutical Co., Ltd. are the only companies in China. Nanchang Jisheng is another listed Chinese medicine company Jiangzhong Pharmaceutical holding subsidiary.

Picture source: official website of the State Drug Administration

In February this year, China Resources Jiangzhong Marketing official account released an article entitled "fight the first quarter", Jiangzhong brand Huangqi Shengmai drink (sugar-free) New year's start ", according to the article, Jiangzhong new product Huangqi Shengmai drink (sugar-free) has a comprehensive rise in the New year, benchmarking chain to create good news frequently, terminal coverage continues to exceed 15000. The main body of the official account certification is Jiangxi Jiang traditional Chinese Medicine Trading Co., Ltd., and Tianyan investigation shows that Jiang traditional Chinese Medicine holds 99.71% of the shares.

Rely on the old capital since listing.

As early as in the 2016 annual report, Xinguang Pharmaceutical said that the company attaches great importance to scientific research and innovation and new product development, has provincial high-tech research and development centers, and cooperates with a number of scientific research institutions and units in Zhejiang Province to carry out scientific research and innovation and cooperate to develop new products.

However, since 2016, the only products that have appeared in the annual report are Huangqi Shengmai Yin, Manzhi Guben granule, Siji vegetable granule, Zengye granule, Huangqi Shengmai granule, Sanqi capsule, Shenjindan capsule, Yupingfeng Oral liquid and other products.

In the 2016 annual report, Xinguang Pharmaceutical said it now has 6 dosage forms, 49 drug production approval numbers and 2 health food approval numbers.

Photo Source: Xinguang Pharmaceutical 2016 Annual report

Seven years later, in the 2023 annual report, Xinguang Pharmaceutical still has 6 dosage forms, 49 drug production approval numbers and 2 health food approval numbers.

Some investors question why R & D costs remain high if the company has not developed new products in recent years if it has been maintaining existing products.

Data show that in recent years, the R & D expenditure of Xinguang Pharmaceutical Industry is mainly at the level of 10 to 20 million yuan. The R & D expenditure in 2023 is 15.1342 million yuan, and the R & D expenditure rate is 5.6%.

According to Choice data, Xinguang Pharmaceutical has the highest R & D expenditure rate among the 38 traditional Chinese medicine companies that have disclosed their 2023 annual reports, second only to Kangyuan Pharmaceutical, Huasen Pharmaceutical, Tianshili, Fangsheng Pharmaceutical and Tai long Pharmaceutical.