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【Guide】Huadong Medicine's net profit increased by 18% in the first half of the year, and it plans to pay 3.5 yuan per 10 shares

China Fund News reporter Nan Shen

On the evening of August 15, Huadong Medicine, a well-known A-share pharmaceutical white horse, released its 2024 semi-annual performance report. In the first half of the year, the company's net profit increased by 18.29% year-on-year. With steady performance growth, Huadong Medicine plans to implement an interim dividend distribution plan of 3.5 yuan per 10 shares, without bonus shares or dividends.

The last time Huadong Medicine implemented interim dividends was in the 2010 interim report. This dividend will also raise the company's dividend yield this year to more than 3%.

Four major sectors grew steadily

The semi-annual report shows that Huadong Medicine achieved operating income of 10.554 billion yuan in the second quarter of this year, a year-on-year increase of 2.76%; achieved a net profit attributable to shareholders of the listed company of 834 million yuan, a year-on-year increase of 22.85%; and achieved a net profit attributable to shareholders of the listed company after deducting non-recurring gains and losses of 787 million yuan, a year-on-year increase of 17.46%.

During the reporting period, the operating indicators of Huadong Medicine's four major business segments, namely pharmaceutical industry, pharmaceutical commerce, medical beauty and industrial microbiology, maintained steady growth, and the operating quality and growth momentum continued to improve steadily.

In the pharmaceutical industry, the core subsidiary Sino-US East China achieved operating income of 6.698 billion yuan (including CSO business), a year-on-year increase of 10.63%; and achieved net profit attributable to shareholders of 1.385 billion yuan, a year-on-year increase of 11.48%; and the return on net assets reached 12.29%.

In the first half of the year, Huadong Medicine had 1 BLA approved for its innovative drugs, 3 NDA/BLA accepted, 5 IND approved in China or the United States, and 4 generic drug marketing applications approved.

In terms of pharmaceutical business, Huadong Medicine actively responded to the dual challenges of weak market demand and policy regulation, giving equal importance to the in-hospital and out-of-hospital markets, and to business expansion and operational efficiency improvement, achieving operating income of 13.552 billion yuan, a year-on-year decrease of 0.58%; and cumulative net profit of 218 million yuan, a year-on-year increase of 0.9%.

The medical beauty business, which the market pays close attention to, had a total operating income of 1.348 billion yuan (excluding internal offset factors), a year-on-year increase of 10.14%. Huadong Medicine's medical beauty business has a professional marketing team of more than 300 people in China, and has built a global medical beauty marketing network. Currently, product sales have covered more than 80 countries and regions around the world.

In terms of industrial microorganisms, sales revenue reached RMB 285 million during the reporting period, an increase of 27.43% over the same period last year.

Plan to implement interim dividend

Under the condition of steady growth in performance, Huadong Medicine stated that in order to deeply respond to the spirit and relevant requirements of the new "Nine National Articles" document, increase the level of dividends, increase the frequency of dividends, and improve the level of investor returns, the company has formulated the 2024 semi-annual profit distribution plan based on the actual business development situation as well as profitability, financial status, future development prospects and other factors.

Specifically, Huadong Medicine plans to pay RMB 3.5 in cash (including tax) for every 10 shares, based on the existing total share capital of 1.754 billion shares after deducting 65,000 restricted shares that have not yet been repurchased and cancelled. No bonus shares will be issued, and no capital increase will be made from public accumulation funds. The total cash dividend is RMB 614 million (including tax). This is the company's first interim dividend in 14 years since 2010.

On May 28, Huadong Medicine has implemented a cash dividend of 5.8 yuan per 10 shares. Together with this dividend, it means that its dividend per share can reach 9.3 yuan this year. Compared with the company's current share price (28.53 yuan), the dividend yield reaches 3.26%.

Huadong Medicine was founded in 1993 and is headquartered in Hangzhou, Zhejiang. It was listed on the Shenzhen Stock Exchange in December 1999. As of August 15, the company's latest market value was 50 billion yuan. As of the end of June, the company had 98,300 shareholders, a slight increase from 93,800 at the end of the first quarter.

Editor: Xiaomo

Review: Xu Wen

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