news

With Bloomage Biotechnology disclosing its 2024 semi-annual report, the interim reports of the three medical beauty musketeers have all been released. In the first half of this year, the performance of the three medical beauty musketeers diverged. Among them, Aimeikang continued to maintain net profit growth, but the net profit growth rate slowed down slightly; Bloomage Biotechnology saw both revenue and net profit decline, with net profit falling by nearly 20% year-on-year; although both revenue and net profit increased, Haohai Biotech still ranked last among the three musketeers.

Focusing on the medical beauty business of the three companies, Aimeikang has maintained a high gross profit margin of over 94% with a high revenue share of medical beauty business. Haohai Biotech's medical beauty business revenue share has gradually increased and has exceeded ophthalmic products. Huaxi Bio, which has vigorously developed functional skin care products in the past five years, has been under pressure due to the transformation of functional skin care products. On the contrary, the medical terminal business, which accounts for less than 30% of the business, has become the company's main performance growth point.

Performance differentiation

Looking at the semi-annual reports of the three companies, only Huaxi Biotechnology saw a decline in performance in the first half of the year. Financial data shows that in the first half of 2024, Huaxi Biotechnology achieved operating income of approximately 2.811 billion yuan, a year-on-year decrease of 8.61%; the corresponding attributable net profit was approximately 342 million yuan, a year-on-year decrease of 19.51%.

Regarding the reasons for the decline in performance, Huaxizi Bio said in an interview with Beijing Business Daily that the overall operating results in the reporting period were under pressure, mainly because management changes generated a series of expenses in the short term, affecting short-term profits and losses, but the company will lay a solid foundation to facilitate long-term development.

The net profits of Aimei and Haohai Biotech continued to grow year-on-year in the first half of the year. Aimei achieved operating income of approximately RMB 1.657 billion, a year-on-year increase of 13.53%; the corresponding attributable net profit was approximately RMB 1.121 billion, a year-on-year increase of 16.35%. It is the company with the highest performance among the three companies, and its net profit is far higher than the other two companies.

Compared with the mid-year reports of Aimei in recent years, the company's revenue and net profit growth rates slowed down in the first half of the year. In this regard, relevant Aimei staff said in an interview with Beijing Business Daily that an important factor in the slowdown in revenue growth is the base. Aimei achieved the highest single-quarter operating income in history in the second quarter of 2023, which was 22% higher than the average level of the other three quarters last year. Excluding the base factor, profitability in the first half of this year actually hit a new high, gross profit remained stable, and return on net assets also increased. In addition, the macro environment and service consumption are still in a weak recovery stage, and the entire industry will be affected.

After experiencing a sharp drop in performance in 2022 and a sharp rebound in performance in 2023, Haohai Biotech's net profit maintained a slight increase in the first half of this year. In the first half of this year, Haohai Biotech achieved operating income of 1.404 billion yuan, a year-on-year increase of 6.97%; the corresponding attributable net profit was approximately 235 million yuan, a year-on-year increase of 14.64%.

Medical beauty business is the "hero"

Beijing Business Daily reporters noticed that during the reporting period, medical beauty business became the "hero" in the business development of the above-mentioned companies.

In the first half of this year, the proportion of Huaxi Bio's functional skin care products revenue further decreased to about 1.381 billion yuan, accounting for 49.14%, less than 50%. The company's medical terminal product revenue further increased to 743 million yuan, a year-on-year increase of 51.92%, accounting for 26.51% of the company's main business revenue.

It is understood that Huaxi Bio independently develops and produces medical terminal products in the field of hyaluronic acid biomedical materials, which are mainly divided into two categories: medical beauty and medicine.

Huaxi Bio told Beijing Business Daily that the company started a pilot reform in the field of medical beauty in 2021 and completed the adjustment in 2022. By 2023, the medical beauty business has entered a benign development stage. In 2023, the revenue of skin medical products was 747 million yuan, a year-on-year increase of 60.29%; in the first half of 2024, the revenue of skin medical products was 555 million yuan, a year-on-year increase of 70.14%.

Haohai Biotech is in a similar situation. In the first half of this year, the operating income of Haohai Biotech's medical beauty and wound care products continued to increase, reaching about 635 million yuan, accounting for 45.18%; the revenue of ophthalmic products declined, accounting for 32.15%. In the same period last year, the revenue of Haohai Biotech's medical beauty and wound care products and ophthalmic products accounted for 36.93% and 36.6% respectively.

In the first half of this year, Haohai Biotech's hyaluronic acid products contributed 417 million yuan in revenue, a year-on-year increase of 51%. Among them, the domestic high-end hyaluronic acid "Hai Mei" continued to increase rapidly, and the revenue of "Hai Wei" and "Jiao Lan" hyaluronic acid products also achieved a significant increase.

Relevant personnel from Haohai Biotechnology told the Beijing Business Daily reporter that in the field of artificial lenses, the selected products in the national procurement began to be gradually implemented in the first half of the year. Although the company's winning artificial lens products achieved a certain growth in sales, the substantial drop in the selected prices in the volume-based procurement resulted in the company's artificial lens product sales revenue still showing a year-on-year decline during the reporting period.

Compared with Haohai Biotech and Bloomage, Aimei is more focused on the field of medical beauty. The company's main products include a series of skin fillers based on sodium hyaluronate, skin fillers based on poly-L-lactic acid, facial implants based on polydioxanone, and other products. Aimei, which focuses on the field of medical beauty, also ranks first among the three companies in terms of gross profit margin, which is 94.91% in the first half of this year. The gross profit margins of Bloomage and Haohai Biotech are 74.52% and 70.51% respectively.

Stock prices are low

Compared with the medical beauty craze a few years ago, the current heat of the medical beauty industry has declined. The stock prices of the above three companies are all at low levels. On August 26, Huaxizi Biopharma even hit a new historical low in stock price.

Trading data showed that on August 26, Huaxi Bio opened low and continued to fall, with an opening price of 50 yuan per share, a drop of 5.41%, and finally closed down 7.17% at 49.07 yuan per share, with a total market value of 23.64 billion yuan, a total transaction amount of 168 million yuan, and a turnover rate of 1.71%. The intraday low fell to 48.76 yuan per share, setting a new historical low for the stock price. In the form of post-adjustment, Huaxi Bio's latest closing price has fallen by more than 80% from its historical high in July 2021.

The stock price performance of Aimei Beauty is not ideal either. On August 26, Aimei Beauty closed down 2.36% at 137.96 yuan per share, with a total market value of 41.72 billion yuan. The lowest intraday price was 136.84 yuan per share, which was the lowest stock price since 2021.

In contrast, Haohai Biotech's stock price has fluctuated less in recent years, mainly because its stock price has fallen rapidly from July 2021 to October 2022. As of the close of August 26, Haohai Biotech reported 59.47 yuan per share, with a total market value of 13.98 billion yuan. Compared with its historical high in July 2021, Haohai Biotech's stock price has fallen by more than 60% after adjustment.

In the opinion of investment and financing expert Xu Xiaoheng, the performance of medical beauty stocks in recent years is mainly due to the excessive increase in the previous period and the overheated market. The decline in stock prices is not necessarily due to problems with the company's fundamentals, but more likely due to changes in market style.

According to Cao Zhe, Chief Investment Officer of Aven Intelligence, with the advancement of technology and the diversification of consumer demand, new products and services are constantly emerging in the medical beauty industry. The medical beauty industry is an industry full of opportunities and challenges. With the advancement of technology and the strengthening of industry regulations, the medical beauty industry will continue to maintain rapid development, but it also requires companies to continuously improve service quality and manage risks to meet market challenges. Investors also need to pay attention to and keep expectations of the medical beauty industry in order to make wise investment decisions.

Beijing Business Daily reporter Ding Ning