Biden Pharmaceutical IPO: The gross profit margin is declining and the inventory is high in excess sales, and the research and development costs are insufficient

In recent years, the gross profit margin has declined year by year, and its large inventory balance has caused a backlog of operating cash flow. The company's export revenue accounts for relatively high revenue, which is more affected by the fluctuation of exchange rate fluctuations.

On May 5, 2022, Shanghai Biden Pharmaceutical Technology Co., Ltd. (hereinafter referred to as: Biden Pharmaceutical) will pass the Shanghai Stock Exchange Science and Technology Board. On June 6, the company has submitted registration.

The prospectus shows that Biden Pharmaceutical's issuance of no more than 16.2291 million shares this time, accounting for not less than 25.00%after the company's total share capital was issued. It is expected to raise 434 million yuan, of which 280 million yuan are used for the pharmaceutical molecular block area center project, 74 million yuan for R & D laboratory projects, and supplementary mobile funds of 80 million yuan.

Reading the prospectus and found that Bi De Pharmaceutical's gross profit margin has declined year by year, and the large inventory balance has caused a backlog of operating cash flow. The company's export revenue accounts for relatively high income. Homes. Regarding the above situation, I found that the network sent an interview letter to the public mailbox to send an interview letter to the question. As of press time, Biden Pharmaceutical did not give a reasonable explanation.

The gross profit margin is declining and the inventory is high

According to public information, Biden Pharmaceutical is a core business focused on the front end of the new drug R & D industry chain. Relying on the research and development, production and sales of drug molecular blocks, it can provide new drug research and development institutions with novel and diverse functional pharmaceutical molecular blocks and diverse functions and diverse functions and diverse functional molecular blocks and diverse functions and diverse functions. High -tech enterprises such as scientific reagents and other products.

From 2019 to 2021, Biden Pharmaceutical's revenue achieved revenue of 249 million yuan, 391 million yuan and 606 million yuan, respectively, with a year-on-year growth rate of 52.54%, 57.47%, and 54.86%. The yuan, 5903,600 yuan and 975.73 million yuan, the year -on -year growth rate of 94.15%, 5452.03%, and 65.37%, respectively.

Source: Wind (Biden Medicine)

It is found that Biden Pharmaceutical only turned to profit in 2020. The net profit was turned from negative to positive, and the growth momentum was very rapid. However, while the scale is continuously expanded, Biden Medicine's profitability is constantly declining.

From 2019 to 2021, the gross profit margin of Bisha Pharmaceutical's main business was 59.80%, 54.46%, and 49.49%, respectively, and the comprehensive gross profit margin was 59.66%, 54.38%, and 49.46%, respectively, and continued to decline. Biden Pharmaceutical said that it was mainly affected by the company's product sales level, adjustment of new income standards, and exchange rate fluctuations.

Source: prospectus (Bi De Medicine)

In addition, the cash flow of Biden Pharmaceutical needs to be improved. From 2019 to 2021, the net operating cash flow of Biden Pharmaceutical was 29.886 million yuan, 3.6451 million yuan, and -64.8831 million yuan, respectively. Earlier, the scale of operating cash flow was far from the scale of net profit, and in 2021, it became negative.

Source: prospectus (Bi De Medicine)

Biden Pharmaceutical said that the low operating cash flow is mainly due to the high demand of the company's business scale expansion. Therefore, the cash outflow of raw material procurement cash outflows is relatively high.

In fact, there is a higher balance of inventory. From 2019 to 2021, the book value of Biden Pharmaceutical Inventory was 131 million yuan, 219 million yuan, and 477 million yuan, respectively, accounting for 49.16%, 43.11%, and 52.59%of the company's total assets at the end of the same period. As of the end of 2021, the company had reserved 73,300 drug molecular block products.

Source: prospectus (Bi De Medicine)

Bi De Pharma frankly said in the prospectus that with the continuous expansion of the company's business scale, inventory will rise. Large -scale inventory will occupy the company's operating funds, affecting operating cash flow, profit level, and increasing financial risks.

Insufficient R & D expenses for overseas income are insufficient

Because Bidou Pharmaceutical is one of the main suppliers of molecular blocks below the domestic kilo -level level, the current product sales are mainly based on the level of kg. The downstream new drug research and development customers are mainly based on the use of scientific research and new drug research and development. The use of drug molecular blocks and scientific reagent products. The demand has the characteristics of high -tech, multi -product, microsefilled dose, and multi -frequency. The company's customers are relatively scattered. From 2019 to 2021, there are more than 8,000 customers who cooperate with Pharmaceuticals.

In addition, Biden Pharmaceutical has a subsidiary in the United States, Germany, India and other regions, and is mainly responsible for the overseas promotion and sales of pharmaceutical molecular blocks and scientific reagent products. From 2019 to 2021, Bien Pharmaceutical's overseas sales revenue was 102 million yuan, 192 million yuan, and 279 million yuan, respectively, accounting for 41.17%, 48.98%, and 46.11%of the main business revenue, showing an upward trend.

Source: prospectus (Bi De Medicine)

Biden Pharmaceutical said that the scale of overseas sales has increased significantly. It mainly actively promotes the transformation of overseas sales models in 2018. Through the establishment of regional centers in the United States, Europe, India and other places, it has promoted the global layout of the business and enhanced its own brand recognition. Therefore, the proportion of overseas sales has steadily increased.

It is worth noting that Bi De Pharma's foreign dealer ARK Pharm sells traces in the United States (value of less than 50,000 US dollars in total sales) in the United States. The regulatory chemicals that permit can only be sold, and its actual controller Liangfu Huang was sentenced to one year of probation by the North District Court of Illinois in August 2019, 120 hours of community services, and a fine of 9,500 US dollars. The penalties have been fulfilled. Product exports are relatively high, and foreign exchange business is mainly settled in US dollars, euro, or Indian rupees, which has also caused Biden Pharmaceutical to be affected by fluctuations in exchange rate fluctuations. From 2019 to 2021, the exchange loss (income) of Biden Pharmaceuticals was -11.975 million yuan, 7.2747 million yuan, and 6.672 million yuan, respectively.

Source: prospectus (Bi De Medicine)

With the growth of Biden Pharmaceutical's exports and the intensification of exchange rate fluctuations, if the RMB appreciates significantly on the US dollar or other foreign currencies, the competitiveness of the company's export products market will decline, and at the same time, exchange loss will be produced, which will adversely affect the company's operating performance.

In addition, Biden Pharmaceutical still seems to have the problem of "heavy sales and light development". From 2019 to 2021, the sales costs of Biden Pharmaceuticals were 59.0947 million yuan, 50.718 million yuan, and 78.928 million yuan, respectively, accounting for 23.77%, 12.96%, and 12.93%of operating income. 21.4937 million yuan and 34.883 million yuan, accounting for 9.53%, 5.49%, and 5.75%of operating income, respectively.

Source: prospectus (Bi De Medicine)

As an innovative pharmaceutical company, the sales cost is more than twice the cost of R & D, which is a bit sighing.

(Reporter Luo Xuefeng Financial Researcher Chen Kangli)

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