WuXi PharmaTech (603259): High-performance industry giants enjoy breakthroughs in the industry

WuXi PharmaTech (603259): High-performance industry giants enjoy breakthroughs in the industry
The company’s performance in 2018 was excellent, and net profit attributable to mothers increased by 84 each year.22% of the companies released the 2018 annual report, and the company achieved operating income of 96 in 2018.14 ppm, an increase of 23 in ten years.80%; net profit 西安耍耍网 attributable to mothers22.61 ppm, an 84-year increase.22%; net profit after deduction is 15.59 ppm, an increase of 59 in ten years.18%; net cash flows from operating activities.40 ‰, a decrease of 8 per year.54%.The increase in the company’s net profit attributable to mothers was mainly due to the increase in core business profits and the use of new financial instrument regulations in 2018 to recognize the gains from changes in the fair value of investment projects.The company’s net operating cash flow declines every six months.54% was mainly due to the payment of part of the tax corresponding to the total assets and compensation of the drug development service department held by Hequan Pharmaceutical from its subsidiary Shanghai Wuming in 2017.2.5 billion.Instead of this one-time tax effect, the net operating cash flow is reduced every year.56%, mainly to expand production and operation, purchase of goods, acceptance of labor services and increase in cash paid to employees.In addition, since most of the company’s business income comes from overseas and is denominated in US dollars, if measured at the average exchange rate of the same period last year, the company’s operating income will increase by 25 per year.41%. The company’s cost control has improved, and its operating efficiency has continued to improve. The net profit margin has risen significantly. The company’s main business gross profit margin has dropped from the same period last year2.The 42 PPs are: (1) the gross profit margin of laboratory services in the United States decreased by 7 compared with the same period last year.87 PP; (2) In the first half of 2018, the exchange rate of RMB against the US dollar increased significantly compared with the same period of the previous year.By strictly controlling the operating expenses of the company, the operating efficiency has been continuously improved, and the sales expenses and management expenses have increased.91% and 17.34%, which was lower than the growth of main business income, and the sales expense ratio decreased by 0.24 PP to 3.51%, the management expense ratio decreased by 4.58 PP to 11.76%, which in part caused the company’s net interest rate to rise7.58 PP to 24.27%. All business segments maintained rapid growth, and clinical research and other CRO services revenues increased by 64.17% of the companies maintained rapid growth in all business segments in 2018: China’s laboratory services achieved revenue of 51.13 ppm, an increase of 24 in ten years.09%.Mainly because the company has helped global customers to promote new drug research and development, many new drugs have obtained FDA breakthrough therapies, orphan drugs and other identifications. At the same time, it has continued to deepen cooperation with domestic customers to empower domestic small molecule new drug development with international leading strength.The client completed the IND declaration of 27 small molecule innovative drugs and obtained 17 clinical approvals; the CDMO / CMO service achieved revenue of 26.99 ppm, an increase of 28 in ten years.00%, through the establishment of close cooperation with customers in the pre-clinical stage, the company has continuously brought new clinical stages and commercialization projects to the company, helping the company’s CDMO / CMO revenue to continue to grow rapidly. The service projects in 2018 involved more than 650 new drug molecules; U.S. laboratory services achieved revenue12.40,000 yuan, an increase of 6 in ten years.10%, thanks to the company’s active business development in the second half of the year, the growth rate of cell and gene therapy services and medical device testing business have improved significantly compared with the first half; clinical research and other CRO services achieved revenue5.850,000 yuan, an annual increase of 64.17%, mainly due to the rapid growth of the domestic new drug clinical trial market, and the company’s CRO and SMO service quality, scale and capabilities have improved significantly, and the number of customers and orders has grown rapidly. Benefiting from the expansion of the high prosperity of the industry, the company, as a major giant, expects that the rapid growth of the external industry will be a high prosperity track. The global CRO market is expected to maintain 10 in the future.Fast growth of about 5%, of which China’s CRO market maintained a leading position of 20.Rapid growth of about 4%; the global small molecule CDMO / CMO market future trend remains 12.Fast growth of about 0%, in which the Chinese small molecule CDMO / CMO market strives to maintain 19.The CDMO / CMO market is also expected to achieve rapid growth of about 4%; global cell and gene therapy products.High-speed growth of about 5%. We believe that the company, as a very few open service platforms in the industry for new drug R & D full industry chain service capabilities, has a leading position in service capabilities and scale in the industry transformation, and is expected to fully benefit from the rapid growth of the global new drug R & D and expansion service market.The company’s performance is expected to achieve sustained and rapid growth. We are optimistic that the company’s performance will continue to grow. Maintaining the “Hold” rating will benefit from the high prosperity of the external industry and the company’s leading position in the industry. The company’s performance is expected to continue to grow.Considering that the company’s performance exceeds our expectations, we will return the company’s net profit to the original from 2019-202020.07 billion, 25.14 million is raised to 28 in 2019-2021.5.8 billion, 37.4.9 billion, 48.64 ppm, corresponding to P / E of 40, 30, and 23 times, maintaining the “Hold” rating. Risk reminders: the risk of declining market demand for pharmaceutical R & D services, the risk of changes in industry regulatory policies, the risk of increased competition in the industry, the risk of loss of core technical staff, and the risk of exchange rates