SSY Group Limited announces 2019 interim results

Net profits up 23% to HK$548 million with interim
dividend HK$0.05/share

Continuously kept leading position in the
industry

Dynamics of R&D and bulk pharmaceuticals
projects emerged

Results summary:

• Total revenue HK$2,326 million for first half year, representing an
  increase of 11.1% year over year
• Net profit HK$548 million, representing an increase of 23.1% year
  over year
• The Board resolved to pay an increased interim dividend of HK$0.05
  per share

HONG KONG,
CHINA�- Media OutReach - 26 August 2019 - SSY Group Limited (“SSY”
or the “Company”; Stock Code: 2005.HK) and its subsidiaries (together, the
“Group”) presents the interim results of the Company for the six months ended
30 June 2019 (“first half of the year” or the “period”).

 

During the first half of the year, the Group
achieved a revenue of HK$2,326 million, representing an increase of 11.1%
compared to the corresponding period of last year, and the gross profit margin increased by 1 percentage point.
The net profit was HK$548 million, representing an increase of 23.1% compared
to the corresponding period of last year. During the
first half of the year, the Company an emphasis was on the reinforcement of
penetration rate in major provincial markets. We completed market development
for over 100 new hospitals, focused on adjustments to product mix, improved the
sales growth of therapeutic infusion solutions, and ensured that both
production and sales of the Company‘s products were vigorous. We continued to be the Company
with the fastest growth of production and sales volume in the intravenous
infusion solutions industry.

 

The Board of
directors resolved to pay an interim dividend of HK$0.05 per share for year 2019,
which represented an increase compared to last year interim dividend of HK$0.04
per share. The total amount of interim dividend this year to be paid is HK$152
million.

 

During the
first half of the year, sales volume of intravenous infusion solutions reached approximately
780 million bottles/bags, representing an increase of approximately 8% year-on-year,
of which the proportion of therapeutic infusion solutions increased to 21.5%,
representing an increase of 1.7 percentage points year-on-year. Access to different markets by newly approved
products being gradually completed. Of those, the tendering/online tender of
Moxifloxacin Sodium Chloride Injection has been completed in 12 provinces and
has formed the sales in 16 provinces, achieving a sales of HK$40,170,000 during
the first half of 2019. With progress of market access and development in
hospitals in the second half of the year, there will be significant growth in
sales. The export sales to foreign countries kept growing steadily with a
growth of 13% in volume during the first half of the year year-on-year. We
completed the export registration procedures and obtained registration
certificates for 20 product specifications in 6 countries, and increased 3 new
countries for export. Ampoule products had a fast growth. During the first half
of the year, the sales of ampoule products amounted to HK$151 million,
representing a growth of 312% year-on-year. In respect of medical materials,
Jiangsu Best obtained 4 sets of registration numbers for medical materials of
butyl rubber stopper. As far as the policy for national medical reform was
concerned, consistency evaluation for injection was conducted actively.

 

Technological innovation capabilities have
been further enhanced, gradually forming a set of comprehensive, scientific and
transparent systems for technical innovation. In the first half of year 2019, reassessment
of National Centre for Enterprise Technology, Model Enterprises for National
Technology Innovation, National and Local Joint Laboratory and Workstation for
Postdoctoral Scientific Research have been started. During the first half of
the year, submissions for registration of 60 items were completed, of which 5
items obtained consistency evaluation and 4 items related to raw and auxiliary
package assessment. The Company has obtained 14 approvals for production of
generic drugs, of which Tirofiban Hydrochloride and Sodium Chloride Injection,
a cardiovascular drug clinically used to treat acute coronary syndrome, was
viewed as a theraputical drug of great potential in promoting for clinical use
and thus a key product for the Company’s performance development. Approval for
peritoneal dialysis solution series, combining with the Company’s existing
hemodialysis product portfolio will bring the Company a nice room for market
growth. Hydroxyethyl starch 130 sodium chloride injection will win a place in
the markets. Fluconazole tablet 50mg & 150mg passing consistency
evaluation, of which that of 150mg specification being the first type passing
consistency evaluation in the PRC.

 

In the aspect of development of projects, the
Company’s newly-built high-value-added infusion production line for large
volume and specification, with GMP certification obtained in May and 20 million
bags/year as designed capacity, has already been in production and operation.
The phase-one bulk pharmaceuticals project, which was invested and constructed
in Bohai new district under Hebei Guangxiang Pharmaceutical Co., Ltd., has been
completed and come into trial-run production. It was planned for an on-spot
inspection for GMP certification in August 2019.

Looking ahead
for the second half of the year, the global economy will be more complicated
and dynamic. Facing numerous uncertain factors such as medical payment system, “4+7“ centralised procurement and trade conflicts, the Group will
keep its composure, keep the progress of implementation of innovative drugs and
consistency evaluations, improve continuously the business and product mix. Regarding
R&D of new products, the Company will adhere to the new products
development idea of “combining
generic drugs and innovative drugs“ with injection as the basis, reinforcing the Company‘s technological and product
advantages in the intravenous infusion solutions industry of China. We will
comprehensively promote the development of new products for therapeutic
injections and focus on various fields including treatment of chronic diseases
and circulatory systems, emergency anaesthesia therapy, antipyretic and
analgesic therapy, as well as the new anti-infective therapy. We expect to
obtain approximately 6 production approvals for injection and oral formulation
in the second half of this year, gradually create product series in high-end
anti-infective, respiratory field and in the field of kidney disease and
dialysis. For bulk pharmaceuticals project, it is planned to complete an
on-spot inspection for GMP certification in the second half of the year.

 

Mr. Qu
Jiguang, Chairman and CEO of SSY Group Limited said, “We are
full of confidence on future development of the Company. Leveraging on
competitive edges on our scale, quality and lean management, our development
will definitely be strengthened further despite strong market competition. We
are committed to bringing satisfactory return to our investors. I would like to
take this opportunity to express our gratitude to our investors and all staff
of the Group for their support to the development of the Company.”

About SSY Group Limited

SSY Group Limited is one of the leading pharmaceutical manufacturers in China with
nearly 7 decades of operation history and a well-established brand name. The
Group went public on the Hong Kong Stock Exchange in December 2005 with stock
code 2005. The group has become a component stock of Morgan Stanley Capital
International Index (MSCI) China Index from June 2018. The Group is principally
engaged in the research, development, manufacture and sale of a wide range of
pharmaceutical products, including OTC drugs, bulk medicine and medical
materials, mainly intravenous infusion solution to hospital and distributors.
The manufacturing plants of the Group locates in Hebei Province and Jiangsu
Province in China, its products take leading position in the high-end hospital
market in China.