SHANGHAI, March 18, 2024 /PRNewswire/ -- WuXi AppTec (stock code: 603259.SH / 2359.HK), a global company that provides a broad portfolio of R&D and manufacturing services that enable companies in the pharmaceutical and life sciences industry, today announced its financial results for the year ending December 31, 2023 ("Reporting Period"):
[1] Net profit attributable to the owners of the Company is prepared according to Accounting Standard for Business Enterprises of PRC. Due to the different accounting treatment of long-term equity investments under IFRS, Net profit attributable to the owners of the Company under IFRS was RMB10,690 million. |
[2] In 2022 and 2023, WuXi AppTec had a fully-diluted weighted average share count of 2,954,165,418 and 2,949,887,619 ordinary shares, respectively. |
2024 Outlook
Despite uncertainties in the external environment, revenue is expected to reach RMB 38.3-40.5 billion in 2024, and maintain positive growth of 2.7-8.6% excluding COVID-19 commercial projects. We will continue to improve operating efficiency. Adjusted non-IFRS net profit margin (NPM) in 2024 is expected to remain at a similar level as last year, taking into consideration of new capacity ramp-up and FX impact. With improved asset utilization and operating efficiency, free cash flow is expected to remain positive and reach RMB 4-5 billion in 2024, which will continuously cover the cash dividends and investments in talents, while global capacity is expected to be expanded as planned (with capex of RMB ~5 billion).
Management Comment
Dr. Ge Li, Chairman and CEO of WuXi AppTec, said, "We achieved an important milestone in 2023, with revenue surpassing RMB40 billion and adjusted non-IFRS net profit exceeding RMB10 billion for the first time. The Company's unique CRDMO and CTDMO business models have enabled us to better meet the increasing quality demands from customers worldwide while continuing to drive business growth."
"As technology advancement and science innovations continue to emerge, global demand for life saving and innovative drugs continues to grow, along with customers' demand for our enabling services. Nevertheless, the recent proposed legislation in the U.S. Congress would preemptively and unfairly designate our company without due process. As the proposed legislation remains subject to further review and changes, we continue to engage with relevant stakeholders to explore possible solutions and appeal for due process through a transparent consideration of the facts. WuXi AppTec has always been committed to 'doing the right thing and doing it right.' Our company has not been subject to any sanctions, and does not pose a national security risk to any country. Since its founding two decades ago, the value of WuXi AppTec has been to serve as an enabler to the pharmaceutical and life sciences industry. Today, we continue to do so as a trusted and valued service partner for our customers by constantly providing relevant capacity and capabilities required for new drug R&D and manufacturing."
"We are truly thankful for our customers' long-term trust and support. We will further enhance our capacity and capabilities and continuously improve our operating efficiency, supporting our customers and partners in their endeavors to bring lifesaving medicines to patients around the world. Together, we can realize our vision that 'every drug can be made and every disease can be treated'."
Business Performance by Segments
i. In 2023, D&M services revenue declined 0.1% year-over-year to RMB21.62 billion; excluding COVID-19 commercial projects, D&M services revenue grew strongly by 55.1%.
ii. In 2023, we added 1,255 new molecules to our D&M pipeline. By end of 2023, our D&M pipeline reached 3,201 molecules, including 61 commercial projects, 66 in phase III, 326 in phase II and 2,748 in phase I and pre-clinical stages, among which 20 commercial and phase III projects were added during the year.
iii. We commenced operations at the new Taixing API manufacturing site in January 2024, preparing for future business growth.
i. In 2023, TIDES revenue grew strongly by 64.4% year-over-year to RMB3.41 billion. By end of 2023, backlog of TIDES grew significantly by 226% year-over-year.
ii. In 2023, the number of TIDES D&M customers increased 36% year-over-year to 140, and the number of TIDES molecules increased 41% year-over-year to 267.
iii. We completed capacity expansion in Changzhou and Taixing. The expanded workshops commenced operations in January 2024, with the total reactor volume of solid phase peptide synthesizers increasing to 32,000L.
i. SMO revenue grew 26.1% year-over-year, maintaining an industry leading position in China. In 2023, SMO supported 54 new drug approvals for customers.
ii. Clinical CRO enabled our customers to obtain 21 IND approvals and submit 5 NDA filings.
This release provides a summary of the results and is not intended to be a comprehensive report. For additional information, please refer to the WuXi AppTec 2023 Annual Results Presentation and 2023 Annual Report disclosed on the Company's official website, as well as the 2023 Annual Report and other relevant announcements published on the websites of the Shanghai Stock Exchange (www.sse.com.cn) and the Stock Exchange of Hong Kong (www.hkexnews.hk), and the designated media for dissemination of the relevant information. Investors are advised to exercise caution and be aware of the investment risks in trading Company shares.
Net Profit Attributable to the Owners of the Company is prepared under Accounting Standard for Business Enterprises of PRC ("People's Republic of China Financial Reporting Standards"), in currency of RMB. Besides, all other financial information disclosed in this press release is prepared based on International Financial Reporting Standards (IFRS), in currency of RMB.
The 2023 Annual Report of the Company has been audited.
2023 Results by Segments
Unit: RMB million
Segment |
Revenue |
Change |
Adjusted non-IFRS |
Change |
Adjusted non-IFRS |
WuXi Chemistry |
29,171.49 |
1.1 % |
13,167.70 |
10.8 % |
45.1 % |
WuXi Testing |
6,539.67 |
14.4 % |
2,526.62 |
20.3 % |
38.6 % |
WuXi Biology |
2,552.55 |
3.1 % |
1,082.25 |
6.8 % |
42.4 % |
WuXi ATU |
1,309.60 |
0.1 % |
(125.11) |
Note1 |
(9.6) % |
WuXi DDSU |
726.45 |
(25.1) % |
265.33 |
(9.5) % |
36.5 % |
Others |
41.05 |
22.1 % |
20.99 |
33.6 % |
51.1 % |
Total |
40,340.81 |
2.5 % |
16,937.79 |
11.2 % |
42.0 % |
Notes: 1. Adjusted non-IFRS gross profit of WuXi ATU was RMB(125.11) million in 2023, compared to RMB(76.69) million in 2022, a decline of RMB48.42 million.
2. Any sum of the data above that is inconsistent with the total is due to rounding.
Consolidated Statement of Profit or Loss[3] – Prepared under IFRS
RMB Million |
Year Ended |
Year Ended |
Year-over-Year Change |
Revenue |
40,340.8 |
39,354.8 |
2.5 % |
Cost of services |
(23,968.3) |
(24,848.3) |
(3.5) % |
Gross profit |
16,372.5 |
14,506.5 |
12.9 % |
Other income |
962.5 |
644.3 |
49.4 % |
Other gains and losses |
1,350.3 |
1,211.7 |
11.4 % |
Impairment losses under expected credit |
(240.9) |
(117.3) |
105.4 % |
Impairment losses of non-financial assets |
(67.4) |
- |
N/A |
Impairment losses of goodwill |
(49.6) |
(131.3) |
(62.2) % |
Selling and marketing expenses |
(701.0) |
(731.6) |
(4.2) % |
Administrative expenses |
(2,994.9) |
(2,943.8) |
1.7 % |
Research and development expenses |
(1,440.6) |
(1,614.0) |
(10.7) % |
Operating Profit |
13,190.7 |
10,824.6 |
21.9 % |
Share of results of associates |
(35.1) |
(52.5) |
(33.2) % |
Share of results of joint ventures |
(32.5) |
6.3 |
N/A |
Finance costs |
(193.6) |
(159.8) |
21.1 % |
Profit before tax |
12,929.6 |
10,618.5 |
21.8 % |
Income tax expense |
(2,131.7) |
(1,715.9) |
24.2 % |
Profit for the year |
10,797.9 |
8,902.6 |
21.3 % |
Profit for the year attributable to: |
|||
Owners of the Company |
10,690.2 |
8,813.7 |
21.3 % |
Non-controlling interests |
107.7 |
88.9 |
21.2 % |
10,797.9 |
8,902.6 |
21.3 % |
|
Weighted average number of ordinary shares |
|||
– Basic |
2,934,188,474 |
2,931,932,166 |
0.1 % |
– Diluted |
2,949,887,619 |
2,954,165,418 |
(0.1) % |
Earnings per share attributable to ordinary |
|||
– Basic |
3.64 |
3.01 |
20.9 % |
– Diluted |
3.61 |
2.82 |
28.0 % |
[3] If the sum of the data below is inconsistent with the total, it is caused by rounding |
Consolidated Statement of Financial Position[4] – Prepared under IFRS
RMB Million |
December 31, |
December 31, |
2023 |
2022 |
|
Non-current Assets |
||
Property, plant and equipment |
25,844.4 |
23,444.9 |
Right-of-use assets |
2,348.3 |
1,857.5 |
Goodwill |
1,820.9 |
1,822.1 |
Other intangible assets |
906.7 |
926.3 |
Interests in associates |
2,180.4 |
1,135.7 |
Interests in joint ventures |
35.2 |
67.3 |
Deferred tax assets |
366.7 |
492.1 |
Financial assets at fair value through profit or |
8,626.0 |
8,954.3 |
Other non-current assets |
105.8 |
1,054.9 |
Biological assets |
1,012.5 |
938.0 |
43,246.9 |
40,693.1 |
|
Current Assets |
||
Inventories |
2,886.1 |
3,952.6 |
Contract costs |
695.6 |
678.8 |
Biological assets |
1,154.6 |
1,037.3 |
Amounts due from related parties |
86.7 |
123.0 |
Trade and other receivables |
9,372.7 |
7,590.4 |
Contract assets |
1,234.4 |
1,048.2 |
Income tax recoverable |
17.5 |
16.0 |
Financial assets at FVTPL |
11.0 |
2.0 |
Derivative financial instruments |
414.0 |
135.6 |
Other current assets |
785.8 |
1,427.8 |
Pledged bank deposits |
1.6 |
1.8 |
Term deposits with initial term of over three |
3,761.4 |
- |
Bank balances and cash |
10,001.0 |
7,983.9 |
30,422.5 |
23,997.2 |
|
Total Assets |
73,669.3 |
64,690.3 |
[4] If the sum of the data below is inconsistent with the total, it is caused by rounding. |
Consolidated Statement of Financial Position (continued)[5] – Prepared under IFRS
RMB Million |
December 31, |
December 31, |
2023 |
2022 |
|
Current Liabilities |
||
Trade and other payables |
7,333.5 |
7,253.4 |
Amounts due to related parties |
11.5 |
14.5 |
Derivative financial instruments |
501.9 |
115.4 |
Contract liabilities |
1,955.4 |
2,496.6 |
Bank borrowings |
3,721.6 |
3,874.1 |
Lease liabilities |
240.5 |
205.3 |
Income tax payables |
991.9 |
517.8 |
Other current liabilities |
- |
22.1 |
14,756.3 |
14,499.4 |
|
Non-current Liabilities |
||
Bank borrowings |
687.0 |
279.1 |
Deferred tax liabilities |
530.1 |
440.5 |
Deferred income |
1,079.9 |
910.9 |
Lease liabilities |
1,098.6 |
983.8 |
Convertible bonds-debt component |
- |
502.0 |
Convertible bonds-embedded derivative |
- |
147.9 |
Other long-term liabilities |
- |
0.1 |
3,395.6 |
3,264.3 |
|
Total Liabilities |
18,151.9 |
17,763.7 |
Net Assets |
55,517.4 |
46,926.7 |
Capital and Reserves |
||
Share capital |
2,968.8 |
2,960.5 |
Reserves |
52,153.6 |
43,629.4 |
Equity attributable to the owners of the |
55,122.5 |
46,590.0 |
Non-controlling interests |
395.0 |
336.7 |
Total Equity |
55,517.4 |
46,926.7 |
[5] If the sum of the data below is inconsistent with the total, it is caused by rounding. |
Adjusted Non-IFRS Net Profit Attributable to the Owners of the Company[6]
RMB Million |
Year Ended |
Year Ended |
Year-over-Year Change |
|
Net Profit Attributable to the Owners of the |
9,606.7 |
8,813.7 |
9.0 % |
|
GAAP difference[7] |
1,083.4 |
- |
N/A |
|
Net Profit Attributable to the Owners of the |
10,690.2 |
8,813.7 |
21.3 % |
|
Add: |
||||
Share-based compensation expenses |
622.0 |
684.2 |
(9.1) % |
|
Issuance expenses of convertible bonds |
0.3 |
1.7 |
(81.4) % |
|
Fair value gains from derivative |
(40.2) |
(508.6) |
(92.1) % |
|
Foreign exchange related losses |
294.4 |
136.1 |
116.3 % |
|
Amortization of acquired intangible |
57.9 |
56.7 |
2.2 % |
|
Non-financial assets impairment and |
129.1 |
131.3 |
(1.7) % |
|
Talent incentive and retention expenses shareholders |
151.5 |
69.7 |
117.3 % |
|
Non-IFRS Net Profit attributable to the |
11,905.2 |
9,384.7 |
26.9 % |
|
Add: |
||||
Realized and unrealized (gains)/losses |
(1,083.0) |
20.8 |
N/A |
|
Realized and unrealized share of |
32.5 |
(6.3) |
N/A |
|
Adjusted non-IFRS net profit attributable to |
10,854.6 |
9,399.3 |
15.5 % |
|
[6] If the sum of the data below is inconsistent with the total, it is caused by rounding. |
[7] Due to the different accounting treatment of long-term equity investments under IFRS, it occurs GAAP difference of RMB1,083.4 million. |
About WuXi AppTec
As a global company with operations across Asia, Europe, and North America, WuXi AppTec provides a broad portfolio of R&D and manufacturing services that enable the global pharmaceutical and life sciences industry to advance discoveries and deliver groundbreaking treatments to patients. Through its unique business models, WuXi AppTec's integrated, end-to-end services include chemistry drug CRDMO (Contract Research, Development and Manufacturing Organization), biology discovery, preclinical testing and clinical research services, advanced therapies CTDMO (Contract Testing, Development and Manufacturing Organization), helping customers improve the productivity of advancing healthcare products through cost-effective and efficient solutions. WuXi AppTec received an AA ESG rating from MSCI for the third consecutive year in 2023 and its open-access platform is enabling more than 6,000 customers from over 30 countries to improve the health of those in need – and to realize the vision that "every drug can be made and every disease can be treated." Please visit: http://www.wuxiapptec.com
Forward-Looking Statements
This press release may contain certain "forward-looking statements" which are not historical facts, but instead are predictions about future events based on our beliefs as well as assumptions made by and information currently available to our management. Although we believe that our predictions are reasonable, future events are inherently uncertain and our forward-looking statements may turn out to be incorrect. Our forward-looking statements are subject to risks relating to, among other things, the ability of our service offerings to compete effectively, our ability to meet timelines for the expansion of our service offerings, our ability to protect our customers' intellectual property, unforeseeable international tension, competition, the impact of emergencies and other force majeure. Our forward-looking statements in this press release speak only as of the date on which they are made, and we assume no obligation to update any forward-looking statements except as required by applicable law or listing rules. Accordingly, you are strongly cautioned that reliance on any forward-looking statements involves known and unknown risks and uncertainties. All forward-looking statements contained herein are qualified by reference to the cautionary statements set forth in this section. All information provided in this press release is as of the date of this press release and are based on assumptions that we believe to be reasonable as of this date, and we do not undertake any obligation to update any forward-looking statement, except as required under applicable law.
Use of Non-IFRS and Adjusted Non-IFRS Financial Measures
We provide non-IFRS gross profit and non-IFRS net profit attributable to the owners of the Company, which exclude share-based compensation expenses, issuance expenses of convertible bonds, fair value gain or loss from derivative component of convertible bonds, foreign exchange-related gains or losses, amortization of intangible assets acquired in business combinations, non-financial assets impairment, etc. We also provide adjusted non-IFRS net profit attributable to the owners of the Company and earnings per share, which further exclude realized and unrealized gains or losses from our venture capital investments and joint ventures. Neither is required by, or presented in accordance with IFRS.
We believe that the adjusted financial measures used in this press release are useful for understanding and assessing our core business performance and operating trends, and we believe that management and investors may benefit from referring to these adjusted financial measures in assessing our financial performance by eliminating the impact of certain unusual, non-recurring, non-cash and non-operating items that we do not consider indicative of the performance of our core business. Such adjusted non-IFRS net profit attributable to the owners of the Company, the management of the Company believes, is widely accepted and adopted in the industry the Company is operating in. However, the presentation of these adjusted non-IFRS financial measures is not intended to be considered in isolation or as a substitute for the financial information prepared and presented in accordance with IFRS. You should not view adjusted results on a stand-alone basis or as a substitute for results under IFRS, or as being comparable to results reported or forecasted by other companies.
