Full Press Release Details
BEIJING CONTINENT PHARMACEUTICALS CO., LTD.
| Pages | |
| UNAUDITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS | |
| Unaudited interim condensed consolidated statements of profit or loss and other comprehensive income for the six months ended June 30, 2023 and 2022 | 1 |
| Unaudited interim condensed consolidated statements of financial position as of June 30, 2023 and audited consolidated statements of financial position as of December 31, 2022 | 2 |
| Unaudited interim condensed consolidated statements of changes in equity for the six months ended June 30, 2023 and 2022 | 3 |
| Unaudited interim condensed consolidated statements of cash flows for the six months ended June 30, 2023 and 2022 | 4 |
| Notes to the unaudited interim condensed consolidated financial statements | 5 |
BEIJING CONTINENT PHARMACEUTICALS CO., LTD.
UNAUDITED INTERIM CONDENSED CONSOLIDATED STATEMENTS OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME
For the six months ended June 30, 2023 and 2022
(Amounts expressed in thousands of RMB)
| Notes | For the six months ended June 30, | |||||||||||
| 2023 | 2022 | |||||||||||
| (Unaudited) | (Unaudited) | |||||||||||
| Revenue | 4 | 379,265 | 312,673 | |||||||||
| Cost of revenue | ( 15,170 | ) | ( 14,286 | ) | ||||||||
| Gross profit | 364,095 | 298,387 | ||||||||||
| Other income and gains | 9,993 | 2,184 | ||||||||||
| Selling expenses | (214,503 | ) | (161,141 | ) | ||||||||
| Administrative expenses | (22,071 | ) | (25,376 | ) | ||||||||
| Research and development expenses | (23,435 | ) | (29,311 | ) | ||||||||
| Other expenses | (3,729 | ) | (3,919 | ) | ||||||||
| Finance costs | ( 94 | ) | ( 172 | ) | ||||||||
| Profit before tax | 110,256 | 80,652 | ||||||||||
| Income tax expense | 5 | ( 29,058 | ) | ( 16,776 | ) | |||||||
| Net profit | 81,198 | 63,876 | ||||||||||
| Other comprehensive income, net of tax | - | - | ||||||||||
| Total comprehensive income | ||||||||||||
| 81,198 | 63,876 |
The accompanying notes are an integral part of the unaudited interim condensed consolidated financial statements.
BEIJING CONTINENT PHARMACEUTICALS CO., LTD.
UNAUDITED INTERIM CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL POSITION AS OF JUNE 30, 2023 AND AUDITED CONSOLIDATED STATEMENTS OF FINANCIAL POSITION
AS OF DECEMBER 31, 2022
(Amounts expressed in thousands of RMB)
| Notes | June 30, 2023 | December 31, 2022 | |||||||
| (Unaudited) | (Audited) | ||||||||
| ASSETS | |||||||||
| Non-current assets | |||||||||
| Property, plant and equipment | 6 | 145,226 | 123,339 | ||||||
| Right-of-use assets | 13,633 | 15,282 | |||||||
| Prepayments and deposits | 24,519 | 21,730 | |||||||
| Intangible assets | 181,628 | 161,249 | |||||||
| Deferred tax assets | 2,941 | 2,589 | |||||||
| Bank deposits | 10 | 133,486 | 51,500 | ||||||
| Total non-current assets | 501,433 | 375,689 | |||||||
| Current assets | |||||||||
| Inventories | 7 | 38,167 | 42,639 | ||||||
| Trade receivables | 8 | 93,738 | 108,753 | ||||||
| Debt investments at fair value through other comprehensive income | 9 | 1,875 | 10,597 | ||||||
| Prepayments, deposits and other receivables | 12,524 | 8,493 | |||||||
| Cash and bank balances | 10 | 158,880 | 163,420 | ||||||
| Total current assets | 305,184 | 333,902 | |||||||
| Total assets | 806,617 | 709,591 |
| LIABILITIES AND EQUITY | |||||||||
| Current liabilities | |||||||||
| Trade payables | 1,021 | 850 | |||||||
| Other payables and accruals | 11 | 73,828 | 61,084 | ||||||
| Lease liabilities | 3,421 | 3,467 | |||||||
| Tax payable | 14,199 | 12,668 | |||||||
| Total current liabilities | 92,469 | 78,069 | |||||||
| Non-current liabilities | |||||||||
| Customers' deposits | 346 | 380 | |||||||
| Lease liabilities | 19 | 1,525 | |||||||
| Deferred government grants | 5,977 | 5,150 | |||||||
| Total non-current liabilities | 6,342 | 7,055 | |||||||
| Total liabilities | 98,811 | 85,124 | |||||||
| Equity | |||||||||
| Share capital | 61,318 | 61,318 | |||||||
| Capital reserve | 250,801 | 248,660 | |||||||
| Surplus reserve | 31,449 | 31,449 | |||||||
| Retained profits | 364,238 | 283,040 | |||||||
| Total equity | 707,806 | 624,467 | |||||||
| Total liabilities and equity | 806,617 | 709,591 |
The accompanying notes are an integral part of the unaudited interim condensed consolidated financial statements.
BEIJING CONTINENT PHARMACEUTICALS CO., LTD.
UNAUDITED INTERIM CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY
For the six months ended June 30, 2023 and 2022
(Amounts expressed in thousands of RMB)
| Note | Share capital | Capital reserve | Surplus reserve | Retained profits | Total | ||||||||||||||||||
| As of January 1, 2023 (unaudited) | 61,318 | 248,660 | 31,449 | 283,040 | 624,467 | ||||||||||||||||||
| Profit for the period | - | - | - | 81,198 | 81,198 | ||||||||||||||||||
| Equity-settled share option arrangements | 12 | - | 2,141 | - | - | 2,141 | |||||||||||||||||
| As of June 30, 2023 (unaudited) | 61,318 | 250,801 | 31,449 | 364,238 | 707,806 |
| Share capital | Capital reserve | Surplus reserve | Retained profits | Total | |||||||||||||||||||
| As of January 1, 2022 (unaudited) | 61,318 | 240,055 | 16,346 | 147,109 | 464,828 | ||||||||||||||||||
| Profit for the period | - | - | - | 63,876 | 63,876 | ||||||||||||||||||
| Equity-settled share option arrangements | 12 | - | 4,302 | - | - | 4,302 | |||||||||||||||||
| As of June 30, 2022 (unaudited) | 61,318 | 244,357 | 16,346 | 210,985 | 533,006 |
The accompanying notes are an integral part of the unaudited interim condensed consolidated financial statements.
BEIJING CONTINENT PHARMACEUTICALS CO., LTD.
UNAUDITED INTERIM CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
For the six months ended June 30, 2023 and 2022
(Amounts expressed in thousands of RMB)
| Note | For the six months ended June 30, | ||||||||||
| 2023 | 2022 | ||||||||||
| (Unaudited) | (Unaudited) | ||||||||||
| CASH FLOWS FROM OPERATING ACTIVITIES | |||||||||||
| Profit before tax | 110,256 | 80,652 | |||||||||
| Finance costs | 94 | 172 | |||||||||
| Interest income | (1,510 | ) | (287 | ) | |||||||
| Loss on disposal of property, plant and equipment | 6 | 24 | |||||||||
| Depreciation of property, plant and equipment | 3,660 | 2,965 | |||||||||
| Depreciation of right-of-use assets | 1,909 | 1,635 | |||||||||
| Amortization of intangible assets | 1,640 | 1,630 | |||||||||
| Recognition of equity-settled share option expenses | 12 | 2,141 | 4,302 | ||||||||
| Provision for inventories | 103 | 219 | |||||||||
| (Reversal) provision for the impairment of trade receivables | (371 | ) | 97 | ||||||||
| Amortization of deferred government grants | ( 141 | ) | ( 75 | ) | |||||||
| 117,787 | 91,334 | ||||||||||
| Decrease in inventories | 4,369 | 144 | |||||||||
| Decrease (increase) in trade receivables and debt investments at fair value through other comprehensive income | 22,249 | (18 | ) | ||||||||
| (Increase) decrease in deposits and other receivables | (4,015 | ) | 3,928 | ||||||||
| Increase (decrease) in trade payables | 2,030 | (175 | ) | ||||||||
| Increase in other payables and accruals | 11,934 | 19,684 | |||||||||
| Cash generated from operations | 154,354 | 114,897 | |||||||||
| Income tax paid | ( 27,879 | ) | ( 31,767 | ) | |||||||
| Net cash generated from operating activities | 126,475 | 83,130 |
| CASH FLOWS FROM INVESTING ACTIVITIES | ||||||||
| Purchase of property, plant and equipment | (26,710) | (8,042 | ) | |||||
| Additions to intangible assets | (21,923) | (20,968 | ) | |||||
| Purchase of long-term bank deposits | ( 80,476) | ( 50,302 | ) | |||||
| Net cash used in investing activities | ( 129,109) | ( 79,312 | ) | |||||
| CASH FLOWS FROM FINANCING ACTIVITIES | ||||||||
| Principal portion of lease payments | (1,812) | (1,457 | ) | |||||
| Interest paid on lease liabilities | ( 94) | ( 172 | ) | |||||
| Net cash used in financing activities | ( 1,906) | ( 1,629 | ) | |||||
| NET (DECREASE) INCREASE IN CASH AND CASH EQUIVALENTS | (4,540) | 2,189 | ||||||
| Cash and cash equivalents at beginning of period | 163,420 | 166,294 | ||||||
| CASH AND CASH EQUIVALENTS AT END OF PERIOD | 158,880 | 168,483 |
The accompanying notes are an integral part of the unaudited interim condensed consolidated financial statements.
BEIJING CONTINENT PHARMACEUTICALS CO., LTD.
NOTES TO THE UNAUDITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Amounts expressed in thousands of RMB)
Beijing Continent Pharmaceuticals Co., Ltd. (the "Company") is a limited company registered and established in the People's Republic of China (the
"PRC") in 2002. The registered office of the Company is located at 60 Shunkang Road, Shunyi District, Beijing, the PRC.
The Company and its subsidiary (collectively referred to as the "Group") are principally engaged in the following activities:
In the opinion of the directors, the immediate holding company of the Company is BJ Continent Pharmaceuticals Limited, which is incorporated in Hong
Kong, and the intermediate holding company of the Company is Continent Pharmaceuticals Inc., which is incorporated in the Cayman Islands, and the ultimate holding company of the Company is GNI Group Co., Ltd., which is a listed company on the Tokyo
Stock Exchange since September 23, 2011.
The interim condensed consolidated financial information for the six months ended June 30, 2023 has been prepared in accordance with International
Accounting Standard 34 Interim Financial Reporting ("IAS 34"). The interim condensed consolidated financial information does not include all the information and disclosures
required in the annual financial statements and should be read in conjunction with the Group's annual consolidated financial statements for the year ended December 31, 2022.
The accounting policies adopted in the preparation of the interim condensed consolidated financial information are consistent
with those applied in the preparation of the Group's annual consolidated financial statements for the year ended December 31, 2022, except for the adoption of the following new and revised International Financial Reporting Standards ("IFRSs") for
the first time for the current period's financial information.
| Amendments to IAS 1 and IFRS Practice Statement 2 | Disclosure of Accounting Policies |
| Amendments to IAS 8 | Definition of Accounting Estimates |
| Amendments to IAS 12 | Deferred Tax related to Assets and Liabilities arising from a Single Transaction |
| Amendments to IAS 12 | International Tax Reform - Pillar Two Model Rules |
BEIJING CONTINENT PHARMACEUTICALS CO., LTD.
NOTES TO THE UNAUDITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Amounts expressed in thousands of RMB)
The nature and impact of the new and revised IFRSs are described below:
BEIJING CONTINENT PHARMACEUTICALS CO., LTD.
NOTES TO THE UNAUDITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Amounts expressed in thousands of RMB)
Revenue is analyzed as follows:
| For the six months ended June 30, | ||||||||
| 2023 | 2022 | |||||||
| (Unaudited) | (Unaudited) | |||||||
| Revenue from contracts with customers | ||||||||
| Sales of pharmaceutical products | 379,265 | 312,673 |
Disaggregated revenue information is as follow:
| For the six months ended June 30, | ||||||||
| 2023 | 2022 | |||||||
| (Unaudited) | (Unaudited) | |||||||
| Timing of revenue recognition | ||||||||
| Products transferred at a point in time | 379,265 | 312,673 |
The Company was designated and approved as a High and New Technology Enterprise in December 2022 with a validity period of 3
years and was entitled to a preferential tax rate of 15% accordingly.
The Group calculates the period income tax expense using the tax rate that would be applicable to the expected total annual
earnings. The major components of income tax expense in the unaudited interim condensed consolidated statements of profit or loss are:
| For the six months ended June 30, | ||||||||
| 2023 | 2022 | |||||||
| (Unaudited) | (Unaudited) | |||||||
| Current income tax charge in Mainland China | 29,410 | 16,847 | ||||||
| Deferred income tax | ( 352 | ) | ( 71 | ) | ||||
| Total tax charge for the period | 29,058 | 16,776 |
BEIJING CONTINENT PHARMACEUTICALS CO., LTD.
NOTES TO THE UNAUDITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Amounts expressed in thousands of RMB)
During the six months ended June 30, 2023 and 2022, the Group's property, plant and equipment increased with costs of
RMB25,553 and RMB6,163, respectively, which were mainly categorized as the additions in construction in progress.
The carrying amounts of these constructions in progress as of June 30, 2023 and December 31, 2022 were RMB57,747 and RMB33,778,
| June 30, 2023 | December 31, 2022 | |||||||
| (Unaudited) | (Audited) | |||||||
| Raw materials | 6,650 | 7,354 | ||||||
| Work in progress | 4,999 | 2,749 | ||||||
| Semi-finished goods | 13,622 | 22,790 | ||||||
| Finished goods | 13,061 | 9,808 | ||||||
| 38,332 | 42,701 | |||||||
| Provision for inventories | ( 165 | ) | ( 62 | ) | ||||
| 38,167 | 42,639 |
| June 30, 2023 | December 31, 2022 | |||||||
| (Unaudited) | (Audited) | |||||||
| Trade receivables | 94,229 | 109,615 | ||||||
| Allowance for impairment | ( 491 | ) | ( 862 | ) | ||||
| 93,738 | 108,753 |
The Group's trading terms with its customers are mainly on credit, and the credit period is usually within 3 months. The Group seeks to maintain
strict control over its outstanding receivables to minimize credit risk. Overdue balances are reviewed regularly by the management. Trade receivables are non-interest-bearing.
The balances of RMB1,875 and RMB10,597 as of June 30, 2023 and December 31, 2022, respectively, represented bills receivable
arising from the sale of pharmaceutical products. As the Group's management policy is collect contractual cashflows when the bills expire or endorse the bills to supplier before the bills mature, management accounted for them as debt investments
at fair value through other comprehensive income.
BEIJING CONTINENT PHARMACEUTICALS CO., LTD.
NOTES TO THE UNAUDITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Amounts expressed in thousands of RMB)
| June 30, 2023 | December 31, 2022 | |||||||
| (Unaudited) | (Audited) | |||||||
| Cash and bank balances | 292,366 | 214,920 | ||||||
| Less: Long-term bank deposits | ( 133,486 | ) | ( 51,500 | ) | ||||
| Cash and cash equivalents | 158,880 | 163,420 |
Cash at banks earns interest at floating rates based on daily bank deposit rates. The bank balances are deposited with
creditworthy banks with no recent history of default.
The long-term bank deposits represented certificates of deposits issued by four different banks with due dates in 2025 and
2026. According to the Group's assessment, these deposits have passed "solely payments of principal and interest test" and the Group intends to hold them till the due date, so these deposits were accounted for as financial assets measured at amortized cost.
| June 30, 2023 | December 31, 2022 | |||||||
| (Unaudited) | (Audited) | |||||||
| Payroll and welfare payables | 35,043 | 34,911 | ||||||
| Accrued expenses | 24,786 | 1,970 | ||||||
| Other payables | 12,365 | 22,081 | ||||||
| Deferred government grants* | 6,259 | 5,300 | ||||||
| Others | 1,698 | 2,352 | ||||||
| 80,151 | 66,614 | |||||||
| Less: | ||||||||
| Non-current portion of customers' deposits | (346 | ) | (380 | ) | ||||
| Non-current portion of deferred government grants | ( 5,977 | ) | ( 5,150 | ) | ||||
| Current portion | 73,828 | 61,084 |
BEIJING CONTINENT PHARMACEUTICALS CO., LTD.
NOTES TO THE UNAUDITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Amounts expressed in thousands of RMB)
In February 2021, the board of directors of the Company approved the 2021 Stock Incentive Plan (the "2021 Plan") to certain
employees and consultants of the Company to purchase a total of 9,197,685 ordinary shares of the Company. The 2021 Plan has a contractual term of seven years. Share options granted under the 2021 Plan were accounted for as equity awards, and
subject to service condition and certain specified performance targets. In addition, share options granted under the 2021 Plan have an exercise price of RMB9.79 per share, and will not be exercisable until the closing of an IPO and the lapse of the
applicable lock-up periods after such IPO.
In December 2021, the board of directors of the Company approved to further amend the 2021 Plan, and removed the exercise
condition related to the closing of an IPO. In addition, all share options granted under the 2021 Plan will generally vest over twenty months after the grant date, subject to certain specified performance targets.
A summary of number of share options under the 2021 Plan is as follows:
| For the six months ended June 30, 2023 | For the six months ended June 30, 2022 | |||||||||||||||
| Number of share options | Weighted average exercise price RMB per share | Number of share options | Weighted average exercise price RMB per share | |||||||||||||
| (Unaudited) | (Unaudited) | (Unaudited) | (Unaudited) | |||||||||||||
| Outstanding at the beginning of the period | 9,195,130 | 9.79 | 9,197,685 | 9.79 | ||||||||||||
| Forfeited | ( 10,220 | ) | 9.79 | ( 2,555 | ) | 9.79 | ||||||||||
| Outstanding at the end of the period | 9,184,910 | 9.79 | 9,195,130 | 9.79 |
No share options were granted or exercised during the six months ended June 30, 2023 and 2022, respectively. The Group recognized share option expenses of RMB2,141 and RMB4,302 for the six months ended June 30, 2023 and 2022, respectively.
In April 2023, the shareholders of the Company approved to terminate the 2021 Plan. The termination will take effect upon
the effective time as defined in the Business Combination Agreement entered among Catalyst Biosciences, Inc. ("Catalyst"), GNI Group Ltd. and certain of its subsidiaries, and the Company and certain of its minority shareholders on December 26,
2022, as amended on March 29, 2023. According to the Business Combination Agreement, each outstanding share option under the Company's 2021 Plan upon termination will be cancelled and replaced with options granted under the 2023 Omnibus Incentive
Plan of Gyre Therapeutics, Inc., the new name of Catalyst after the business combination closes. In addition, the Company will no longer grant any options under the 2021 Plan.
Since the termination of the 2021 Plan was not effective as of June 30, 2023, there was no accounting impact for the six