-- Announcement on Evaluation Report on "Corporate Value and Return Enhancement" Action Plan 2024 and "Corporate Value and Return Enhancement" Action Plan 2025
Securities code: 603367 Securities abbreviation: Chenxin Pharmaceutical Announcement number: 2025-042
Chenxin Pharmaceutical Co., Ltd.
Evaluation Report on the Action Plan of “Improving Quality, Increasing Efficiency and Emphasis on Return” in 2024 and Announcement on the Action Plan of “Improving Quality, Increasing Efficiency and Emphasizing Return” in 2025
The company's board of directors and all directors guarantee that the contents of this announcement do not contain any false records, misleading statements or major omissions, and assume legal responsibility for the authenticity, accuracy and completeness of its contents.
Chenxin Pharmaceutical Co., Ltd. (hereinafter referred to as "Chenxin Pharmaceutical" or the "Company") actively responds to the Shanghai Stock Exchange's "Initiative on Carrying out the Special Action of "Improving Quality, Increasing Efficiency and Focusing on Returns" for Shanghai Stock Exchange Companies", promotes the company's high-quality development, enhances the company's investment value, protects the legitimate rights and interests of investors, especially small and medium-sized investors, and effectively performs the company's responsibilities and obligations. In order to protect the rights and interests of investors and promote capital market fairness To achieve stable and healthy development, the company disclosed the "Announcement of Chenxin Pharmaceutical Co., Ltd. on the 2024 "Improving Quality, Efficiency and Focus on Returns" Action Plan (Announcement Number: 2024-077)" (hereinafter referred to as the "Action Plan") on the website of the Shanghai Stock Exchange on October 29, 2024. It aims to improve operating quality and profitability through various measures, promote high-quality development and enhance investment value.
Since the disclosure and implementation of the "Improving Quality, Efficiency and Returns" action plan in 2024, the company has actively carried out and implemented relevant work, and achieved good results in protecting the rights and interests of investors and establishing a good capital market image. The company held the ninth meeting of the fifth board of directors on August 27, 2025 for review The meeting approved the "Evaluation Report on the Action Plan of "Improving Quality, Increasing Efficiency and Emphasis on Return" in 2024 and the Proposal on the Action Plan of "Improving Quality, Increasing Efficiency and Emphasis on Return" in 2025, to evaluate the implementation of the action plan in 2024 and clarify the goals of the action plan in 2025. The specific contents are as follows:
1. Focus on the main business and strengthen the quality of operation and development
The company's main business is the research and development, production and sales of chemical pharmaceutical preparations. The company's products cover five major dosage forms: large-volume injections (including non-PVC soft bags, plastic bottles, stand-up bags, and glass bottles), freeze-dried powder injections, small-volume injections, tablets, and capsules. The company's main products include large-volume infusion-glass bottles, large-volume infusion-non-PVC soft bags, large-volume infusion-plastic bottles, small-volume injections, oral solid preparations, freeze-dried powder injections, drops, ointments, rinses, etc. General items: sales of formula foods for special medical purposes; food sales (only sales of prepackaged foods); Internet sales of food (only sales of prepackaged foods); sales of health food (prepackaged); sales of food additives; import and export of goods; import and export of technology; medical research and experimental development; technical services, technology development, technical consultation, technology exchange, technology transfer, technology promotion, etc.
The company's operating income in 2024 was 3.982 billion yuan, a decrease of 10.77% from the same period last year; the company's total profit in 2024 was 576 million yuan, a decrease of 3.37% from the same period last year; the company's profit attributable to the owners of the parent company in 2024 Net profit was 509 million yuan, a decrease of 2.38% from the same period last year; the net profit attributable to the owners of the parent company after deducting non-recurring gains and losses in 2024 was 426 million yuan, a decrease of 5.63% from the same period last year; basic earnings per share was 1.12 yuan.
In 2025, the company will continue to adhere to the business philosophy of "innovating through the old, being honest and trustworthy", working together to create a win-win situation, using benchmarking learning as the starting point, focusing on solving key issues that affect and restrict the company's development, strengthening brand building, promoting digital construction and upgrades, and promoting sustainable and efficient development of the company through management improvement.
2. Pay attention to R&D investment and promote development with science and technology
The company adheres to the combination of independent innovation and cooperative innovation. On the basis of independent research and development, it attaches great importance to various cooperation and has successively cooperated with Georgia State University in the United States, University of Liverpool in the United Kingdom, Peking University, Academy of Military Medical Sciences, China Pharmaceutical University, Shandong University, Shenyang Pharmaceutical University, and Shandong Pharmaceutical Industry Research Institute, Guangzhou Institute of Pharmaceutical Industry, Tianjin Institute of Pharmaceutical Research, Shanghai Institute of Pharmaceutical Industry, WuXi AppTec, etc. carry out scientific research cooperation to develop new products or tackle key technologies. Combined with the company's strong industrialization capabilities, we can achieve complementary resource advantages through internal and external cooperation and effectively transform scientific research results into productivity.
In 2024, the total annual R&D investment is 343 million yuan, with more than 100 projects under development. The product direction focuses on complex injections, sustained-release oral solid preparations, ophthalmic preparations, topical preparations, generic drug consistency evaluation, preparation internationalization, new drugs with major clinical needs, etc. It aims to build a product portfolio with complementary advantages in the treatment fields of clinical nutrition, oncology, anesthesia, psychiatry, cardiovascular, ophthalmology, dermatology, etc., and provide more choices to meet major clinical needs. At the same time, focusing on major clinical needs and clinical therapeutic value, the company's innovative drug projects are focused on diseases that do not yet have good treatments, such as solid tumors, drug-resistant infections, autoimmunity, and alopecia diseases. During the year, new Class 1 drugs against drug-resistant tuberculosis have entered Phase III clinical research, new Class 1 dual-target anti-tumor drugs are in Phase II clinical studies, new Class 1 anti-influenza virus drugs have completed Phase II clinical studies, new Class 1 drugs for the treatment of autoimmune inflammation and antifungals have completed Phase I clinical summary reports and initiated Phase II clinical studies, new Class 1 triple-target anti-tumor drugs are in Phase II clinical studies, and new Class 1 drugs for acute pancreatitis are in Phase I clinical studies. At the same time, the acute pancreatitis project has started veterinary drug research and development.
In 2025, the company will continue to implement measures to reduce costs and increase efficiency to cope with the market impact of national centralized procurement and the global economic downturn. On the premise of ensuring the continuity of the company's operations, the company will continue to expand investment in R&D and actively build around the construction of scientific and technological talents and R&D platforms. The process-based talent management system and performance incentive system of "introduction, training, use, evaluation" absorb and train a group of new drug R&D talents who are specialized in new drug R&D and have deep academic attainments and practical experience to improve the development of new technologies, high-quality realization of new products, process improvement and innovation, product performance testing and other innovative capabilities, thereby continuously improving product quality and technological added value, and creating a market-driven, customer-centered, more technically professional and experienced R&D team.
3. Maintain communication with investors and enhance recognition in the capital market
The company strictly abides by the relevant laws, regulations and normative document requirements for information disclosure by listed companies, continues to improve the construction of the information disclosure system, conscientiously performs its information disclosure obligations, and ensures timely, accurate and complete disclosure of information.
In 2024, the company attaches great importance to investor communication and is committed to building a transparent and efficient communication bridge. Through various channels, including holding regular performance briefings, "SSE e-interaction" and receiving phone calls from investors, we provide detailed interpretations of the company's production and operations, in-depth explanations of the company's strategic layout and industry prospects, and effectively respond to investors' core concerns. During the year, the company held the 2023 annual and first quarter 2024 performance briefing, the 2024 semi-annual performance briefing, and the 2024 third quarter performance briefing to actively convey the company's value and further enhance the market's understanding and confidence in the company. At the same time, the company disclosed a total of 121 announcements on the official website of the Shanghai Stock Exchange and designated information disclosure media, including 117 temporary announcements, 4 regular reports, and 162 attachments and related filing documents. Ensure that investors understand the company's business matters in a timely manner and protect the interests of investors to the greatest extent.
In 2025, the company will continue to attach great importance to investor relations management, fully listen to investors' opinions and suggestions, and enhance the market's trust in the company by improving corporate governance, optimizing internal decision-making processes, and enhancing the transparency of the company's operations so that investors can clearly understand the company's development trends and strategic plans. The company will formulate a "Market Value Management System" to clarify market value management principles, responsible departments and early warning mechanisms to maintain the stability of the company's market value and enhance shareholder return capabilities. At the same time, the company continues to hold performance briefings on a regular basis, and organizes the company's chairman, independent directors, senior managers, financial directors, board secretaries and other management personnel to promptly attend performance briefings, shareholders' meetings, board of directors and other relevant meetings, and provide in-depth interpretations of the company's development strategy, major project progress, financial situation and other issues that are generally concerned by investors. The company will further improve the information disclosure system and timely communicate development trends through regular reports, temporary announcements, etc., so that investors can accurately grasp the company's value context and consolidate the foundation of market trust.
4. Strengthen the responsibilities of “key minorities” and improve their ability to perform duties
In 2024, the company continued to strengthen the performance responsibilities of "key minorities" and achieved remarkable results: strictly abiding by the "Company Law" The "Securities Law" requires that the duty performance of controlling shareholders, directors, supervisors and senior managers be regulated. During the year, no matters that harmed the rights and interests of small and medium-sized investors occurred. None of the company's directors, supervisors and senior managers reduced their shareholdings, reflecting firm confidence in the company's development prospects; Company Organization The "key minority" actively participated in 4 compliance trainings organized by regulatory authorities and the company, completed the annual goals on time, and effectively improved the performance capabilities of directors, supervisors, and senior managers; the company continued to optimize the incentive mechanism and related compensation systems to achieve a close link between executive compensation and operating performance.
In 2025, the company will adhere to the concept of standardized operations, continue to deepen the construction of the corporate governance system, continue to improve the relevant institutional systems for corporate governance, and effectively protect the rights and interests of investors. The company always maintains close communication with "key minority" groups such as directors, supervisors, and senior managers. The company will pay close attention to changes in laws, regulations and regulatory policies, enhance the normative awareness and performance capabilities of the "key minority", and further strengthen the standardized operation and execution of the shareholders' meeting, board of directors and special committees. In the future, the company will continue to play the leading role of the "key minority", continue to optimize the benefit sharing mechanism between management and shareholders, maintain the stability of the capital market through practical actions, and promote the company's high-quality development.
5. Strengthen shareholder returns and build a long-term mechanism
Based on the actual operating conditions, the company comprehensively considers future development, and at the same time, actively rewards the interests of all shareholders. In 2024, as reviewed and approved by the company's second extraordinary shareholders' meeting in 2024, on November 22, 2024, the company implemented 20 The mid-term equity distribution plan for 2024 is based on the company's total share capital of 452,754,129 shares at the time of equity distribution. A cash dividend of RMB 0.22 per share (tax included) will be distributed, with a total cash dividend of RMB 99,605,908.38. At the same time, as reviewed and approved by the company's 2024 Annual General Meeting of Shareholders, the company implemented the 2024 annual equity distribution on June 19, 2025. Based on the company's total share capital of 452,754,129 shares at the time of the equity distribution, a cash dividend of 0.22 yuan per share (tax included) was distributed, and a total cash dividend of 99,605,908.38 yuan was distributed.
In summary, the company will distribute cash dividends in the 2024 half-year and 2024 annual total of RMB 199,211,816.76, accounting for 39.15% of the net profit attributable to shareholders of listed companies for the year.
In 2025, the company will integrate company development and returns to all shareholders, take into account immediate and long-term interests, and convey the company's confidence in future profits through sustained and stable cash dividends. On the premise of meeting the profit distribution conditions, ensure that the annual dividend ratio is no less than 30% to stabilize investor expectations. Combining the company's operating conditions, profitability level, future development plans, capital needs, investor returns and other factors in the first half of 2025, and subject to the conditions of profit distribution, a scientific and reasonable mid-term dividend plan for 2025 (first half year) and annual dividend plan for 2025 (second half year) will be formulated.
6. Procedures for implementation of this evaluation report and plan
The company held the ninth meeting of the fifth board of directors on August 27, 2025. The meeting reviewed and approved the "Evaluation Report on the Action Plan of "Improving Quality, Increasing Efficiency and Emphasis on Return" in 2024 and the Proposal on the Action Plan of "Improving Quality, Efficiency and Emphasis on Return" in 2025. The board of directors believes that the plan combines the development status of the industry in which the company operates and believes that it can objectively and truly reflect the actual situation of the company.
7. Other instructions and risk warnings
This evaluation report on the 2024 "Improving Quality, Efficiency and Emphasis on Returns" action plan and the 2025 "Improving Quality, Efficiency and Emphasis on Returns" action plan have been reviewed and approved at the ninth meeting of the company's fifth board of directors. This plan is based on the company's current operating conditions and external environment. It does not constitute a relevant commitment to investors. In the future, it may be affected by macro policy adjustments, industry competition changes and other factors, and there is a certain degree of uncertainty. Investors are kindly requested to invest rationally and pay attention to investment risks.
Announcement is hereby made.
Board of Directors of Chenxin Pharmaceutical Co., Ltd.
August 27, 2025