CSPC PHARMACEUTICAL GROUP LTD. 
By Hong Kong Exchanges and Clearing Limited and The Stock Exchange of Hong Kong Limited take no responsibility for the contents of this document, make no representation as to its accuracy or completeness and expressly disclaim any liability whatsoever for any loss howsoever arising from or in reliance upon the whole or any part of the contents of this document.
The Board of Directors of China Pharmaceutical Group Limited (the "Company") hereby announces the unaudited consolidated results of the Company and its subsidiaries (the "Group") for the nine months ended 30 September 2012 as follows:
CONSOLIDATED INCOME STATEMENTFor the nine months ended 30 September 2012
For the nine months ended 30 September 2012 2011HK$'000 HK$'000
(Unaudited) (Unaudited)
Revenue 4,947,286 5,929,211
Cost of sales (4,316,418) (4,605,611)
Gross profit 630,868 1,323,600
Other income 48,328 67,606
Selling and distribution expenses (366,158) (404,407) Administrative expenses (398,991) (461,843) Other expenses (39,085) (98,337)
Operating (loss) profit (125,038) 426,619
Share of results of a jointly controlled entity (1,072) 10,462
Finance costs (67,682) (50,883)
(Loss) profit before taxation (193,792) 386,198
Taxation (2,798) (83,181) (Loss) profit for the period (196,590) 303,017
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(
(Loss) earnings per share - Basic (13.73) 18.69
Notes:
1. The accounting policies used in the preparation of the financial data for the nine months ended 30
September 2012 are consistent with those followed in the preparation of the interim financial statements of the Group for the six months ended 30 June 2012.
2. The calculation of the basic loss per share for the nine months ended 30 September 2012 is based on the loss for the period attributable to owners of the Company of HK$210,078,000 (2011: profit of HK$286,332,000) and 1,529,766,661 shares in issue (2011: weighted average number of ordinary shares of 1,531,820,595) for the period.
No diluted earnings per share has been presented for the nine months ended 30 September 2012 and
2011 as there were no potential ordinary shares in issue during both periods.
3. The board of directors does not declare the payment of an interim dividend for the nine months ended
30 September 2012 (2011: Nil).
4. The financial data for the nine months ended 30 September 2012 is based on the internal records and management accounts of the Group and has not been reviewed or audited by the external auditor of the Company.
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SEGMENT INFORMATIONThe following is an analysis of the Group's revenue and results by reportable and operating segment for the period under review:
For the nine months ended 30 September 2012 (Unaudited) Intermediates and Bulk Drugs Vitamin C Antibiotics Finished Segment series series Drugs Others Total Eliminations ConsolidatedHK$'000 HK$'000 HK$'000 HK$'000 HK$'000 HK$'000 HK$'000
SEGMENT REVENUE
External sales 976,363 1,947,754 1,931,050 92,119 4,947,286 - 4,947,286
Inter-segment sales 918 224,812 - - 225,730 (225,730) -
TOTAL 977,281 2,172,566 1,931,050 92,119 5,173,016 (225,730) 4,947,286
Inter-segment sales are charged at prevailing market rates. SEGMENT (LOSS)
PROFIT (37,079) (140,691) 108,948 (5,188) (74,010)
Unallocated income | 6,994 | |
Unallocated central | ||
expenses | (58,022) |
Operating loss (125,038)
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Intermediates and
Bulk Drugs
Vitamin C Antibiotics Finished Segment
series series Drugs Others Total Eliminations Consolidated
HK$'000 HK$'000 HK$'000 HK$'000 HK$'000 HK$'000 HK$'000
SEGMENT REVENUE
External sales 1,381,050 2,488,013 1,967,661 92,487 5,929,211 - 5,929,211
Inter-segment sales 1,185 675,340 - 188,315 864,840 (864,840) - TOTAL 1,382,235 3,163,353 1,967,661 280,802 6,794,051 (864,840) 5,929,211
Inter-segment sales are charged at prevailing market rates.
SEGMENT PROFIT
(LOSS) 187,602 133,971 180,361 (939) 500,995
Unallocated income 7,428
Unallocated central
expenses (81,804) Operating profit 426,619
Product prices of vitamin C remained under pressure due to excessive production capacity. Despite the Group's advantage in production costs, this product series still reported a loss for the period. The market condition of antibiotics remained stable in the third quarter. However, production costs were slightly pushed up as the Group's production line in Inner Mongolia was undergoing technical modifications. As a result, this series still recorded a loss for the period.
Finished Drugs Business
During the period, the market maintained a steady development. With effective adjustments to the Group's marketing strategies to minimize the impact of the low tender price and the policy of restrictive use of antibiotics, the overall business maintained a steady growth.
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Following the approval by independent shareholders at general meeting, the acquisition of certain pharmaceutical businesses by the Company was completed on 29 October 2012. The completion of the acquisition marked the Group's successful transformation from being a manufacturer of bulk drugs and common generic drugs into a large-scale pharmaceutical conglomerate which focuses on the development of new drugs. The current product series of the new businesses include a number of patented and new drug products, which have gained wide market acceptance and enjoyed rapid growth. We believe that the new businesses will provide the Group with strong profit contributions and growth drivers, and create satisfactory returns to the shareholders.
By order of the Board Cai Dongchen Chairman
Hong Kong, 30 November 2012
As at the date of this announcement, the board of directors of the Company comprises Mr. Cai Dongchen, Mr. Feng Zhenying, Mr. Chak Kin Man, Mr. Pan Weidong, Mr. Zhao John Huan, Mr. Wang Shunlong, Mr Wang Huaiyu, Mr. Lu Jianmin and Mr. Wang Zhenguo as executive directors; Mr. Lee Ka Sze, Carmelo as non-executive director; and Mr. Huo Zhenxing, Mr. Qi Moujia, Mr. Guo Shichang and Mr. Chan Siu Keung, Leonard as independent non-executive directors.
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