(Yicai) Oct. 27 -- Shares of WuXi AppTech climbed after the Chinese pharmaceutical giant raised its annual earnings forecast for the second time this year against the backdrop of a strong performance in the third quarter.

WuXi AppTec [SHA: 603259] was trading up 2.2 percent at CNY106.06 (USD14.91) as of 2.20 p.m. in Shanghai today. Its Hong Kong-listed stock [HKG: 2359] surged 3.9 percent to HKD114.80 (USD14.78).

Revenue will likely expand 17 percent to 18 percent to CNY43.5 billion to CNY44 billion (USD6.1 billion to USD6.2 billion) this year from the previous one, the Shanghai-based company said in its third-quarter financial statement yesterday.

In March, WuXi AppTech had predicted its revenue would increase 10 percent to 15 percent to CNY41.5 billion to CNY43 billion in 2025 from the year before. In July, the firm raised the forecast, expecting the annual revenue to jump between 13 percent and 17 percent to up to CNY43.5 billion.

Net profit surged 53 percent to CNY3.5 billion (USD492.1 million) in the three months ended Sept. 30 from a year earlier, the earnings report showed yesterday. Revenue rose 15 percent to CNY12.1 billion.

In the first three quarters of the year, WuXi AppTech's net profit widened 85 percent to CNY12.1 billion, and its revenue increased 19 percent to CNY32.9 billion from the same period last year.

WuXi AppTec continued to strengthen its contract research, development, and manufacturing organization business model in the first three quarters, resulting in continuous revenue growth, the firm pointed out, adding that it improved its overall profitability by optimizing the production process and operational efficiency.

Another factor contributing to WuXi AppTech's faster-than-expected earnings growth was the sale of a portion of its stake in one of its joint ventures.

WuXi AppTec announced on Oct. 9 that it had sold some shares of WuXi XDX, a JV between WuXi AppTech and WuXi Biologics, in the secondary market this year, generating net investment gains that will likely bring CNY4.4 billion in net profit for fiscal year 2025.

WuXi Biologics was initially a subsidiary of WuXi AppTec, but it later became an independent company listed in Hong Kong, with no remaining equity relationship between the two.

In a separate statement yesterday, WuXi AppTech also announced a plan to sell two of its subsidiaries -- WuXi Clinical Development Services Shanghai and WuXi MedKey Med-Tech Development Shanghai -- to Chinese private equity giant Hillhouse Investment Management for CNY2.8 billion.

“The transaction reflects the company’s long-term strategy to continuously focus on its core CRDMO business model, emphasizing drug discovery, laboratory testing, process development and manufacturing services,” WuXi AppTech noted. “This move is expected to provide financial support and accelerate the development of global capabilities and capacities to better serve customers for the benefit of patients worldwide.”

WuXi Clinical and WuXi MedKey contributed 0.7 percent to WuXi AppTec's net profit and 3.5 percent to its revenue in the first three quarters.

Editor: Futura Costaglione