21st century business herald reporter Lei Chen intern Jiang Yaqi Beijing report

the medical and beauty industry chain has built a "solid" plate advantage in the-share market. the "three swordsmen" composed of huaxi biology (688363.SH), aimeike (300896.SZ) and haohai shengke (688366.SH) all show the huge demand.

The iteration of products and strategies also reflects the choice of the market. Different enterprises have different coping strategies and different operating results. It is also because of the change of hot spots, the customer health, corporate compliance and cross-border capital operation behind the financial report data of medical and American industry chain enterprises are always stirring the market.

Looking back over the past year, the performance of Huaxi Biology, Aimee and Haohai Biotech has shown a significant trend of differentiation. Some companies stand out in the market competition and have outstanding performance; others face challenges and need to find new growth points.

Regardless of their performance, they are actively exploring a breakthrough path in their respective stages of development in order to gain a firm foothold in the highly competitive market.

According to the "China Medical Beauty Industry 2023 Insight Report" jointly released by Alcian and Deloitte Management Consulting, the size of China's medical beauty market is expected to achieve a compound growth rate of 15% to 20% in the next five years.

In the face of such attractive market prospects, these companies are also constantly increasing research and development, tamping technology moat.

Three Musketeers performance differentiation

You're chasing me on the same medical track, but the performance curves of the three have diverged considerably.

Huaxi Biology, as a leader in the medical and aesthetic industry, encountered certain performance challenges in 2023.

Due to the decline in revenue of functional skin care products and the decline in gross profit margin, Huaxi Bio achieved revenue of 6.076 billion yuan last year, a year-on-year decrease of 4.45, and net profit fell sharply by 38.97 to 0.583 billion yuan.

This is the first year since the company went public in 2019 to see a simultaneous decline in revenue and net profit attributable to the company.

"The active slowdown in internal management changes has led to a reduction in the skincare business." Huaxi biological related people to the twenty-first Century economic report reporter said.

From the perspective of business composition, Huaxi Bio's business scope mainly includes raw materials business, medical terminal business, functional skin care products business and functional food business. Among them, functional skin care products accounted for 61.8 percent of revenue.

Affected by the phased strategic adjustment, its functional skin care business experienced a phased decline. The business achieved revenue of 3.757 billion billion yuan last year, a year-on-year decrease of 18.45. In addition, the company's functional food business realized revenue of 0.058 billion billion yuan, down 22.53 year on year.

In this regard, Huaxi Biology pointed out that the company is actively making strategic adjustments, committed to optimizing the category system with large single products as the core, deepening brand value, and strengthening the overall management of multi-brand resources. At the same time, the company is also adjusting the channel structure to increase the proportion of self-employed channels.

In contrast, Aimee and Haohai Biotech achieved performance growth in 2023.

Aimeike achieved revenue of 2.869 billion yuan last year, up 47.99 percent from a year earlier, and net profit of 1.858 billion yuan, up 47.08 percent from a year earlier.

Aimee's products can be divided into four main categories: solution injection products, gel injection products, facial buried line products and cosmetics and other products. Among them, solution injection products for the company's largest business segment, revenue accounted for 58.2.

last year, the company's solution injection products achieved revenue of 1.671 billion yuan, up 29.22 percent year-on-year, with sales of 5.1413 million units, up 48.88 percent and gross profit margin of 94.48 percent.

But "success and failure". The 21st Century Business Herald reporter noticed that the revenue growth rate of the company's solution injection products has declined in recent years. Revenues for solution injection products will grow by 133.84 per cent in 2021, plummeting to 72.25 per cent in 2022 and falling to 29.22 per cent in 2023.

Among the "three swordsmen of medical beauty", Haohai Biotech grew the fastest last year, with revenue of 2.654 billion yuan in 2023, up 24.59 percent from the same period last year, and net profit up 130.58 percent to 0.416 billion yuan from the same period last year.

by business, the company's medical beauty and wound care products, ophthalmic products, orthopedic products, anti-adhesion and hemostatic products last year's revenue was 1.057 billion yuan, 0.928 billion yuan, 0.476 billion yuan, 0.147 billion yuan, revenue accounted for 39.82, 34.97, 17.94, 5.52.

in 2023, the company's medical beauty and wound care business revenue was 1.057 billion yuan, up 41.27 year on year. Ophthalmic products realized a main business income of 0.928 billion billion yuan, up 20.57 year on year. This is the first time the company's medical beauty sector has surpassed the ophthalmology business.

Find a breakthrough outside the basic disk

While the basic disk business is facing challenges, the reporter noticed that the other business lines of the three companies are developing steadily.

Judging from the performance composition in 2023, Huaxi's biological raw materials business still achieved steady growth, and the medical terminal business maintained rapid growth.

Benefiting from the growth of pharmaceutical-grade raw materials and cosmetic-grade raw materials, the company's raw material business achieved revenue of 1.129 billion yuan last year, an increase of 15.22 percent over the same period last year; revenue from the medical and beauty business increased significantly, and revenue from the medical terminal business reached 1.09 billion yuan, an increase of 58.95 percent over the same period last year.

especially in the medical terminal business, the company's medical and beauty sector has deeply explored product differentiation and improved its layered anti-aging product portfolio, which grew 58.95 year-on-year last year.

The 21st Century Business Herald reporter learned from the company that this achievement has benefited from the in-depth excavation of product differentiation advantages in the medical and beauty sector and the improvement of the layered anti-aging product portfolio. In particular, the income of skin medical products reached 0.747 billion yuan, up 60.29 year on year.

in the field of raw materials business, huaxi biology realized revenue of 1.129 billion yuan in 2023, up 15.22 year on year. Among them, the sales revenue of export raw materials reached 0.517 billion billion yuan, a year-on-year increase of 21.47, marking the results of Huaxi Bio's internationalization strategy.

Among them, the company's differentiated advantage category micro-cross-linked moisturizing doll needle revenue increased by more than 200 percent year-on-year, moisturizing filler revenue increased by more than 250 percent year-on-year.

Huaxi Bio is also steadily advancing the internationalization strategy of its medical and beauty business. At present, the company's medical beauty brand has registered filler products in the European Union, Russia, Thailand, Peru and other countries and regions, and sold the products to 15 countries and regions including Europe, the Russian-speaking region, the Middle East, and the Americas.

Aimee is actively seeking category expansion, but also through foreign investment and cooperation to enrich the product line, from "narrow path" to "wide path".

the annual report shows that aimeike continues to increase its strategic layout in the field of weight management and fat reduction. on the basis of introducing simegllutide products in cooperation with Beijing quality peptide biomedical technology co., ltd. (quality peptide biology), aimeike invests 4.89 equity of quality peptide biology with a total amount of 50 million yuan.

In addition, Aimee has a number of products in reserve. Some agency sources expect that Borneda is expected to be approved this year and Botox is expected to be approved around next year.

Haohai Biotech also takes a diversified development path. The annual report shows that the company continues to expand and improve its product line and integrate the industrial chain through a combination of endogenous growth and mergers and acquisitions.

"The Group will continue to make effective use of its own funds to explore the four rapidly developing therapeutic areas of ophthalmology, medical beauty, orthopedics and surgery, actively look for advanced technologies and excellent products, and take the opportunity to increase its product reserves by means of technology introduction or investment cooperation." The annual report of Haohai Biotech shows.

R & D waiting for inflection point

In terms of commonality, companies have increased their R & D investment since last year.

Huaxi Biology continued to increase its investment in basic research and applied basic research last year to accelerate the transformation and application of scientific research results. In 2023, the company's R & D investment reached a new high of 0.446 billion billion yuan, up 14.98 percent year-on-year.

In the key strategic area of synthetic biology, Huaxi Biology continues to achieve results. During the reporting period, the company successfully launched 9 new products of bioactive raw materials using six platforms including synthetic biology research and development platform, further enriching the product line.

At the same time, Huaxi Bio uses synthetic biology technology to achieve efficient synthesis of bioactive substances. In particular, progress has been made in hyaluronidase, chondroitin sulfate, heparin, collagen, ergothioneine, human milk oligosaccharides and other products. Through the systematic synthesis of a variety of human milk oligosaccharides, a human milk oligosaccharide material library was constructed.

Aimee is steadily expanding its research pipeline and extension layout, expanding track reserves such as fat reduction and energy source equipment. In 2023, the company's research and development investment accounted for 8.72 percent, and the amount of research and development investment increased by 44.49 percent year-on-year.

the company currently has 8 class iii mechanical registration certificates and has a number of research projects, of which, for the chin of the baonida and botulinum toxin in the registration application stage.

last year, Aimee co-invested in peptide biology to strengthen its strategic layout in the field of weight management and fat reduction, and signed a distribution agreement with South Korea Jeisys to lay out the energy source equipment track.

In the first quarter of 2024, Haohai Shengke continued to enrich the company's product line. For example, the company's hydrophobic injection astigmatism correction aspheric intraocular lens products completed clinical trials and entered the registration phase in February 2024; innovative intraocular filling bio-gel products successfully completed clinical trials in January 2024 and entered the registration phase.

data show that from 2017 to 2021, the scale of China's medical beauty market increased from 99.3 billion yuan to 189.2 billion yuan, with an average annual compound growth rate of 17.5. At the same time, the agency expects the size of China's medical beauty market to achieve a compound growth rate of 15% to 20% in the next five years. As the medical and beauty industry gradually came out of the trough, all three companies showed new growth trends in the first quarter.

Huaxi Bio's profit inflection point is more obvious. In the first quarter of this year, the company achieved revenue of 0.778 billion billion yuan, up 111.12 percent from the same period last year, and net profit of 0.152 billion billion yuan, up 41.05 percent from the same period last year.

The company's profit side returned to higher growth in the first quarter, benefiting from an increase in the proportion of high-margin medical terminals and raw materials business. In addition, after the control of middle and back office expenses began last year, the effect appeared in the first quarter of this year, with the sales rate below 40% and the gross profit margin rising to 75.73.

The remaining two companies also achieved growth in the first quarter of this year. Aimeike achieved revenue of 0.808 billion yuan in the first quarter, up 28.24 percent from a year earlier, and net profit of 0.527 billion yuan, up 27.38 percent from a year earlier. Haohai Shengke achieved revenue of about 0.646 billion yuan, up 5.68 percent year-on-year, and net profit of about 97.54 million yuan, up 20.16 percent year-on-year.

Zheshang Securities believes that benefiting from the scale effect, the advantages of the marketing systemAimee's first-quarter sales expense rate decreased year-on-year. The decrease in management expenses was mainly due to the higher listing expenses of Hong Kong stocks in the same period last year, superimposed on the scale effect.

for the first quarter report card of haohai shengke, cinda securities research report pointed out that hyaluronic acid or continue last year's good growth trend, follow-up further attention to the fourth generation of hyaluronic acid approved progress.