Pharmaron Beijing Co., Ltd — Earnings Release 2019

Feb 28, 2020

Hong Kong Exchanges and Clearing Limited and The Stock Exchange of Hong Kong Limited take no responsibility for the contents of this announcement, 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 announcement.

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Pharmaron Beijing Co., Ltd.[*] 康龍化成（北京）新藥技術股份有限公司

(A joint stock company incorporated in the People’s Republic of China with limited liability) (Stock Code: 3759)

PRELIMINARY FINANCIAL DATA FOR YEAR 2019

This announcement is made by Pharmaron Beijing Co., Ltd. (the “ Company ” and together with its subsidiaries, the “ Group ”) pursuant to Rule 13.09 of The Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited (the “ Listing Rules ”) and the Inside Information Provisions (as defined in the Listing Rules) under Part XIVA of the Securities and Futures Ordinance (Chapter 571 of the Laws of Hong Kong).

Important notes: The financial information of the Company for the year of 2019 set out in this announcement was preliminary data, in which the key financial data and financial indicators have been prepared in accordance with Accounting Standards for Business Enterprises, and have not been audited or reviewed by the Audit Committee of the Company or an external accounting firm. As such, differences may be found between the above-mentioned data and the final financial information to be disclosed in the 2019 annual report to be published by the Company. References to annual reports of the Company in this announcement refer to the annual report published or to be published by the Company on the Shenzhen Stock Exchange (the “ SZSE ”). Further, the financial standards and adjustments treatments mentioned in this announcement refer to those standards and treatments under the Accounting Standards for Business Enterprises. Investors are hereby reminded to exercise caution when dealing in the shares of the Company.

I. KEY FINANCIAL DATA AND FINANCIAL INDICATORS FOR THE YEAR OF 2019

Reporting period: January 1, 2019 to December 31, 2019 (the “ Reporting Period ”)

Currency: RMB

	For the	For the
	year ended	year ended	Year-on-
	December	December	year change
Item	31, 2019	31, 2018	(%)
Revenue	3,757,160,086.84	2,908,123,033.72	29.20
Operating profit	631,487,023.57	392,582,640.20	60.85
Profit before tax	632,551,810.09	392,566,860.98	61.13
Net profit attributable to the shareholders
of the Company	547,191,486.94	333,044,273.76	64.30
Basic earnings per share (RMB)	0.8284	0.5638	46.93
Return on net assets on weighted average basis	16.70%	15.49%	1.21

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	As at	As at	Year-on-
	December 31,	January 1,	year change
	2019	2019	(%)
Total assets	9,935,038,258.59	4,802,079,994.40	106.89
Equity attributable to the shareholders of the Company	7,767,063,398.51	2,313,579,924.38	235.72
Share capital	794,387,462.00	590,663,575.00	34.49
Net asset per share attributable to
the shareholders of the Company (RMB)	9.78	3.92	149.49

Note: 1. The above figures are figures in the consolidated statements of the Company (unaudited);

1. The above-mentioned indicators such as net profit, basic earnings per share, return on net assets, interests of shareholders, and net assets per share are based on figures attributable to shareholders of the Company. Basic earnings per share and return on net assets are calculated on weighted average basis;

2. Discrepancy between the figures for the financial year ended December 31, 2018 (the “ FY2018 ”) in the table above and those in the 2018 annual report of the Company disclosed on the SZSE is mainly due to the adoption of new standard for lease since January 1, 2019. The figures for the FY2018 have been adjusted retrospectively in accordance with the requirements of the Accounting Standards for Business Enterprises No. 28－Changes in Accounting Policies and Estimates and Corrections of Errors. The figures for the FY2018 shown in the table above are the adjusted figures, details of which will be set out in the 2019 annual report of the Company to be disclosed on the SZSE;

3. Discrepancy between the figures of this Reporting Period in the table above and those in the 2018 annual report of the Company disclosed on the SZSE is mainly due to the adoption of new standards for lease, revenue and financial instruments since January 1, 2019. The figures of this Reporting Period have been adjusted retrospectively in accordance with the requirements of the Accounting Standards for Business Enterprises No. 28－Changes in Accounting Policies and Estimates and Corrections of Errors. The figures at the beginning of the Reporting Period shown in the table above are the adjusted figures, details of which will be set out in the 2019 annual report of the Company to be disclosed on the SZSE.

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II. DISCUSSION OF OPERATING RESULTS AND FINANCIAL POSITION

(I) Operating Results

During the Reporting Period, the Company generated revenue of RMB3,757,160,086.84, representing an increase of 29.20% compared with the same period of last year; operating profit of RMB631,487,023.57, representing an increase of 60.85% compared with the same period of last year; profit before tax of RMB632,551,810.09, representing an increase of 61.13% compared with the same period of last year; net profit attributable to the shareholders of the Company of RMB547,191,486.94, representing an increase of 64.30% compared with the same period of last year. The increase in operating profit, profit before tax and net profit attributable to the shareholders of the Company were mainly due to: 1) continuous improvement of the pharmaceutical research & development services capabilities, broadening of the integrated services platform and strengthening of the market position under the guidance of the end-to-end fully-integrated pharmaceutical research & development services strategy during the Reporting Period; and 2) increase of the business volume and number of customers by the Company through i) continuously deepening the collaboration with the existing large international pharmaceutical companies and biotech companies as well as increased business development effort for the international market and ii) increased effort in exploring the domestic market. With the increased revenue and business volume in different service segments, the economies of scale of each service segments were further enhanced which in turn led to the significant increase in the operating profit, profit before tax and net profit attributable to the shareholders of the Company.

(II) Financial Position

As at the end of the Reporting Period, the Company recorded total assets of RMB9,935,038,258.59, representing an increase of 106.89% compared with the beginning of the period; equity attributable to the shareholders of the Company as at the end of the Reporting Period reached RMB7,767,063,398.51, representing an increase of 235.72% compared with the beginning of the period; share capital at the end of the reporting period reached RMB794,387,462.00, representing an increase of 34.49% compared with the beginning of the period; net assets per share attributable to the shareholders of the Company as at the end of the Reporting Period reached RMB9.78, representing an increase of 149.49% compared with the beginning of the period.

The above changes were mainly attributable to:

• (1) During the Reporting Period, the initial public offering of ordinary shares (A Shares) in RMB was completed, the net proceeds from which amounted to RMB432,853,541.78;

• (2) During the Reporting Period, the initial public offering of ordinary shares (H Shares) in HK dollar was completed, the net proceeds from which amounted to RMB4,522,693,355.57;

• (3) During the Reporting Period, the net profit attributable to the shareholders of the Company significantly increased by 64.30% to RMB547,191,486.94 compared with the previous year.

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III. DISCUSSION OF THE DIFFERENCE WITH THE PREVIOUS RESULTS FORECAST

The operating results disclosed in this announcement are consistent with the estimate results disclosed in the announcement of Company dated January 21, 2020, and there is no significant difference.

IV. OTHER INFORMATION

This announcement is prepared based on the preliminary estimation by the finance department of the Company in accordance with Accounting Standards for Business Enterprises and has not been audited by an external accounting firm. Details of the specific financial data will be disclosed in the 2019 annual report to be published on the SZSE by the Company. Investors are advised to exercise caution and pay attention to the risks involved.

V. DOCUMENTS FOR INSPECTION

1. The comparative balance sheet and the profit and loss statement, which are signed and sealed by the current legal representative, the responsible person(s) of accounting affairs and the responsible person(s) of the accounting department (the accounting supervisor(s)) of the Company;

2. Other documents as required by the SZSE.

By order of the Board Pharmaron Beijing Co., Ltd. 康龍化成（北京）新藥技術股份有限公司 Dr. Lou Boliang* Chairman

Beijing, People’s Republic of China February 28, 2020

As at the date of this announcement, the Board of Directors comprises Dr. Lou Boliang, Mr. Lou Xiaoqiang and Ms. Zheng Bei as executive Directors; Mr. Chen Pingjin, Mr. Hu Baifeng, Mr. Li Jiaqing and Mr. Zhou Hongbin as non-executive Directors; Mr. Dai Lixin, Ms. Li Lihua, Ms. Chen Guoqin, Ms. Shen Rong and Mr. Tsang Kwan Hung Benson as independent non-executive Directors.

• For identification purposes only

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