FAST NEWS: WuXi AppTec Q1 Profit Doubles on Strong Chemical Business

The latest: Pharmaceutical services outsourcing company WuXi AppTec Co. Ltd. (2359.HK; 603259.SH) reported its revenue rose 71.2% to 8.47 billion yuan ($1.29 billion) in the first quarter, while its operating profit rose 106% to 1.71 billion yuan, according to an announcement late on Monday.

Looking up: The company’s chemistry business was particularly strong for the quarter, with revenue up 102% to 6.12 billion yuan, accounting for 72% of its total, mainly due to an increase in customer volume and the addition of new capacity.

Take Note: Net cash flow from operating activities for the quarter totaled 497 million yuan, down 25.6% from a year earlier, due to a significant increase in material buying to meet growing customer demand.

Digging Deeper: WuXi AppTec is a pharmaceutical outsourcing services provider, covering the entire industry chain from drug discovery to commercialization. It has grown rapidly on big demand from both foreign and domestic drug developers for outsourced R&D and manufacturing services for their activity in the fast-growing China market, and has recorded eight consecutive quarters of revenue growth. The company forecasts that if the Shanghai Covid-19 pandemic is effectively controlled by the end of April, it expects to achieve revenue growth of 63% to 65% in this year’s second quarter, and is confident that it will achieve full-year revenue growth of 65% to 70%.

Market Reaction: WuXi AppTec’s stock rose 3.2% in early trade on Tuesday and closed up 3% at HK$105.9 at the midday break. The shares now trade at the low end of their 52-week range.

Translation by Jony Ho

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