FAST NEWS: Joinn Lab profit plunges, sending shares to 52-week low
The latest: Joinn Laboratories (China) Co. Ltd. (6127.HK; 603127.SH), China’s leading non-clinical contract research organization (CRO), announced on Tuesday it expects to report a net profit of 311 million ($43.8 million) to 419 million yuan for 2023, down 61.1% to 71.1% from the previous year.
Looking up: The company expects to report its operating revenue last year was between 2.27 billion yuan and 2.49 billion yuan, representing flat to 10% growth, mainly due to a slight increase in revenue from its laboratory services business.
Take Note: The company’s profit was hit by losses on fair value changes for its biological assets, as well as falling prices for its laboratory services business, which lowered its gross margins.
Digging Deeper: Lab monkeys that are one of Joinn’s main businesses were in short supply during the pandemic as companies rushed to develop Covid vaccines and drugs. The average price per monkey spiked from 15,000 yuan in the latter half of 2019 to nearly 200,000 yuan at the end of 2022, helping to pump up the value of Joinn’s biological assets. But the pandemic’s decline, combined with shifting policies for the use of wild animals, caused the value of Joinn’s biological assets to fall last year, which weighed on its financial results.
Market Reaction: Joinn’s shares closed down 3.3% at HK$10.68 by the midday break on Wednesday, hitting a 52-week low.
Translation by A. Au
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