FAST NEWS: Joinn Laboratories spents $3.7 million on share buyback

The Latest: Joinn Laboratories (China) Co. Ltd. (6127.HK; 603127.SH), China’s leading non-clinical contract research organization (CRO), said on Monday that since announcing a plan on Mar. 27 to repurchase its A shares through centralized bidding, it has so far spent 26.72 million yuan ($3.7 million) to buy back 1.62 million shares.

Looking Up: The impact on the company’s cash flow was relatively small due to the modest size of the share buybacks that have commenced.

Take Note: The company announced earlier that it plans to utilize 50 million yuan to 100 million yuan to buy back shares, and as it does not involve H-shares issued in Hong Kong, the positive effect on the share price may be limited.

Digging Deeper: During the Covid pandemic, lab monkeys that are one of Joinn’s main businesses were in short supply 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, which in turn caused last year’s earnings to plummet by 63%.

Market Reaction: Joinn’s Hong Kong shares fluctuated slightly in Tuesday trade, closed down 0.1% at HK$8.34 by the midday break, near the lower end of their 52-week range.

Translation by A. Au

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