Genscript Biotech Reports Full Year 2020 Financial Results
Highlights:
Revenue of the Group for the year ended December 31,2020 was approximately US$390.8 million,representing an increase of 42.9% as compared with approximately US$273.4 million for the year ended December 31,2019
Gross profit of the Group for the year ended December 31,2020 was approximately US$255.9 million,representing an increase of 41.9% as compared with approximately US$180.3 million recorded for the year ended December 31,2019
The adjusted net profit* of non-cell therapy business was approximately US$44.4 million,representing an increase of 105.6% as compared with approximately US$21.6 million for the year ended December 31,2019,and the adjusted net loss* of cell therapy business was approximately US$213.3 million,whilst the adjusted net loss* of cell therapy business was approximately US$131.9 million for the year ended December 31,2019
Loss of the Group for the year ended December 31,2020 was approximately US$281.4 million,whilst loss was approximately US$117.5 million for the year ended December 31,2019. The adjusted net loss* of the Group was approximately US$168.9 million,whilst the adjusted net loss* of approximately US$110.3 million was recorded for the year ended December 31,2019
NANJING,China,March 27,2021 -- Genscript Biotech (HKEX: 1548.HK) (GenScript),a global leading biotech company,today announced its audited financial results for the year ended December 31,2020.
"In 2020,the outbreak of COVID-19 pandemic presented both challenges and opportunities to the life science community. Thanks to concerted efforts of all GenScript people,the Group delivered historically strong results amid the outbreak," said Patrick Liu,Rotating CEO of GenScript. "In the past year,our business segments tided over difficulties,turned challenges into opportunities and achieved many breakthroughs. In the future,we will move forward with dedication and create more value for both our investors and customers. We are committed to our mission of "making people and nature healthier through biotechnology" and strive for human wellbeing."
Financial Results Highlits for the Year Ended December 31,2020
Revenue
In 2020,the Group recorded revenue of approximately US$390.8 million,representing an increase of 42.9% from approximately US$273.4 million in 2019. This was primarily attributable to (i) the strong growth in business of specially-functioned protein and antibody which meet market demands on key products related to COVID-19,(ii) the continuing increase from life-science services and products from major strategic customers and new competitive services and products,(iii) the increase of contract revenue derived from Legend's collaboration with Janssen with new milestone achieved,and (iv) the increase in both the number of customers and their purchase volume of industrial synthetic biology products.
Gross Profit
In 2020,the Group's gross profit increased by 41.9% to approximately US$255.9 million from approximately US$180.3 million in 2019. The increase in gross profit was primarily attributable to the (i) strong growth in life-science and biologics development business and high gross margin products,especially for COVID-19,and (ii) significant improvement on capacity utilization of materials and labor efficiency in industrial synthetic biology products.
Selling and distribution expenses
The selling and distribution expenses increased by 52.4% to approximately US$107.3 million in 2020 from approximately US$70.4 million in 2019. This was mainly attributable to the (i) increased investment into the commercial talent pool by recruiting more experienced personnel and improving incentive packages,and (ii) increased expenses for the global expansion of our business.
Administrative expenses
In 2020,the administrative expenses increased by 63.3% to approximately US$90.3 million from US$55.3 million in 2019. This was mainly caused by (i) competitive compensation package for our employees including shared-based payment provided to recruit experienced talents for all business segments,(ii) the reinforcement of some key administrative functions such as information technology,supply chain and finance to build up capable and professional administrative team to support the Group's overall business expansion,and (iii) the expansion of the European and Asia- Pacific Regional centers to accelerate the Group's global market penetration.
Research and development expenses
The research and development expenses increased by 41.6% to approximately US$263.4 million in 2020 from approximately US$186.0 million in 2019. This was mainly due to the (i) investment in COVID-19 related projects and other new challenging research and development projects,which significantly strengthened our competitiveness in the market and improved our production efficiency,(ii) increase in clinical trial expenses and preclinical study costs,especially in the cell therapy segment,and (iii) increase in compensation package including shared-based payment for research and development personnel.
*Adjusted net profit/(loss)
Non-cell
therapy
US$'000
Celltherapy
US$'000
Total
US$'000
Net profit/(loss)
22,054
(303,477)
(281,423)
Excluding: Share-based payment expenses,net of tax
10,904
4,760
15,664
Exchange differences,net of tax
6,526
(66)
6,460
Consultation expenses for the Investigation,net of tax
1,086
—
1,086
Impairment loss on goodwill,other intangible assets and
long-term investments,net of tax
3,806
—
3,806
Fair value loss of convertible redeemable preferred shares
—
79,984
79,984
Service fee for the issuance of Legend Series A Preference Shares
—
4,014
4,014
Spin-off expenses relating to the separate listing of Legend
24
1,439
1,463
Adjusted net profit/(loss)
44,400
(213,346)
(168,946)
CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME
REVENUE
2020
US$'000
390,846
2019
US$'000
273,354
Cost of sales
(134,953)
(93,064)
Gross profit
255,893
180,290
Other income and gains
24,795
21,185
Selling and distribution expenses
(107,341)
(70,358)
Administrative expenses
(90,341)
(55,256)
Research and development expenses
(263,401)
(186,022)
Fair value loss of convertible redeemable preferred shares
(79,984)
—
Finance costs
(5,432)
(781)
Other expenses
(15,497)
(589)
Share of losses of associates
(599)
(308)
Reversal of/(provision for) impairment of financial assets,net
7
(1,851)
LOSS BEFORE TAX
(281,900)
(113,690)
Income tax credit/(expense)
477
(3,826)
LOSS FOR THE YEAR
(281,423)
(117,516)
Attributable to: Owners of the parent
(204,945)
(96,912)
Non-controlling interests
(76,478)
(20,604)
(281,516)
CONSOLIDATED STATEMENT OF FINANCIALPOSITION
NON-CURRENT ASSETS
2020
US$'000
2019
US$'000
Property,plant and equipment
345,215
235,986
Advance payments for property,plant and equipment
5,906
8,585
Investment properties
7,726
7,442
Right-of-use asset
34,017
29,642
Goodwill
14,116
15,245
Other intangible assets
26,020
25,482
Investment in associates
3,433
2,615
Financial assets at fair value through profit or loss
10,555
4,667
Other non-current asset
3,542
—
Deferred tax assets
3,702
5,701
Total non-current assets
454,232
335,365
CURRENT ASSETS
Inventories
31,745
16,486
Contract costs
5,785
3,369
Trade and notes receivables
141,748
73,067
Prepayments,other receivables and otherassets
32,834
31,621
Financial assets at fair value through profit or loss
5,866
25,434
Loans to an associate
2,422
2,007
Restricted cash
7,471
972
Time deposits
136,245
148,693
Cash and cash equivalents
629,058
252,397
Total current assets
993,174
554,046
CONSOLIDATED STATEMENT OF FINANCIALPOSITION
CURRENT LIABILITIES
2020
US$'000
2019
US$'000
Trade and bills payables
23,376
17,627
Other payables and accruals
168,980
125,035
Interest-bearing bank borrowings
44,642
17,008
Lease liabilities
2,588
1,769
Tax payable
3,532
2,846
Contract liabilities
84,414
60,130
Government grants
379
90
Total current liabilities
327,911
224,505
NET CURRENT ASSETS
665,263
329,541
TOTAL ASSETS LESS CURRENT LIABILITIES
1,119,495
664,906
NON-CURRENT LIABILITIES
Interest-bearing bank loans
1,260
1,748
Lease liabilities
6,513
3,608
Contract liabilities
277,052
277,827
Deferred tax liabilities
7,030
5,582
Government grants
11,495
3,843
Other non-current liability
554
—
Total non-current liabilities
303,904
292,608
NET ASSETS
815,591
372,298
EQUITY
Equity attributable to owners of the parent
Share capital
1,954
1,879
Treasury shares
(16,712)
(7,774)
Reserves
916,463
388,699
901,705
382,804
Non-controlling interests
(86,114)
(10,506)
TOTAL EQUITY
815,298
About GenScript Biotech Corporation
GenScript Biotech Corporation (Stock Code: 1548.HK) is a global biotechnology group. Based on its leading gene synthesis technology,GenScript has developed four major platforms including the global cell therapy platform,the biologics contract development and manufacturing organization (CDMO) platform,the contract research organization (CRO) platform and the industrial synthesis product platform. GenScript's business operation spans over 100 countries and regions worldwide with legal entities located in the US,the Chinese mainland,Hong Kong of China,Japan,Singapore,Netherlands and Ireland.
