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Regarding the Response to the Audit Inquiry Letter on the Application for Issuance of Shares to Specific Targets by Pharmaron Beijing Co., Ltd.
BDO China Shu Lun Pan Certified Public Accountants (Special General Partnership) [blank]
Shenzhen Stock Exchange:
We have received the "Audit Inquiry Letter Regarding the Application for Issuance of Shares to Specific Targets by Pharmaron Beijing Co., Ltd." (Audit Letter [2025] No. 020051) (hereinafter referred to as the "Inquiry Letter") issued by your exchange on September 16, 2025. BDO China Shu Lun Pan Certified Public Accountants (Special General Partnership) (hereinafter referred to as the "Accountant" or "our firm"), acting as the audit institution for Pharmaron Beijing Co., Ltd. (hereinafter referred to as "Pharmaron" or the "Company") regarding its application for the issuance of shares to specific targets, has prudently reviewed the issues raised in the Inquiry Letter that require verification by the accountant. The response is as follows:
Notes:
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Unless otherwise specified, the abbreviations or definitions involved in this response are the same as those in the "Prospectus."
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If the sum of the mantissas of the total figures in this response does not match the sum of the listed figures, it is due to rounding.
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Our firm has not been engaged to audit or review the financial statements for the period from January to March 2026. The verification procedures described below and the results of these procedures are solely for the purpose of assisting Pharmaron in responding to your exchange's inquiry letter and do not constitute an audit or review.
Question 1
According to the application materials, the Company's main business consists of chemical business, pharmacology and pharmacokinetics business, and macromolecule business. In the last three years, operating income has continued to decline, reaching 1,326.5843 million yuan, 1,138.3658 million yuan, and 970.2048 million yuan, respectively. Among these, chemical business segment revenue was 362.0357 million yuan, 327.2355 million yuan, and 256.1948 million yuan; macromolecule business segment revenue was 253.2320 million yuan, 206.4956 million yuan, and 157.5017 million yuan. The Company's net profit was 362.4180 million yuan, -916.9390 million yuan, and -226.5123 million yuan, shifting from profit to loss, mainly affected by business segment adjustments and changes in the financing environment of the innovative drug market. From January to March 2025, the Company's operating income and net profit attributable to the parent company were 261.2613 million yuan and 6.6421 million yuan, a year-on-year increase of 11.37% and 126.09%. During the reporting period, the Company's gross profit margins were 26.59%, 25.91%, 22.00%, and 27.47%, with the gross profit margin of each business segment showing a downward trend.
During the reporting period, the Company's revenue was primarily from overseas, with the proportion exceeding 70% in each period. Overseas revenue was 934.5843 million yuan, 941.7186 million yuan, 805.6362 million yuan, and 211.3370 million yuan, showing a fluctuating decline. During the reporting period, the gross profit margin of the Company's overseas business was 23.27%, 24.96%, 26.34%, and 32.51%; the domestic gross profit margin was 30.55%, 30.62%, -0.40%, and 6.00%, with significant fluctuations, mainly due to the severe losses in the macromolecule CDMO business within the domestic business in 2024.
During the reporting period, the Company's R&D expenses were 92.2781 million yuan, 77.4683 million yuan, 59.5509 million yuan, and 12.1015 million yuan, with R&D expense ratios of 6.96%, 6.81%, 6.14%, and 4.63%, all showing a downward trend. The Company's R&D expense ratio is lower than the average level of comparable companies in the industry.
At the end of each period of the reporting period, the book value of the Company's accounts receivable was 341.4946 million yuan, 263.8525 million yuan, 176.7193 million yuan, and 202.7965 million yuan, accounting for 25.74%, 23.18%, 18.21%, and 19.41% of operating income, respectively. The proportion of accounts receivable with an aging of less than 1 year was 89.93%, 81.11%, 70.15%, and 72.81%, showing a downward trend. The decline in the Company's accounts receivable in 2024 was mainly due to the individual provision for bad debts for accounts receivable from Jiali Medical Technology (Guangzhou) Co., Ltd.