MINDRAY Medical Back To A Annual Report First Show: Revenue Exceeded 16 Billion To Accelerate The Globalization Of The Epidemic

Recently, returnees "top student" MINDRAY medical (300760.SZ) in addition to continuous ushered in a large number of orders for ventilators, but also ushered in the first full financial year after returning to A.

In April 1st, the Shenzhen medical biotech Limited by Share Ltd, the leading medical device leader, released the 2019 annual report, which showed that the company's operating income in 2019 was 16 billion 560 million yuan, an increase of 20.38% over the same period last year. The total profit was 5 billion 370 million yuan, an increase of 26.66% over the same period last year. The net profit attributable to shareholders of listed companies increased by 4 billion 680 million yuan, representing a 25.85% increase over the same period last year.

After a few years of rolling back to A shares, MINDRAY also competed with the Ningde times in the market value of over 300 billion yuan.

As a leading medical device in China, MINDRAY medical is very popular with market investors. A medical industry's securities personage told the twenty-first Century economic news reporter: "MINDRAY medical has advantages in imaging, color Doppler ultrasound and other fields, and the product line is perfect. The epidemic has greatly stimulated the demand for ventilators in the international market, and will play a catalytic role in MINDRAY's performance this year. The biggest challenge now is whether capacity can be guaranteed. "

MINDRAY medical has advantages in imaging, color Doppler ultrasound and other fields, and the product line is perfect. Gan Jun photo

Steady growth of the three major businesses

According to its annual report, MINDRAY's main business revenue continued to grow, mainly benefiting from the sustained and steady growth of the medical device market, the strong support of the national industrial policy and the competitive advantage of the company in R & D, production and marketing. Life information and support, in vitro diagnostics and medical imaging are still three pillars of growth.

Among them, life information revenue was 6 billion 340 million yuan, an increase of 21.4% over the same period, and the market share of core products monitors increased further, and the development of anesthesia machines and respirators continued to develop at a high level. As the fastest growing sector, IVD earned 5 billion 810 million yuan, an increase of 25.7% over the same period last year, and its blood products continued to increase in high and medium hospitals, and chemiluminescence products continued to grow at a high growth rate. Influenced by the industrial environment, medical imaging revenue increased by 4 billion 40 million yuan, up 12.3% compared with the same period last year, and the growth rate has declined.

In 2019, the company's sales and administrative expenses were 3 billion 610 million yuan and 770 million yuan respectively, and the cost of sales and management expenses were 21.8% and 4.6% respectively, down 1.5 and 0.6 percentage points respectively. In 2019, MINDRAY's operating cash flow was 4 billion 720 million yuan, an increase of 17% over the same period last year. In addition, R & D investment amounted to 1 billion 650 million yuan, accounting for 10% of total revenue.

The steady growth of MINDRAY in 2019 is inseparable from the vigorous development of the domestic medical device Market under the policy support.

Public information shows that the domestic medical device industry has grown rapidly and has become the second largest market in the world. It is estimated that from 2021 to 2022, the main income of medical device manufacturers will be able to exceed one trillion yuan. The composite growth rate of China's medical device industry will remain at around 15%, and the domestic market will maintain a high speed expansion in the coming period.

On the global market, the global medical device market in 2018 was about $427 billion 800 million. In the 2017-2024 year, global medical device sales grew by an average of 5.6%, reaching 594 billion 500 million in 2024.

In the field of innovative medical devices, the Chinese government has repeatedly issued a strong policy to speed up the examination and approval of innovative medical devices, and promote the structural reform of the supply side of the medical device industry.

At present, the level of diagnosis and treatment has nearly 300 pilot cities. The aging of China's population and the gradual improvement of the medical system will continue to promote the policy of grading treatment. The hierarchical diagnosis and treatment system has been gradually improved, and the support of local governments to the hardware construction of primary medical institutions has been increasing continuously, so as to promote the expansion of the basic equipment market. The primary medical device market is mainly occupied by domestic manufacturers, and the advantage of imported brands is not obvious. The hierarchical diagnosis and treatment system has brought important opportunities for domestic manufacturers.

Accelerating overseas market expansion

On the other hand, the global surge in demand for ventilators has become an excellent opportunity for MINDRAY to expand its overseas market this year.

MINDRAY medical chairman Li Xiting said that invasive breathing machine development and production threshold is relatively high, and it is not easy to increase production in a large scale. "The company has been stepping up its production and expanding its capacity. At present, there are nearly 100 sets of respirators per day."

At the same time, in March 31st, MINDRAY medical Constable Li Wenmei pointed out that the global demand for ventilators was at least one million units. The capacity of MINDRAY medical ventilator has increased to five times that of the same period last year, and is still trying to improve it.

Some people in the industry have analyzed that because of the reasons of capacity, no matter which medical device enterprise is afraid to take orders for thousands of ventilators.

Huatai Securities research report pointed out that domestic demand for medical devices is strong, and overseas demand boosting role is expected to continue throughout the year. For the domestic market, MINDRAY's revenue grew by 22.3% in 2019. And in the domestic epidemic prevention performance is outstanding, especially the guardianship of the whole line of equipment growth is strong, considering the follow-up critically ill departments construction, primary medical capacity building and so on, Huatai Securities is expected to maintain 20%-25% growth in 2020.

In addition, overseas market, MINDRAY's revenue growth in 2019 reached 17.9%, of which North America, Europe, Latin America and Asia Pacific growth rate were 10.3%, 12.8%, 27.3%, 27.3%. Recently, overseas epidemics continue to spread, and confirmed cases in Europe and America are rising rapidly and there is no downward trend.

MINDRAY plans to push forward the development of the globalization platform in 2020, and carry out more in-depth localization in the fast developing regions such as Europe, India, Russia and Brazil.

"MINDRAY's overseas development path is inseparable from the pace of mergers and acquisitions. Since 2008, MINDRAY has 13 medical mergers and acquisitions, of which 4 are international mergers and acquisitions. Through mergers and acquisitions, we successfully opened the overseas sales market and entered the international queue. The foreign sales of MINDRAY medical are different according to the different plans of the country. The United States adopts direct selling, while Europe sells direct sales and distribution. MINDRAY medical has been working with five major collective purchasing organizations in the United States, 2/3 of the company's products have entered 9 of the top 10 hospitals in the United States, and 19 of the top 20 hospitals in Europe have used MINDRAY ultrasound products. The former researcher told the twenty-first Century economic news reporter.

In addition, MINDRAY hopes to take the emergency procurement as an opportunity to expand overseas high-end hospital customers. In the field of overseas sales, in the face of the rapid spread of the epidemic in various countries around the world, the company has received procurement needs from Europe, Asia Pacific and the Middle East to cope with the epidemic. In particular, the outbreak of European epidemic, European governments and medical institutions put forward a large number of sharp increase in demand for orders.

"MINDRAY started by acting as an agent and started a strong sales channel. Later, it acquired a lot of high-quality assets, and the scale was also increasing. The epidemic had an impact on the ventilator industry, and it also had an impact on the whole breathing machine industry, especially for leading enterprises such as MINDRAY and fish diving." A private institution in Shenzhen said to the twenty-first Century economic news reporter.

In the next few years, MINDRAY plans to increase the market share of growth businesses through mergers and acquisitions, integrating the global frontier technology of the whole industry chain. The layout of investment and acquisition will emphasize regional differentiation and explore the localization operation platform and supply capability of major international markets.

But at the same time, MINDRAY also classified the risks of industrial policy change, the risk of new coronavirus pneumonia, the risk of product development, the risk of falling product prices, the risks associated with Sino US trade friction, the risk of exchange rate fluctuations, and the risk of dealers' sales patterns as possible risks.

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