3D Medicines (1244) H2 2023 earnings summary

Executive summary

• Revenue rose 11.9% YoY to RMB634.9m, entirely from Envafolimab sales in mainland China; gross profit reached RMB585.9m with a 92.3% margin.

• Total comprehensive loss narrowed to RMB562.5m from RMB1,052.0m, while adjusted total comprehensive loss widened 4.1% to RMB263.6m.

• The pipeline comprised 12 candidates, with Envafolimab commercialized and multiple clinical programs advancing; Macao approval was granted in Jan 2024.

Financial highlights

• Revenue was RMB634.9m, up 11.9% YoY; cost of sales rose 16.3% to RMB49.1m and gross profit increased 11.6% to RMB585.9m.

• R&D expenses increased 21.3% to RMB425.5m; selling and marketing expenses rose 5.9% to RMB378.8m.

• Administrative expenses rose to RMB217.1m from RMB142.8m, primarily reflecting an RMB85.4m increase in share-based payment expenses.

• Total comprehensive loss was RMB562.5m versus RMB1,052.0m; adjusted loss, adding back preferred-share fair-value losses and share-based payment expenses, was RMB263.6m versus RMB253.2m.

• Basic and diluted loss per share improved to RMB2.30 from RMB22.52; cash, bank balances and financial assets totaled RMB1,120.8m at year-end, up 19.0%.

Outlook and guidance

• Priorities include accelerating late-stage clinical programs, advancing candidates toward commercialization, improving operating efficiency and pursuing global innovation with partners.

• Envafolimab sales in Macao and out-licensing in emerging markets were expected to support revenue growth; a Jan 2024 license granted Glenmark exclusive oncology development and commercialization rights in its territory.

• Plans included moving the 3D124 mRNA cancer vaccine into clinical development and expanding combination studies and global clinical programs; no numeric financial guidance was stated.