Cutia Therapeutics (2487) H2 2023 earnings summary

Executive summary

• First full year of commercialization; revenue reached RMB137.6 million, up 1,110.8% YoY, led by scalp and routine skin care product sales.

• Net loss widened to RMB1,963.8 million, mainly reflecting RMB1,454.3 million in fair value losses on convertible redeemable preferred shares; these shares converted to ordinary shares at the June 2023 listing.

• Pipeline advanced across adipose management, hair loss, acne, atopic dermatitis and topical anesthesia, with multiple clinical and regulatory milestones reached.

Financial highlights

• Revenue was RMB137.6 million versus RMB11.4 million in 2022; cost of sales rose to RMB66.6 million from RMB3.4 million as product sales expanded.

• Gross profit rose to RMB71.0 million from RMB7.9 million, while gross margin declined to 51.6% from 69.8% due to product mix.

• R&D costs increased 19.3% to RMB215.7 million; selling and distribution expenses rose 479.7% to RMB208.3 million, mainly from higher staffing and marketing activity.

• Administrative expenses rose 85.1% to RMB185.9 million; other income and gains totaled RMB60.2 million versus RMB105.7 million in 2022.

• Net loss was RMB1,963.8 million versus RMB555.8 million; basic and diluted loss per share was RMB9.60 versus RMB6.94.

Outlook and guidance

• CU-20401 submental-fat Phase II trial is expected to complete in 2025; abdominal-fat Phase II is expected to start in 2024, with China commercialization approval targeted for 2028.

• CU-40102’s NDA was accepted in January 2024; China commercialization approval is expected in 2025. CU-10201 approval is expected in 2024.

• 2024 priorities include accelerating pipeline clinical development, strengthening online marketing and exploring online-to-offline sales approaches.