Q & A from Pharmeis
This was send on 2nd Dec 2005 as I was researching on Pharmesis at that time. It might be a bit outdated but just wanted to show you few questions I ask about a company.
Dear Mr Lee,
Thank you for your time and interest in the developments of Pharmesis Group. Please find below our responses to your queries:
What is your recent developments and products and what are their significance in the market?
1. Our business operations have been normal and other than those factors reported in our 6 months announcement dated 10 August 2005 that had been detrimental to the industry and our results, there had been no other major developments to date. Nevertheless. we would like to bring to your attention several new plans and initiatives mentioned in the same report, including the launch of a couple of new products in the PRC market that have gone underway to drive our revenue growth. We will continue to update our shareholders and interested investors with further details via SGXNET announcement as and when appropriate.
What percentage of your operating cost is on R&D?
2. Our R&D based on our latest accounts indicate approximately 8% of total operating costs (excluding Selling and distribution expenses).
What percentage of your revenue is from Gansu granules?
3. Gansu constitutes approximately 30% of our total revenue for our Group based on latest accounts.
Knew that your sole right to produce Gansu granules will expire in 2006, what is the probability of getting the sole right again in 2007? What is the implication if you do not get the sole right, or any rights at all (touch wood)?
4. One of the most important pre-requisite for Pharmesis to obtain the sole right is that our Group must maintain consistent product quality with the products manufactured according to GMP standards. As both our manufacturing facilities are already GMP-certified and the quality of our products has been consistent, the Management is confident that our Group stands in good stead for re-application of the sole right, barring unforeseen circumstances.
What is your NAV for the past 5 years?
5. The NAV (in RMB cents) for the past three years from 2003 to 2005 are: 19.53, 52.57 and 53.28 respectively. The base used for computing NAV for 2003 is the pre-Invitation share capital of 150 million shares, and 200 million shares for both 2004 and 2005 (as at 30 June 2005). As the balance sheet for 2003 was prepared on the assumption that the Group structure existed as at 31 December 2003, there are no figures available for computing NAV for 2001 and 2002.
What is the percentage of earnings that are given as dividends for the past 2 yrs?
6. Building on its foundation, our Group is currently channelling (or re-investing) profits to grow its businesses in the PRC and beyond. Hence, no dividends have been distributed for the past 2 financial years. The management (or directors) will review the dividend policy from time to time but at the moment, the Group does not have a formal dividend policy.
What is your current strategy to increase shareholder value for the next 5 yrs?
7. Besides strengthening its marketing efforts in its base market in the PRC, our Group is also capitalising on opportunities to market its key products overseas. Despite the recent lacklustre market conditions and industry performance in the PRC, our Group remains vigilant and continues to realign its marketing strategies with the aim of keeping Pharmesis as a forerunner in the pharmaceutical industry. Further announcement will be made when further material information is available.
Thank you for your interest in the Company once again.