Annual Report 2021

MANAGEMENT DISCUSSION AND ANALYSIS 9 The United Laboratories International Holdings Limited Annual Report 2021 BUSINESS REVIEW AND FINANCIAL RESULTS For the year ended 31 December 2021, the Group’s revenue was approximately RMB9,703.4 million, an increase of 10.6% as compared with last year. The profit attributable to owners of the Company for the year ended 31 December 2021 was approximately RMB988.1 million while the profit for the year ended 31 December 2020 was approximately RMB703.0 million, representing an increase of 40.6%. During the Year, segmental revenue (including inter-segment sales) of intermediate products, bulk medicine and finished products increased by 19.7%, 8.1% and 8.4% respectively as compared with last year. Segmental result of intermediate products increased by 53.5% as compared with last year. Segmental result of bulk medicine and finished products decreased by 4.6% and 1.2% respectively as compared with last year. The Group’s operations during the Year are summarised as follows: Intermediate Products and Bulk Medicine During the Year, the Group’s intermediate products and bulk medicine recorded segment external sales of RMB1,700.3 million and RMB3,968.6 million respectively, representing year-on-year growth of 18.9% and 9.6% respectively. The average sales price of 6-APA continued to increase, and the external sales of bulk medicine such as amoxicillin increased steadily. Overseas export recorded a revenue of RMB2,096.0 million, representing year- on-year decrease of 16.6% mainly due to decrease in Europe and India markets. The Group continued to occupy a leading position in the domestic and export market of intermediate products and bulk medicine, and made active contributions to maintaining the stability of the international API supply chain during the epidemic. United Laboratories (Inner Mongolia) Limited, a wholly-owned subsidiary of the Company, entered into a strategic cooperation framework in relation to veterinary drugs with Zhejiang Apeloa Biotechnology Co., Ltd.. The two parties are to fully exert their respective strengths, and strive to develop all-round competitiveness in technology, production and market in the field of veterinary drugs. In terms of policy, the National Development and Reform Commission and the Ministry of Industry and Information Technology issued the Notice on the Implementation Plan for Promoting the High-quality Development of API Industry in November 2021, proposing to promote the large-scale and intensive development of bulk medicine production, encourage advantageous enterprises to become bigger and stronger, improve industrial concentration, and encourage the integrated development of API and finished products. As a leading enterprise of antibiotic bulk medicines, the Group will actively seize policy opportunities, optimize its own vertical integration development model, and promote the coordinated development of intermediate products, bulk medicine and finished products.