By Sherry Qin
WuXi AppTec’s Hong Kong-listed shares fell sharply after the company posted weaker-than-expected third-quarter results, and said it plans to terminate its H-share award scheme and repurchase shares.
The pharmaceutical company’s H-shares were last down 8.1% at 93.4 Hong Kong dollars (US$11.94 ) early Tuesday, after touching HK$92.8 earlier in the session. Its Shanghai-listed shares declined 4.6% to 86.36 yuan.
The Shanghai-based company posted a flattish net profit of 2.76 billion yuan (US$377.4 million) in the third quarter, up 0.8% from a year earlier. Its third-quarter revenue was 0.3% higher at CNY10.67 billion.
The company’s management said it has proposed to the board to terminate its 2023 H-share incentive plan and repurchase 15.47 million H-shares, as “performance growth” hasn’t been as anticipated.
Management now expects 2023 revenue to grow 2%-3%, compared with the previous guidance of a 5%-7% growth, due to lower-than-expected demand for early-stage drug discovery services, the company said in a filing late Monday after its third-quarter results.
Nomura analyst Jialin Zhang says in a research note that the deceleration in WuXi AppTec’s topline figures and the lowered guidance for 2023 are “a bit disappointing, not only for the company but also for the sector in the short run.”
Write to Sherry Qin at [email protected]
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