EPS of $-0.04 increased by 32.4% from previous year
Gross margin of 44.5%
Net income of -53.45M
"N/A" - N/A
CStone Pharmaceuticals (2616.HK) QQ4 2024 Financial Analysis – Immuno-oncology pipeline progress, cost discipline and liquidity position drive a narrowed quarterly loss
Executive Summary
CStone Pharmaceuticals reported QQ4 2024 revenue of 76.52 million CNY, with gross profit of 34.06 million CNY and a GAAP operating loss of 51.21 million CNY. The quarter produced a net loss of 53.45 million CNY and an EPS of -0.0419. While the company posted a meaningful year-over-year improvement in operating loss (down from -175.8 million CNY in QQ4 2023 to -51.2 million CNY in QQ4 2024, a roughly 70% improvement), profitability remains negative on both a gross and net basis as R&D and SG&A investments persist to advance the clinical pipeline. The company ended QQ4 2024 with robust liquidity: cash and cash equivalents of 387.9 million CNY and short-term investments of 285.0 million CNY (total liquid assets of ~672.9 million CNY), contributing to a net cash position of approximately -31.96 million CNY in net debt terms. Operating cash flow was negative at -78.0 million CNY, driven largely by working capital movements (notably a substantial inventory build). Management commentary is not included in the provided dataset, limiting the inclusion of direct quotes. Investors should monitor pipeline milestones and potential catalysts to convert cash burn into value, alongside ongoing cost discipline and potential licensing or collaboration opportunities.
Key Performance Indicators
Revenue
76.52M
QoQ: 0.00% | YoY:-24.38%
Gross Profit
34.06M
44.51% margin
QoQ: 0.00% | YoY:-54.84%
Operating Income
-51.21M
QoQ: 0.00% | YoY:70.87%
Net Income
-53.45M
QoQ: 0.00% | YoY:32.34%
EPS
-0.04
QoQ: 0.00% | YoY:32.42%
Revenue Trend
Margin Analysis
Key Insights
Revenue: 76.52m CNY in QQ4 2024, down 24.38% YoY from 101.18m CNY in QQ4 2023; QoQ change 0.00%.
- Revenue: 76.52m CNY in QQ4 2024, down 24.38% YoY from 101.18m CNY in QQ4 2023; QoQ change 0.00%.
- Gross Profit: 34.06m CNY, gross margin 44.5% (0.4451).
- Operating Loss: -51.21m CNY; EBITDA: -41.12m CNY; EBITDA margin -53.73%; Operating margin -66.93%.
- Net Income: -53.45m CNY; Net margin -69.85%.
- EPS (diluted): -0.0419 CNY.
- Liquidity: Cash and cash equivalents 387.94m CNY; short-term investments 285.00m CNY; total cash & short-term investments 672.94m CNY.
- Balance Sheet Health: Total assets 1,393.47m CNY; total liabilities 1,029.60m CNY; total stockholders’ equity 363.87m CNY. Current ratio 1.60; inventories elevated at 286.10m CNY; working capital dynamics reflect a sizable inventory build and receivables, with payables less clearly defined in the data.
- Cash Flow: Operating cash flow -78.02m CNY; free cash flow -78.02m CNY. Free cash flow impact driven by working capital movements and ongoing R&D/SG&A investments.
Income Statement
Metric
Value
YoY Change
QoQ Change
Revenue
76.52M
-24.38%
0.00%
Gross Profit
34.06M
-54.84%
0.00%
Operating Income
-51.21M
70.87%
0.00%
Net Income
-53.45M
32.34%
0.00%
EPS
-0.04
32.42%
0.00%
Key Financial Ratios
currentRatio
1.6
grossProfitMargin
44.5%
operatingProfitMargin
-66.9%
netProfitMargin
-69.9%
returnOnAssets
-3.84%
returnOnEquity
-14.7%
debtEquityRatio
0.98
priceToBookRatio
7.58
priceEarningsRatio
-12.9
Net Income vs. Revenue
Expense Breakdown
Management Commentary
No earnings call transcript is provided in the dataset. Consequently, there are no management quotes or theme-based highlights to quote directly from the QQ4 2024 call. If a transcript becomes available, quotes will be incorporated under this section with thematic grouping (strategy, operations, market conditions).
N/A
— N/A
N/A
— N/A
Forward Guidance
No formal quarterly guidance is included in the provided materials. Given the R&D-heavy model and ongoing progression of the immuno-oncology and precision medicine pipeline (e.g., Sugemalimab, GAVRETO, avapritinib and other CS assets), the primary near-term catalysts are clinical readouts and regulatory milestones, potential strategic collaborations or licensing deals, and any unexpected shifts in operating spend. Investors should monitor:
- Pipeline milestones and readouts (e.g., IO combinations, IDH1- and FGFR4-related programs).
- Clinical trial updates and regulatory milestones in China and international markets.
- Cash burn trajectory and any steps to extend runway (partial monetization, licensing, or collaboration deals).
- Financing alternatives if the burn rate accelerates or milestones are delayed.
Overall, the midpoint view is that the company maintains a fragile near-term profitability profile but has a visible liquidity runway that supports continued clinical activity; catalysts could materially shift risk-reward if pipeline milestones land positively.
Competitive Position
Company
Gross Margin
Operating Margin
Return on Equity
P/E Ratio
2616.HK Focus
44.51%
-66.90%
-14.70%
-12.90%
1877.HK
87.40%
-54.60%
-6.04%
-7.55%
1801.HK
75.90%
-0.28%
2.27%
48.06%
2696.HK
73.70%
14.00%
7.20%
13.93%
2552.HK
50.20%
-1.08%
39.80%
-6.24%
Gross Profit Margin
Operating Profit Margin
Return on Equity
P/E Ratio Comparison
Investment Outlook
CStone remains a high-uncertainty, high-potential biotech story. The QQ4 2024 results show meaningful revenue declines on a YoY basis, with continued negative profitability, but the company retains a healthy liquidity buffer to fund its R&D pipeline and pursue strategic partnerships. The key to a more compelling investment thesis is clear progress in pipeline milestones and any monetization moves (collaborations/licensing) that would translate early-stage clinical effort into nearer-term value realization. Valuation remains elevated on a sales basis (PS ~36.05x) and prospects hinge on milestone-driven catalysts rather than current profitability. Investors should monitor:
- Pipeline readouts and regulatory updates for Sugemalimab, GAVRETO, avapritinib and other assets.
- Any licensing or collaboration announcements that monetize assets without dilutive financing.
- The trajectory of operating expenses and the pace of cash burn relative to clinical milestones.
- Balance sheet resilience and ability to sustain operations if milestones are delayed.
Overall, a selective exposure with emphasis on milestone-driven catalysts and clear partnerships would be prudent for risk-managed exposure to CStone.
Key Investment Factors
Growth Potential
- Robust cash runway (~672.9m CNY liquidity as of QQ4 2024) supports continued clinical development and potential strategic collaborations.
- Multiple late-stage and preclinical assets (Sugemalimab, GAVRETO, avapritinib, Nofazinlimab, Ivosidenib, Fisogatinib) offer multiple potential value inflection points depending on trial outcomes and regulatory milestones.
Profitability Risk
- Persistent negative profitability (EBITDA and net losses) and high operating costs (R&D and SG&A) create sensitivity to clinical trial outcomes and collaboration milestones.
- Bio/pharma funding cycles and competition for clinical trial slots may pressure timelines and capital efficiency.
- Regulatory and commercialization risk for China and international markets, including competition from larger biopharma players with more advanced oncology portfolios.
Financial Position
- Strong liquidity and a net cash position despite ongoing losses, supported by sizable cash and short-term investments.
- Elevated working capital (significant inventory and receivables) and a negative cash flow from operations in QQ4 2024 indicate ongoing burn but manageable liquidity given the cash cushion.
SWOT Analysis
Strengths
Robust liquidity position with ~672.9m CNY in liquid assets and a net cash position (net debt ~= -31.96m CNY) as of QQ4 2024.
Diversified immuno-oncology and precision medicine pipeline across multiple development stages (Sugemalimab, GAVRETO, avapritinib, Nofazinlimab, Ivosidenib, Fisogatinib, and CS assets).
Strategic exposure to China and international markets via a broad product pipeline and collaboration potential.
Weaknesses
Negative EBITDA and net income, indicating ongoing cash burn.
High operating expenses (R&D and SG&A) and inventory buildup contributing to negative cash flow.
Limited near-term revenue visibility without multiple successful clinical milestones or regulatory approvals.
Opportunities
Upcoming clinical updates and potential regulatory milestones for key assets could unlock near-term value inflection points.
Strategic collaborations or licensing deals to monetize pipeline assets and extend runway.
China oncology market growth and potential partnerships for Sugemalimab and other assets.
Threats
Competitive biotech landscape with peers advancing IO and targeted therapies; potential delays in trial readouts.
Regulatory risks and pricing/reimbursement pressures in China and overseas markets.
Rising cost of capital and the need to preserve liquidity if trials encounter delays or setbacks.