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Welcome Notes
Dear Ladies and Gentlemen,
As the Chairman of Extrawell, I am pleased to report
to you that we have put our short-term pain of business
re-alignment behind and back on track of growth and
profitability this year
- Revenue growth by 5% to HK$178.3 million;
- Both gross profit and gross profit margin have
experienced significant improvements of 51.4% and
12.1% respectively; and
- We have managed to upturn from net loss of HK$75.8
million last year to net profit attributable to equity
holders of the Company of HK$4.7 million this year.
We
are operating in very challenging market conditions
with competitive pricing pressures, government price
controls, increasingly stringent regulatory requirements
and overwhelming counterfeit products. Nevertheless,
we are confident to outpace the competition through:
- Far and foresight of the management to initiate
strategic moves;
- Perseverant, devoted, conscientious staff with
experience and professional qualifications;
- Distinguished academic marketing strategies through
continuous education of the medical professionals
and academia and strong after sales support by our
professional sales team; and
- Consistent investment in research and development
enabling us to bring innovate and differentiated
products that offer patients with clear therapeutic
benefits
We have shown the ability to turn challenges into
opportunities. We have achieved significant progress
to transform Extrawell for the next generation by setting
up a new platform for growth. Results are gradually
realised, particularly in the recovery of our sales
and profitability and progress of applications for
launch of new medicines.
Moving a new medicine from concept to patient is a
long and resource-intensive process. We are very excited
about the progress of our clinical trials and applications
to the State Food and Drug Administration of the People’s
Republic of China (“SFDA”). This year,
the Phase II clinical trial of our patented new product,
oral insulin, was successfully completed at the end
of year 2005 and results issued by the five SFDA authorised
medical centers are encouraging on the efficacy of
oral insulin, show much safer than insulin injections
and there is no sign of side effects. The management
satisfies with the progress of this pipe-line product
and is making progress on the operational front to
organize all essential resources for full scale manufacturing
and marketing in the next stage.
Diabetes affects hundred-millions of people worldwide
everyday. It is estimated that 4.5 million of Type
I insulin dependent diabetic patients and 40.5 million
of Type II non-insulin dependent diabetic patients
in the Mainland China alone. Oral insulin offers diabetic
patients with much more convenient and low costs alternative
to traditional insulin in injection form. This will
improve the quality of life for diabetic patients significantly.
In view of the anticipated huge demand for oral insulin,
we are making plans to house large-scale production
with GMP compliance and high quality standard. We target
to bring together new partners who can bring in their
resources and expertise in the area of pharmaceutical
products distribution and management expertise of production
facilities. We believe that these alliances would bring
along their expertise to maximise the efficiency of
the operations and better returns to our shareholders.
The road of this project has been challenging and
unclear, however we are gradually achieving results.
Although our transformation has not yet completed,
we are certain that we have taken the right steps.
In the coming years, we will develop a market of vast
potential with oral insulin in the PRC and the World
and allow our shareholders to realise that what we
have paid today is worthwhile tomorrow.
We have made ambitious goals for ourselves and recognised
that to achieve them requires exceptional vision and
commitment of the management and the devotion and dedication
of each individual employee. I would like to take this
opportunity to extend my gratitude to each of our management
and staff members. Last but not least, I would like
to thank you, as shareholders of the Company, who
have been perpetually supportive and trust in our ambition.
Dr. Mao Yu Min
Chairman
Hong Kong, 19 July 2006
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