Key takeaway

WuXi AppTec once again delivered high-quality growth in its 2025 results, continuously optimizing production processes and operational efficiency. The increased revenue share from late-stage and commercialized projects further improved capacity utilization, driving enhanced profitability. In 2025, revenue from continuing operations increased by 21.4% year over year, while adjusted non-IFRS net profit rose 41.3% year over year to RMB 14.957 billion, meeting expectations overall. At the same time, the company divested its clinical CRO/SMO business to further focus on its core operations. Looking ahead to 2026, the company will accelerate the construction of global production capacity. With the conversion of existing orders and the continued progress of chemical business projects, while maintaining strong revenue growth (with a projected growth rate of 18%-22%), profitability is expected to remain resilient.

Event

The company released its 2025 annual report, with performance meeting expectations In 2025, the company successfully navigated market competition and policy environment changes by leveraging its industry-leading technology and execution efficiency to achieve continuing operations revenue of RMB 43.42 billion, representing a year-on-year increase of 21.4%. The chemical business grew by 25.5%, driven by rapid order expansion in segments such as small molecule CDMO and large molecule TIDES, along with continuously improving capacity utilization and efficiency. At the same time, the company continued to optimize its business structure, with the proportion of laterstage projects further increasing, and adjusted net profit maintaining strong growth. The total cash dividend for 2025 amounted to RMB 6.76 billion, combined with the buyback and cancellation of A-shares worth RMB2.00 billion, totaling RMB8.76 billion, which accounted for 45.7% of the net profit attributable to the parent company. Looking ahead to 2026, the steady growth in backlog orders provides a solid foundation for sustainable revenue growth. In 2026, the company will upgrade capacity and processes at its major global production bases to maintain its leading global competitiveness in a changing market environment.

Risks:

1. The number of new drug R&D projects falls short of expectations: Continuous customer demand for new drug R&D is a key driver of the company's sustained performance growth. A lower than expected number of new drug R&D projects will adversely impact the company's performance;

2. The company's backlog growth is lower than expected: The backlog serves as a key indicator for the company's future revenue growth expectations. Lower than expected backlog growth may lead to a decline in projected performance, thereby impacting the company's valuation;

3. Intense industry competition: Currently, several CXO companies in the industry compete with our company in preclinical and clinical services. The heightened comp etition will intensify pressure to reduce costs and improve efficiency, negatively impacting the company's growth performance.

4. The rapid expansion of production capacity may prevent new capacity from quickly generating incremental performance, thereby a ffecting capacity utilization and cost amortization.

5. Risks of global operations and international policy changes. If any of the following situations occur such as significant changes in laws, regulations, industrial policies, or political and economic c onditions in countries and regions where the company operates globally, or disruptions caused by unforeseen factors such as geopolitical tensions, war, trade sanctions, or other force majeure events there could be potential adverse impacts on the company s ability to conduct and sustain its international business operations.