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On September 28, 2020, Amic was listed on the GEM with a market value of 40.8 billion yuan. In the following nine months, the stock price soared 4 times. In March 2021, it became the third thousand-yuan stock after Moutai, with a peak market value exceeding 170 billion. This company, dubbed "Moutai for Medical Aesthetics", wrote a legend in the capital market during the golden age of medical aesthetics with its ultra-high gross profit margin of 94.85% and net profit margin of 60%.
The core secret of Amic's success lies in the moat built by the registration certificate of Class III medical devices. Its signature product "HiTi", as the first neck wrinkle repair injection in China, has monopolized the market for a long time since it was approved in 2016. Between 2017 and 2020, revenue from solution products soared from 34 million to 447 million, with an average annual compound growth rate of 129%. This "exclusive market + pricing power" model perfectly replicates Moutai's core logic. However, with the continuous emergence of similar competing products, Amic’s high-growth myth is gradually reaching its final chapter.
The myth of high growth is no longer the revenue and net profit growth rate dropped to single digits for the first time
The annual report disclosed on March 19 shows that Amic will achieve operating income of 3.026 billion yuan in 2024, with the year-on-year growth rate plummeting from 47.99% in 2023 to 5.45%; net profit attributable to the parent company is 1.958 billion yuan, with the growth rate slipping from 47.08% to 5.33%. This is the first time since 2016 that the company's annual revenue and net profit growth has dropped to single digits.
What is particularly noteworthy is that in the fourth quarter, the company's single-quarter revenue was 650 million yuan and net profit was 372 million yuan, a year-on-year decrease of 7% and 15.47% respectively, setting a quarterly double decline record for the first time since its listing. Judging from previous quarterly data, Amic’s growth stall has actually been evident for a long time. In the first quarter of 2024, the company's revenue growth rate was 28.24%, and the net profit growth rate was 27.38%; in the second quarter, the company's revenue growth rate was 2.35%, and the net profit growth rate was 8.03%; in the third quarter, the company's revenue growth rate was 1.10%, and the net profit growth rate was 2.13%. In 2024, the growth rate last year showed a trend of declining quarter by quarter.
Judging from the cash flow situation, the company's net cash flow from operating activities in 2024 will be 1.927 billion yuan, a year-on-year decrease of 1.38%, which is the first year-on-year decline in history. The reasons behind this include a significant increase in period expenses and an increase in inventory. In terms of period expenses, the company's sales expenses and R&D expenses in 2024 will be 277 million yuan and 304 million yuan respectively, both reaching record highs. However, from the perspective of results, the marginal effect of sales expenses driving revenue growth is weakening, and the growth rate of sales expenses in 2023 and 2024 is higher than the revenue growth rate.
Research and development expenses have maintained a year-on-year double-digit growth rate in the past three years, but new products have not yet formed large-scale revenue, and it may be difficult to bring substantial benefits in the short term. In terms of inventory, the company's inventory at the end of 2024 was 72.843 million yuan, accounting for an increase of 0.14% to 0.87% of total assets. Among them, the ending inventory of goods was 32.0488 million yuan, a year-on-year increase of about 45%. Display terminal sales have slowed down.
"High Body" cannot reverse its decline by exchanging price for volume. "Wet Day Angel" has weak growth
Judging from the products, as the first neck wrinkle repair product in China, Amic’s “HiTi” was once the company’s “cash cow”. After being launched in 2017, its sales soared from 119,700 units to 5.14 million units in 2023, accounting for more than 70% of revenue at one time. However, the 2024 annual report data disclosed that the annual sales volume of solution injection products with "Hi Body" as the core was 6.3463 million units, a year-on-year increase of 24.44%, but the revenue only increased by 4.4% to 1.744 billion yuan.
The converted average ex-factory price dropped to 275 yuan/piece from 325 yuan/piece in 2023, a decrease of 15.4%. During the same period, inventory increased significantly by 91.40%. It can be seen that since Huaxi Biotechnology’s neck wrinkle repair product “Runzhi·Gege” was approved in July 2024, the market competition landscape has been facing reshaping, and Amic’s price-for-volume strategy has had very limited results.
Judging from the revenue structure of Amic, in 2024, the company's solution injection products with "High Body" as the core and gel injection products with "Moisturizing Angel" as the core will achieve revenue of 1.743 billion yuan and 1.216 billion yuan respectively, accounting for 57.64% and 40.18% of total revenue respectively, which are the company's pillar businesses.
Among them, "Moistening Angel" (cross-linked sodium hyaluronate gel containing L-lactic acid-ethylene glycol copolymer microspheres) obtained the Class III medical device registration certificate in June 2021. In the following years, product revenue showed a rapid growth trend and is regarded as the company's second growth curve. However, "Soaking Angel" also experienced sluggish growth in 2024. The sales volume of gel injection products in 2024 was only 893,600 units, a year-on-year decrease of 11.24%, and the revenue growth rate also plummeted from 81.43% in 2023 to 5.01%.
From an industry perspective, the pressure on Amic's two core products is a concentrated reflection of the increasing market competition, slowing industry expansion, and tightening supervision. Hyaluronic acid was once the "golden track" of the medical aesthetics industry, but now it has fallen into serious involution. As of 2024, more than 50 hyaluronic acid Class III medical device certificates have been approved domestically, and there are more than 400 circulating brands. This has also led to an increase in the choice of medical aesthetics institutions, and the bargaining power of upstream manufacturers has continued to weaken.
From the perspective of industry growth, a review of the medical aesthetics industry in 2024 shows that affected by the macro environment, the overall growth rate of the industry has slowed down significantly. According to estimates by Allergan and Deloitte, the overall growth rate of the medical aesthetics market in 2024 is about 10%. Although it still maintains double-digit growth, it has dropped significantly compared with the 20% growth rate in 2023. At the regulatory level, in 2024, the State Food and Drug Administration will strengthen the approval of the "Three Device Certificates" to crack down on illegal medical beauty institutions, and the pressure on upstream manufacturers to rectify channels will increase significantly.
The plight of Aimeike is essentially the epitome of the medical beauty industry entering its mature stage from the outbreak period. As the medical beauty industry enters the second half of its journey, the era of "making money while lying down" will be gone forever. At present, about 98% of Amic's revenue still relies on hyaluronic acid products. Among the 10 products under development mentioned in the annual report, only Bonida 2.0 for chin filling will be approved at the end of 2024. However, this product is essentially an expansion of the indications of existing products and is not a revolutionary innovation.
Among the company's reserve products, botulinum toxin, collagen and other products are facing fierce competition, making it difficult to cultivate popular varieties similar to "High Body". It is still doubtful whether the acquisition of 85% equity of South Korea's REGEN company at a high premium of 1.386 billion can open a new growth curve. Under the new market competition landscape, Amic still faces many challenges if it wants to maintain its leading position in the industry.
