WuXi Biologics reported a 4.3 percent increase in first-half net profit attributable to shareholders, reaching 2.44 billion yuan, while revenue climbed 18.4 percent to 11.79 billion yuan. The adjusted figure tells a different story, up 38.4 percent to 3.31 billion yuan after stripping out a 585 million yuan foreign-exchange loss that swung from a negligible gain a year earlier.
The FX distortion
The gap between reported and adjusted profit widened dramatically this period. A foreign-exchange loss of 585.1 million yuan, compared with a 1.5 million yuan gain in the prior year, erased more than a third of the adjusted earnings. That swing alone accounts for the entire difference between the 4.3 percent headline rise and the 38.4 percent adjusted jump.
Margins and capacity
Gross margin expanded 3.5 percentage points to 46.2 percent, driven by operating leverage and higher capacity utilisation. Gross profit rose 28.1 percent to 5.45 billion yuan, outpacing revenue growth. The company attributed the improvement to productivity gains across its manufacturing network.
Market reaction
Shares rose 7.4 percent on Tuesday to close at HK$52.20, ahead of the earnings filing. The move suggests investors were positioning for the adjusted number rather than the statutory one.