The company is experiencing a 11.95% year-over-year revenue contraction alongside significant margin pressure, evidenced by an operating margin that has compressed to 6.07%.
| Metric | Dec'24 | Dec'23 | Dec'22 | Dec'21 |
|---|
| Sales/Revenue | 186.36M | 211.65M | 260.27M | 214.07M |
| Revenue Growth % | -11.95% | -18.68% | 21.58% | - |
| Cost of Goods Sold | 95.06M | 81.8M | 106.75M | 88.67M |
| COGS % of Revenue | 51.01% | 38.65% | 41.02% | 41.42% |
| Gross Profit | 91.3M | 129.85M | 153.52M | 125.39M |
| Gross Margin % | 48.99% | 61.35% | 58.98% | 58.58% |
| Gross Profit Growth % | -29.69% | -15.41% | 22.43% | - |
| Operating Expenses | 74.86M | 84.87M | 87.69M | 73.01M |
| OpEx % of Revenue | 40.17% | 40.1% | 33.69% | 34.11% |
| Selling, General & Admin | 63.84M | 66.63M | 63.56M | 58.19M |
| SG&A % of Revenue | 34.26% | 31.48% | 24.42% | 27.18% |
| Research & Development | 12.79M | 11.9M | 13.42M | 11.37M |
| R&D % of Revenue | 6.87% | 5.62% | 5.16% | 5.31% |
| Other Operating Expenses | -1.78M | 6.33M | 10.7M | 3.45M |
| Operating Income | 16.44M | 44.99M | 65.83M | 52.38M |
| Operating Margin % | 8.82% | 21.25% | 25.29% | 24.47% |
| Operating Income Growth % | -63.46% | -31.67% | 25.68% | - |
| EBITDA | 40.6M | 68.9M | 84.63M | 68.39M |
| EBITDA Margin % | 21.79% | 32.55% | 32.52% | 31.95% |
| EBITDA Growth % | -41.07% | -18.59% | 23.74% | - |
| D&A (Non-Cash Add-back) | 24.16M | 23.91M | 18.8M | 16.01M |
| EBIT | 18.44M | 48.19M | 66.75M | 54.11M |
| Net Interest Income | -3.81M | -4.11M | -2.73M | -934K |
| Interest Income | 231K | 312K | 114K | 112K |
| Interest Expense | 4.04M | 4.42M | 2.84M | 1.05M |
| Other Income/Expense | -2.04M | -1.22M | -1.92M | 683K |
| Pretax Income | 14.39M | 43.76M | 63.91M | 53.07M |
| Pretax Margin % | 7.72% | 20.68% | 24.56% | 24.79% |
| Income Tax | 924K | 6.25M | 8.17M | 6.6M |
| Effective Tax Rate % | 6.42% | 14.29% | 12.79% | 12.44% |
| Net Income | 11.31M | 31.46M | 46.73M | 38.96M |
| Net Margin % | 6.07% | 14.86% | 17.96% | 18.2% |
| Net Income Growth % | -64.04% | -32.69% | 19.96% | - |
| Net Income (Continuing) | 13.47M | 37.51M | 55.74M | 46.47M |
| Discontinued Operations | 0 | 0 | 0 | 0 |
| Minority Interest | 68.58M | 66.42M | 60.37M | 51.36M |
| EPS (Diluted) | 0.00 | 0.00 | 0.00 | 0.00 |
| EPS Growth % | - | - | - | - |
| EPS (Basic) | 0.00 | 0.00 | 0.00 | 0.00 |
| Diluted Shares Outstanding | 0 | 0 | 0 | 0 |
| Basic Shares Outstanding | 0 | 0 | 0 | 0 |
| Dividend Payout Ratio | 141.66% | 125.42% | 45.84% | 28.36% |
Swine cycle demand volatility
As reported in recent financial disclosures, ZYBT experienced an 11.95% year-over-year revenue decline, reflecting significant pressure on its core swine vaccine business and potential shifts in the competitive landscape of government-led immunization programs within the Northeast China region where the company maintains its primary operational footprint.
The double-digit revenue contraction suggests that the company is struggling to offset the cyclical downturn in the domestic swine population. Investors should monitor whether this decline is a temporary byproduct of the pig cycle or a structural loss of market share to larger, more diversified national competitors.
Based on reported figures, the company maintains a 48.99% gross margin, yet the operating margin has compressed to 6.07%, indicating that high fixed costs associated with specialized biological manufacturing are currently outpacing the company's ability to generate sufficient scale through its existing government procurement tender model.
The disparity between gross and operating margins highlights a heavy reliance on overhead-intensive P3 laboratory infrastructure. This cost structure appears to leave little room for error, suggesting that any further pricing pressure from government tenders could rapidly erode the company's already thin bottom-line profitability.
According to industry analysis of the firm's cost structure, ZYBT faces a high fixed-cost base driven by the necessity of maintaining sterile, high-security production environments, which complicates expense discipline during periods of declining demand for its core livestock vaccine products across the domestic Chinese agricultural market.
The reliance on biological substrates like SPF eggs introduces exposure to agricultural commodity price volatility that management may struggle to pass on to customers. The current cost profile warrants investigation into whether R&D spending is being effectively converted into high-margin commercial products or merely sustaining legacy lines.
While the company's P3 laboratory certifications provide a regulatory barrier, the 11.95% revenue decline suggests that this moat may be insufficient to protect against broader sector-specific demand downturns, such as the impact of African Swine Fever on the total addressable market for veterinary vaccine products.
Short-term optimism regarding the company's regional dominance in Jilin may be misplaced if the shift toward direct-to-farm commercial sales fails to materialize. Investors should remain cautious, as the current valuation may not fully account for the risks associated with high geographic concentration and potential regulatory policy shifts.
Quick answers to the most common questions about buying ZYBT stock.
For fiscal year 2024, Zhengye Biotechnology Holding Limited (ZYBT) reported total revenue of $186.4M. This represents a 12.9% decline compared to $214.1M in 2021.
Zhengye Biotechnology Holding Limited (ZYBT) is profitable, generating $11.3M in net income for the fiscal year ending 2024 with a net profit margin of 6.1%.
Zhengye Biotechnology Holding Limited (ZYBT) reported an operating income of $16.4M, resulting in an operating profit margin of 8.8%. This margin reflects the operational efficiency of the business before interest and taxes.
Zhengye Biotechnology Holding Limited (ZYBT) generated $91.3M in gross profit for the year, representing a gross profit margin of 49.0%. This demonstrates the company's core pricing power and production efficiency.