Pharmaceutical Manufacturing Listed Companies' Financial Performance Evaluation Study

A public company performance has always attracted much attention from those who have a stake in it, such as shareholders, creditors, managers, employees, patrons and suppliers, and government. However, the current performance evaluation system is not adequate .In Chinese securities market, public pharmaceutics companies(here in after referred to as PPC)have received wide recognition and adequate attention from both institutional and individual investors for their features of high investment, high risk, high earnings and high tech.Performance evaluation can help a manger understand his(or her)company status in its industry and set a right direction for its future development. The target of performance evaluation is to realize company strategic object and become a winner in the fierce competition through advancing and maintaining its core competitive edge, so as to achieve long term stable and sustainable development. For investors rightly understanding a PPC performance can help them make right investment decision, or fend off investment risks.Taking experimentation and the core status of the financial performance into consideration, this paper will focus on the quantitative evaluation on PPC in order to prod a remedy for obsessive accounting issues via statistics. Methodologies employed in this paper include theory study and measure of statistic analysis combined with experimentation study, which enable this paper more precise, objective and applicable.While description the design content of the evaluation indicators for PPC performance the paper take into consideration the following factors: the characteristics of the pharmaceutics industry and the evolution trend of its operation environment, the requirements put by this trend on PPC management strategy and PPC performance evaluation, the operation feature of PPC. The design content includes six indicators with money making at the core of evaluation:money making, development in the future, debt repayment, operation, stock expansion, and research& development.In order to give a comprehensive mark for PPC, indicators that contain overlapping information are eliminated through syntheses analysis during the process of the selection of indicators, and objective of the indicators are guaranteed by factor analysis, so the evaluation system put forward by this paper overcomes subjective in setting indicators, and reduces calculation time at the least price of information loss.The main contribution of this paper is, in term of the outstanding features of the PPC, namely high investment, high returns and high risks, making a study on the system of the evaluation indicators for PPC financial performance, introducing index of research and development rate into evaluation model, and making comprehensive evaluation on PPC financial performance through factor analysis.