Hi, good morning, everyone, for those who are based in China and Hong Kong, and good evening for those based in the US. This is the 2025 WuXi AppTec results call.

My name is Laurence Tam. I'm a China healthcare analyst at Morgan Stanley.

We're honored today to have the full team from WuXi AppTec to present the 2025 result in English. The format of the call will be two parts.

First, I'll let management go through their prepared remarks. You can refer to the slides on the webcast.

Then the second part will be a Q&A session. To ask questions, simply open the link that was sent to you during the registration, and you can type your questions into the Q&A box at the bottom of the window.

You can also send me your questions at the following email: lawrence, l-a-u-r-e-n-c-e dot t-a-m at morganstanley.com, and I'll repeat your questions to management. With that, let me now pass it on to the Head of IR at WuXi AppTec, Ms.

Tang Rui Jia, to introduce management and to start the prepared remarks. I'll pass it on to you, Ruijia.

Thanks.

Okay. Thank you, Laurence.

Welcome, everyone, to WuXi AppTec's 2025 annual results conference call. We released our financial results last night, and have posted the latest on our company website.

During today's call, we will make forward-looking statements. Although we believe that our predictions are reasonable, future events are uncertain, and our forward-looking statements may turn out to be incorrect.

Accordingly, you are strongly cautioned that reliance on any forward-looking statements involves known and unknown risks and uncertainties. In addition, to supplement the company's consolidated financial statements presented in accordance with IFRS, we provide adjusted non-IFRS financial data.

We believe the adjusted financial measures are useful for understanding and assessing our core business performance. We believe that investors may benefit from referring to these adjusted financial measures by eliminating the impact of certain unusual and non-recurring items that are not indicative of the performance of our core business.

However, these adjusted measures are not intended to be considered in isolation or as a substitute for the financial information under IFRS. All IP rights and other rights pertaining to the information and materials presented are owned by WuXi AppTec.

Audio recording, video recording, or disclosure of such materials by any means without the prior consent of WuXi AppTec is prohibited. This call does not intend to provide a complete statement of relevant matters.

For relevant information, please refer to the company's disclosure documents and information on Shanghai Stock Exchange, Hong Kong Stock Exchange, and the company's website. As usual, in today's call, there will be Q&A session after our presentation.

Please kindly share with us your name and institution before asking questions. With that, please allow me to introduce our Co-CEO, Dr.

Minzhang Chen, to present our 2025 annual results. Minzhang, please.

Thanks, Ruijia. Good morning and good evening.

Thank you for joining our 2025 annual earnings call. We will begin on slide number 5.

In 2025, WuXi AppTec beat full-year guidance and achieved record performance in both revenue and profit. Total revenue achieved 45.46 billion RMB.

Notably, revenue from continuing operations grew 21.4% year-over-year to reach 43.42 billion RMB. Our adjusted non-IFRS net profit grew 41.3% year-over-year to 14.96 billion RMB, with non-IFRS net profit margin further improved 5.9 percentage points year-over-year to 32.9%.

Next slide, please. The company remains focused on enhancing our core capabilities and capacity to better meet customer demand.

With continuous capacity expansion, by end of 2025, our backlog for continuing operations reached 58 billion RMB, growing 28.8% year-over-year. This does not include business operations we sold or discontinued such as clinical research services.

Next slide, please. Slide 7 shows our diversified revenue streams of continuing operations.

Based on customer headquarters, revenue generated from US market grew 34.3% year-over-year. Japan, Korea, and other regions grew 4.1%.

Europe and China saw some decline, mainly due to fluctuations in project delivery timing. This diversified revenue structure reflects our global footprint and capabilities to enable healthcare innovations.

We believe it will continue to underpin the stability and the resilience of our performance. Slide 8, please.

As an enabler of innovation and a trusted partner, and a contributor to the global pharmaceutical and life science industry, the company continues to drive sustainability, embrace initiatives with sustained recognition by leading global ratings. In 2025, we achieved our first MSCI AAA and CDP Climate Change A ratings, maintained CDP water security A and EcoVadis gold ratings, and were included in the S&P Global Sustainability Yearbook for the fourth consecutive year.

Meanwhile, our near-term greenhouse gas emissions reduction targets have been successfully validated by SBTi. As a committed UNGC participant and the PSCI supplier partner, we actively embrace global initiatives and are dedicated to integrating sustainability into our business strategy and operations.

Next slide, please. For over two decades, WuXi AppTec has remained steadfast in our commitment to safeguarding customer IP and adhering to the highest standards for quality and compliance.

In 2025, we completed 741 quality audits and inspections from global customers, regulatory authorities, and independent third parties, as well as 60 information security audits by global customers. This means, on average, we welcomed three quality audits per day and over one information security audit per week, all with no critical findings.

Currently, 20 of our main sites-- 20 of our main sites are ISO and IEC 27001 certified, covering all main sites in China. IP is the lifeline for both our company and our customers.

We uphold integrity as our foundation, and enforce a zero tolerance policy against any infringement. This is our core value, and our highest responsibility and commitment to our customers.

Now let's move on to the segment performance, please turn to page 9. WuXi Chemistry's CRDMO business model drives continuous growth.

In 2025, WuXi Chemistry revenue grew 25.5% year-over-year to 36.47 billion RMB. Benefiting from continued process optimization and enhanced capacity efficiency, driven by the growth of late-stage clinical and commercial projects, our adjusted non-IFRS gross profit margin steadily improved 5.9 percentage points year-over-year, reaching 52.3%.

Our small molecule drug discovery, R business, continues to generate downstream opportunities. In 2025, we have successfully synthesized and delivered over 420,000 new compounds to our customers.

Meanwhile, 310 molecules were converted from R to D phase in 20-- from R to D in 2022. As we continue to strengthen the capabilities of our integrated CRDMO platform, we consistently enhance the internal conversion of molecules at different stages.

Our small molecule D&M business remains strong, and the small molecule CDMO pipeline continued to expand. In 2025, small molecule D&M business revenue grew 11.4% year-over-year to 19.92 billion RMB.

Meanwhile, the company continued to build small molecule capacity. In 2025, our Changzhou, Taixing, and Jinshan API sites all successfully passed FDA on-site inspections with no single observation.

By year-end, total reactor volume of small molecule APIs reached over 4,000 cubic meters. WuXi TIDES, our new modalities business, sustains rapid growth.

With a sequential ramp-up of new capacity released in 2024 and 2025, TIDES revenue almost doubled to reach 11.37 billion RMB in 2025. As of year-end, TIDES backlog grew 20.2% year-over-year.

TIDES D&M customers increased 25% year-over-year, and its number of molecules increased 45% year-over-year. In September 2025, we completed Taixing peptide capacity construction ahead of schedule.

The company's total reactor volume of solid phase peptide synthesizers has reached over 100,000 liters. Next page, please.

Driven by following the molecule and win the molecule strategies, WuXi Chemistry's small molecule CRDMO pipeline efficiently converts and captures high quality molecules and delivering sustained business growth. This reflects our customers' strong trust in our technical capabilities, our service efficiency, and our quality system.

In R stage, we delivered more than 420 420,000 new compounds in 2025, representing a significant scale. At the same time, the complexity of these molecules continued to increase, demonstrating a sustained demand from early-stage R&D customers for high-quality services.

Building on this strong foundation, we continue to enhance the synergy between our R and D capabilities by strengthening the conversion of molecules from R to D. The new compounds synthesized in R stage serve as a continuous funnel driving downstream demand for our D&M services.

Moving to the D&M stage, we added 839 molecules to our pipeline in 2025, with 310 of them converted from R to D. As of year-end, our small molecule D&M pipeline reached 3,452 molecules, including 53 commercial projects, 91 in phase 3, 377 in phase 2, and 2,901 in phase 1 and pre-clinical.

Notably, commercial and phase 3 projects increased by 22. As our late-stage pipeline grows, the complexity and the quality of molecules continue to grow.

This deepens our collaboration with customers and lays a solid foundation for sustained long-term growth. Next page, please.

Our TIDES business has maintained rapid growth over the past few years. In 2025, TIDES revenue grew a strong 96% year-over-year to reach 11.37 billion RMB, nearly doubling.

We have been continuously enhancing our capabilities and capacity to better meet customer demand. Now, I will hand over to our Co-CEO, Dr.

Steve Yang, to talk about WuXi Testing and WuXi Biology. Steve, please.

Thanks, Minzhang. Please turn to slide number 14.

In 2025, WuXi Testing revenue returned to positive growth, increasing 4.7% year-over-year to 4.04 billion RMB, of which revenue from drug safety evaluation service grew 4.6% year-over-year, maintaining its leadership position in Asia Pacific. Adjusted non-IFRS gross profit margin declined year-over-year as the impact of market pricing were gradually reflected in revenue through backlog conversion.

However, with our differentiated capabilities and enhanced operation management, margins continued to improve sequentially quarter-over-quarter. We actively enable customers in global licensing deals, supporting nearly 40% of the successful out-licensing projects from Chinese customers since 2012-- 2022.

Our new modality business continue to expand, with revenue contributions exceeding 30% in 2025, maintaining a leading position in multiple areas. Meanwhile, we continued to advance automation.

Our DMPK team launched a proprietary all-in-one compound identification software solution, improved efficiency by 80% in spectral interpretation and metabolite identification for nucleic acid and peptide test articles. Finally, in 2025, our Suzhou and Shanghai facilities successfully passed multiple regulatory inspections by FDA, by OECD, NMPA, and PMDA.

This underscores the high quality of our GLP operations and our quality systems. Let's turn to slide number 15, please.

WuXi Biology follows the science, strategically builds differentiated capabilities in emergent areas, and we actively extend our global customer outreach. This allows us to efficiently generate downstream opportunities for our CRDMO model, continuously contributing more than 20% of our new customers.

We efficiently enable global customers through our integrated in vitro and in vivo drug discovery capabilities for biology, the cross-regional collaboration, and end-to-end solutions in emerging areas. WuXi Biology revenue resumed positive growth in 2025, growing 2-- 5.2% year-over-year to 2.68 billion RMB.

The adjusted non-IFRS gross profit margin was 36.9%, down 1.9 percentage point, reflecting market pricing dynamics. We closely follow market conditions with a flexible pricing strategy, maximize our value in generating downstream opportunities.

Our revenue growth was driven by advancement in our comprehensive in vitro screening platform and enhanced in vivo pharmacology capabilities. Our non-oncology in vivo business maintained a competitive edge, serving as a key gross contributor to WuXi Biology.

Our new modality business continued the momentum, with the revenue contribution exceeding 30% in 2025, supported by rapid new customer expansion in multiple areas. Now I would like to turn the call to our CFO, Florence, to discuss our financial performance.

Florence, please.

Thank you, Steve. Let's turn to slide 17.

We would like to recap on the company's financials. In 2025, we beat our full-year guidance and achieved record high performance in revenue, profit, and cash flow, all aspects.

Thanks to the visibility provided by our CRDMO business model, we proactively planned our capacity and capabilities. As new capacity ramped up efficiently quarter-over-quarter, we timely supported the growing demand from late-stage clinical and commercial projects.

Meanwhile, we continued to drive quality growth, strengthen our technological expertise, and improve operational efficiency. In 2025, our adjusted non-IFRS gross profit reached 21.89 billion RMB.

Adjusted non-IFRS gross profit margin expanded to 48.2%, up 6.6 percentage points year-over-year. Adjusted non-IFRS net profit grew 41.3% to 14.96 billion.

Correspondingly, adjusted non-IFRS net profit margin improved by 5.9 percentage points to reach 32.9%. Net profit after deducting non-recurring items grew 32.6% to 13.24 billion, and net profit attributable to the owners of the company surged 102.6% to 19.15 billion.

Building on our robust business growth, we sharpened our focus on the CRDMO core business, and continue to enhance our investment management capabilities. This resulted in pre-tax investment gains exceeding 8 billion RMB in 2025, further boosting our net profit attributable to the owners of the company.

Consequently, our diluted earnings per share reached 6.61 RMB, more than doubling year-over-year. Please turn to slide 18.

With sustained business growth, particularly the rapid increase in late-stage clinical and commercial projects, combined with enhanced operational efficiency and financial management, our 2025 adjusted operating cash flow reached a record high of 16.67 billion, growing 39.1% year-over-year. This fully demonstrates the sustainable momentum driven by our high-quality molecules and projects.

We continued to actively advance our global capacity expansion as planned, with CapEx payment of 5.54 billion in 2025. Now, I'd like to hand over to Minzhang to share the company outlook.

Minzhang, please.

Please turn to slide 20. We remain focused on our unique, integrated CRDMO core business, accelerating the growth of our global capabilities and capacity.

We provide highly efficient and exceptional services to our customers, benefiting patients worldwide, and driving long-term growth. We will also drive the O in our CRDMO model, operations.

By driving optimized management and operations, we aim to continuously improving efficiency and strengthen organizational resilience to navigate dynamic market conditions. With customers' ongoing demand for enabling services, our CRDMO business model, and the management execution, the company is confident to sustain rapid business growth.

We expect total revenue to reach 51.3 to 53 billion RMB in 2026, with continuing operations revenue growing 18 to 20 18 to 22% year-over-year. By continuously driving quality growth, realizing scale efficiency, and enhancing operational excellence, while proactively managing new capacity ramp-up and exchange rate challenges, we are confident in maintaining a stable and resilient adjusted non-IFRS net profit margin in 2026.

Finally, CapEx for 2026 is expected to reach 6.5 to 7.5 billion RMB. Along with business growth and efficiency improvements, we expect adjusted free cash flow to reach 10.5 to 11.5 billion RMB.

Next page, please. While accelerating the growth of our global capacity and capabilities, we remain committed to rewarding shareholders and actively upholding the company's value.

The board proposes a cash dividend distribution plan, totaling a record 5.7 billion RMB in 2026. Specifically, we plan to maintain the 30% annual cash dividend payout ratio, expecting to distribute 2025 dividend of 4.71 billion RMB, while continuing our interim dividend plan of 1 billion RMB in 2026.

To continuously attract and retain top talents, we propose the 2026 H-share incentive trust plan. Under this plan, no more than 1.5 billion Hong Kong dollar worth of H-shares will be granted if 2026 revenue reaches 51.3 billion RMB.

An additional 1 billion Hong Kong dollar worth of H-shares will be granted if revenue reaches 53.1-- 53.0 billion RMB or above. This aims to strengthen management resilience and align our team for long-term shared growth.

Importantly, all underlying H-shares will be purchased in the open market at prevailing market prices, with no dilution to existing shareholders. Thanks for your attention, and we are now open for questions.

Thanks a lot, Doctors Chen and Yang, Florence, and also Ruijia. We will now enter the Q&A session.

Once again, I would like to remind investors that if you would like to ask a question, please type into the Q&A box on your screen within the window. You can also send me your questions at the following email: lawrence, l-a-u-r-e-n-c-e dot t-a-m at morganstanley.com.

We apologize if we couldn't get to all of your questions within this call, because we have a lot of questions in the queue. Let me start off with the first question.

Let me congratulate management on a fantastic 2025 and a very positive 2026 guidance. Obviously, this year there's a lot of uncertainty in the markets and also we have experienced a lot of volatility.

Despite that, the company delivered a very positive 2025 and a continuous operations revenue growth range expected for 2026 of 18 to 22%, which means that the midpoint is 20% growth in 2026 for continuous operations, which gives investors a lot of visibility. One of the key concerns this year from investors for the CXO industry is the exchange rate.

Year to date, the U.S. dollar has depreciated against the RMB.

The first question is, in the context of this renewed guidance, how does management think about the impact of currency exchange, and what is your outlook or guidance for each of the three business units? Thanks.

Thanks. We do consider the FX movement and the challenges.

I also would like to appreciate everyone recognize, even with not only the FX, but with all the complex and volatility in the macro environment we are navigating, every company navigating today, we still provide a very clear and a narrow guidance range of our total revenue, which is only about 3% of our top line at the beginning of the year, which is pretty consistent with our historical practice. Basically, that reflects the strong visibility in our CRDMO business model, and our confidence in our execution capabilities, same as our management capabilities on the FX movement as well.

Thanks a lot, Ruijia-- Florence. The second question is a little bit on geopolitics.

Obviously, the situation in the Middle East has escalated in recent weeks, and investors are worried about the rise in oil prices and the impact on raw material costs. Your margins improved significantly last year, and this year, the guidance is that margins would be stable.

How would you think about the impact of geopolitics and oil prices on your margins going forward?

I will comment on the cost fluctuations could be impacted. Our global operations are running smoothly as usual, okay.

We acknowledge there are potential risks to certain upstream raw material costs, but it takes time to transmit through the broader supply chain. We haven't seen any direct or quantifiable impact on our operations or cost, but we will closely monitor the situation and the market dynamics as everyone did.

We have a mature and diversified procurement network in place in the past 25 years. On top of that, we are constantly optimize our manufacturing process, driving operational efficiency, which help us focus on the certainty of meeting the customer demands and needs, and remain committed to deliver exceptional services.

Thanks, Florence. We'll get to sell-side investor questions now.

I will first start with two questions from Goldman Sachs' Chen Ziyi. His first question is, the company continued to be highly committed to TIDES CapEx.

He would like to understand a bit more on the pipeline behind the CapEx budget beyond injectable peptides, which has been a key driver in the past few years. What would be the next key modalities that could potentially be the new focus, for example, siRNA, antisense oligos, oral peptides, or any new modalities that biopharma is thinking about at the early stages?

Thanks.

Right now, there are many modalities, it's a combination. There is no single modality that can replace all.

We have a small molecules, we have peptides, and we have oligos, and we have all kinds of conjugates. Currently, the demand for peptide itself is so high, we continue to build the capacity and to meet the market demand for the peptide.

At the same time, we're also seeing oligonucleotide is growing, and although the market is still small, but we see that there are many many molecules in the pipeline. Also, it's going from a rare disease now to general disease.

The growth will be fast. Also, now the molecule become more and more complex.

To manufacture large scale very complex molecule, need the very technical capabilities as well as manufacturing capacities to meet the market demand. We are doing all this.

Thanks, Dr. Chen.

Ziyi's next question is, there's been some debate on what will be the impact of pharma's announced big CapEx on building internal capacity, particularly in the US. What is WuXi AppTec's view on that?

Have you sensed any change on client outsourcing strategy in the past 6 to 12 months?

In the pharmaceutical industry, historically, all the APIs, drug products, are manufactured internally, and then some of the work is done by the CMO, CDMO. This has a long history, it's nothing new that the large pharmas is also manufacturing internally, nothing new, but we're just committed to continuously to improve our capabilities and to invest in capacities, and provide the best service and meet the customer needs.

Thanks, Dr. Chen.

The next few questions are coming from Michael Law of CLSA. His first question is, can WuXi AppTec give us some color on the current utilization rate of the company's 4,000 cubic meter small molecule API capacity?

How much room do

we still have to ramp up from here? Thanks.

In 2025, our capacity utilization rate has been improved significantly, and we continue to see high demand for our small molecule capacity. As I mentioned, we have 4,000 cubic meter of small molecule capacity.

The utilization rate is very high, but we also continuously optimizing the process and improving the efficiency, and we believe that we still have room to further improve the utilization rate and the productivity of our capacity. Thanks, Dr.

Chen. Michael's second question is, we've seen that AI has been increasingly used in drug discovery.

How does WuXi AppTec view the impact of AI on the CRDMO business model, and what is your strategy in this area? Thank you, Michael.

This is Steve. We see AI as an opportunity rather than a threat.

In fact, we have been actively deploying AI across our business, from drug discovery to development and manufacturing. We have the opportunity to work with many leading companies in this space.

While they may have models that have the potential to generate new hypotheses, at this stage, most of those models require high-quality data, and we are uniquely positioned to provide those data. This is actually a driver to more business for our biology and testing business.

Finally, we believe for our CRDMO model, with the more advancement in ability to unlock either target space or come with new hypotheses to design molecules, it will only accelerate the flow of new ideas into project start. That will ultimately benefit the CRDMO funnel, and in a word where research and discovery become even more globalized and decentralized.

Thanks, Dr. Yang.

Now we have two questions coming from Chen Chen of UBS. First, the US FDA has announced that it plans to drop the standard requirement of two phase 3 or pivotal trials.

Instead, the FDA's default position will be for one phase 3 trial for drug approvals. Do you think that it would accelerate drug approvals and benefit your new orders growth?

I will start, and then invite Minzhang for additional comments. Any regulatory streamlined process will benefit from patient.

Secondly, any acceleration in clinical development potentially will drive more demand and more timely demand for drug substance and drug product to supply clinical trial. If that shortens clinical development time frame, it will help actually accelerate the commercialization drive.

We think all of those initiatives shorten the time to patients will beneficial for our CRDMO model. Minzhang, any additional comments?

No, I think that's well said, yeah.

Thank you, Dr. Yang, Dr.

Chen. Her next question is, one of your biggest clients announced a 10-year plan to invest 3 billion U.S.

dollars in expanding its oral dosage supply chain in China, focusing on oral GLP-1 manufacturing. One of your peers, a CDMO, has received part of this investment, actually 200 million U.S.

dollars initially. Do you think you can also benefit from this multinational's investment in China and to what extent?

We all know that, GLP-1 GLP-1 drugs, no matter it's peptide or small molecule, has a huge demand. Has a huge demand, and so this this announcement, this investment, just further proved that, yes, the demand is very high for this for the molecule.

Because of the, demand is very high and, we are the, we are the major player in this in this field, so we will I we believe that we will benefit from the from the opportunities. I don't want to comment I don't want to comment on the specific, partnership or collaborations, but, the so the I think, only so the 3 billion investment is right now it's only 200 million committed, so, where to spend the rest, yeah.

Thanks, Dr. Chen.

That's it. Thanks.

Great.

The next question comes from Huang Yang of J.P. Morgan.

What is WuXi AppTec's positioning in oral small-molecule GLP-1 CDMO business?

We have a double-digit growth last year, and we are accelerating the growth for the small molecule this year. Part of the contribution of this growth is from the GLP-1 small molecule.

Okay. His next question is, it seems that small-molecule D&M business will have better growth in 2026 versus 2025.

What would be the main drivers for that?

It's just the demand, high demand, because of the drug will be approved this year, I believe, yeah.

Okay. Next, we have two questions coming from an investor from Franklin Templeton.

"Hi, this is Harry from Franklin Templeton. Congrats on the robust performance.

Firstly, what is the revenue breakdown? What is the mix, do you see, and how do you see the geographical mix changing?

Growth, obviously, is very strong in the US, while Europe and China are showing some recovery. Let's first address this question."

Florence, do you want to comment on the mix?

Oh, okay. Yeah.

I think because we follow the customer, follow the molecule, and follow the science. The geographic revenue growth really demonstrate where the innovation come from, where the customer need our capabilities and the capacities.

We do see the strong growth from across all the regions. We believe we can better deliver and execute in 2026.

We see the TO growth across all the regions for 2025. We believe that's growth for all the regions in 2026.

Particularly, the growth strong last year in US. That's why the percentage of the other regions relatively become smaller, but we expect the growth for all regions this year.

A small decline in China and Europe last year was mainly due to the delivery schedule of some large projects. The growth momentum is there.

I think that's basically a proof we have very good position everywhere, and we continue to see the strong growth in U.S., in China, in Europe, and all the other regions.

Thanks. His next question is on the TIDES business.

How do you see sustainability of its growth?

The largest product that we are making, the forecast the demand will continue to grow in the next many years by forecast, by market forecast. The demand will continue to grow.

Also, we also have working on quite a few late-phase, very promising projects which potentially could be big product as well. Go one more step back, we are CRDMO, we have a very big pipeline, not only in small molecules, but also in peptides, and also in oligonucleotide.

We have a pipeline, and that pipeline continuing to funnel the project into the late-phase and commercial projects, and that's where our sustained long-term growth come from.

Okay. On oligonucleotides, what is WuXi AppTec's differentiation from the other oligo CDMOs or manufacturers?

Like all other modalities, like a peptide, small molecule, if you can find a place that has quality, speed, cost, technical capability, and the capacity, you tell me, yeah. Yeah.

I think it's the same. We put all this together, and I think that's our unique advantage.

His last question is, can you give us some color on the general timeline that it takes for a new facility to be built and to contribute in a meaningful way to earnings?

In China, we can do that in less than 12 months from start to fully operational.

Thanks. We have two questions next coming from Nomura's Jialin Zhang.

Firstly, what is the range for the TIDES business gross margin? Do we calculate over 60%?

Is this about the right range, and how should we think about the margin trend for TIDES?

I don't believe we disclose the margin for TIDES. Florence, can you answer that?

We don't disclose the specific margin. I think the margin naturally reflects our capabilities, the capacities, and the value creation to the customers.

Thanks. His next question is, how is the current Middle East situation or conflict impacting the company's investment view in Saudi Arabia in the mid-term?

As I already mentioned earlier, we don't see any near-term disturbance changing our long-term strategy. Our long-term strategy is strengthen CRDMO model, build global capacity wherever there's customer need.

We continue the engaging with stakeholders in Saudi Arabia, and proceed with evaluation of different localization options. Those continue to proceed based on our plan.

Thanks, Dr. Yang.

Next, we'll go to Citi's John Yung. You initially guided continuing operations revenue to grow 10 to 15% for 2020-- for 2025, and you delivered 21% plus.

Now, the same guidance for 2026 is a range of 18 to 22%. Should we also expect this guidance to be prudent, and that you are confident to beat it?

Rather than calling our guidance prudent, I would view it as a responsible to the market, right? I appreciate you track our records.

We are navigating a lot of the complex and volatile macro environments today, but we do have the confidence to execute the guidance we provided to the market, of course. We will closely monitor and give the update timely to all the investors if we see any different situation.

Thank you, Florence. Next, we'll go back to Ziyi Chen's question.

So 2026 guidance has been very clear and exciting. He would like to understand the growth sustainability a bit more.

What is the reasonable growth expectation beyond 2026, when the TIDES business will be slowing down, given the large base and key projects' product cycles? What could be the key growth driver beyond 2026?

I think we have the confidence to keep the sustainable growth. Basically, we follow the molecule, and the CRDMO model really gives us the confidence.

We will continuously capture the high-quality molecule and follow the science. We do have the capabilities and the capacities to better serve our customers.

Okay.

Going back to Nomura's Jialin Zhang, he has a follow-up question. Can management help us understand the competitive landscape of siRNA CRO space and the growth outlook?

How much will it contribute to the current TIDES segment?

Minzhang, would you like to

take it? There are many players out there that has provided the CDMO service on the oligonucleotide.

Specifically, I think I asked about siRNA. Also, siRNA has a very large percentage in our pipeline as well.

Like I said, we continue to focus on the service we provide, and we continue to focus on the quality service, the capacity, the speed, and the competitive cost. I think with our unique advantage, we just focus on providing the best service and win the competition in the end, just like we doing every modality in our business.

Next we have an investor question. WuXi AppTec has 42-plus billion RMB of backlog expected to be converted in 2026, but you're guiding for 51.3 to 53 billion RMB of total revenue.

That means roughly an extra 9 to 11 9 to 11 billion will need to come from new orders signed and delivered within the year. In the current environment with trade policy uncertainty, how confident are you in that year booking assumption, and has Q1 2026 order activity remained consistent with that trajectory?

I think you're right. You noticed actually, 70% of our total backlog is expected to convert into the revenue in 2026, which is within the next 12 months.

I think our ability to convert orders into revenue with speed and efficiency is actually reflect our strong execution capabilities across our whole organization. If you compare with the historical number, actually the percentage is significantly improved, which also demonstrate we have more and more late-stage clinical and commercial projects on hand.

That really enhanced the near-term visibilities and the certainty of our growth trajectory. As I mentioned, we do have the confidence with all the efforts we are making.

We do have the confidence to deliver our guidance and, of course, we always try to beat it, right? I don't see there is any big concern about the new orders coming in and the conversion.

Great. Thanks, Florence.

Last question, let me wrap up by touching a bit on geopolitics. We haven't really talked about the 1260H list from the US Pentagon.

Obviously, it was released shortly in February and then withdrawn within like an hour. A lot of investors looked at that list and saw WuXi AppTec being on there together with a lot of big Chinese companies.

Does the company have anything to say on that? Obviously, Sino-US relations were moving in a positive direction in the months prior to that, with the BIOSECURE bill not naming the WuXi companies.

What is the company's view on relations between the two?

Yes, I'll take that question. Thank you.

As you mentioned, we've seen that in February, the list was put on and withdrawn. At this time, the final 1260H list for 2026 has not been officially published, and there's no definitive timetable at this time.

As when this is going to publish, no one actually knows, and we won't make any prediction or speculations for the timing of the US government's actions. At the same time, we're very confident that WuXi AppTec shall not be included in the 1260H list.

We are a publicly traded company, listed in Hong Kong and Shanghai with transparent corporate governance. The company is not owned or controlled by any government or affiliated with any government or military organization.

At this moment, the company will continue to monitor the situation and take all necessary actions to correct any misinformation and clarify any misunderstandings. In terms of BIOSECURE Act, you mentioned that we all know that the bill was passed as part of the NDAA the end of last year.

Since then, there's no recent development on the implementation, we'll continue to monitor. Thank you.

Thank you very much. We're coming up to the time limit, let me pass it back to management to do concluding remarks.

All right. Thank you all for joining today's earnings call.

So 2025 is the 25th anniversary of WuXi AppTec. For the past 25 years, WuXi AppTec has been dedicated to lowering the barriers to R&D and advancing healthcare innovation worldwide.

Entering 2026, with a sharpened focus on our core CRDMO strategy, we are accelerating the growth of our global capabilities and capacity, further improving production and operational efficiency, and delivering greater value for customers and the shareholders. Staying true to our founding aspiration, we will remain committed to doing the right thing and do it right, enabling our partners to deliver life-saving therapies to patients in need, and advancing our vision that every drug can be made and every disease can be treated.

Thank you all.

Thank you very much to WuXi AppTec's management and the IR team. This will conclude the presentation.

Thank you all for joining.

Thank you.

Thank you.

Thank you.

Bye-bye. Bye.