China Traditional Chinese Medicine (570) H1 2025 earnings summary

Executive summary

• Revenue for the six months ended 30 June 2025 was RMB7,463.4 million, down 11.0% year-over-year, mainly due to increased centralised procurement, intensified competition, and strategic business adjustments.

• Gross profit decreased by 10.5% to RMB3,634.6 million, but gross margin improved slightly to 48.7% due to sales structure optimization.

• Net loss for the period was RMB141.8 million, compared to a profit of RMB214.1 million in the prior year, mainly due to lower sales, goodwill impairment, and increased credit loss provisions.

• No interim dividend was declared for the period.

Financial highlights

• Revenue: RMB7,463.4 million (down 11.0% year-over-year).

• Gross profit: RMB3,634.6 million (down 10.5% year-over-year); gross margin: 48.7% (up 0.3pp).

• Net loss: RMB141.8 million (net margin -1.9%), compared to net profit of RMB214.1 million (net margin 2.6%) last year.

• Basic EPS: -2.14 RMB cents, down from 4.19 RMB cents.

• Operating cash flow: RMB924.9 million (up from RMB569.7 million).

Outlook and guidance

• The company plans to optimize its business structure, focus on value creation, and enhance cost control and efficiency.

• Emphasis on technological innovation, digital transformation, and supply chain resilience to adapt to policy and market changes.

• The company will respond proactively to policy changes and market competition, aiming to build a leading TCM industrial cluster.