China Traditional Chinese Medicine (570) H2 2024 earnings summary

Executive summary

• Revenue for 2024 was RMB16.51 billion, down 8.9% year-over-year, mainly due to policy-driven price reductions and intensified competition in concentrated TCM granules.

• Net profit dropped 98.5% to RMB20.8 million, with adjusted net profit (excluding goodwill impairment and remedial taxes) at RMB635.5 million, down 54.5%.

• Gross profit fell 15.3% to RMB7.86 billion, with gross margin decreasing to 47.6% from 51.2%.

• The company maintained leading positions in core business segments and continued to invest in technological innovation and ESG initiatives.

Financial highlights

• Revenue: RMB16.51 billion (–8.9% YoY); gross profit: RMB7.86 billion (–15.3% YoY).

• Net profit: RMB20.8 million (–98.5% YoY); adjusted net profit: RMB635.5 million (–54.5% YoY).

• Basic EPS: RMB1.07 cents (–95.8% YoY).

• Proposed final dividend: HK0.35 cents/share; special dividend: HK8.30 cents/share.

Outlook and guidance

• Focus on reform, resource integration, efficiency, and innovation to drive high-quality growth.

• Plans to consolidate the TCM great health industry chain, optimize business models, and expand overseas.

• Emphasis on technological innovation, talent development, and digital transformation.