Luye Pharma Group (2186) H1 2025 earnings summary

Executive summary

• Revenue rose 3.5% year-over-year to RMB3,181.1 million in H1 2025, driven by key product sales in oncology and CNS segments.

• Net profit declined 18.4% year-over-year to RMB357.4 million, mainly due to higher selling, distribution, and finance costs.

• Gross profit increased 3.8% to RMB2,157.6 million, with a gross margin of 67.8%.

• No interim dividend declared for H1 2025.

• Focuses on innovative pharmaceuticals in oncology, CNS, cardiovascular, and metabolism, with a global footprint in over 80 countries and strong R&D capabilities.

Financial highlights

• EBITDA: RMB1,204.2 million (+4.2% YoY); EPS: RMB8.32 cents (vs. RMB10.31 cents YoY).

• Selling and distribution expenses rose 19.7% to RMB1,018.8 million, now 32.0% of revenue.

• Administrative expenses increased 9.1% to RMB315.5 million; other expenses dropped 36.2% to RMB213.0 million, mainly due to lower R&D costs.

• Finance costs rose 21.9% to RMB338.5 million, mainly from higher convertible bond interest.

• Effective tax rate: 21.9% (vs. 17.3% YoY).

Outlook and guidance

• Revenue expected to grow sustainably, supported by new product launches, insurance negotiations, and anticipated regulatory approvals.

• Several innovative drugs may complete clinical trials or have data readouts by end-2025.

• Anticipates approvals for aflibercept injection and denosumab BLA submissions in the UK by end-2025 and in the US in 2026.

• Plans to strengthen sales of newly approved products and optimize R&D pipeline.

• Several products are undergoing insurance coverage negotiations, with implementation expected in 2026 if successful.