Sinopharm Group (1099) Q2 2026 earnings summary

Executive summary

• Revenue for H1 2026 was RMB282.80 billion, down 1.13% year-over-year; net profit attributable to owners was RMB3.40 billion, down 1.79%; total net profit was RMB5.18 billion, down 2.95%.

• Retail pharmacy revenue grew 8.58% year-over-year, driven by specialty pharmacy sales and prescription outflow.

• The company focused on cost reduction, efficiency enhancement, digital transformation, and risk management, maintaining stable operations despite industry headwinds.

• Expense ratios improved, with overall expense ratio down 0.27 percentage points year-over-year to 4.11%.

• Gearing ratio was 66.29% as of June 30, 2026.

Financial highlights

• Gross profit was RMB19.07 billion, down 6.27% year-over-year; gross margin declined to 6.74% from 7.11%.

• Operating margin was 2.53%, down 0.07 percentage points year-over-year.

• Basic EPS was RMB1.09, down 1.80% year-over-year.

• Cash and cash equivalents at period end were RMB31.04 billion, down from RMB48.80 billion at end-2025.

• Net cash used in operating activities improved to RMB23.76 billion from RMB34.11 billion in H1 2025.

Outlook and guidance

• Focus on high-quality development, profit structure optimization, and operational efficiency.

• Plans to expand high value-added services, accelerate digital transformation, and strengthen core competitiveness in pharmaceutical and medical device distribution.

• Retail pharmacy to pursue dual-brand strategy and leverage prescription outflow and innovative drug commercialization.

• Emphasis on risk management, cost reduction, and value-added services to drive a second growth curve.