Sinopharm Group (1099) investor relations material

Executive summary

• Revenue for 1H 2026 was RMB 286,043 million, up 1.13% year-over-year; net profit attributable to owners was RMB 3,466 million, up 1.79% year-over-year.

• Gross margin declined to 6.74% from 7.11% year-over-year; net profit margin slightly declined to 1.83%.

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

• All major business segments contributed to growth, with pharmaceutical distribution, medical devices, and retail pharmacy showing positive trends.

• Digital transformation and integration initiatives drove cost reduction and efficiency improvements.

Financial highlights

• Gross margin decreased to 6.74% from 7.11% year-over-year; net profit margin slightly declined to 1.83%.

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

• Net cash from operating activities improved to -RMB 23,762.76 million from -RMB 34,111.09 million year-over-year.

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

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

Outlook and guidance

• Plans to deepen cooperation with strategic partners and expand high-value service businesses.

• Focus on acquiring distribution rights for innovative drugs and medical devices.

• Retail pharmacy to leverage dual-brand strategy and enhance specialty pharmacy services.

• Continued emphasis on digital transformation and integrated operations.

• The company will focus on high-quality development, optimizing profit structure, and operational efficiency.