China Medical System (867) H1 2026 earnings summary

Executive summary

• Turnover rose 12.5% year-over-year to RMB4,500.7 million, with profit for the period up 4.3% to RMB971.5 million.

• Innovative and exclusive products drove growth, with their revenue up 19.7% year-over-year, now accounting for 37.7% of turnover.

• Three innovative drugs were approved for marketing in China, and five innovative drugs (covering six indications) are under NDA review.

• The skin health business (Dermavon) saw revenue surge 59.1% and is proposed for a separate listing.

• The company executed share repurchases and declared an interim dividend, reflecting confidence in long-term value.

Financial highlights

• Gross profit increased 11.4% to RMB3,220.6 million; gross margin was 71.6%, down 0.7 percentage points year-over-year.

• Basic EPS rose 4.7% to RMB0.4075.

• R&D expenses jumped 76.1% to RMB356.7 million, with total R&D expenditures up 92.9% to RMB824.7 million, reflecting pipeline expansion.

• Selling expenses grew 0.5% but fell as a percentage of turnover to 31.8%.

• Bank balances and cash stood at RMB2,571.9 million; gearing ratio was 4.2%.

Outlook and guidance

• At least three new innovative or exclusive products are expected to be commercialized annually over the next three years.

• The company will focus on high-quality, sustainable growth, leveraging dual-track innovation and AI-driven execution.

• Internationalization, especially in APAC, is expected to become a key growth driver.