Luye Pharma Group (2186) H1 2026 earnings summary

Executive summary

• Revenue declined by 5.6% year-over-year to RMB3,002.1 million, mainly due to lower sales of product know-how.

• Net profit rose 6.5% to RMB380.8 million, with profit attributable to shareholders up 24.8% to RMB390.5 million.

• EBITDA increased 3.9% to RMB1,251.2 million, and basic EPS improved to RMB9.78 cents.

• No interim dividend was declared for the period.

Financial highlights

• Gross profit fell 11.8% to RMB1,902.3 million; gross margin decreased to 63.4% from 67.8% year-over-year.

• Other income and gains surged 130.8% to RMB456.6 million, mainly from fair value changes in financial instruments.

• Selling and distribution expenses dropped 21.5% to RMB800.2 million, while administrative expenses rose 3.0% to RMB325.0 million.

• Other expenses increased 86.8% to RMB397.9 million, driven by higher R&D costs and losses on convertible bonds.

• Finance costs decreased 10.1% to RMB304.3 million.

• Income tax expense rose 34.2% to RMB134.6 million; effective tax rate was 26.1%.

Outlook and guidance

• Anticipates product launches in the U.S. and UK for denosumab injections in 2027 and new indication approval for Ruoxinlin in China.

• Multiple clinical trial milestones expected in 2027, including key data readouts and regulatory submissions.

• Focus on ramping up newly approved products and expanding international market presence.

• Ongoing cost optimization and product mix improvements expected to drive sustained profit growth.