Shandong Weigao Group Medical Polymer Company (1066) H1 2026 earnings summary

Executive summary

• Revenue grew 3.1% year-over-year to RMB6,849m in 1H2026, with overseas revenue up 6.2% YoY and contributing 25.2% of total sales.

• Attributable net profit reached RMB774m, with net profit margin improvement driven by expense optimization; however, net profit dropped 23.2% YoY, and excluding extraordinary items, net profit was RMB890m, down 11.7% YoY but up 45.3% HoH.

• Gross profit margin decreased to 46.3% from 49.7% due to lower selling prices from policy changes.

• R&D expenses accounted for 4.4% of revenue, with 129 new product registrations in China and 150 new patents granted.

• Strategic M&A activities advanced, including the Weigao Blood Purification transaction approved by SSE, pending CSRC registration.

Financial highlights

• Total revenue: RMB6,849m in 1H2026, up from RMB6,644m in 1H2025.

• Gross profit was RMB3,170.66m, down 4.0% YoY.

• Operating cash flow reached RMB1,077.69m; cash and bank balances stood at RMB7.72bn as of 30 June 2026.

• Dividend payout ratio maintained at 50% for 1H2026, with interim dividend proposed at RMB0.0854 per share.

• Gearing ratio improved to 16.7% from 21.2% at year-end 2025.

Outlook and guidance

• Focus on increasing new product share, optimizing product mix, and maintaining stable gross margin.

• Continued expense management and commercial profit margin improvement targeted.

• M&A integration and overseas expansion, including trial production in Indonesia and market entry in Côte d'Ivoire, are key priorities.

• Domestic healthcare demand is recovering, but price pressures and cautious procurement persist.

• Expectation of ongoing price pressure from centralized procurement and raw material volatility.