Yunnan Baiyao Group (000538) H2 2025 earnings summary

Executive summary

• Revenue reached ¥41.19 billion in 2025, up 2.88% year-over-year; net profit attributable to shareholders was ¥5.15 billion, up 8.51% year-over-year; adjusted net profit (excluding non-recurring items) was ¥4.87 billion, up 7.55% year-over-year, both at record highs.

• Industrial revenue grew 10.7% year-over-year to ¥16.02 billion, accounting for 38.89% of total revenue, up 2.75 percentage points.

• Operating cash flow was ¥4.60 billion, up 7.04% year-over-year; R&D investment increased 21.51% to ¥423 million, representing 2.64% of industrial revenue.

• The company maintained a strong asset structure with total assets of ¥54.27 billion and net assets attributable to shareholders of ¥40.04 billion; asset-liability ratio was 26.02%.

• Cash dividends for 2025 totaled ¥4.64 billion, representing 90.09% of net profit attributable to shareholders.

Financial highlights

• Gross margin for industrial sales was 65.19%, down 0.74 percentage points year-over-year; commercial sales gross margin was 6.69%, up 0.48 percentage points.

• Basic and diluted EPS were both ¥2.89, up 8.65% year-over-year.

• Weighted average ROE was 13.02%, up 1.03 percentage points, the best in five years.

• Management expenses decreased by 1.68% year-over-year; sales expenses increased by 15.16% due to higher online sales.

• Non-recurring profit totaled ¥289 million, mainly from government subsidies, investment income, and fair value changes.

Outlook and guidance

• 2026 will focus on high-quality growth, optimizing resource allocation, and cultivating new growth drivers, with continued emphasis on the “big single product” strategy and international expansion.

• The company aims to further enhance digitalization, innovation, and supply chain efficiency, and to maintain high dividend payout ratios.