Zhejiang Huahai Pharmaceutical (600521) Q4 2025 earnings summary

Executive summary

• Revenue for 2025 was RMB 8.59 billion, down 10.06% year-over-year; net profit attributable to shareholders was RMB 266 million, down 76.19% year-over-year.

• Decline in profit mainly due to intensified price competition in domestic formulations, stable but pressured API margins, increased R&D expenses (up RMB 240 million), and higher forex losses (up RMB 110 million).

• Comprehensive gross margin was 60.16%, down 1.75 percentage points year-over-year.

• The company remains a leading supplier of cardiovascular and CNS APIs globally, with a robust international and domestic sales network.

Financial highlights

• Operating income: RMB 8.59 billion, down 10.06% year-over-year.

• Net profit attributable to shareholders: RMB 266 million, down 76.19% year-over-year.

• Operating cash flow: RMB 1.23 billion, down 43.38% year-over-year.

• R&D investment: RMB 1.48 billion, 17.23% of revenue.

• Basic EPS: RMB 0.18, down 76.62% year-over-year.

Outlook and guidance

• 2026 sales revenue target set at RMB 9.2 billion, with focus on strengthening API and formulation integration, accelerating innovative drug commercialization, and expanding global presence.

• Strategic emphasis on high-value APIs, differentiated generics, and innovative biologics.

• Continued investment in R&D and international market expansion.