Business Operations - The Group operates 203 retail pharmacies primarily located in Northeast China, with approximately 1,515 active distributors and 1,286 full-time staff[3]. - The Group has established four large-scale logistics storage centers in Shijiazhuang, Shenyang, Harbin, and Jiamusi, enhancing its distribution system across the country[3]. - The main product categories include prescribed drugs, non-prescribed drugs, traditional Chinese medicine, medical equipment, and health care products, among others[4]. - The Group aims to expand its product mix by introducing more health care products and exploring upstream ecological chains, including the construction of Chinese herbal medicine bases[6]. - The Group is actively exploring online pharmacies, cross-border e-commerce, and influencer marketing as part of its "Internet+" strategy[7]. - The Group emphasizes the concept of "Specialization+" and the development concept of "Platform+" to enhance its market position[8]. - The Group is committed to upgrading and digital transformation to adapt to the "New Norm" in the real economy[8]. - The Group's strategy includes leveraging core advantages of branded products and providing value-added services to employees, customers, and consumers[6]. - The Group is focused on becoming a leading practitioner of the "Internet + Universal Health" strategy and developing an ecological industry chain[2]. - The Group's vision is to be an international brand operator in the universal health industry, capitalizing on significant market opportunities[2]. Financial Performance - Revenue for the year ended June 30, 2024, was RMB 1,089.0 million, a decrease of 16.0% from RMB 1,297.0 million in the previous year[12]. - Gross profit decreased by 15.9% to RMB 179.9 million, down from RMB 213.8 million[12]. - Operating profit improved significantly to RMB 0.1 million, compared to a loss of RMB 98.4 million in the previous year, representing an increase of RMB 98.5 million[12]. - The company reported a profit for the year of RMB 0.6 million, a turnaround from a loss of RMB 106.1 million in the previous year, marking an increase of RMB 106.7 million[12]. - Adjusted EBITDA improved to a loss of RMB 13.3 million, compared to a loss of RMB 71.8 million in the previous year, an increase of RMB 58.5 million[12]. - Basic earnings per share increased to RMB 0.06, up from a loss of RMB 18.07 per share in the previous year, an improvement of RMB 18.13[12]. - The current ratio improved to 1.0 from 0.9, indicating better short-term financial health[12]. - Return on equity increased to 0.1%, up from a negative 33.5% in the previous year, reflecting a significant recovery[12]. - The company achieved a gross margin of 16.5%, maintaining the same level as the previous year[12]. - The inventory turnover days decreased to 57.8 days from 59.8 days, indicating improved inventory management[12]. Market Trends and Industry Outlook - The market size of Chinese medicine increased from nearly RMB 450 billion in 2022 to over RMB 480 billion in 2023, with expectations to exceed RMB 500 billion in 2024[16]. - The healthcare industry in China is projected to reach RMB 17.4 trillion by 2025 and RMB 29.1 trillion by 2030[30][31]. - A series of policies were issued in 2024 to optimize the pharmaceutical and healthcare system, including centralized procurement of medicines and enhancing regulatory innovation[17][32]. - The competition in China's pharmaceutical market is expected to intensify due to the implementation of the "Healthy China" strategy and continuous optimization of medical insurance payment standards[21][24]. - Public demand for medicine consumption has risen, driving continuous growth in relevant domestic industries[37]. Operational Efficiency and Strategy - The Company aims to divest non-primary businesses and optimize store layouts to improve operational efficiency[21][24]. - The Company is focusing on integrated outpatient services for its stores to enhance service offerings[21][24]. - The Group recorded retail sales revenue of RMB332.1 million for the Year, representing a year-on-year decrease of 9.1% compared to RMB365.3 million in 2023[40]. - The distribution business recorded sales revenue of RMB756.9 million, a year-on-year decrease of 18.8% from RMB931.7 million in 2023[42]. - The Group closed a number of loss-making retail stores to minimize operating losses, reducing the total number of retail pharmacies from 251 to 203[65]. - The Group provided follow-up services and promotion benefits for approximately 3.66 million offline members, enhancing member loyalty and promoting a healthy corporate image[55]. - The Group conducted 16 online video internal training sessions to optimize training activities and enhance employee adaptability to business transformation[54]. - The Group actively participated in industry alliance activities to strengthen its influence and promote the development of branded products[58]. Environmental, Social, and Governance (ESG) Initiatives - The Group recognizes the importance of environmental, social, and governance (ESG) factors in its sustainable development strategy[22][25]. - The Group is committed to reducing its environmental impact through various policies, including prioritizing local suppliers to decrease transportation energy consumption[95]. - The Group's operational model does not generate waste gas or greenhouse gas emissions, contributing to its commitment to environmental sustainability[88]. - The Group's corporate social responsibility initiatives focus on maintaining sustainable development in environmental, operational, and community aspects[89]. - The Group's environmental goals include reducing emissions and enhancing overall sustainability practices in response to global concerns[89]. - The Group is committed to promoting environmental protection education among stakeholders, ensuring compliance with national regulations[100]. Employee Management and Development - The total employee benefit expenses for the year amounted to RMB113.4 million, down from RMB183.8 million in 2023, with a reduction in full-time employees from 2,555 to 1,286[79]. - The Group has established a set of human resources management policies aimed at providing an ideal working environment and linking compensation to performance[114]. - The Group provides social insurance for employees, including employment injury insurance, and has implemented safety measures to ensure a safe working environment[119]. - The Group's management policies ensure compliance with local employment laws, including regulations against child and forced labor[112]. - The Group encourages employees to participate in external higher education and professional qualification exams, promoting comprehensive skill enhancement[130]. - The Group provided 16 training sessions through Jintian Institute with a total of 552 participants, aiming to improve staff quality and management performance[128]. Corporate Governance and Compliance - The Group has established communication channels with stakeholders, including annual reports and shareholder meetings, to ensure transparency and protect shareholder interests[91]. - The Group has complied with relevant laws and regulations that significantly impact its business operations[164]. - The Group has established a whistle-blowing policy, with no reported cases of corruption or legal issues related to corrupt practices during the year[139]. - The Group emphasizes the protection of consumer privacy, ensuring that all member and consumer data is encrypted[135]. - The Group has strengthened its procurement procedures to avoid infringement of third-party intellectual property rights, holding suppliers accountable for any violations[137]. - The Group is committed to ethical business practices, prohibiting employee involvement in illegal activities such as bribery and fraud[136]. Shareholder Information - The Board does not recommend any final dividend for the Year, maintaining a dividend of Nil for 2023[154][156]. - The Company raised approximately HKD10.2 million through the subscription of 133,509,926 shares at a price of HKD0.08 per share, with a net subscription price of approximately HKD0.076 per share[157][159]. - The net proceeds from the subscription will be used for general working capital, including daily operations of physical retail chain stores, inventory replenishment, and e-commerce sales[161][162]. - As of June 30, 2024, the net proceeds were allocated as follows: HKD7.5 million for inventory procurement related to new drugs and HKD2.7 million for rental expenses of retail stores, totaling HKD10.2 million[162]. - The Group maintains effective communication and good relationships with stakeholders, including employees, customers, suppliers, banks, regulators, and shareholders[152].
大健康国际(02211) - 2025 - 年度财报