Sinopharm Accord(000028) 新京报·2025-04-09 09:21Core Viewpoint - The annual report of China National Pharmaceutical Group Corporation (Sinopharm) indicates a decline in both revenue and net profit for 2024, primarily due to challenges in the retail sector stemming from policy changes and intensified market competition [1][2]. Financial Performance - Sinopharm achieved operating revenue of 74.378 billion yuan, a year-on-year decrease of 1.46% [1]. - The net profit attributable to shareholders was 642 million yuan, down 59.83% year-on-year [1]. - The retail segment, primarily represented by Guoda Pharmacy, reported operating revenue of 22.357 billion yuan, a decline of 8.41% [2]. - The retail segment incurred a net loss of 1.072 billion yuan, a significant drop of 388.83% year-on-year [2]. Retail Sector Challenges - The retail sector's performance was adversely affected by industry policy changes and increased competition, leading to a substantial gap between expected and actual performance [2][3]. - The company recognized impairment losses of 970 million yuan on goodwill and intangible assets, which reduced net profit by 561 million yuan during the reporting period [2]. - The retail environment is characterized by declining customer traffic and sales of high-margin products, exacerbated by intensified competition and the impact of e-commerce [3]. Strategic Adjustments - In response to operational pressures, Sinopharm has initiated store closures, optimizing its retail footprint by shutting down over 1,270 stores in 2024 [3]. - The self-owned brand sales of Guoda Pharmacy exceeded 1 billion yuan, marking a 46% year-on-year increase, while innovative business sales reached 1.89 billion yuan [3]. - Despite these efforts, the overall performance of the retail business has not yet shown signs of recovery [3]. Distribution Segment Performance - The distribution segment generated operating revenue of 52.984 billion yuan, a slight increase of 1.98% year-on-year, but net profit fell by 12.74% to 922 million yuan [4]. - The decline in profitability is attributed to delayed receivables and increased funding costs due to a lack of extraordinary gains compared to the previous year [4]. Market Trends - The retail pharmacy market is experiencing a trend of store closures, with an estimated 39,000 retail pharmacies expected to shut down in 2024, resulting in a closure rate of 5.7% [5]. - The overall sales scale of the Chinese pharmaceutical retail market is projected to reach 501.9 billion yuan in 2024, reflecting a modest growth of 0.8% year-on-year [5]. Company Restructuring - Sinopharm has initiated bankruptcy liquidation for several subsidiaries, including Guoda Pharmacy's Anhui and Tianjin branches, as part of a strategy to enhance management efficiency and address financial challenges [6]. - The company acknowledges that the rapid expansion phase has led to structural adjustments in the retail sector, with a focus on improving operational quality and risk resilience [6].