Bei Jing Shang Bao·2025-08-18 13:39Core Viewpoint - The traditional Chinese medicine company Baiyunshan is facing a challenging period with continuous declines in net profit due to insufficient demand, intensified industry competition, and regulatory pressures [1][3]. Financial Performance - In the first half of the year, Baiyunshan reported a revenue of approximately 418.35 billion yuan, a year-on-year increase of 1.93%, while the net profit attributable to shareholders was about 25.16 billion yuan, down 1.31% year-on-year [3]. - The company’s net profit for the first half of 2024 was approximately 25.5 billion yuan, reflecting a year-on-year decline of 9.31% [3]. - The pharmaceutical industry is experiencing a slowdown, with a reported revenue of 1.23 trillion yuan in the first half of 2025, down 1.2% year-on-year [3]. Business Segment Analysis - Baiyunshan's business segments show significant divergence in performance. The traditional Chinese medicine segment (Danan Yao) saw a revenue decline of 15.23%, while the health and commercial segments reported revenue growth of 7.42% and 4.25%, respectively [8][9]. - Specifically, the revenue from traditional Chinese medicine products fell by 20.12%, while chemical drugs also experienced a decline of 5.85% [9]. R&D and Marketing Expenditure - Baiyunshan's R&D expenses for the first half of the year were 2.85 billion yuan, a decrease of 27.06% year-on-year, indicating a trend of reduced investment in R&D [10]. - In contrast, the sales expenses were significantly higher at 30.28 billion yuan, reflecting a decrease of only 2.92% [10]. - The company has been criticized for prioritizing marketing over R&D, which may hinder its ability to innovate and adapt to market changes [11]. Management Changes - Baiyunshan recently appointed a new chairman, Li Xiaojun, who faces the challenge of navigating the company through multiple pressures while balancing short-term performance with long-term innovation [11].