TRAD CHI MED (China Traditional Chinese Medicine Holdings Co. Limited) reported a net loss of RMB0.46 billion for the year ended 31 December 2025, reversing a profit of RMB20.77 million a year earlier. Revenue declined 10.7% to RMB14.74 billion, mainly due to lower prices and reduced volumes in the concentrated traditional Chinese medicine (TCM) granules segment amid nationwide centralized procurement and intensified competition.
Gross profit slipped 9.7% to RMB7.09 billion, yet the gross margin inched up 0.5 percentage point to 48.1% on product-mix improvements and lower herb procurement costs. Impairment charges—principally RMB494.92 million on goodwill and RMB222.84 million on intangible assets—pushed other losses to RMB722.82 million, weighing heavily on the bottom line. Excluding non-recurring items, adjusted net profit fell 47.5% to RMB333.35 million.
Segment performance showed mixed trends: • Concentrated TCM granules remained the largest contributor, generating RMB6.10 billion (41.4% of total revenue), down 12.5% year on year, with margin contracting 3.1 ppts to 53.8%. • TCM finished drugs delivered RMB4.25 billion, a 6.7% drop, though margin widened 3.1 ppts to 66.7% on lower raw-material costs. • TCM decoction pieces rose 0.6% to RMB3.33 billion, with margin improving to 25.1%. • Chinese medicinal herbs integration revenue fell 40.2% to RMB0.83 billion after the group exited low-margin activities; margin narrowed to 7.7%. • TCM great health products slid 17.2% to RMB0.23 billion, yet margin rose to 31.9% following product-line rationalisation.
Selling and distribution expenses decreased 8.6% to RMB4.95 billion, tracking lower sales, while R&D spending contracted 14.2% to RMB0.51 billion. Finance costs dropped 42.2% to RMB99.13 million as interest-bearing liabilities were cut to RMB1.20 billion from RMB2.70 billion, reducing the gearing ratio to 11.8% (2024: 18.5%).
The group closed 2025 with cash and bank balances of RMB4.04 billion, a current ratio of 2.3 and undrawn bank facilities of RMB10.59 billion. Capital expenditure declined to RMB355.73 million from RMB532.19 million. No final dividend was proposed, compared with a HK0.35-cent final and HK8.30-cent special dividend for 2024.
Management cited strategic restructuring, asset disposals and tightened compliance as priorities for 2026, aligning with China’s policy shift toward value-driven, high-quality TCM development. Focus areas include supply-chain integration, cost optimisation, evidence-based R&D and digital transformation. The company views 2025’s loss as a necessary step to strengthen its asset base ahead of the nation’s 15th Five-Year Plan period commencing in 2026.