Guanhao Biotech 2025 Annual Report Analysis: Financial Expenses Increase by 148%, Non-Recurring Net Profit Grows by 33.47%

Core Profitability Indicators Interpretation

Operating Revenue: Slight Increase of 2.72%, Drug Business as Main Growth Driver

In 2025, Guanhai Biotech achieved an operating revenue of 388 million yuan, a year-on-year increase of 2.72% from 377 million yuan in 2024, maintaining a modest expansion in revenue scale. Looking at the business segments, the drug business performed remarkably, with operating revenue reaching 57.8752 million yuan, a significant increase of 56.40% year-on-year, becoming the main driver of revenue growth; medical device business revenue was 283 million yuan, a slight decrease of 1.30% year-on-year; leasing and other business revenue was 46.5906 million yuan, down 12.83% year-on-year.

From quarterly data, the annual revenue distribution was relatively balanced, with revenues of 94.7971 million yuan, 106.0725 million yuan, 92.6108 million yuan, and 94.2693 million yuan in the four quarters, with the fourth quarter increasing slightly by 1.8% compared to the third quarter.

Net Profit: Down 11.20% Year-on-Year, Non-Operating Gains and Losses Drag Performance

In 2025, net profit attributable to shareholders of the listed company was 24.35M yuan, a decrease of 11.20% from 27.4169 million yuan in 2024. After deducting non-recurring gains and losses, net profit was 26.3119 million yuan, a substantial increase of 33.47% year-on-year, with the divergence mainly influenced by non-recurring gains and losses. During the reporting period, non-recurring gains and losses totaled -1.9659 million yuan, compared to 7.7026 million yuan in 2024, a decrease of 9.6685 million yuan year-on-year, becoming the main reason for the decline in net profit.

Quarterly profit performance shows the company achieved profits in the first three quarters, with net profits of 14.8661 million yuan, 5.538 million yuan, and 6.3144 million yuan respectively, but incurred a loss in the fourth quarter, with net profit attributable to shareholders of -2.3725 million yuan, dragging down the overall annual performance.

Earnings Per Share: Basic EPS Down 10% Year-on-Year

In 2025, the company’s basic earnings per share was 0.09 yuan/share, down 10.00% from 0.10 yuan/share in 2024; non-recurring net earnings per share was 0.10 yuan/share, up 33.47% from 0.07 yuan/share in 2024, consistent with the growth trend of non-recurring net profit.

Cost Structure Analysis

Total Expenses Slightly Increase, Financial Expenses Significantly Rise

In 2025, the company’s total period expenses amounted to 2.52B yuan, up 4.08% from 161M yuan in 2024, reflecting a slight expansion in operational costs.

Selling Expenses: Steady Growth, Continued Market Investment

Selling expenses totaled 80.87M yuan, a 2.21% increase, mainly used for marketing, conference activities, and personnel salaries. Among these, market service fees reached 57.21M yuan, accounting for 50.25% of selling expenses, up 13.38% year-on-year, indicating ongoing increased market investment to promote product sales.

Management Expenses: Essentially Flat, Control Effects Evident

Management expenses were 5.7211 million yuan, only a 0.07% increase, reflecting effective cost control. These expenses mainly covered employee salaries, intermediary agency fees, and office rent.

Financial Expenses: Sharp Increase of 148%, Mainly Due to Interest Expenditure

Financial expenses surged 148.00% to 338,280 yuan, primarily due to increased loans for the Tianhao Zhongshan Medical Technology project, leading to a significant rise in interest costs. During the period, interest expenses were 3.38M yuan, a 291.69% increase from 1.0304 million yuan in 2024.

R&D Expenses: Continued Investment, Steady Progress in R&D Projects

R&D expenses were 40.9657 million yuan, up 13.27%, with ongoing investment in projects such as biological hard membrane repair materials, cardiac surgery patches, and bio-artificial liver. R&D investment during the period was 45.5729 million yuan, accounting for 11.75% of operating revenue, with capitalized R&D expenditure of 4.6072 million yuan, representing 10.11% of R&D investment.

R&D Personnel: Higher Proportion of Highly Educated Staff

In 2025, the company had 66 R&D personnel, accounting for 12.45% of total staff, up 3.03%. The educational structure shows a significant increase in master’s degree or above R&D staff, with master’s degree holders rising from 6 in 2024 to 11, a 72.73% increase; doctoral degree holders increased from 3 to 5, a 60.00% increase. The increase in highly educated R&D personnel helps enhance the company’s innovation capabilities.

Cash Flow Analysis

Overall Cash Flow: Cash and Cash Equivalents Surged by 570.04%

In 2025, net increase in cash and cash equivalents was 56.1189 million yuan, a substantial rise of 570.04% from 8.3754 million yuan in 2024, indicating significant improvement in cash flow.

Operating Cash Flow: Increased Collection from Sales, Net Surged 44.23%

Net cash flow from operating activities was 71.4738 million yuan, up 44.23%, mainly due to increased sales collection during the period. Total cash inflow from operating activities was 456 million yuan, up 5.92%; total cash outflow was 385 million yuan, up only 0.94%, with inflows growing faster than outflows.

Investing Cash Flow: Large Reduction in Outflows, Net Narrowed

Net cash flow from investing activities was -36.1908 million yuan, a 57.40% increase compared to -84.9941 million yuan in 2024, mainly because last year’s payments for the Tianhao Zhongshan Medical Technology project were higher, while investments in 2025 decreased. Total cash outflows for investing activities were 39.3685 million yuan, down 53.71%.

Financing Cash Flow: Reduced Loans, Net Down 51.79%

Net cash flow from financing activities was 21.0184 million yuan, down 51.79%, mainly due to decreased project loans for the Tianhao Zhongshan Medical Technology project. Total cash inflows from financing were 51.1148 million yuan, down 39.86%; outflows were 30.0964 million yuan, down 27.31%.

Risk Factors Interpretation

Policy Change Risks: Impact of Centralized Procurement Policies on Product Profitability

With the comprehensive promotion of volume-based procurement policies for high-value medical consumables, the company’s related products may face downward price pressure, affecting profitability. The company needs to actively participate in procurement, optimize sales strategies, and reduce adverse policy impacts.

New Product Registration Risks: Long R&D Cycles and Uncertain Approvals

The company’s new products have long development-to-approval cycles, with uncertain approval outcomes. If new products fail to obtain approval as planned, it will impact product deployment and performance growth.

Animal Disease Risks: Raw Material Supply Disruption

Some raw materials for production are edible animal tissues. If regional or nationwide large-scale animal disease outbreaks occur, raw material procurement and supply may be restricted, affecting production operations.

Original Technology Industrialization Risks: Market Cultivation Challenges

The market promotion and clinical recognition of the company’s original technology products require long-term effort and continuous investment. Uncertainty exists regarding market acceptance, which may affect the industrialization process of technological achievements.

M&A Integration Risks: Underperformance of Target Integration

The company’s external expansion through acquisitions involves uncertainties in target selection, valuation, and post-merger integration of business and teams. If integration effects fall short, it could impact synergy benefits.

Management and Board Compensation Interpretation

In 2025, the company’s directors and senior management received a total compensation of 9.1209 million yuan. Key executives’ compensation includes:

• Chairman Zhang Yongming: Pre-tax remuneration from the company was 499.3k yuan.
• General Manager Zhao Feng: Pre-tax remuneration was 969.4k yuan.
• Deputy General Managers: Xu Qingrong received 923.1k yuan; You Zhen received 922k yuan; Hou Huaixin received 797.5k yuan; Lin Xianggui received 799.2k yuan; Zhang Weikun received 825.3k yuan.
• Chief Financial Officer Yi Ruofeng: Pre-tax remuneration was 795k yuan.

Overall, executive compensation aligns with company performance, and the core management team’s pay levels are consistent with industry standards and company circumstances.

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