Wandong Medical has issued its 2026 half-year performance forecast, projecting a net loss attributable to the parent company of 82.5 million to 101 million yuan for the first half, marking its first half-year loss since listing in 1997. The company reported a full-year loss of 228 million yuan in 2025, ending a 28-year streak of annual profits, and the loss trend is accelerating in 2026. The first quarter saw a net loss of 15.934 million yuan, while the second quarter loss is expected to widen to between 66.566 million and 84.896 million yuan. The main reason for the losses is the company's active participation in centralized procurement with a price-for-volume strategy. In 2025, it won 34 projects and 932 devices in provincial-level centralized procurement, with a total winning bid amount of 520 million yuan, boosting its market share by about 10 percentage points. However, the average discount rate reached 46 percent, dragging the full-year gross margin down to 26.56 percent, a drop of nearly 20 percentage points from 45.82 percent in 2021. The gross margin even fell to negative 18.86 percent in the fourth quarter of 2025. Meanwhile, research and development, sales, and financial expenses all rose across the board. R&D expenses reached 263 million yuan in 2025, with an expense ratio of 19.54 percent, while sales expenses grew 26.29 percent year-on-year to 277 million yuan. These expenses continued to increase in the first half of 2026, and exchange rate fluctuations led to greater exchange losses, further eroding profits. The Shanghai Stock Exchange has issued an inquiry letter regarding the company's operations and the impact of centralized procurement, but the company declined to be interviewed.
Beijing Wandong Medical Technology Co LtdCentralized procurement price-for-volume strategy forced deep discounts (46% average), crushing gross margins and causing first half-year loss since listing.