United Laboratories International Holdings Limited (United Lab) reported a sharp earnings contraction for the six months ended 30 June 2026 as profit attributable to shareholders fell 81.6% year-on-year to RMB0.35 billion. Revenue declined 18.0% to RMB6.17 billion, dragged by weaker finished-product sales and a softer pricing environment for certain intermediate products.
Gross profit retreated 46.0% to RMB2.12 billion, while EBITDA dropped 66.5% to RMB0.92 billion. The gross margin narrowed to 34.4% from 52.2% a year earlier, reflecting intensified pricing pressure and a normalisation of cost controls in China’s pharmaceutical market. Basic EPS was RMB17.62 cents versus RMB104.26 cents in 1H25; no interim dividend was declared after a RMB0.26 per-share final dividend paid in July.
Segment performance showed mixed trends: • Intermediate products revenue fell 30.4% to RMB0.70 billion; segment profit dropped 69.8% to RMB0.19 billion. • Bulk medicine revenue edged up 2.6% to RMB2.60 billion, but segment profit slid 68.2% to RMB0.08 billion. • Finished products revenue (including a US$15 million licensing milestone) declined 27.9% to RMB2.87 billion; segment profit fell 73.6% to RMB0.40 billion.
Geographically, domestic sales contributed RMB4.83 billion, while exports, led by Europe and South America, generated RMB1.34 billion.
United Lab spent RMB0.47 billion on R&D (down 14.8%), focusing on a 40-compound pipeline with 23 Class 1 new drugs. Key milestones included FDA and NMPA IND approvals for multiple candidates, Phase II data for GLP-1/GIP/GCGR agonist UBT251, and China approval of insulin degludec. A US$15 million milestone from Novo Nordisk for UBT251 was recognised.
Operating cash flow fell to RMB0.03 billion from RMB2.00 billion in 1H25, reflecting higher working-capital outflows and tax payments. Nevertheless, cash and equivalents rose to RMB11.07 billion, and net cash after borrowings and supplier-finance payables stood at RMB3.42 billion. The current ratio improved to 2.05.
Capital expenditure totalled RMB0.43 billion, mainly for plant expansion in Inner Mongolia and Zhuhai. Net borrowings increased to RMB5.92 billion, with 87% at floating rates between 1.90% and 2.70%.
During the period, United Lab repurchased 2.75 million shares for HK$22.63 million and cancelled them in July. Under the 2023 Share Award Scheme, 12.10 million shares were granted; 0.76 million lapsed or were cancelled in 1H26, leaving 3.27 million unvested.
Management reaffirmed commitment to innovation, stating that the company will accelerate clinical development, deepen vertical integration and pursue overseas expansion while maintaining a robust financial position.
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