Sinopharm Q1-2026: Revenue Slips 0.6%, Attributable Profit Down 3.0% amid Higher Working-Capital Needs

Sinopharm Group Co. Ltd. released unaudited first-quarter 2026 results prepared under PRC GAAP.

Revenue and Profitability • Operating revenue edged down 0.63% year on year (YoY) to RMB140.77 billion. • Gross profit fell 5.26% to RMB9.36 billion, trimming the gross margin to 6.65% from 6.98% a year earlier. • Operating profit decreased 2.56% to RMB2.86 billion, while total profit slipped 1.53% to RMB2.90 billion. • Net profit attributable to equity holders dropped 2.97% YoY to RMB1.41 billion, driving basic earnings per share to RMB0.45 versus RMB0.47 in Q1-2025.

Cost and Expense Trends • Operating cost eased 0.29% to RMB131.40 billion, broadly in line with the revenue contraction. • Selling & distribution and G&A expenses fell 6.20% and 6.33% respectively, reflecting continued cost discipline. • R&D spending shrank 26.40% to RMB46.59 million. • Financial expenses improved by 14.20% to RMB383.82 million, but credit-impairment losses remained elevated at RMB944.87 million, similar to the prior-year level.

Balance-Sheet Highlights (vs. 31 Dec 2025) • Total assets expanded 2.72% to RMB400.83 billion. • Cash at bank declined 40.92% to RMB36.37 billion, mainly due to working-capital outflows. • Accounts receivable rose 16.77% to RMB220.61 billion; inventories increased 7.21% to RMB66.63 billion. • Short-term borrowings jumped 17.01% to RMB69.25 billion, contributing to a 3.32% rise in total liabilities to RMB264.34 billion. • Equity attributable to shareholders reached RMB85.52 billion, up 1.71%. The overall debt-to-asset ratio stands at 65.95%.

Cash Flow • Operating activities consumed RMB32.17 billion, an outflow improvement of 6.15% YoY. • Investing activities used RMB0.35 billion, reversing a RMB0.62 billion inflow in Q1-2025 due to higher capex and investment outlays. • Financing activities supplied RMB7.82 billion (Q1-2025: RMB12.88 billion), reflecting increased short-term borrowing and lower net cash from other financing sources. • Cash and cash equivalents closed the quarter at RMB24.08 billion, down from RMB48.80 billion at end-2025.

Parent-Company Performance At the standalone level, the parent company recorded revenue of RMB4.81 billion (-7.74% YoY) and net profit of RMB118.59 million (-56.32% YoY). Operating cash outflow widened to RMB1.40 billion, while cash reserves fell to RMB8.96 billion from RMB24.72 billion three months earlier.

Outlook Management did not provide forward guidance in the filing. The first-quarter results show modest top-line pressure and tighter liquidity, partially offset by cost controls and lower finance expenses. Investors will monitor how Sinopharm manages working-capital build-up and leverage through the remainder of 2026.