Net profit "four consecutive declines" Haier Biomedical's profitability continues to be under pressure

The Science and Technology Innovation Board Daily reported on March 28 (Reporter Shi Shiyun) that Haier Biomedical (688139.SH) released its annual report for 2025 last night.

According to the annual report, in 2025, Haier Biomedical achieved revenue of 2.329 billion yuan, a year-on-year increase of 1.96%. The net profit attributable to the parent company was 251 million yuan, a significant decline of 31.61% compared to 367 million yuan in 2024. The net profit excluding non-recurring items was 220 million yuan, a year-on-year decrease of 31.74%.

It is noteworthy that this marks the fourth consecutive year of declining net profits for Haier Biomedical, with ongoing pressure on profitability. Meanwhile, its net cash flow from operating activities in 2025 was 268 million yuan, down 8.15% from 292 million yuan in 2024.

Additionally, according to the profit distribution plan disclosed simultaneously by Haier Biomedical for the year 2025, it is proposed to distribute a cash dividend of 3.3 yuan (tax included) for every 10 shares to all shareholders.

From a quarterly performance perspective, Haier Biomedical achieved revenue of approximately 567 million yuan in the fourth quarter of 2025, a year-on-year increase of about 13.17% and a slight quarter-on-quarter increase of about 0.18%. The net profit attributable to the parent company was 52.34 million yuan, a year-on-year decrease of about 8.96% and a quarter-on-quarter decline of about 9.21%.

In response to the situation of increasing revenue without increasing profit, Haier Biomedical stated that the international situation is becoming more complex due to trade frictions, and industry demand is still in the recovery process. Coupled with the fact that the company’s new production capacity is still ramping up, and ongoing increases in medium to long-term strategic investments, the company’s profitability is facing phase-based pressure in 2025.

Haier Biomedical mainly focuses on the life sciences sector, covering low-temperature storage, laboratory solutions, intelligent medication, blood technology, and more. It is committed to providing digital scenario solutions for users in higher education research, biopharmaceutical enterprises, hospitals, disease control, blood stations, and grassroots public health. In terms of equity structure, Haier Biomedical’s controlling shareholder is Qingdao Haier Biomedical Holdings Co., Ltd., and the actual controller is Haier Group.

Currently, Haier Biomedical’s main business consists of two major segments: life sciences and medical innovation. In 2025, these two segments achieved revenues of 1.118 billion yuan and 1.198 billion yuan, respectively, representing year-on-year growth of 2.25% and 1.51%. However, the corresponding gross profit margins fell by 1.36 percentage points and 1.10 percentage points, respectively.

In addition, in terms of product sales, the sales volume of Haier Biomedical’s life sciences and medical innovation products in 2025 was 106,079 units, down 9.59% from 117,325 units last year. Additionally, due to a 2.43% decrease in production volume compared to the previous year, the company’s inventory also decreased by 3.33%.

Faced with the operational pressure of slowing revenue growth and continuous decline in net profit, Haier Biomedical attempted to break through through mergers and acquisitions. In December 2024, Haier Biomedical announced its intention to merge with Shanghai Laishi through a share issuance and stock exchange and simultaneously raise supporting funds. This “snake swallowing elephant” type of major restructuring attracted significant market attention. However, just less than half a month after the official announcement, this merger was terminated due to the complexity of the transaction structure, which failed to form a specific plan recognized by all relevant parties.

However, the failure of this merger has not shaken Haier Biomedical’s determination to continue seeking development through external acquisitions. The annual report clearly states that mergers and integrations can achieve technological enhancements, ecosystem expansions, and scene implementations, thereby improving the overall competitiveness of the enterprise.

The Science and Technology Innovation Board Daily has noted that prior to planning the merger with Shanghai Laishi, Haier Biomedical had completed six industry acquisitions, including the acquisition of the liquid nitrogen business in 2017, the plasma collection business in 2020, and the intelligent medication business in 2023. The company stated that it will increase its acquisition efforts in the future to further expand its industrial boundaries and open up growth space.

The ongoing acquisition expansion has also led to a continuous increase in Haier Biomedical’s goodwill scale, which has risen from 10.6694 million yuan in 2016 to 758 million yuan in 2025, an increase of approximately 747 million yuan, nearly a 70-fold increase.

Goodwill is essentially an asset formed from acquisition premiums, and its impairment risk is highly correlated with the profitability of the acquired assets. If the performance of the target is steadily growing, the impairment pressure is relatively small. However, if the performance significantly underperforms expectations, it may trigger impairment, directly dragging down current profits. As of now, Haier Biomedical has not encountered significant goodwill impairment. Previously, the acquisition of Kangsheng Bio by Haier Biomedical did not fulfill its performance commitments, but after impairment testing, the recoverable amount of the related asset group was still higher than the book value, so no goodwill impairment was recognized.

In terms of secondary market performance, Haier Biomedical experienced a peak period from its initial public offering until August 2021, with its stock price reaching an all-time high of 148.94 yuan on August 19, 2021. However, since then, the company’s stock price has continued to undergo deep adjustments. As of the close on March 27, Haier Biomedical’s stock price was 30.65 yuan per share, having dropped nearly 80% from its historical peak.