Longshen Rongfa's net profit in 2025 increased by 79.56% year-on-year, improving quality and efficiency to build development resilience

(Source: Longshen Rongfa)

On the evening of April 2nd, the company officially released its 2025 annual report. Faced with a complex and volatile macroeconomic environment and increasingly fierce industry competition, the company坚持固本夯基、稳中求进, focusing on strengthening its core traditional Chinese medicine business, enhancing product innovation, capacity upgrades, market expansion, and lean management. The full-year operating results achieved significant profit growth and improved development quality, delivering an impressive high-quality development report card. During the reporting period, the company realized operating revenue of 886.9587 million yuan, with net profit attributable to shareholders of listed companies of 43.9508 million yuan, a year-on-year increase of 79.56%; net profit after deducting non-recurring gains and losses was 50.5265 million yuan, up 7.96% year-on-year. Operating efficiency steadily improved, and profitability significantly strengthened. Meanwhile, the company plans to distribute a cash dividend of 0.2 yuan (tax included) per 10 shares to all shareholders, totaling 6.0669 million yuan.

As a national high-tech enterprise, Gansu Province “Specialized, Refined, Characteristic, Innovative” enterprise, and a core backbone enterprise in Longyao industry, the company has always focused on the main business of Chinese patent medicines and multi-industry synergy as its development direction. It has formed a product matrix centered on two major proprietary products: Yuanhu Pain-Relief Drops and Xuanfei Cough-Relief Compound, covering five dosage forms—drops, mixtures, tablets, capsules, and films—with a total of 25 varieties. Among them, five are nationally exclusive varieties, with multiple products included in the national essential drug list and medical insurance catalog, forming prominent advantages and market recognition in pain relief and cough suppression. Additionally, during the reporting period, the company’s three categories of medical devices—blood dialysis dry powder and concentrated dialysis solution—successfully obtained registration approval, covering two major categories and 16 models. The company became the first in Gansu, Qinghai, Ningxia, and other northwest provinces to obtain registration certificates for these products. After commissioning, these will open new growth points for the company.

By 2025, the company will continue to refine its market operations, consolidate hospital sales, expand OTC channels, and build a dual-driven marketing strategy. The “big marketing” system will be further improved, with core product markets continuously expanding. Throughout the year, Yuanhu Pain-Relief Drops and Xuanfei Cough-Relief Compound cumulatively covered 2,983 and 2,324 grade hospitals, respectively, representing increases of 6.27% and 7.57% over the previous year. Relying on excellent product quality and brand influence, the two core products remain at the top of industry rankings. The company ranked 9th in the “2025 Q1 China’s Top 10 Group (Secondary) of Traditional Chinese Medicine Gastrointestinal Drugs (Gastritis, Ulcers) in the Three Major End Markets of China’s Top Three Terminals.” The flagship Yuanhu Pain-Relief Drops ranked 9th in the “2025 Q1 China Public Medical Institutions’ Top 20 Traditional Chinese Medicine Gastrointestinal Drugs (Gastritis, Ulcers),” and 15th in the “Top 20 Brands in Sales of Traditional Chinese Medicine Pills in China’s Public Medical Institutions.” The flagship Xuanfei Cough-Relief Compound ranked 10th in the “2025 H1 China Retail Pharmacies’ Top 20 Brands for Cough, Phlegm, and Asthma Relief in Traditional Chinese Medicine,” and 6th in the “2025 Q1-Q3 China Public Medical Institutions’ Top 20 Brands for Cough, Phlegm, and Asthma Relief in Traditional Chinese Medicine.” The market position and competitiveness of these core products continue to strengthen. Additionally, the company’s health food Huangqi Danggui Capsules were approved as non-drug products in the Macao SAR, marking a new step in expanding into the Guangdong-Hong Kong-Macao Greater Bay Area market and promoting traditional Chinese medicine health products “going global.” Furthermore, the company continues to expand the health product market, with products such as “7°Fedel,” mint lozenges, Huangqi Danggui drinks, Cistanche raw pulp, and Goji berry raw pulp being sold both online and offline.

In terms of innovation and R&D, the company completed the acquisition of 70% equity of Gansu Pharmaceutical Group Innovation Research Institute, further integrating drug R&D and testing technology platforms to rapidly strengthen R&D capabilities. Leveraging advantages in dosage forms such as drops, tablets, mixtures, and films, the company established a pilot laboratory, which has been put into operation and has completed the “Lanzhou High-tech Zone Pharmaceutical Pilot Research Center” registration, bridging the “last mile” from laboratory research to industrial production. Guofang Testing passed CNAS accreditation and expanded CMA qualifications, accumulating 2,221 CMA parameters across six major fields, greatly enhancing testing capacity and possessing the qualification to issue mutual recognition testing reports for over 100 economies worldwide. The development of major varieties is progressing steadily: the real-world study project for the treatment of acute exacerbation of COPD with Xuanfei Cough-Relief Compound has been initiated; comparative analysis of the advantages of Yuanhu Pain-Relief Drop formulations and other key technical research projects are advancing steadily; the Class 2 reformulated new drug Bupropion ODT (orally disintegrating film) has entered the registration review stage; classic formula development is progressing smoothly; the re-production and listing of Tongmai Oral Liquid, the completion of production line modifications for Acetaminophen Oral Solution, and the progress of pharmaceutical film change for Clotrimazole are all ongoing, continuously strengthening the company’s R&D strength and core competitiveness.

While improving operational quality, the company adheres to strict drug quality safety standards, fully implementing the new pharmacopoeia and traditional Chinese medicine production regulations. It has passed re-certification of quality, environment, energy, and occupational health and safety management systems, strictly controlling product quality throughout the process. The company actively promotes GAP (Good Agricultural Practice) base construction, advancing the green, standardized, regulated, and intensive cultivation of Chinese medicinal materials. The Huangqi GAP base successfully passed review by the Gansu Provincial Drug Administration. Committed to green development, the company was awarded the title of Lanzhou Green Factory; its rooftop distributed photovoltaic project was successfully connected to the grid, reducing approximately 450 tons of CO2 emissions annually, fulfilling the responsibilities of a state-owned enterprise for green, low-carbon, high-quality development. Due to outstanding performance in green and intelligent manufacturing, the company was recognized as a Lanzhou “Municipal Green Factory,” and its “Green Low-Carbon Operation and Resource Recycling Practices in Traditional Chinese Medicine Factory Area” was shortlisted as an excellent demonstration case by the Ministry of Ecology and Environment’s Publicity and Education Center for the 2025 Beautiful China·Green Space initiative. The company and its subsidiary Puan Pharmaceutical were simultaneously listed among Gansu Province’s high-tech, high-growth, high-value-added enterprises in 2024; Puan Pharmaceutical was awarded the “Healthy Enterprise” title in Wuwei City, Gansu Province, and the “First Prize for High-Quality and Steady Growth of Industrial Enterprises in Wuwei City,” and was included in the second batch of Gansu Province’s manufacturing single-industry champion enterprises, demonstrating leadership in local industrial growth and healthy enterprise development.

Looking ahead to 2026, as the opening year of the “14th Five-Year Plan,” the company will continue to focus on its main business, intensify market penetration, industrial empowerment, innovation-driven development, and lean management. It will accelerate the secondary development of core varieties, the listing and sales of medical devices, and the comprehensive promotion of health products. The company will deepen international cooperation in traditional Chinese medicine along the “Belt and Road” initiative, striving to build a comprehensive industry chain integrating modern Chinese medicine production, Chinese medicinal material planting and processing, medical devices, new drug R&D, pharmaceutical distribution, testing and inspection, and health services—making greater contributions to the high-quality development of Gansu’s traditional Chinese medicine industry and the construction of a Healthy China.

Source | Securities Affairs Department

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