Dingdang Health Technology Group Ltd. Issues Positive Profit Alert for FY2025

Key Highlights for Investors

• Significant Reduction in Net Loss: Dingdang Health Technology Group Ltd. (Stock Code: 09886) expects its net loss for the year ended December 31, 2025 (FY2025) to narrow by more than 80% compared to FY2024, when the net loss was approximately RMB380 million.
• Turnaround to Adjusted Net Profit: The Group anticipates achieving an adjusted net profit (non-IFRS measure) of not less than RMB5 million in FY2025, a marked improvement from the adjusted net loss of RMB57.2 million reported in FY2024.
• Reduction in Impairment Losses: Impairment losses on goodwill and other intangible assets recognized in FY2024 (approximately RMB198.9 million and RMB6.8 million, respectively) are expected to decrease significantly in FY2025.
• Strategic Urban Layout Optimization: The Group has focused on deepening its presence in core first-tier cities such as Beijing, Shanghai, and Shenzhen. Expansion and densification of its smart pharmacy networks have enhanced operational efficiency and driven steady business growth.
• Supply Chain and Product Mix Improvements: Strengthening supply chain service capabilities, optimizing the product sales mix, and increasing the proportion of high gross profit product categories have contributed to improved operational efficiency and profitability.

Detailed Analysis

Dingdang Health Technology Group Ltd. has issued a positive profit alert indicating a dramatic improvement in its financial performance for FY2025. The company expects its net loss to shrink by over 80% compared to FY2024, when it reported a loss of RMB380 million. This improvement is attributed to several factors:

1. Lower Impairment Charges: In FY2024, the company recorded significant impairment losses in goodwill and other intangible assets totaling approximately RMB205.7 million. These impairment amounts are expected to decrease substantially in FY2025, relieving pressure on the bottom line.
2. Urban Layout Strategy: Dingdang Health is deepening its focus on first-tier cities (Beijing, Shanghai, Shenzhen), where it has actively expanded and densified its smart pharmacy networks. This strategic approach has led to enhanced operational efficiency and steady business growth.
3. Supply Chain & Product Mix Enhancements: The Group has strengthened its supply chain capabilities, optimized its product mix, and increased the proportion of higher-margin product categories. These efforts have significantly improved both operational efficiency and profitability.

Benefiting from these favorable factors, the Group expects to achieve an adjusted net profit (non-IFRS measure) of at least RMB5 million for FY2025. This marks a turnaround from the adjusted net loss of RMB57.2 million in FY2024. The adjusted net profit figure is calculated by adding back impairment of goodwill and intangible assets (after tax), amortization of intangible assets from acquisitions (after tax), and share-based payment expenses to the net loss. The company notes this measure is intended to provide additional insight into operational performance, but it is not a substitute for IFRS-based financial analysis and may not be directly comparable with similar measures used by other companies.

Important Information for Shareholders

• Price Sensitivity: The expected turnaround from loss to profit, combined with significant reduction in impairment charges and improved operational efficiency, are likely to be price-sensitive developments. These could positively impact investor sentiment and potentially affect the company’s share price.
• Preliminary Assessment: The information provided is based on unaudited, preliminary figures and has not yet been reviewed by auditors or the audit committee. Final audited results may differ.
• Annual Results Timeline: Shareholders and investors are advised to review the upcoming annual results announcement for FY2025, which is expected to be published in March 2026 for more detailed and audited financial information.
• Caution Advised: Investors should exercise caution when dealing in the company’s shares prior to the release of the final annual results.

Board and Management Update

The announcement was authorized by the Board of Dingdang Health Technology Group Ltd., chaired by Mr. Yang Wenlong. The Board currently comprises five executive directors, one non-executive director, and three independent non-executive directors.

Conclusion

Dingdang Health Technology Group Ltd.’s anticipated turnaround from loss to profit, substantial reduction in impairment charges, and strategic progress in urban expansion and supply chain optimization represent material, price-sensitive developments. Shareholders and investors should monitor future announcements closely and exercise caution until audited results are released.

Disclaimer: This article is based on preliminary, unaudited financial information released by Dingdang Health Technology Group Ltd. The final figures may change upon audit. Investors are urged to consult the official audited results and exercise caution in their investment decisions. This article does not constitute financial advice.

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