SSY Group Limited Issues Profit Warning for FY2025: Significant Decline in Earnings Expected

SSY Group Limited (Stock Code: 2005), a pharmaceutical company incorporated in the Cayman Islands and listed on the Hong Kong Stock Exchange, has issued a profit warning regarding its financial performance for the year ended 31 December 2025. The announcement, released on 16 February 2026, provides critical insights that may significantly impact investor sentiment and share price.

Key Points of the Profit Warning

• Substantial Decrease in Profit: The company expects a reduction in profit attributable to equity shareholders of between 45% and 60% for the year ended 31 December 2025, compared to the previous year’s profit of HK\$1,061,150,000.
• Preliminary Nature: These figures are based on unaudited management accounts and a preliminary assessment. The actual audited results may differ.
• Major Contributing Factors:
  • Decline in Turnover: Due mainly to three factors:
    1. In 2024, the PRC experienced a significant influenza outbreak, which drove strong demand for intravenous infusion solutions and other medicines. However, in 2025, the absence of a large-scale epidemic and enhanced control of medical insurance costs led to a decline in terminal sales volume of medicines.
    2. Intensified Competition and Price Pressure: The expansion of various forms of volume-based procurement (including the National Centralised Medicines Procurement and local alliance procurement) has resulted in continued price pressure due to heightened domestic and international competition.
    3. Loss of Key Product Sales Channel: The turnover of Bromhexine Hydrochloride in ampoule injection decreased as this product was no longer sold through the National Centralized Medicines Procurement.
• Financial Stability: Despite the profit decline, the company affirms that it maintains a solid financial position and cash flow.
• Strategic Response: SSY Group has been actively diversifying its product portfolio, with increased emphasis on oral preparations and bulk pharmaceutical products to optimize its product mix and mitigate the impact of market challenges.
• Ongoing Monitoring: The Board commits to closely monitoring the situation and taking timely action as the market environment evolves in 2026.

What Shareholders Need to Know

• Potential Share Price Impact: The anticipated sharp decline in profits—up to 60%—is a material development that could significantly affect the company’s share price.
• Unaudited Figures: The information provided is based on management accounts and has not been audited or reviewed by the company’s audit committee. Final results may vary.
• Upcoming Announcements: The finalized consolidated annual results and further details will be disclosed in the company’s forthcoming annual results announcement and annual report.
• Investor Caution: The company explicitly advises shareholders and potential investors to exercise caution when dealing in SSY Group securities under the current circumstances.

Conclusion

The profit warning issued by SSY Group Limited indicates a challenging year ahead, with a major expected reduction in profitability due to decreased product demand, sustained price pressure, and intensified competition. While the company remains financially stable and is pursuing diversification, this announcement is price-sensitive and could lead to increased volatility in the company’s share price. Investors are advised to monitor further disclosures closely and remain prudent in their investment decisions.

Disclaimer

This article is for informational purposes only and does not constitute investment advice. Investors should conduct their own due diligence and consult professional advisors before making any investment decisions. The information is based on preliminary, unaudited data and may be subject to change upon the release of the company’s audited annual results.

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