The "Midea Group" support cannot prevent the pain of transformation. Wandong Medical reports its first annual loss and suspends dividends.

First Annual Loss in 29 Years: Wanting Medical (600055.SH) Reports Disappointing 2025 Results

According to the annual report released on the evening of March 25, the company’s revenue for 2025 was 1.347 billion yuan, down 11.64% year-over-year; net profit attributable to shareholders was a loss of 228 million yuan, a decline of 244.81%. The fourth quarter performance fell short of market expectations, with revenue dropping sharply to 158 million yuan and net loss attributable to shareholders reaching 201 million yuan.

Despite the loss, the company will not distribute dividends for 2025, breaking a tradition of annual year-end dividends maintained for over 20 years. Additionally, the company plans to sell a loss-making subsidiary established less than three years ago to its controlling shareholder, Midea Group (000333.SZ). The subsidiary was originally set up for strategic expansion but is now being divested due to business adjustments.

Whether Wanting Medical’s transformation will succeed remains to be seen. Market reactions show that the company’s stock has been volatile and declining this year, especially after reaching a high point on January 14, with a total decline of 19.24% as of March 26.

Q4 Losses Drag Down Full-Year Results

After incurring losses in the third quarter last year, Wanting Medical’s losses widened further in the fourth quarter, leading to its first annual loss in 29 years.

In the first three quarters of last year, the company’s revenue was 373 million yuan, 470 million yuan, and 345 million yuan respectively, but plummeted to 158 million yuan in Q4. Net profit attributable to shareholders turned negative starting in Q3 with a loss of 78.51 million yuan, and worsened in Q4 to a loss of 201 million yuan.

Many investors noted that the Q4 performance was below expectations. The actual operational results in Q4 did not align with prior guidance shared during investor relations activities.

After releasing the third-quarter report last year, numerous institutional investors engaged with Wanting Medical’s management. According to the investor relations record disclosed on October 27, 2024, senior executives explained that in Q4, centralized procurement entered a delivery peak, with provincial and county-level procurement in Fujian, Anhui, Shanxi, Xinjiang, Sichuan, and other regions expected to deliver hundreds of millions of yuan, driving overall Q4 performance growth.

However, the actual Q4 results declined sharply, dragging down the full-year performance. The company’s revenue for 2025 was 1.347 billion yuan, down 11.64%; net loss attributable to shareholders was 228 million yuan, down 244.81%; net cash flow from operating activities was -252 million yuan, down 215.44%.

In the annual report, Wanting Medical stated that its 2025 performance reflects a strategic adjustment and deep transformation amid a complex and changing macro environment and industry cycle.

Regarding the revenue decline, the company said that it adjusted its overall marketing strategy, focusing on upward and outward expansion, utilizing centralized procurement projects internally to capture mid-to-high-end markets, and actively expanding international channels. The longer-than-expected delivery cycle of procurement projects led to lower domestic income compared to the previous year.

As of the end of 2025, contract liabilities stood at 175 million yuan, up 127.44% from 76.68 million yuan a year earlier, mainly due to an increase in undelivered orders.

On profit and operating cash flow pressure, the company explained that increased strategic investments included participating in centralized volume-based procurement to accelerate penetration into mainstream public hospital markets and optimize product structure for greater competitiveness. It also maintained high R&D investment, focusing on core technologies like helium-free MRI and next-generation intelligent imaging, to build momentum for high-end market transformation.

Due to its ongoing transformation and losses, Wanting Medical will not distribute dividends for 2025, breaking a tradition of annual year-end dividends for over 20 years. The company stated that, given the lack of profit in 2025 and considering external industry environment and future development, to maintain stable growth and protect long-term shareholder interests, the board decided not to pay cash dividends, issue bonus shares, or transfer capital reserves to increase share capital, with profits to be carried forward to future periods.

Divestment of Loss-Making Subsidiary During Transformation

Along with the annual report, Wanting Medical announced plans to transfer its less-than-three-year-old loss-making subsidiary to a subsidiary of its controlling shareholder.

The company intends to transfer 100% equity of its wholly owned subsidiary, Suzhou Wanying Medical Technology Co., Ltd. (“Suzhou Wanying”), to Midea Imaging Technology (Shanghai) Co., Ltd. (“Midea Imaging”) for 48 million yuan.

This transaction constitutes a related-party deal, as Midea Imaging is controlled by Midea Group, Wanting Medical’s controlling shareholder.

Suzhou Wanying was established in November 2023, fully owned by Wanting Medical. At that time, the company stated that, based on strategic needs and leveraging local policies and industry resources, it invested 100 million yuan in setting up the subsidiary in Suzhou to develop core component R&D and manufacturing, enhance technology transfer, expand market space, and improve core competitiveness.

However, in 2024 and 2025, Suzhou Wanying incurred losses of 5.89 million yuan and 11.20 million yuan respectively, with total accumulated losses of 17.09 million yuan, showing a continuous decline.

According to the announcement, Wanting Medical’s book value of its 100% stake in Suzhou Wanying was 36.21 million yuan. The sale will realize an appreciation of 11.78 million yuan, a 32.54% increase.

The company explained that the sale was driven by the need to adjust its business strategy.

Wanting Medical was listed on the Shanghai Stock Exchange on April 24, 1997, and is a veteran in China’s medical imaging equipment industry. Its actual controller and major shareholder have changed multiple times. China Resources Group was once the controlling shareholder, and in March 2012, the company was renamed “China Resources Wanting.” In 2015, Yuwell Technology acquired controlling interest, and in September 2016, the company reverted to the name “Wanting Medical.”

In 2021, Midea Group acquired a 29.09% stake from Yuwell and its controlling shareholder Wu Guangming, becoming the controlling shareholder. He Xiangjian became the actual controller.

During Midea’s control period, the company’s board of directors has changed three times. The longest-serving chairman held the position for four years. The second chairman, Ma Chibing, served only eight months from May 21, 2025, to January 25, 2026, before resigning for personal reasons. On January 26, 2026, Wang Jianguo was elected chairman.

A major challenge facing Wanting Medical now is whether it can successfully transform. The company stated that in recent years, the global medical imaging industry has undergone profound changes driven by technological innovation, market demand, and policy guidance. Dependence on external technology and insufficient innovation pose fundamental risks. Fierce market competition and payment pressures impact profitability, fragile global supply chains and disconnected industry chains affect operational stability, and increasingly strict regulations raise market entry and ongoing operation barriers.

“The company needs to establish comprehensive risk management, balance short-term survival with long-term innovation strategically, strengthen supply chain resilience, deepen clinical collaboration, and actively adapt to global regulatory changes to navigate cycles and achieve sustainable development,” it said.

Duty Editor: Yulin