May be subject to delisting risk warning; Mingde Biotech states "current production and operations are normal"

The era of high profits in the IVD industry is gradually becoming a thing of the past, with profit pressures affecting leading companies. On March 22, Mingde Bio (002932) released a revised earnings forecast. Due to an expected negative total profit, net profit, and net profit after deducting non-recurring gains and losses for 2025, as well as revenue below 300 million yuan after deductions, the company’s stock trading may be subject to delisting risk warning by the Shenzhen Stock Exchange after the 2025 annual report is disclosed.

However, the company stated in the announcement that all production and operations are currently normal.

The announcement shows that the company originally expected a net profit attributable to the parent company of 12 million to 18 million yuan. After revision, it is expected to incur a loss of 15 million to 25 million yuan; the original estimate for net profit after deducting non-recurring gains and losses was -98 million to -78 million yuan, revised to a loss of 100 million to 140 million yuan.

Additionally, the company expects a total loss of 50 million to 75 million yuan in 2025; projected revenue is between 250 million and 310 million yuan, with revenue after deductions ranging from 237 million to 297 million yuan.

Regarding the reasons for the earnings revision, Mingde Bio stated that when the 2025 performance forecast was disclosed, the annual audit work had not been fully carried out. As the related work progressed, the company and the annual audit firm re-evaluated the 2025 performance based on prudence.

“Mingde Bio conducted a comprehensive review and cautious analysis of revenue, and some transactions were uncertain due to receivables collection,” the company said. The corresponding revenue was not included in 2025, leading to a reduction in revenue and net profit attributable to the parent company.

Meanwhile, the company further communicated with the annual audit firm, conducting impairment tests on assets with signs of impairment one by one. Based on prudence, adjustments were made to asset impairment losses for inventories, fixed assets, and other assets, resulting in a corresponding decrease in net profit attributable to the parent company.

Since 2023, policies such as normalized centralized procurement and the reform of DRG/DIP (Diagnosis-Related Group/Diagnosis-Intervention Packet) payment methods have changed the survival and development logic of the IVD industry. The stage of easy high profits for IVD companies has become history.

Facing industry growth challenges, IVD companies are exploring different paths, seeking differentiated development strategies. Mingde Bio focuses on critical and severe diseases, with main products and services covering in vitro diagnostic reagents and instruments, critical illness information solutions, and third-party medical testing services. Since the end of last year, the company has undertaken a series of acquisitions to enhance its core competitiveness and synergy around its main business.

On December 30 last year, Mingde Bio announced its plan to acquire 100% equity of Wuhan Bikai’er with cash, which is expected to constitute a major asset restructuring.

Wuhan Bikai’er is one of the early companies to introduce the FirstAid concept and technology internationally, with a comprehensive layout in emergency equipment, emergency single items, and emergency services. Mingde Bio stated that acquiring Wuhan Bikai’er would further extend its business boundaries, improve the industrial chain layout, and enhance asset quality and profitability.

On January 19 this year, Mingde Bio announced its plan to acquire a 51% stake in Hunan Lanyi through capital increase and equity purchase, with a total investment of 35.71 million yuan. Hunan Lanyi focuses on R&D, production, and service of IVD instruments and reagents, especially possessing core technology in glycated hemoglobin testing. Mingde Bio said that this acquisition would help build a closed-loop service model for “critical and severe diseases + chronic disease management.”