China Health Group (673) released additional information related to its annual report for the year ended 31 March 2025, highlighting developments in the recovery of loan and interest receivables, as well as updates on the performance and plans for its distribution and hospital operations.
The announcement explained that impairment losses of approximately HK$11.7 million were recognized for expected credit losses on receivables involving Shuangluan Hospital, Mingcheng Wangda, and a developer of hospital management systems (Jimuyun). Legal proceedings for Shuangluan Hospital and Mingcheng Wangda are ongoing. As of the announcement date, a court judgment is still pending for the Shuangluan Hospital case, while the first hearing for Mingcheng Wangda’s litigation is scheduled for December 2025. Regarding the Jimuyun loan, the company extended its maturity to 31 March 2026, citing continuous collaboration with the debtor.
In discussing the distribution business, the document noted a revenue decline of around 39.6% from the previous year, down to approximately HK$27.7 million, mainly attributed to the effects of the nationwide centralised procurement policy in the PRC and intensified market competition. Operating margins during the year decreased to 24.9%, impacted by lower average selling prices. Through cost-control measures, the segment recorded a net profit of about HK$0.3 million in FY2025. Looking ahead, the company intends to strengthen Beijing Youkang’s role as a distributor of high-quality medical consumables and devices, focusing on product diversification and further expansion in cardiovascular segments.
For hospital operations, the focus is on Anping Bo’ai Hospital, a Class II general hospital with 130 inpatient beds. The announcement indicated that national healthcare reforms have compressed margins and heightened competition, shifting demand toward larger hospitals with advanced facilities. Anping Bo’ai Hospital’s patient volumes and revenues declined, prompting a move toward integrated rehabilitation, nursing-care, and preventive services. Processes are in place to adjust staff roles, introduce new departments, and partner with local elderly nursing homes. The company aims to align with policy priorities by offering community-oriented health-management packages, strengthening rehabilitation services, and broadening service lines without significant capital expenditure.
A new hospital president was appointed in October 2025 to oversee these strategic adjustments, including departmental updates and performance-based staff remuneration systems. The ultimate goal is to streamline operations, rebuild revenue, and position the hospital for long-term growth under a reformed healthcare environment.
Shareholders and investors are advised to remain mindful of the latest litigation proceedings and operational changes outlined in the supplemental announcement, as the company continues its efforts to improve business performance and expand its service scope within the evolving medical and healthcare industry.