Shandong Pharmaceutical Glass Under Observation | Performance Pressure in 2025, Weak Downstream Demand Leads to Decline in Revenue and Net Profit

By Shan Shuo

On March 23, 2026, Shandong Yaobolin Pharmaceutical Glass Co., Ltd. (Securities Code: 600529) held a 2025 annual performance briefing via the network platform of the Shanghai Stock Exchange (SSE) Roadshow Center. According to the company’s “Shandong Yaobolin Pharmaceutical Glass Co., Ltd. 2025 Annual Report” (hereinafter referred to as the “2025 annual report”) released on March 7, 2026, this domestic leader in pharmaceutical glass packaging saw a double decline in both revenue and net profit last year.

At the performance briefing, the company’s management provided focused responses to investors’ concerns regarding performance fluctuations, inventory levels running high, progress on the fund-raising projects, and the company’s future strategy.

Comprehensive performance decline—the weak downstream demand is the main reason

According to disclosures in the 2025 annual report, Shandong Yaobolin achieved total operating revenue of RMB 4.474 billion last year, down 8.78% year-on-year; it recorded net profit attributable to owners of the parent company of RMB 690 million, with a year-on-year decline of 26.87%; and net profit after deducting non-recurring gains and losses was RMB 658 million, down 27.13% year-on-year.

By quarter, the pressure on performance ran throughout the year. In the fourth quarter, single-quarter revenue was RMB 1.122 billion, down 9.59% year-on-year, while net profit attributable to the parent company was RMB 147 million, down 33.87% year-on-year.

It is worth noting that over the past year, Shandong Yaobolin’s main products experienced broad-based declines. According to the table showing main businesses by product in the 2025 annual report, among the six main products disclosed by the company, five products saw their operating revenue decline to varying degrees in 2025. Among them, the company’s core high-gross-margin product—borosilicate molded bottles—saw its sales volume fall 11.8% year-on-year, while its inventory volume surged 82.4% year-on-year.

Regarding the reasons for the performance decline, Zhao Haibao, the board secretary of Shandong Yaobolin, said on the SSE Roadshow Center network platform that the company’s main-product revenue fell in 2025 mainly due to declining demand from domestic pharmaceutical manufacturers.

Data from the National Bureau of Statistics show that in the first half of 2025 (January to June), scale above medical manufacturing industries recorded operating revenue down 1.2% year-on-year and total profit down 2.8% year-on-year.

The contraction in downstream demand is also directly reflected in the company’s asset structure. The 2025 annual report shows that Shandong Yaobolin’s ending inventory increased 32.61% compared with the beginning of the year. Song Yizhao, the company’s CFO, explained to reporters from Securities Daily on the roadshow platform that the main reason for the increase in inventory was the rise in inventories of goods resulting from the decline in revenue.

The company also mentioned in its 2025 annual report that, affected by weak market demand and the need for continuous production characteristics of glass kilns, it made provisions for inventory write-downs of RMB 103 million and provision for impairment of construction in progress of RMB 44 million, leading to a significant increase in annual asset impairment losses to RMB 157 million.

As for investors’ concerns about inventory impairment risk, Song Yizhao said at the performance briefing that the company reduces inventory levels by expanding markets and increasing sales; at the same time, it controls some capacity by adjusting the timing of glass kiln overhauls. Going forward, the impact of impairment on the company’s performance will not be significant.

In addition, investors have also focused on the progress of the company’s fund-raising projects. According to disclosures in the 2024 and 2025 annual reports, the cumulative investment progress for the fund-raising project “Shandong Yaobolin Pharmaceutical Glass Co., Ltd.’s Grade One Water-Resistant Medicinal Glass Bottle” increased from 29.26% in 2024 to 40.20% in 2025, while the project’s scheduled date to reach the state of being ready for intended use is December 2026.

Regarding questions about the relatively slow progress in the project’s early stage, Zhao Haibao responded at the performance briefing that the company’s fund-raising project is expected to reach the intended target by the end of 2026.

Breaking through and expanding: a dual engine driven by internationalization and smart manufacturing

Facing performance pressure, Shandong Yaobolin laid out its response strategies and future plans in the performance briefing. Zhao Haibao said that in 2026 the company will continue to implement the concept of high quality, low cost, and good service to stabilize and enhance market share; it will also introduce advanced technologies and management concepts to speed up the construction of smart factories; and it will actively cultivate and expand international markets to open up a new chapter for its foreign trade.

The company’s internationalization strategy has already taken substantive steps. According to the company’s “Announcement of Shandong Yaobolin Pharmaceutical Glass Co., Ltd. on External Investment to Establish a Wholly Owned Subsidiary in Malaysia,” released on March 7, the board of directors of Shandong Yaobolin approved, on March 5, 2026, the proposal to establish a subsidiary in Malaysia, aiming to “promote the globalization strategy by establishing an overseas subsidiary, in accordance with the company’s strategic plans and business development needs.”

This move is aligned with the company’s business performance. The company’s 2025 financial report shows that although revenue in the domestic market fell 13.65% year-on-year, the company’s overseas revenue in 2025 reached RMB 1.502 billion, up 1.98% year-on-year, becoming a bright spot in its performance. In the annual report, the company stated that this was mainly due to the continuous growth of its international market shares of core products such as molded bottles (for injection), daily-chemicals/food bottles, and brown bottles.

What is also notable is that the company’s controlling shareholder change is also being advanced. According to the SSE website, Shandong Yaobolin released a plan for a share placement (private placement) on January 14, 2026, proposing to issue shares to China International Medicinal Health Co., Ltd., among others. If the issuance is completed, Sinopharm International will become the company’s controlling shareholder, and the actual controller will change to China National Pharmaceutical Group Co., Ltd.

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