Fosun International's loss last year expanded to nearly 23.4 billion RMB. Guo Guangchang: Unprecedented

Fosun International (00656) announced that, for the year ended December last year, the loss attributable to shareholders widened to 23.396 billion yuan (RMB; the same below), with loss per share of 2.88 yuan, and no final dividend will be paid. The loss for the same period in 2024 was 4.349 billion yuan.

The company said the loss this time was not due to a deterioration in underlying business fundamentals; the core reason was the Board’s prudent principle, which led to non-cash impairment charges for some projects in the company’s past development process. At the same time, it also involved impairment of goodwill and intangible assets in some non-core business segments. The impairment charges this time will not affect daily operations, cash flow, or business operations. Core businesses such as pharmaceuticals and insurance are still seeing steady growth.

During the period, revenue was 173.425 billion yuan, down 9.74% year on year.

Chairman and founder Guo Guangchang said that such performance, in the development history of Fosun over more than 30 years, was also unprecedented. In the past, Fosun was especially bold and made many attempts—some succeeded and some failed, and overall it paid plenty of tuition fees. In recent years, China’s real estate industry has faced macro and structural adjustments. Some projects that were laid out in the past indeed diverged from the value that existed at the time of the group’s initial investment under current market conditions and circumstances. Therefore, the Board has prudently chosen to complete this asset impairment so that Fosun can better focus resources and attention and invest in high-growth core tracks.

Guo Guangchang pointed out that, with the global economy brewing opportunities amid volatility and China’s innovative industries entering a development trend, deepening the layout at this time can not only optimize the asset structure, but also help Fosun secure an early lead in the industry, making Fosun lighter, healthier, and more sustainable.

Looking ahead, the company said that management is confident. The group will continue to focus on its core businesses, accelerate the exit of non-core assets, and optimize its asset portfolio. Relying on the steady growth of core subsidiaries such as Fosun Pharma, Yuyuan Co., Ltd., Fosun Tourism and Culture, and Fosun Portuguese Insurance, the company will strive in the medium term to gradually restore a profit scale of RMB 10 billion.

At the same time, in continuing to enhance shareholder returns, in addition to the controlling shareholder and management increasing their holdings of the company’s shares and the company continuing to execute share buybacks, the company announced that, for the year ending December 2026, its target dividend payout ratio would be increased from the current 20% to 35%, and it is committed to continuously improving the dividend payout ratio. In addition, based on the company’s accumulated distributable profits, the dividend for the fiscal year 2026 is expected to be not less than RMB 1.5 billion.