Recently, the leading player in the pharmaceutical retail industry, Dachanlin (603233. SH), held a performance briefing for 2024 and the first quarter of 2025, showcasing the company's operating results and future development plans in all aspects. Peng Guangzhi, the Chief Financial Officer and Secretary of the Board of Directors of the company, pointed out that Da Canlin has successfully built a store network covering 21 provinces (autonomous regions, municipalities directly under the central government) across the country, and the cross provincial expansion battle has been basically completed. In 2025, the company will focus on accelerating the increase of market share in areas already covered by encryption and further strengthen economies of scale.

In 2024, Da Canlin submitted a remarkable report card. In 2024, the company achieved a revenue of approximately 26.497 billion yuan, a net profit attributable to shareholders of the listed company of approximately 915 million yuan, a net profit attributable to shareholders of the listed company after deducting non recurring gains and losses of approximately 885 million yuan, and a net cash flow generated from operating activities of approximately 3.106 billion yuan. The company continues to expand its stores and has achieved rapid growth in revenue through the joint efforts of self construction, mergers and acquisitions, and direct franchise. The company's revenue scale increased from 5.265 billion yuan in 2015 to 26.497 billion yuan in 2024, with a compound annual growth rate of approximately 19.7%.

As of the end of 2024, the company has opened a total of 16553 stores (including 6050 franchise stores). In the first half of 2024, after completing coverage in Shanghai and Inner Mongolia, the company's business will cover 21 provinces (autonomous regions, municipalities directly under the central government) across the country, and the national layout has been basically achieved. The cross provincial expansion battle has been basically completed. Starting from the second half of 2024, the company officially enters the encryption period, focusing on increasing its market share in provinces (including autonomous regions and municipalities directly under the central government) and further strengthening economies of scale. After entering the encryption period, the company will have more energy to further enhance its refined management capabilities in traditional mature areas. At the same time, as the company's sales scale gradually expands and market share gradually increases in the new region, the scale effect of the company in the new region will gradually be reflected, and its profitability will also gradually enhance.

Entering 2025, the company will continue its good development trend, achieving a revenue of 6.956 billion yuan in the first quarter, a year-on-year increase of 3.02%; The net profit attributable to the parent company was 460 million yuan, a year-on-year increase of 15.45%. In addition, the net cash flow generated from operating activities was 1.768 billion yuan, a year-on-year increase of 44.14%. The abundant cash flow will provide solid support for future business expansion and strategic implementation, and also indirectly reflect the continuous improvement of the company's operating quality.

According to data from MiNet, the market share of the three major terminal markets of public hospitals, retail pharmacies, and public primary healthcare has evolved from 64%, 26.3%, and 9.7% in 2020 to 59.8%, 30.8%, and 9.4% in 2024, respectively. Therefore, the proportion of public hospitals in national drug consumption is showing an overall downward trend, while the proportion of retail pharmacies is showing an overall upward trend, and the long-term trend of prescription outflow remains unchanged. In response to the trend of "prescription outflow" in the pharmaceutical industry, Dachanlin continues to promote the layout of hospital side stores and DTP pharmacies, outpatient coordination, dual channel designated locations, and special network points at different locations. As of the end of 2024, the company has 248 DTP pharmacies, 10093 designated stores for personal account medical insurance, 652 designated stores for dual channel, and 1214 designated stores for Menmanmen.

With the tightening of medical insurance supervision and the reshaping of industry service processes, the pharmaceutical retail industry has bid farewell to the period of rapid expansion, and major players have slowed down their expansion pace and shifted their focus to optimizing inventory. In this context, compliance management and professional service capabilities have become the core competitiveness of enterprises.

During the industry integration period, Dachanlin took the lead in layout, improving operational efficiency through encrypted layout in the covered areas. At the same time, it continued to explore the closed-loop chain of "medical+medicine+health+examination+insurance", expanding new space for chronic disease management and innovative drug sales, and building a solid moat. Analysis indicates that with the deepening of the company's transformation, Dachanlin is expected to continue consolidating its leading advantages, creating emerging performance growth poles, and creating greater value for investors.

(This article does not constitute any investment advice, and the information disclosed is subject to the company's announcement. Investors operate based on this and bear the risks themselves.)