Changes in Hong Kong stocks | China Traditional Chinese Medicine (00570) fell more than 7% after the profit warning and is expected to lose about 800 million yuan to 850 million yuan in the first half of the year. The impact of the business format caused the company's goodwill to deteriorate

The Zhitong Finance App learned that Chinese Traditional Chinese Medicine (00570) fell by more than 7% after the warning. As of press release, it was down 4% to HK$1.44, or HK$307.97 million.

According to the news, on July 17, China Traditional Chinese Medicine announced that the Group expects a loss of about RMB 800 million to RMB 850 million for the six months ending June 30, 2026, and about RMB 142 million for the same period last year. The board of directors believes that due to industry policy adjustments and changes in the market environment, sales revenue and profitability declined, leading to further impairment of goodwill; the revenue scale and profitability of the proprietary Chinese medicine business and the production and operation of Chinese herbal medicines declined; asset impairment, credit impairment, and increased tax payments by some subsidiaries during the current period also had an impact on losses.

The Board of Directors emphasized that the above impairment of goodwill is non-cash and is a necessary measure to improve the Group's financial situation in the future. Facing an increasingly strict external regulatory environment, the Group will actively investigate the existing business model and effectively address the ongoing challenges brought about by increased industry competition and the macroeconomic environment by improving operating efficiency, optimizing resource allocation, and reforming marketing models.