FAST NEWS: Fosun Pharma hits pause button on share buyback program
The Latest: Shanghai Fosun Pharmaceutical (Group) Co. Ltd. (2196.HK; 600196.SH) announced Monday it hasn’t yet implemented a share buyback since announcing a plan on March 27 to buy back its A shares through centralized bidding.
Looking Up: As the share buyback has not yet commenced, it has not had any impact on the company’s cash flow.
Take Note: The fact that Fosun Pharma has not started the buyback more than a month after the announcement may lead investors to question the authenticity of the program.
Digging Deeper: Fosun Pharma is a diversified drug company whose portfolio includes pharmaceutical, medical equipment and healthcare services. With the end of the Covid pandemic in China early last year, the sales of vaccines, antiviral drugs and other anti-epidemic products dropped sharply. As the seller of the comirnaty vaccine and the anti-viral drug azvudine, Fosun Pharma’s business performance was affected. Even with the satisfactory sales contribution from innovative drug products, its revenue dropped by 5.8% to 41.2 billion yuan ($5.82 billion) last year, and its profit dropped by an even bigger 35.8% to 2.4 billion yuan.
Market Reaction: Fosun Pharma’s shares fluctuated slightly in Tuesday trade, closing unchanged at HK$12.74 by the midday break, near the lower end of their 52-week range.
Translation by A. Au
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