Increasing profits without increasing revenue: Is Huaxi Biological relying on "saving money" to support its performance?

On February 27th, Huaxi Bio-Tech Co., Ltd. (hereinafter referred to as “Huaxi Bio”), a giant in hyaluronic acid, released its 2025 performance forecast.

During the reporting period, Huaxi Bio achieved a total revenue of 4.217 billion yuan, a 21.49% decrease compared to 5.371 billion yuan in the same period last year; net profit attributable to the parent company was 291 million yuan, a 67.03% increase year-on-year; net profit attributable to the parent company excluding non-recurring gains and losses increased by 75.28% to 188 million yuan.

This apparent contradiction of “profit growth without revenue growth” is mainly due to Huaxi Bio’s cost reduction efforts, aside from the small base in the same period last year and the impact of non-recurring gains and losses.

The performance forecast shows that during the reporting period, net profit attributable to the parent company and net profit attributable to the parent company excluding non-recurring gains and losses increased by over 30% year-on-year, mainly due to the company’s continuous optimization of business structure and resource allocation, resulting in a year-on-year decrease in sales and management expenses.

Specifically, in 2025, Huaxi Bio’s management expenses decreased by more than 10% year-on-year, and sales expenses decreased by over 30%.

“During the reporting period, the company carried out systematic structural optimization around skin science innovation transformation and nutritional science innovation transformation, adjusting the related business’s C-end brand system, product structure, and channel models,” Huaxi Bio stated. The company reduced investments in brands and projects with low input-output efficiency, focusing on core businesses.

According to incomplete information compiled by Beijing News Shell Finance, in September 2025, Huaxi Bio’s skincare brand “Runxi Spring,” focused on anti-aging and repair effects, announced store closures. In November of the same year, the online operation of “Dema Run,” which emphasizes “customized skin measurement,” stalled. Huaxi Bio responded that the adjustments of these two brands aim to focus on core businesses and main brands.

In the 2025 performance forecast announcement, Huaxi Bio also admitted that structural adjustments may have a certain short-term impact on revenue scale but “will help optimize the business structure.”

(Source: Beijing News)