Fosun's Business Streamlining Strategy Yields Results: Financial Stability Strengthened While Core Businesses Show Resilience

The 2023 Fosun International Investor Open Day held in Shanghai on June 8 revealed the conglomerate’s progress in executing its strategic pivot toward financial resilience and operational efficiency. With over 100 institutional investors in attendance—including representatives from BlackRock, J.P. Morgan Securities, and UBS—the event showcased Fosun’s pharmaceutical, tourism, and consumer segments across flagship properties like Fosun Pharma headquarters, the Grand Yuyuan, and the Bund Finance Center.

Deleveraging Strategy Demonstrates Clear Traction

Fosun’s 2022 performance underscored the effectiveness of its business streamlining approach. The company disposed of assets with contract values exceeding RMB40.0 billion, generating nearly RMB30.0 billion in cash inflows at the holding level. More significantly, by March 2023, holding-company debt had decreased by approximately RMB24.0 billion to RMB93.0 billion—a tangible reduction in financial strain.

To bolster liquidity further, Fosun secured multiple financing channels. In January 2023, five major state-owned commercial banks—including ICBC, ABC, BOC, CCB, and Bank of Communications—jointly led a RMB12.0 billion syndicated loan. Subsequently, the company’s offshore multi-currency syndicated facility attracted over US$450 million in commitments.

These moves resonated with rating agencies. On May 30, S&P Global Ratings elevated Fosun International’s outlook to stable, citing the company’s resilient liquidity management and successful debt maturity management. The proportion of debts due within 12 months has declined markedly, stabilizing the company’s liability structure.

Core Businesses Drive Consumption-Led Recovery

Household consumption and tourism segments emerged as the primary engines of growth. Yuyuan achieved operating revenue of RMB15.244 billion in Q1 2023, a 22.61% year-on-year increase, with jewelry and fashion segment revenue climbing 28.55% to RMB11.494 billion. Customer traffic at Yuyuan Tourist Mart surged 87% compared to the prior-year period, signaling robust domestic consumption recovery.

Fosun Tourism Group (FTG) demonstrated even more dramatic improvement. Its net profit doubled compared to Q1 2022, while Club Med’s business volume reached RMB5.004 billion, representing 44.2% growth. During China’s May Day holiday, Atlantis Sanya’s business volume exceeded five times the 2022 level, attracting 115,000 visitors.

Shede Spirits benefited from the same tailwind, with revenue and net profit both advancing, alongside rising mid-to-high-end product mix penetration. Lanvin Group, Fosun’s first U.S.-listed subsidiary, reported annual revenue growth of 37% to EUR422 million across its five major brands, maintaining industry-leading momentum in the global luxury sector.

Innovation-Driven Drug Pipeline Accelerates Commercialization

Pharmaceutical innovation remained central to Fosun’s growth narrative. The company invested RMB10.4 billion in R&D during 2022, up 17% year-on-year, with long-term research efforts crystallizing into commercial milestones.

Shanghai Henlius’ HANSIZHUANG (serplulimab injection), launched in March 2022, achieved the distinction of becoming the world’s first anti-PD-1 monoclonal antibody approved for first-line small cell lung cancer treatment. Within nine months of launch, it generated over RMB300 million in revenue. Q1 2023 proved pivotal: the product achieved RMB249.8 million in domestic market revenue, with monthly sales exceeding RMB100 million for the first time in March, indicating accelerating commercial traction.

Fosun Pharma’s overall Q1 2023 operating revenue reached RMB10.871 billion (+4.68% YoY), with net profit attributable to shareholders at RMB919 million (+14.78% YoY) after adjusting for non-recurring items. Meanwhile, HANQUYOU (trastuzumab injection), China’s first monoclonal antibody biosimilar approved in both China and the EU, received FDA acceptance for its biologics license application—a path toward becoming the first such biosimilar approved across China, EU, and U.S. markets.

Outlook: Sustained Focus on Value Creation

Alex Gong, Executive Director and CFO of Fosun International, emphasized management’s commitment to maintaining business streamlining discipline while enhancing industrial competitiveness and global reach. The strategic focus remains on core consumption-facing businesses capable of delivering high-value growth.

Fosun International, founded in 1992 and Hong Kong-listed (00656.HK) since 2007, manages total assets of RMB823.1 billion as of end-2022. Ranking No. 589 on the 2022 Forbes Global 2000 List with an MSCI ESG rating of AA, the company continues positioning itself as a global innovation-driven consumer group committed to serving the wealth, health, and happiness needs of one billion families worldwide.