ST Xiangxue: Announcement on Provision for Asset Impairment in 2025
Securities code: 300147 Securities abbreviation: ST Xiangxue Announcement number: 2026-021
Guangzhou Xiangxue Pharmaceutical Co., Ltd.
Announcement on Provision for Asset Impairment in 2025
The company and all members of the board of directors guarantee that the information disclosed is true, accurate and complete, and contains no false records, misleading statements or major omissions.
The 35th meeting of the ninth board of directors of Guangzhou Xiangxue Pharmaceutical Co., Ltd. (hereinafter referred to as the "Company") reviewed and approved the "Proposal on the Company's Provision for Asset Impairment in 2025". In accordance with relevant laws and regulations such as the "Shenzhen Stock Exchange GEM Stock Listing Rules", "Business Accounting Standards", "Shenzhen Stock Exchange Listed Companies Self-Regulatory Guidelines No. 2 - Standardized Operations of GEM Listed Companies" and other relevant laws and regulations, the specific circumstances of this provision for asset impairment are hereby announced as follows:
1. Overview of the current provision for asset impairment
In accordance with the relevant provisions of "Accounting Standards for Business Enterprises No. 8 - Asset Impairment" and the company's accounting policies, the company conducted a comprehensive inspection of the assets within the scope of the consolidated statements as of the end of 2025, and made corresponding impairment provisions for assets with signs of impairment. A total of RMB 576,696,101.46 was made for various asset impairments in 2025, as detailed in the following table:
Asset name Amount incurred in the current period/yuan
Loss on inventory depreciation and impairment loss on contract performance costs 13,048,531.06
Impairment losses on fixed assets 397,853,780.29 Impairment losses on assets
Impairment losses on construction in progress 94,593,787.21 Others 38,911,597.43
Bad debt losses on accounts receivable 8,322,443.21 Credit impairment losses Bad debt losses on other receivables 23,948,271.17 Others 17,691.09 Total 576,696,101.46
2. The impact of this provision of asset impairment provisions on the company
This provision for asset impairment will reduce the company's total profit in 2025 by RMB 576,696,101.46. This provision for asset impairment has been audited and confirmed by Beijing Dehao International Accounting Firm (Special General Partnership).
3. Recognition standards and accrual methods for this impairment provision
(1) Recognition standards and accrual methods for inventory depreciation losses and impairment of contract performance costs
After conducting a comprehensive inventory of the inventory at the end of the period, the inventory depreciation reserve is withdrawn or adjusted based on the lower of the inventory cost and the net realizable value. For inventory of goods that are directly for sale, such as finished goods, inventory, and materials for sale, during the normal production and operation process, the net realizable value is determined by the estimated selling price of the inventory minus the estimated sales expenses and related taxes; for material inventories that need to be processed, during the normal production and operation process, the estimated selling price of the finished goods produced is deducted to the time of completion. The net realizable value is determined based on the estimated costs, estimated sales expenses and relevant taxes. For inventories held for the execution of sales contracts or labor contracts, the net realizable value is calculated based on the contract price. If the quantity of inventory held is greater than the quantity ordered in the sales contract, the net realizable value of the excess inventory is calculated based on the general sales price.
At the end of the period, inventory depreciation provisions are accrued based on individual inventory items; however, for inventories with large quantities and low unit prices, inventory depreciation provisions are accrued according to inventory categories; inventory depreciation provisions are made on a consolidated basis for inventories that are related to product series produced and sold in the same region, have the same or similar end use or purpose, and are difficult to measure separately from other items.
If the factors that caused the previous write-down of the inventory value have disappeared, the amount of the write-down will be restored and reversed within the amount of the inventory devaluation provision that was originally accrued, and the reversed amount will be included in the current profit and loss.
(2) Conditions for confirmation of impairment of fixed assets
Depreciation of fixed assets is calculated based on their recorded value minus the estimated net residual value over their estimated useful lives. For fixed assets with provision for impairment, the depreciation amount will be determined based on the book value after deduction of impairment provision and the remaining useful life in the future period; no depreciation will be provided for fixed assets that have been fully depreciated and are still in use.
The company determines the service life and estimated net residual value of fixed assets based on their nature and usage. At the end of the year, the service life, estimated net residual value and depreciation method of fixed assets will be reviewed. If there are differences from the original estimates, corresponding adjustments will be made.
The depreciation methods, depreciation years and annual depreciation rates of various types of fixed assets are as follows:
Category Depreciation method Depreciation life (years) Residual value rate (%) Annual depreciation rate (%) Houses and buildings Average life method 30-40 5-10 2.25-3.17 Machinery and equipment Average life method 5-15 5-10 6.0-19.0
Means of transportation Average age method 5-8 5-10 11.25-19.0
Category Depreciation method Depreciation period (years) Salvage value rate (%) Annual depreciation rate (%) Office and other equipment Year-average method 4-5 5-10 18.0-23.75
Subsequent expenditures related to fixed assets that meet the fixed asset recognition conditions will be included in the cost of fixed assets; if they do not meet the fixed asset recognition conditions, they will be included in the current profit and loss when incurred.
When a fixed asset is disposed of or no economic benefits are expected to be generated through use or disposal, the fixed asset is derecognised. The amount of disposal income from the sale, transfer, scrapping or damage of fixed assets after deducting their book value and related taxes is included in the current profit and loss.
(3) Confirmation standards and accrual methods for projects under construction
- Initial measurement of projects under construction
Projects under construction built by the company itself are valued at actual costs. The actual costs consist of the necessary expenditures incurred before the asset reaches its intended usable state, including the cost of project materials, labor costs, relevant taxes paid, borrowing costs that should be capitalized, and indirect costs that should be apportioned.
- Standards and timing for transferring construction in progress to fixed assets
For projects under construction, all expenditures incurred before the asset reaches its intended usable state shall be regarded as the recorded value of the fixed assets. If the construction in progress has reached the intended usable state, but the final settlement of completion has not yet been processed, from the date it reaches the intended usable state, the estimated value will be transferred to fixed assets based on the project budget, cost or actual cost of the project, etc., and the depreciation of the fixed assets will be accrued in accordance with the company's fixed asset depreciation policy. After the final settlement of completion has been processed, the original estimated value will be adjusted based on the actual cost, but the originally accrued depreciation amount will not be adjusted.
(4) Credit impairment loss recognition standards and accrual methods
- Impairment of accounts receivable
The Company separately determines credit losses for accounts receivable that have sufficient evidence to assess expected credit losses at a reasonable cost at the individual instrument level.
When there is insufficient evidence to assess expected credit losses at a reasonable cost at the individual instrument level, the Company refers to historical credit loss experience, combined with current conditions and judgments of future economic conditions, divides accounts receivable into several portfolios based on credit risk characteristics, and calculates expected credit losses on the basis of the portfolios. The basis for determining the combination is as follows:
Combination name Basis for determining combination Provision method
Portfolio 1 Accounts receivable from customers Refer to historical credit loss experience, combined with current conditions and
Forecast future economic conditions, prepare a comparison table between the aging of accounts receivable and the expected credit loss rate throughout the duration, and calculate the expected credit loss rate.
use loss
Combination 2
Portfolio 1 Accounts receivable of companies within the scope of consolidation
Providing pharmaceutical consumables, medical supplies to affiliated hospitals and affiliated hospitals. Referring to historical credit loss experience, combined with the current situation and the accounts receivable arising from the distribution of combined 2 medical equipment; the expected measurement of bad debt provisions for each receivable's future economic conditions.
Level medical insurance center settlement payment
- Impairment of other receivables
The company separately determines its credit losses for other receivables that are individually significant and have suffered credit impairment after initial recognition; and that have sufficient evidence to assess expected credit losses at a reasonable cost at the individual instrument level.
When there is insufficient evidence to assess expected credit losses at a reasonable cost at the individual instrument level, the Company refers to historical credit loss experience, combined with current conditions and judgments of future economic conditions, divides other receivables into several combinations based on credit risk characteristics, and calculates expected credit losses on a combination basis. The basis for determining the combination is as follows:
Combination name Basis for determining combination Provision method
With reference to historical credit loss experience, combined with current conditions and forecasts of future economic conditions, through default risk exposure and the risk of failure within 12 months or
Expected credit loss rate for the entire duration, calculate expected credit loss combination two
Portfolio 1 Other receivables of companies within the scope of consolidation
Refer to the historical credit loss experience, combine the current situation and the future economic situation. 2. The company's subsidiary pharmaceutical distribution enterprises measure the bad debt provisions in order to obtain the medical economic situation.
Deposit paid for the hospital’s drug distribution rights
4. Review opinions on the current provision for asset impairment
(1) Opinions of the board of directors
The company's provision for asset impairment in 2025 complies with the "Accounting Standards for Business Enterprises" and the company's relevant accounting policies and other relevant regulations, and fairly reflects the company's financial status and operating results in 2025.
(2) Opinions of the Audit Committee of the Board of Directors
The company's provision for asset impairment provisions has sufficient basis and has fulfilled the corresponding approval procedures. It complies with the provisions of the "Accounting Standards for Business Enterprises" and the company's relevant accounting policies. After the company has made provision for asset impairment, it can more fairly reflect the company's asset status and operating results, and can make the company's accounting information on asset values more true, reliable and reasonable, without harming the interests of the company and all shareholders, especially the interests of small and medium-sized shareholders. Agree with the company's provision of asset impairment provisions this time.
Announcement is hereby made.
Board of Directors of Guangzhou Xiangxue Pharmaceutical Co., Ltd.
April 28, 2026