Impairment of goodwill and other assets drags down performance; leading "OK lens" manufacturer Oppein Vision's net profit declines again

As competition in the market for orthokeratology lenses (commonly known as “OK lenses”) intensifies, once-flagship stock company Opokangshi (300595) is currently experiencing earnings pressures. On March 28, Opokangshi released its 2025 performance report. In 2025, Opokangshi saw revenue growth without profit growth.

Financial data shows that in 2025, Opokangshi achieved operating revenue of 1.861 billion yuan, up 2.62% year over year; attributable net profit was 480 million yuan, down 16.2% year over year.

This is already the second consecutive year that Opokangshi’s net profit has declined. In 2024, Opokangshi recorded operating revenue of about 1.814 billion yuan, up 4.4% year over year; attributable net profit was about 572 million yuan, down 14.16% year over year.

According to materials, Opokangshi’s products include rigid contact lenses and their care products, vision care products other than hard lenses, other eye health products, and more. Among them, the main products are orthokeratology lenses and their care products, used for vision correction and slowing the progression of myopia.

In its 2025 annual report, Opokangshi stated plainly that the company’s sales revenue currently mainly comes from orthokeratology lenses and related products, as well as optometry and related vision services. Orthokeratology lenses have relatively high usage costs and fall under high-end consumer medical devices. During the reporting period, the domestic high-end consumer market continued to show weakness; if this trend persists, it will continue to affect the company’s operating performance.

In addition, Opokangshi mentioned that there are increasingly many registered brands for orthokeratology lenses, leading to intensified market competition. At the same time, products entering the adolescent myopia prevention and control market—such as low-concentration atropine, soft defocus-reducing contact lenses, functional frame glasses, and phototherapy devices—are also competing for market share, which has an unfavorable impact on the company’s sales growth.

The 2025 annual report shows that in 2025, the sales revenue of the hard contact lens industry, which accounted for more than half of Opokangshi’s revenue, declined year over year to 982 million yuan, a drop of 3.68%.

Asset impairment has become an important reason for Opokangshi’s net profit decline in 2025. In 2025, Opokangshi accrued total impairment provisions of 74.9867 million yuan across various categories, and the asset impairment losses during the reporting period increased 34.11% year over year. Among them, goodwill impairment accounts for a relatively high proportion; during the reporting period, Opokangshi accrued goodwill impairment of 39.974 million yuan.

It is worth noting that as of the end of 2025, Opokangshi still had 884 million yuan of goodwill sitting on its books.

In its 2025 annual report, Opokangshi said that in some equity investments, the valuation of the investee companies was higher than their net assets, which resulted in a certain amount of goodwill.

“Most of the companies in which the Company invested are ophthalmology and optometry-related businesses. Although the overall industry is a growing, sunrise industry, market demand, in the long run, is on the rise, and there will still be periods of weakened consumer demand and product sales bottlenecks, which can cause the operating conditions of some investee companies to fail to meet expectations, leading to goodwill impairment. This has an unfavorable impact on the company’s current-period profit and loss, net assets, and continuing operating capability,” Opokangshi said in its 2025 annual report.

An Guangyong, an expert from the Credit Management Committee of the All-China Federation of Mergers and Acquisitions, said that for companies with high amounts of goodwill on their books, assets should be assessed regularly, and goodwill impairment tests should be conducted in a timely manner to avoid inflated book goodwill and ensure that financial statements reflect true value.

In its 2025 annual report, Opokangshi said that most of the targets of its investments and acquisitions are optometry and related service enterprises that have already passed the risk period. They already have a certain foundation in their localities and have the ability to generate ongoing profits. When valuing investment and acquisition targets, the company takes a prudent and conservative approach. In the investment agreements, it clearly sets out terms such as requirements for business development, over-target incentives, and compensation for failure to meet targets, and strictly controls risks.

During the reporting period, Opokangshi’s gross margin also declined: down 1% year over year, falling to 72.46%. In its annual report, Opokangshi explained that mainly because revenue from hard lenses with higher gross margin decreased, while revenue from other products with lower gross margin increased, resulting in the increase in profit being lower than the increase in revenue.

In addition, in 2025, Opokangshi’s selling expenses increased to 521 million yuan, up 12.86% year over year, mainly due to an increase in sales personnel and technical support personnel.

In response to related issues with the company, a reporter from Beijing Business Today attempted to call the office of Opokangshi’s secretary to the board of directors for an interview, but no one answered the phone.

Beijing Business Today reporter Ding Ning