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<ul><li>Resilience in the face of macro headwinds. Persistently weak consumer sentiment (see Figure 1), combined with the impact of increased regulatory oversight in the healthcare system as the national government addresses corruption and Medicare fraud in pharmacies, have put both upstream and downstream partners in 111’s supply chain ecosystem under pressure.</li><li>According to a source cited by management, China’s retail pharmacy sector sales were down 2.2% Y/Y in the first nine months of 2024 (see Figure 2), with large chain pharmacies operating under financial pressure and independent pharmacies with their more limited resources coming under even greater pressure.</li><li>Despite these macro headwinds, 111’s revenue base has demonstrated some resilience. The revenue generated by its B2B platform dropped modestly by 1.2% Y/Y in 3Q24 and declined by less than 2% Y/Y in the first nine months of the year, a drop accentuated by the reported 3.7% Y/Y dip in 1Q24 due to an unfavorable comparison arising from the unexpected surge in sales in 1Q23 as a result of a resurgence in COVID infections.</li></ul>

Resilience in the face of macro headwinds. Persistently weak consumer sentiment (see Figure 1), combined with the impact of increased regulatory oversight in the healthcare system as the national government addresses corruption and Medicare fraud in pharmacies, have put both upstream and downstream partners in 111’s supply chain ecosystem under pressure.According to a source cited by management, China’s retail pharmacy sector sales were down 2.2% Y/Y in the first nine months of 2024 (see Figure 2), with large chain pharmacies operating under financial pressure and independent pharmacies with their more limited resources coming under even greater pressure.Despite these macro headwinds, 111’s revenue base has demonstrated some resilience. The revenue generated by its B2B platform dropped modestly by 1.2% Y/Y in 3Q24 and declined by less than 2% Y/Y in the first nine months of the year, a drop accentuated by the reported 3.7% Y/Y dip in 1Q24 due to an unfavorable comparison arising from the unexpected surge in sales in 1Q23 as a result of a resurgence in COVID infections.

111, Inc. - YI: Resilience Amid Short-Term Challenges

<ul><li>Two fulfillment centers added. In line with its goal to establish a national pharmaceutical logistics network (Kunpeng), 111 announced that it has added two new fulfillment centers.</li><li>This brings its network up from 11 to 13 centers across China. One of the new additions is in Guangzhou, Guangdong province in the South, with the other in Wuhan, in the central province of Hubei.</li><li>The two new centers expand the scale and capabilities of the company's existing fulfillment operations in each of those populous regions.</li></ul>

Two fulfillment centers added. In line with its goal to establish a national pharmaceutical logistics network (Kunpeng), 111 announced that it has added two new fulfillment centers.This brings its network up from 11 to 13 centers across China. One of the new additions is in Guangzhou, Guangdong province in the South, with the other in Wuhan, in the central province of Hubei.The two new centers expand the scale and capabilities of the company's existing fulfillment operations in each of those populous regions.

111, Inc. - Continuing to Build Up a Robust and Nimble Warehousing & Distribution Network

China

111, Inc. operates as a digital and mobile healthcare platform. The Company offers pharmacy distribution, medical consultancy, e-prescription, and other services. 111 serves patients in China.

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111 Inc (YI US)

111, Inc. - YI: Resilience Amid Short-Term Challenges

Persistently weak consumer sentiment (see Figure 1), combined with the impact of increased regulatory oversight in the healthcare system

Water Tower Research

111, Inc. - Continuing to Build Up a Robust and Nimble Warehousing & Distribution Network

Two fulfillment centers added. In line with its goal to establish a national pharmaceutical logistics network (Kunpeng), 111 announced that it has...

Water Tower Research

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