After a 35-Million-Yuan Loss, Wanfang Development Shifts Focus to Internet Healthcare
Since its establishment in 2008, the real estate developer Wanfang Development has seen a gradual decline in profits. The company began its transformation in 2012, venturing into various sectors including land consolidation and urbanization development, forestry, and mining. However, these efforts failed to reverse Wanfang Development’s deteriorating performance. According to the company’s 2015 annual report, it achieved total operating revenue of RMB 239 million, a year-on-year increase of 23.99%; however, the net profit attributable to shareholders of the parent company was a loss of RMB 35.39 million, representing a 1,269.91% decrease from the previous year. In that same year, Wanfang Development embarked on a comprehensive strategic layout in the “Internet + Healthcare” sector.
According to the 2015 annual report disclosed by Wanfang Development, the “In-Depth Research and Investment Prospect Forecast Report on China’s Internet+ Healthcare Industry (2016–2020)” points out that boundary expansion and the development of derivative industries are driving the health services industry toward a market space worth RMB 10 trillion. Rising per capita income and an aging population are boosting residents’ health demands, making the trend of expanding boundaries in the health industry irreversible. Beyond the medical services sector, emerging fields such as health management and promotion, health insurance, and related services will involve numerous supporting industries, with the potential to create a massive market comparable in scale to the medical services industry itself.
Driven by both boundary expansion and the development of derivative industries, it is highly probable that the health services industry will reach a scale of 10 trillion yuan. Currently, internet-based models have yet to establish scalable profit models in the three major value segments of the medical services industry—healthcare reform, health big data, and third-party platforms—indicating substantial room for future growth. Leveraging this vast market potential, the company will focus its core business on “Internet + Healthcare.”
To facilitate mergers, acquisitions, and investments in “Internet + Healthcare” assets, Wanfang Development has established a quasi-financial segment primarily engaged in fund management and wealth management, gradually building a platform for the coordinated development of its industrial and quasi-financial operations. In its annual report, Wanfang Development stated that the company will divest its timber trading business, de-emphasize its urbanization construction activities, and implement a dual-business development strategy integrating “Internet + Healthcare” with quasi-financial services.
