Aluminum Corporation Of China Limited. - ADR

Q3 results were disappointing; revenue flat-to-down and profitability materially pressured - Revenue: ~$602M, down ~1% YoY (excluding the impact of the large commercial payer loss earlier in 2026 and a non-core asset sale). - Category performance: Sleep grew >4% YoY (mainly sleep supplies), but diabetes declined ~3% (pump growth couldn’t offset CGM/other diabetes supply declines). Respiratory down ~6.5%, wound down ~6%—not enough pickup vs expectations. - Profitability: Adjusted EBITDA $47.8M (and adjusted EBITDA less patient service equipment CapEx was just under ~$17M), reflecting weak collections and cost pressure.

Collections/allowances and cost-to-serve issues are core drivers (not “market/brand” problems) - Contractual allowances: still high; collections are “disappointing.” Improvement vs prior quarters, but not enough: - Favorable contractual allowance impact ~$6M in Q3 vs prior year, but earlier quarters cited around ~$10M. - Cost of net revenue: 56.6% of net revenue, 280 bps higher YoY, largely due to mix effects (payer loss) and lower collection rate. - SG&A: 41.5% of net revenue, up from 38.1% in Q3 2025; also cited higher business insurance claims and difficulty taking out enough costs vs lost revenue.

Liquidity runway remains strong despite underperformance; no major near-term refinancing stress - Net debt: ~$1.73B, down $40M vs Dec. 31, but up slightly (+$18M) vs end of June. - Cash/credit: $27M cash and $35M drawn revolver; ~$300M available liquidity. - AR securitization: extended to Oct 2029 and facility size unchanged ($150M), described as evidence of receivables quality/effective management. - Management said liquidity work provides the runway to execute changes ahead of the first maturity in early 2029.