(Yicai Global) Oct. 28 -- Chinese herbal medicine firm Yunnan Baiyao Group racked up losses of CNY1.6 billion (USD250 million) in the first three quarters through poor stock market investments, causing its net profit for the period to sink 42 percent from a year earlier.

Yunnan Baiyao reported profit of CNY2.5 billion (USD390 million) in the nine months ended Sept. 30, according to its latest earnings results released yesterday. Revenue in the third quarter, though, was up 9.98 percent year on year to CNY9.3 billion (USD1.4 billion) and that for the first three quarters up 18.5 percent to CNY28.4 billion (USD4.4 billion).

The company, most known for its namesake herbal medicine used to stop bleeding and heal wounds, turned to the capital markets in recent years to bolster lackluster earnings from its main businesses. Initially, it did well, bagging CNY2.6 billion (USD406 million) from 2019 to 2020.

However, the firm’s luck did not hold and things turned sour this year. The value of Yunnan Baiyao’s holdings in smartphone giant Xiaomi sank by CNY610 million (USD95 million) in the first half, those in dairy firm Inner Mongolia Yili Industrial Group by CNY170 million and those in drugmaker Jiangsu Hengrui Pharmaceuticals by CNY180 million. By the end of Sept. 30, the losses had reached CNY1.6 billion.

Yunnan Baiyao’s share price [SHE:000538] closed down 3.83 percent today at CNY88.36 (USD13.8).

Editor: Kim Taylor