Revenue was slightly lower than expected. In the second half of the year, the plan was to maintain the “increase” rating of the 2024 semi-annual report. The company achieved operating income of 1.179 billion yuan, a year-on-year increase of 0.75%, a net profit loss of 0.03 billion yuan, an overall year-on-year decrease of 0.015 billion yuan. The company achieved an operating income of 0.454 billion yuan in 2024Q2, a year-on-year decrease of 7.54%, and a loss of 0.055 billion yuan on the year-on-year increase. billion yuan. The company sorted out the organization, planned product strategies, and laid out channel development in the first half of the year. It is expected that the summer ready-to-drink sector will gain strength in the third quarter. We maintain our profit forecast. We expect the company to achieve net profit of 0.33, 0.4, and 0.49 billion yuan respectively in 2024-2026, up 19.2%, 20.3%, and 21.3% year-on-year. The PE corresponding to the current stock price is 13.2, 11.0, and 9.0 times, maintaining a “gain” rating.

Off-season revenue is under pressure, and new channels are progressing steadily

On the product side, the company's 2024H1 brewed category and ready-to-drink category achieved revenue of 0.614 and 0.547 billion yuan respectively, down 2.13% and 3.83% year-on-year respectively; 2024Q2 brewed products and ready-to-drink products achieved operating income of 0.129 and 0.313 billion yuan respectively, down 23.0% and 0.4% year-on-year respectively. The brewing season in the second quarter, terminal sales were under pressure, and brewed digestive inventory had a great impact. The ready-to-drink product company positioned Meco fruit tea for the third quarter and continued marketing and cultivation of frozen lemon tea for the third quarter Plan ahead of schedule during peak season. On the channel side, the company's 2024Q2 distribution channel achieved revenue of 0.402 billion yuan, the e-commerce channel achieved revenue of 0.024 billion yuan, a year-on-year decrease of 50.1%, the export channel achieved revenue of 0.005 billion yuan, a year-on-year increase of 21.0%, the direct management channel achieved revenue of 0.011 billion yuan, a year-on-year decrease of 40.7%, the company's brewing team optimization, and ready-to-drink product channel focus. By the end of July, the company's direct management covered more than 0.02 snack stores Million companies are launching 0.09 million automatic vending machines, which are expected to contribute to growth during the peak season.

Reduced costs contributed to gross profit margins, and margins were under slight pressure

The company's 2024H1 gross margin was 30.6%, up 2.7 pct year on year. The gross margin for the second quarter was 25.7%, up 2.1 pct year on year, mainly due to a decrease in raw materials and freight costs. On the cost side, the company's 2024Q2 sales expenses rate was 35.6%, down 1.7 pct year on year, mainly due to a decrease in advertising promotion; the management expenses ratio was 11.9%, an increase of 1.2 pct year on year, mainly due to an increase in equity incentive costs. The company lost 0.055 billion yuan in net profit to mother in 2024Q2, a slight increase over the previous year. Looking ahead to entering the peak season in the second half of the year, the company is expected to achieve rapid revenue growth.

Risk warning: risk of raw material price increase, food safety risk, risk of new product promotion falling short of expectations.