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Financial Union reports on August 29th (by reporter Ren Chaoyu): Foshan Haitian Flavouring and Food (603288.SH) is regaining growth. After experiencing a decline in revenue and net income last year, the company achieved double growth in the first half of this year, with online sales growth outpacing offline sales. Financial Union reporters have learned that online condiment sales in the first half of the year may perform better than the overall large cap market.

In an announcement made by Foshan Haitian Flavouring and Food this evening, the company achieved revenue of 14.156 billion yuan in the first half of 2024, a year-on-year increase of 9.18%; net income attributable to shareholders of the listed company was 3.453 billion yuan, a year-on-year increase of 11.52%.

However, the net cash flow from operating activities in the first half of the year decreased by 56.45% compared to the previous year. The company stated that this was mainly due to the timing difference in receiving pre-holiday stocking payments for the Spring Festival.

Regarding the reasons for the performance growth, the company mentioned that the overall prices of bulk raw materials have shown a trend of correction, which has helped the company to some extent in easing cost pressures. At the same time, the company continues to implement various measures to improve quality, increase efficiency, create profit space, and support the high-quality products, efficient operations, and long-term stable development of the company.

In 2024, as the beginning year of the company's '45 Plan', Foshan Haitian Flavouring and Food has set a full-year target of 12% revenue growth and 10.8% profit growth.

It is worth noting that in the context of soft consumer demand, even essential consumer goods like condiments are under pressure. For example, Jonjee Hi-Tech Industrial and Commercial Holding (600872.SH), known as the 'Second Soy Sauce', failed to continue the growth momentum in Q2, dragging down the first half-year performance. Foshan Haitian Flavouring and Food mentioned in the interim report that the industry currently shows certain essential characteristics but still faces multiple challenges.

From the perspective of sales channels, in the first half of the year, Foshan Haitian Flavouring and Food's online channel achieved sales revenue of 60.6 billion yuan, a year-on-year increase of 29.17%, while the offline channel achieved sales revenue of 125.78 billion yuan, a year-on-year increase of 8.26%.

Regarding the e-commerce sector, Sandalwood expressed to Caijing.com that the total sales of condiments on major e-commerce platforms increased by 15% year-on-year in the first half of 2024.

As a core subcategory, soy sauce outperformed other categories in the industry, with a 27% year-on-year increase in total sales in the first half of the year. In terms of brands, the competition in the online channel is fierce, with small and medium-sized brands making efforts and increasing their market share.

Investor Chen Xiaolong in the food and beverage industry told reporters that in reality, the overall growth rate of the condiment industry is far lower than the growth rate of online sales. The overall industry growth rate should only be in single digits. The largest consumer end of condiments, the dining channel, is still in a slump, while the second largest consumer end, household consumption, remains cautious overall.

In summary, the condiment market presents structural opportunities, and the importance of the online market is increasing.