The company's 24H1 revenue/net profit attributable to mothers/net profit deducted from non-mother was 2.319/0.315/0.275 billion yuan, a year-on-year decrease of 13.27/48.13/ 45.70%. The company's 24Q2 revenue/net profit attributable to mothers/net profit deducted from non-mother was 1.144/0.135/0.109 billion yuan, a year-on-year decrease of 11.94/52.98/ 51.78%. The decline in the company's revenue was mainly affected by both the transition period of the company's strategic adjustment and market transition period and changes in the consumption environment.

By revenue category, 24H1 electric shaver/hair dryer/electric hair clipper/electric toothbrush/nose hair trimmer/hair ball trimmer/spare parts and other products

15.03/4.10/1.05/1.06/0.088/0.021/0.078 billion yuan, -19.88/+23.84/-24.25/ -5.58/-1.11/-25.82/ -13.13% year-on-year. Affected by the accelerated popularity of emerging products, high-speed hair dryers, the hair dryer category is growing rapidly. According to the omni-channel summary data of Aowei Cloud Network, the online market for 2024H1 personal care appliances is segmented, with retail sales in the electric shaver/electric toothbrush/hair dryer category -5.2/-5.3/ +24% year-on-year.

Looking at revenue by brand, vPro's 24H1 revenue was 0.501 billion yuan, up 35.92% year on year. Market share increased significantly, accounting for 21.70% of sales, up 4.53 pcts year on year. The revenue of the 24H1 brand is estimated to be 1.818 billion yuan, a year-on-year decrease of 21.14%. The company adheres to a structured dual-brand strategy. Feike drives high-end products through technological innovation and high-value design to achieve brand upgrades; vPro's positioning pursues the ultimate cost performance ratio of high quality and low cost. 24H1 has developed a total of 9 new products, including shavers and high-speed hair dryers, and launched a total of 9 series of new products. It continues to expand Feike's offline experiential retail image stores nationwide, and has launched 17 new Feike “Chaozhi” image stores. As of 24H1, the company has 449 dealers.

By region, foreign/foreign revenue was 2.316/0.002 billion yuan, a year-on-year decline of 13.00/ 7.63%.

The company's 24H1/24Q2 gross margin was 55.61/54.07%, -2.29/ -5.75pct year-on-year. The decline in gross margin may be related to changes in the brand structure. The vPro brand connects with cost-effective consumers and accounts for an increase in the company's overall revenue. Furthermore, the gross margin of the hair dryer business declined year-on-year, mainly due to increased price competition.

What is the gross margin of 24H1 electric shaver/hair dryer/electric hair clipper/electric toothbrush/nose hair trimmer/hair ball trimmer/spare parts and other products

62.75/35.66/49.78/55.83/61.42/48.47/ 23.10%, +1.43/-6.28/+4.46/+5.53/+1.52/+4.50/-42.12pct 24H1's domestic/foreign gross margin was 55.60/ 56.39%, -2.34/+9.82pct year-on-year.

The company's 24H1 sales/management/R&D/finance rate was 34.55/3.70/1.77/ -0.22%, +7.17/+0.95/-0.16/-0.08pct; 24Q2 sales/management/R&D/finance ratio was 35.52/3.75/1.99/ -0.22%, +5.37/+0.78/-0.19/-0.02pct year over year. The increase in the company's sales expenses ratio is mainly due to an increase in advertising, promotion and promotion expenses; the increase in management expenses ratio is mainly due to depreciation and personnel expenses.

Investment advice: The company is a leading domestic personal care appliance company. It continues to deepen the high-end upgrading of the product structure, channel optimization and social marketing of content. The Flyco brand is steadily upgraded. The VPro brand undertakes orderly rapid revenue growth, and the volume of high-speed hair dryers can be expected. Overseas markets are expected to contribute to the increase, and the company's revenue performance will continue to grow. Based on the company's 2024 semi-annual report and the weak recovery in domestic consumption, we lowered our profit forecast. We expect the company's net profit to mother for 2024-2026 to be 0.733/0.767/0.896 billion yuan, respectively, and the PE corresponding to the current stock price is 20.20/19.30/16.52 times, respectively. Maintain a “Recommended” rating.

Risk Warning: Macroeconomic Fluctuations, Increased Price Competition, Rising Investment Costs, Uncertainty in New Product Development, Fluctuating Raw Material Prices