Finance Associated Press, November 13 (Reporter Chen Kang) One of the leading brands in huangjiu, Kuaijishan (601579.SH), experienced a year-on-year decline in net income in the third quarter. Some investors noted that the company's revenue in the Zhejiang region decreased by 10% year-on-year this quarter. At today's third-quarter earnings conference, Kuaijishan General Manager Yang Gang responded that the revenue decrease was due to operational reasons within the company, and also due to rare high temperatures in Zhejiang and changes in the dining industry's economic conditions.

It is worth noting that Kuaijishan's sales expenses for the first three quarters reached 0.216 billion yuan, much higher than the 0.13 billion yuan in the same period last year, which is related to the increased investment in the company's comprehensive marketing activities. At the earnings conference, Yang Gang stated that in the process of implementing the dual brand strategy of 'Kuaijishan' and 'Lanting', the company is increasing online sales business and promoting high-end huangjiu. The revenue growth of the high-end Lanting series from January to September was approximately 60%-80% compared to the same period last year.

The improvement in market share of mid-to-high-end and online sales segments has significantly boosted the gross margin in Q3 by nearly 9 percentage points compared to last year. Regarding product structure, Yang Gang also mentioned that the company is reducing the production of OEM products, with around 10%-15% of products subject to production cessation due to product adjustments.

An investor asked, 'The company conducted a large number of marketing activities for huangjiu ice drinks in Q3, why is this not reflected in the quarterly revenue growth rate?' Yang Gang responded, 'Huangjiu ice drinks have the dual characteristics of marketing activities and brand promotion. This year, we are paying more attention to guiding consumption habits rather than just promotions, hence the more evident lag in the promotional effect of ice drinks.'

To boost sales, Kuaijishan recently reached a strategic cooperation with real estate company Country Garden. Yang Gang said, 'The cooperation with Country Garden is an attempt to expand the presence of huangjiu in communities. Both parties have optimistic expectations for the cooperation's effectiveness, but the specific increase awaits practice.'

In the past two years, Kuaijishan has been continuously promoting the 'high-end, youthful, national' marketing strategy. Among the youthful products is the eye-catching 'one-day-one-smoked' sparkling huangjiu. Yang Gang mentioned that youthful products like sparkling huangjiu and sparkling rice wine have attracted widespread attention from young people since June 18th this year, predominantly sold online with supplementary offline sales, showing a significant increase compared to last year.

In the operating data disclosed by Kuaijishan for January to September, the revenue of 'other wines', including sparkling huangjiu, was 71.5355 million yuan, a year-on-year increase of 51.09%. The revenue of mid-to-high-end huangjiu and regular huangjiu were 0.628 billion yuan and 0.326 billion yuan respectively, with year-on-year increases of 10.65% and 8.15%.

At the Kuaijishan World Famous Liquor Conference on November 8th, Kuaijishan released the "Kuaijishan Premium Huangjiu Grading and Rating Standards", marking the industry's first standard definition for "premium huangjiu".