Finance Association, November 19 (Reporter Chen Kang) Clothing inventory pressure due to poor market demand has always been a core concern for investors. The traditional underwear brand Aimu Co., Ltd. (603511.SH) explained at today's 2024 third quarter results briefing that the end of the third quarter was a relatively high point of inventory during the company's regular operations, mainly preparing for peak sales in the fourth quarter. It is basically normal for inventory to rise slightly from the beginning of the year.

According to financial reports, as of the end of the third quarter, Aimu's inventory was 1.057 billion yuan, an increase of 0.005 billion yuan over the same period last year, and an increase of 0.039 billion yuan from the beginning of this year.

Judging from the performance, the company's net profit declined year-on-year in the first three quarters. In particular, the net profit loss for the third quarter reached 13.35 million, which turned into a year-on-year loss, which was called a “cliff-style decline” by investors. Zhang Rongming, chairman and general manager of the company, responded that the normal operating characteristics of the company's business were good in the first and fourth quarters and weak in the second and third quarters. He said, “Market demand fell markedly in the third quarter of 2024, and the company's revenue declined significantly; when combined with the company's own channel and brand operation characteristics, there were large fixed costs for offline channels and the company's overall operation. The company carried out a series of actions to increase efficiency and reduce costs. Although expenses have declined, they cannot offset the impact of falling profits caused by revenue and caused losses in a single quarter.”

Zhang Rongming mentioned that the company has set up a special efficiency and cost reduction team. In addition, in order to improve operating efficiency, the company has also taken measures such as removing inefficient offline channels, actively controlling online promotion activities, and increasing marketing input and output.

Aimu Co., Ltd. is mainly engaged in R&D, production and sales of intimate apparel (underwear). Currently, it has formed Aimu core brands including Aimu, Mr. Aimu, Aimu Kids, and Lankavin, and is promoting brands such as Huxi, Aimei, and Baodi Weide as the company's cutting-edge brands.

In recent years, traditional underwear brands such as An Lifang (01388.HK) and Urban Beauty (02298.HK) have faced weak growth. At the same time, emerging underwear brands such as Ubras, NEIWAI, and Banana have been favored by more consumers, especially in the online market. Regarding the new competition, Zhang Rongming mentioned that Aimu will continue to adhere to the middle and high-end positioning and explore omnichannel marketing. The share of Aimu's channel revenue in the first three quarters was: online revenue accounted for nearly 30% of main business revenue, and offline revenue accounted for nearly 70%.

Aimu Co., Ltd. established a sportswear division this year to operate the Aimu Sports and CHI CHU (CHI CHU) brands to meet the professional sports needs of women. Zhang Rongming said at the performance conference, “Up to now, the sportswear division is still in its infancy and does not account for much of the performance.”