Overall performance is under pressure due to weakening industry sentiment. The company's 2024 revenue was 56.793 billion yuan, -20.5% YoY, and net profit to mother was 1.95 billion yuan, or -11.95% YoY. Revenue for the first quarter of 2025 was 17.521 billion yuan, or -31.64% year-on-year, net profit to mother 0.613 billion yuan, or -23.55% year-on-year; net profit not attributable to mother was 0.644 billion yuan, or -22.88% YoY. Due to factors such as high gold prices suppressing demand for terminals, the company's overall performance is still under pressure.
Store adjustments, products focus on innovation. By business, in 2024, the jewelry business was 46.908 billion yuan, -19.31% year over year; the gold trading business revenue was 9.381 billion yuan, -26.42% year over year. In terms of store expansion, in 2024, the company mainly focused on store adjustments. The number of marketing outlets reached 5,838, and the number of sales outlets decreased by 156 throughout the year.
Of these, 10 self-operated stores have been opened, further strengthening brand building with self-operated stores, and regional subsidiaries have also been set up to open regional direct-run stores. On the product side, the company is strengthening original product research and development, as well as cross-border co-branding with well-known IPs such as Gundam and Miha Tour.
The gross margin increased, and the cost ratio was basically stable. The company achieved steady growth with a gross profit margin of 8.93% in 2024, +0.62pct year on year, 9.06% in the first quarter of 2025, and +0.69pct year on year. The sales expense ratio for the first quarter was 1.22%, which was basically the same year on year. The management expense ratio was 0.62%, +0.13pct year on year. In terms of cash flow, the company achieved net operating cash flow of 3.548 billion yuan, or -13.06% year-on-year, affected by factors such as declining revenue and stocking.
Risk warning: Store expansion falls short of expectations; gold prices fluctuate greatly; institutional mechanism optimization falls short of expectations.
Investment advice: From an industry perspective, the gold category has the advantages of value preservation and fashion attributes, and terminal demand is still expected to be gradually released. Furthermore, in terms of the company's internal governance, we are actively promoting and deepening the reform of the state-owned enterprise system, and further releasing operating benefits through market-based operational adjustments. Considering that the current relatively high gold price may still inhibit consumer demand for terminal gold and jewelry in the short term, we lowered the company's net profit from 2025-2026 to 2.09/2.22 billion yuan (previous values were 2.181/2.395 billion yuan, respectively), and added the 2027 forecast to 2.336 billion yuan. The corresponding PE was 12.2/11.5/10.9 times, respectively, maintaining the “superior to the market” rating.
