The company's 1Q2025 revenue fell 31.64% year on year, and net profit to mother fell 23.55% year on year
The company announced its 2025 quarterly report: 1Q2025 achieved operating income of 17.521 billion yuan, a year-on-year decrease of 31.64%, realized net profit of 0.613 billion yuan, a year-on-year decrease of 23.55%, and realized net profit without deduction of 0.644 billion yuan, a year-on-year decrease of 22.88%.
In 2024, the company achieved operating income of 56.793 billion yuan, a year-on-year decrease of 20.50%, achieved net profit of 1.95 billion yuan, a year-on-year decrease of 11.95%, and realized net profit deducted from non-mother of 1.803 billion yuan, a year-on-year decrease of 16.34%.
The company's comprehensive gross margin of 1Q2025 increased by 0.69 percentage points, and the cost ratio increased by 0.18 percentage points during the period, and the consolidated gross margin of 1Q2025 was 9.06%, an increase of 0.69 percentage points over the previous year. The company's consolidated gross margin in 2024 was 8.93%, an increase of 0.62 percentage points over the previous year.
The 1Q2025 company's expense ratio for the period was 2.20%, an increase of 0.18 percentage points over the previous year. Among them, the sales/management/R&D/finance expense ratios were 1.22%/0.62%/0.03%/0.33%, respectively, with year-on-year changes of -0.03/+0.13/0.00/+0.09 percentage points, respectively. The company's expense ratio for the 2024 period was 2.93%, an increase of 0.52 percentage points over the previous year. Among them, the sales/management/R&D/finance expense ratios were 1.61%/1.05%/0.05%/0.22%, respectively, with year-on-year changes of +0.13/+0.36/+0.00/+0.03 percentage points, respectively.
Channel side continues to optimize and launch products for cross-border cooperation
On the channel side, the company continuously optimizes store quality. By the end of 2024, the company had a total of 5,838 marketing outlets (including 16 overseas banks), a decrease of 156 for the whole year. Among them, the number of self-operated Yinlou outlets was 197, a net increase of 10; the number of franchised stores was 5,641, a decrease of 166. On the product side, the company continues to promote new products and launch IP cooperation products. With “Treasure Gold”, “Fengxiang Happy Event” and new fashion products as the main line, the company launched pure gold jewelry and new products in the Color Treasure series, such as “Money Dragon Blessings” and “Baroque Garden”; with the theme “Fengshang Gold Wave”, it showcased the Gold Rope Art Cultural Festival and various products such as glasses and watches. At the same time, the company teamed up with Bandai Namco to launch the first Mobile Suit “Gundam” pure gold series product in China, co-branded Miha Tour to develop the “Starry Dome Railway” series of products, and cooperated with NetEase Gaming's mobile game “Egg Boy Party” to create fashion products.
Lower profit forecast and maintain “buy” rating
The high price of gold suppressed the company's sales of gold products, causing the company's performance to be under relative pressure. We lowered our 2025/2026 net profit forecast by 46%/47% to 1.553/1.772 billion yuan, and added 1.918 billion yuan for the company's 2027 net profit forecast. As a leading brand in the gold and jewelry industry, the company has a stable user mentality, continues to launch innovative products, and maintains a “buy” rating.
Risk warning: Gold prices and RMB exchange rates fluctuated more than expected, and channel expansion was slower than expected.
