Incident: The company achieved revenue of 5.22 billion yuan in 2024, +5.3% year on year, net profit of 1.34 billion yuan, +5.7% year on year; of these, 24 Q4 orders achieved revenue of 1.43 billion yuan, +4.7% year over year, and net profit of 0.22 billion yuan to mother, -12.3% year over year. The 25Q1 company achieved revenue of 0.96 billion yuan, +2.7% year on year, and net profit of 0.19 billion yuan to mother, +2.2% year over year. The 25Q1 performance was in line with market expectations.
Revenue is growing steadily, and the market is sinking into intensive cultivation. 1. On the product side, high-end wine achieved revenue of 4.76 billion yuan, +2.0% year over year, of which sales volume was +2.7% year over year, and the tonnage price was -0.7%, which is expected to contribute mainly to the increase in volume 8; mid-range wine revenue was 0.26 billion yuan, +29.1% year over year, of which sales volume was +36.1% year over year, and tonnage price was -5.1%, mainly due to the high speed release of the new product Tianhao Chen. In addition, 25Q1 premium wine revenue was 0.85 billion yuan, up 6.7%, while mid-range wine revenue was 0.05 billion yuan, or -34.2% year-on-year. 2. On the channel side, in 2024, the wholesale agency channel achieved revenue of 4.5 billion yuan, +2.4% year-on-year, and the emerging channel achieved revenue of 0.53 billion yuan, or +10.0% year-on-year. The 25Q1 wholesale agency channel achieved revenue of 0.61 billion yuan, or -0.1% year-on-year, while the emerging channel achieved revenue of 0.29 billion yuan, +0.3% year-on-year. 3. In the context of industry demand under pressure, the company actively maintains channel inventory health and a stable profit system, concentrates on cultivating the core market, opening more than 1,000 new stores throughout the year, steadily improving the level of channel refinement, and successfully completing the business goals set at the beginning of the year.
Profitability remains stable, and cash flow is under slight pressure. The company's gross margin fell 0.4 percentage points year on year to 82.8% in 2014; in terms of cost ratio, the sales expense ratio decreased 1.3 percentage points year on year to 25.1%, management expenses increased 0.9 percentage points to 8.2%, financial expenses remained stable, and the annual net interest rate increased 0.1 percentage points to 25.7%. 2. The gross margin of the 25Q1 company increased 1.5 percentage points year-on-year to 82.0%, the sales expenses ratio decreased 7.6 percentage points to 27.5%, and the 25Q1 net margin decreased 0.1 percentage points to 19.8%.
3. Cash from sales in 25Q1 was 0.73 billion yuan, or -21.3%; as of the end of 25Q1, the company contract was responsible for 0.94 billion yuan, -18.7% year-on-year. Under the industry inventory removal cycle, cash flow was slightly under pressure.
The year 24 ended successfully, and 25Q1 started steadily. 1. In the current environment where industry demand growth is slowing down and competition is becoming more intense, the company will continue to strengthen its core competitiveness through the five dimensions of brand, product, channel, culture and strategic investment, based on a new strategy. 2. Looking ahead to 2025, the company will officially launch the “First Square” product to further increase the share of group buying business; the company will continue to expand consumer coverage, accelerate the development of core stores in key cities, increase sales in benchmark stores, and achieve a continuous increase in revenue and market share under a multi-pronged approach.
Profit forecasting and investment advice. EPS is expected to be 2.81 yuan, 3.03 yuan, and 3.31 yuan respectively in 2025-2027, corresponding to dynamic PE 17 times, 15 times, and 14 times, respectively. The company's famous wine genes are deep, the channel inventory is healthy, and the value chain system is stable. The core products are all in the subhigh-end price range. The long-term positive trend has not changed, and the “buy” rating is maintained.
Risk warning: Economic recovery falls short of expectations, and market competition increases risks.
