① Haitian flavor industry's performance stalled last year, and sales of the three major products declined. ② Haitian Flavors Q1 net revenue increased by double digits year on year, and set targets for revenue and net profit expectations of about 12.02% and 10.72% year-on-year growth respectively for this year, which is to return to the growth rate at the beginning of the listing.
Financial Services Association, April 26 (Reporter Ren Chaoyu) “Sauce Mao” Haitian Flavors (603288.SH) stalled last year, and sales of the three major products declined. The company called 2023 “a year that extremely requires endurance and determination” in its annual report. However, the quarterly report released at the same time tonight shows that the company achieved double-digit year-on-year growth in Q1 revenue and net profit this year. The company expects this trend to continue throughout the year, and the “sauce mao” that once had unlimited popularity will return?
According to financial data, in 2023, the company achieved operating income of 24.559 billion yuan, a year-on-year decrease of 4.10%; net profit attributable to shareholders of listed companies was 5.627 billion yuan, a year-on-year decrease of 9.21%. In the first quarter of this year, the company achieved operating income of 7.694 billion yuan, an increase of 10.21% over the previous year; net profit attributable to shareholders of listed companies was 1.919 billion yuan, an increase of 11.85% over the previous year.
Haitianwei's main business focuses on the condiments sector. Last year, its food manufacturing industry achieved revenue of 22.815 billion yuan, down 4.11% year on year; gross margin fell 0.96% year on year. The company said it was mainly due to the decline in sales scale and the impact of the category structure.
By product, sales of the company's main products such as soy sauce, seasoning, and oyster sauce all declined year-on-year last year, with soy sauce sales falling the most, to 8.17%. In terms of gross margin of all products, only the gross margin of soy sauce increased 2.34% year on year, and the gross margin of seasoning, oyster sauce and other products all declined year on year; in terms of production, seasoning and oyster sauce production increased slightly by 3.67% and 0.85% year on year last year, while soy sauce production fell 3.45% year on year; under the dual effects of declining sales and slight increase in production, seasoning and soy sauce inventories increased 165.68% and 152.54% year on year.
Judging from the sales channel situation, the company's online and offline channel revenue and gross margin all declined. Among them, online channel revenue fell the most year-on-year, reaching 10.06%. The company said it was “due to optimizing the product matrix for online channels.”
Pang Kang, chairman of Haitian Flavour Industry, once explained at the company's 2023 semi-annual results meeting that the company's performance is affected by many aspects. The market environment, consumer demand, etc. are still changing rapidly, and it will still take a certain period of time to return to a stable and orderly state. Currently, B-side catering has recovered somewhat compared to before, but it has not yet returned to pre-epidemic levels.
A Financial Services News reporter learned earlier that the company raised prices at the end of 2021, and the price increase for major products ranged from 3% to 7%. The price increase took into account multiple factors such as cost changes, sales strategies, and continuous enterprise development. At last year's Q3 results meeting, Haitian Wei said, “The effect of price increases on gross profit and profit was not significant, mainly due to the cost side rising above expectations in recent years. On the one hand, the company accelerates transformation and transformation in products, channels, terminal construction, etc., to further strengthen market competitiveness; on the other hand, it seeks benefits from management and expands its advantages of intensive scale and lean management by optimizing internal resource allocation and firmly promoting scientific and technological innovation and digital empowerment.” In addition, the company also mentioned that the price of sugar has increased significantly, so it has a certain impact on the cost side.
Notably, the company clearly stated in its 2023 report that the planned revenue target for this year is 27.51 billion yuan, and the net profit target attributable to shareholders of listed companies is 6.23 billion yuan. According to this estimate, the company's revenue and net profit are expected to grow at a year-on-year rate of about 12.02% and 10.72% respectively this year, which is a return to the growth rate at the beginning of the company's listing.
A Finance Association reporter combed through the company's past performance and noticed that since the company went public in 2014, net profit increased by double digits, with a year-on-year increase of up to 30% in a single quarter. However, since Q2 2021, the company's performance has clearly stalled, and net profit has increased by single digits in each period. For the first time in Q1 2022, net profit fell 6.36% year on year. In Q1-Q4 of 2023, both revenue and net profit declined year on year.
What “no longer shines” is not only performance. The stock price of Haitian Flavors continued to fall last year, with a drop of 42.12%. Today (April 26), the closing price was 38.84 yuan/share. However, in the seven years since the company went public, the stock price doubled one after another. At its peak, the stock price was close to 220 yuan. As a result, Chairman Pang Kang climbed to 11th place in the 2020 “Hurun 100 Wealth List” with a net worth of 1950 billion yuan, ahead of famous entrepreneurs such as Lei Jun, Wang Xing, and Liu Qiangdong. It remains to be seen how “Chaommao” actually performs in the future.