化妆品业务：产品升级调整期Q2 增速放缓，新推“即沐”进军洗护24H1 收入11.86 亿元/+7%，其中24Q2 收入6.42 亿元/+1.4%，24Q2 瑷尔博士、颐莲收入各为3.5 亿元(-0.9%)、2.47 亿元(+11%)，当前处于产品升级调整期增速有所放缓，瑷尔博士全面升级“闪充”、“益生菌”两大系列，并持续推新“摇醒精华”、“祛痘精华”等；颐莲升级嘭嘭霜夯实高保湿心智聚焦打造面霜、面膜升级单品；24H1 毛利率61.37%/-1.66pct，下滑主因线下分销收入占比提升及促销活动力度加大、低毛利率爆款产品销售占比增加等；24H1 净利润约0.9 亿元，归母净利率约7.6%。Event: Company discloses 2024 interim results:
24H1: Revenue 1.925 billion yuan/ -22.2%, net profit due to mother 0.127 billion yuan/ -33%, net profit not attributable to mother 0.112 billion yuan/ +77%.
24Q2: Revenue 1.035 billion yuan/ -14%, net profit attributable to mother 0.068 billion yuan/ +12%, net profit not attributable to mother 0.06 billion yuan/ +25%.
Cosmetics business: The growth rate of Q2 slowed during the product upgrade and adjustment period. The new “Jimu” entered the care 24H1 with revenue of 1.186 billion yuan/ +7%, of which 24Q2 earned 0.642 billion yuan/ +1.4%, and 247 billion yuan (+11%) each earned 0.35 billion yuan (-0.9%) and 0.247 billion yuan (+11%) in 24Q2. Currently, during the product upgrade and adjustment period, the growth rate has slowed down. Dr. Aier has fully upgraded the “Flash Charge” and “Probiotics” series, and continues to push forward New “Wake Up Essence”, “Acne Remover Essence”, etc.; Yilian Upgraded Cream strengthens the moisturizing mind and focuses on creating upgraded products for face creams and masks; 24H1 gross profit margin 61.37%/-1.66pct, the decline was mainly due to increased offline distribution revenue share, increased promotion activities, and increased sales share of explosive products with low gross margin; 24H1 net profit of about 0.09 billion yuan, and net profit margin of about 7.6% to mother.
Other brand developments in the cosmetics sector: After the company launched the medical beauty brand “KeMi KeyC”, the cosmetics sector entered the collagen medical beauty circuit. The brand development strategy was upgraded from “4+N” to “5+N”, and upgraded from a single beauty business to a new ecosystem of “Shengbei+Medical Beauty”; at the same time, the 24H1 cosmetics business launched a new brand “Jimu”, which specializes in microecological scalp care, and officially entered the care circuit.
Raw materials and additives: Weak domestic demand & increased market competition, high export quality, 24H1 revenue 0.172 billion yuan/ +0.7%, 24Q2 revenue 0.088 billion yuan/ -7%, 24H1 gross profit margin 39.27% /+3.73 pct. Among them, in terms of domestic sales, weak terminal demand compounded increased market competition, which affected domestic sales revenue falling 22.00% year on year. Overseas, the company focused on high-quality customers and achieved a 48.71% year-on-year increase in export revenue and a 9.60 percentage point increase in gross margin.
Pharmaceutical business: 24H1 revenue 0.24 billion yuan/ -17%, 24Q2 revenue 0.131 billion yuan/ -12%, 24H1 gross profit margin 52.13%/-4.15pct, mainly due to changes in pharmaceutical industry policies.
Investment advice: Currently, Freda is in a period of comprehensive business upgrading and adjustment, focusing on the iterative volume of the company matrix; at the same time, Freda is still one of the Group's core high-quality assets. Early management adjustments also reflect the Group's emphasis on Freda. It is expected to receive stronger support from the Group's resource level in the future. At the same time, the advantages of state-owned enterprises are expected to be further highlighted in the current industry context. In addition, related incentives are also expected to advance steadily; it is predicted that 2024-2025 net profit of 0.3/0.36 billion yuan, corresponding to PE21/17x, maintaining “highly recommended” ratings.
Risk warning: Risk of increased competition in the cosmetics sector; risk of drug business being affected by policies; risk of trustworthiness of referring to third-party data; risk of lagging behind based on data information.
