China Feihe (6186) H2 2024 earnings summary

Executive summary

• Revenue rose 6.2% year-over-year to RMB20,748.6 million, driven by increased brand awareness and growth in infant milk formula sales.

• Gross profit increased 8.7% to RMB13,764.8 million, with gross margin improving to 66.3% from 64.8% due to product mix and lower raw material costs.

• Net profit grew 11.1% to RMB3,654.1 million, and basic/diluted EPS rose to RMB0.39 from RMB0.37.

• Final dividend proposed at HK$0.1632 per share, with interim dividend already paid, maintaining a policy of distributing no less than 30% of net profit.

Financial highlights

• Infant milk formula products contributed 91.9% of revenue, up 6.6% year-over-year.

• Other dairy products and nutritional supplements accounted for 7.3% and 0.8% of revenue, respectively.

• Selling and distribution expenses increased 7.0% due to higher publicity and online platform costs.

• Administrative expenses decreased 4.6% mainly from lower share-based payments.

• Finance costs fell 16.0% due to reduced borrowings.

Outlook and guidance

• Plans to focus on innovation in nutrition for all age groups, expand international markets, and enhance global brand influence.

• Continued commitment to high-quality development and modernization of the dairy industry.