Health and Happiness (H&H) International (1112) H2 2025 earnings summary

Executive summary

• Achieved 10.3% year-on-year revenue growth in 2025, with all business segments returning to growth and broad-based gains across geographies.

• Adjusted EBITDA rose 5.0% to RMB 2,050.5 million, with a margin of 14.3%; adjusted net profit increased 22.7% to RMB 664.1 million.

• Net profit rebounded to RMB 196.1 million from a loss of RMB 53.7 million in 2024.

• Swisse surpassed HKD 1 billion/USD 1 billion in sales, becoming number one in Mainland China and Australia.

• Strategic focus on innovation, premiumization, and omni-channel expansion, especially in China, ANZ, and Southeast Asia.

Financial highlights

• Revenue reached RMB 14,353.6 million, up 10.3% year-on-year, with gross profit up 13.2% to RMB 8,963.7 million and gross margin at 63.1%.

• Adjusted EBITDA margin at 14.3%; adjusted net profit margin at 4.6%; net profit grew 22.7%.

• 88% of EBITDA converted to operating cash flow; cash position at year-end was RMB 1,709 million/HKD 1.7 billion.

• Dividend payout ratio maintained at 30%, with HKD 0.35 per share distributed.

• Leverage ratio improved from 3.99x to 3.45x, with gross debt reduced by over RMB 600 million.

Outlook and guidance

• Confident in maintaining double-digit growth and further deleveraging in 2026, targeting a leverage ratio of around 3x.

• Strategic priorities include continued investment in core brands, innovation, and expansion in high-growth channels and markets.

• Focus on premiumization, innovation, and diversification to drive healthy growth.

• Continued localisation of pet supply in China and expansion of Zesty Paws into new markets.

• Ongoing deleveraging and liquidity optimisation to support long-term growth.