Pou Sheng International (3813) Q3 2024 earnings summary

Executive summary

• Revenue for 9M24 was RMB 13,984mn, down 9.5% year-over-year.

• Net profit attributable to owners increased 10.4% to RMB 343mn, with overall net profit up 6.1% to RMB 348mn.

• Gross profit margin improved by 0.9pp to 34.0%, and operating profit margin rose 0.4pp to 3.7% year-over-year.

• Digital channels contributed 27% of total sales, up 13% year-over-year, with Douyin sales doubling.

• Sales momentum remained soft due to weak store traffic in mainland China, but omni-channel and digital transformation supported resilience.

Financial highlights

• Gross profit was RMB 4,758mn, down 6.9% year-over-year.

• Operating profit was RMB 514mn, nearly flat year-over-year; net profit margin improved to 2.5% from 2.1% a year ago.

• EBITDA for 9M24 was RMB 1,387.1mn, down 7.5% year-over-year.

• SG&A expenses decreased 7.8% year-over-year; SG&A ratio increased slightly to 31.6%.

• Capital expenditure increased 16.5% to RMB 275.1mn.

Outlook and guidance

• Focus remains on digital transformation, profitability, cost competitiveness, and store-level productivity improvements.

• Strategic alliances and omni-channel expansion to drive future growth, with digital sales targeted above 25%.

• Continued refinement of retail network and integration of SAP ERP to enhance operational excellence.

• Emphasis on cost reduction, efficiency, and maintaining financial strength.