Core Viewpoint - The company, Mao Geping, reported a strong revenue growth of 31.3% year-on-year for the first half of 2025, but the growth rate has slowed compared to over 40% in the same period of 2024 [1][4]. Financial Performance - Revenue for the first half of 2025 reached 2.588 billion yuan, with a net profit of 670 million yuan, reflecting a year-on-year increase of 36.1% [1]. - The overall gross margin was 84.2%, showing a slight decline compared to the same period last year [1]. - Product sales remained the core driver of performance, generating 2.521 billion yuan in revenue, a 32.7% increase year-on-year, accounting for 97.4% of total revenue [4]. Market Expansion - The company has entered the fragrance market, launching two high-end perfume series, which achieved sales of 35,000 units in just over a month, contributing 11.41 million yuan to total sales [6]. - International sales saw a significant increase of 503.1% year-on-year, although they still represent a small portion of total revenue at only 0.05% [4]. Sales Channels - Online and offline sales were relatively balanced, with cosmetic sales of 1.224 billion yuan online and 1.297 billion yuan offline, reflecting year-on-year growth of 26.6% and 39.0%, respectively [5]. - The company has established over 405 self-operated counters and 32 distributor counters across more than 120 cities in China [5]. Industry Context - The overall growth of the Chinese beauty market is slowing, with high-end and differentiated products becoming the focus of competition [7]. - The fragrance market is seen as a key growth area, with a projected compound annual growth rate of 15% from 2018 to 2023, indicating significant potential for expansion [6][7]. - The company aims to develop a second growth curve through its fragrance and international market strategies, which are crucial for its future development [8].

Summary of the Conference Call for Mao Geping Cosmetics Co., Ltd. Company Overview - **Company**: Mao Geping Cosmetics Co., Ltd. - **Industry**: Cosmetics and Beauty Key Points and Arguments Financial Performance - In the first half of 2025, the company achieved a revenue of **2.588 billion RMB**, a year-on-year increase of **31.3%** [3] - Net profit reached **670 million RMB**, up **36.1%** year-on-year, driven by improved operational efficiency and reduced sales and administrative expenses [3] - The net profit margin was **25.9%**, an increase of **0.9 percentage points**, while the gross margin was **84.2%**, a decrease of **0.7 percentage points** [3] Sales Channels - Online sales accounted for **51.4%** of total revenue, growing **39%** year-on-year, while offline sales made up **48.6%**, with a growth of **26.6%** [5] - The company reported an increase in offline repurchase rate to **30.3%** and membership growth to **5.6 million** [2][5] - Online repurchase rate was **24.1%**, with registered users reaching **13.4 million** [5] Product Performance - Makeup products contributed **56.4%** to total sales with a growth rate of **31.3%**, while skincare products accounted for **43.1%** with a growth of **33.4%** [6] - Newly launched fragrance products generated **11.41 million RMB**, representing **0.5%** of total sales [2][6] Expansion Plans - The company plans to expand into international markets including **Singapore, Hong Kong, Japan, South Korea, and France**, starting with a store opening in Hong Kong on **October 1, 2025** [3][30] - The company aims for a **30%** compound annual growth rate over the next three years, projecting revenues of **5 billion RMB** and profits of **1.2 billion RMB** for 2025 [3][41] Training and Education Initiatives - Mao Geping operates **9 makeup art institutions** and is preparing to open a **10th** in Guangzhou [8] - The company invested in upgrading facilities in existing schools to enhance educational experiences [8] ESG Initiatives - The company donated **5 million RMB** to Akesu Vocational and Technical College to establish a beauty art education exchange center, supporting local employment and aligning with rural revitalization strategies [9] Brand Strategy - The company is focused on enhancing its brand image through collaborations with cultural institutions and events, which has positively impacted brand recognition and reduced sales expenses [19][20] - Future product launches will include high-end skincare and makeup lines, with a focus on consumer value rather than just increasing average transaction value [27][38] Marketing and Consumer Engagement - The company emphasizes a multi-channel marketing strategy, leveraging platforms like Douyin and Tmall, while also exploring new e-commerce opportunities [34] - The target demographic for online sales is primarily younger consumers, while offline sales attract a more diverse customer base [35] Challenges and Opportunities - The company acknowledges the challenges in the competitive cosmetics market but sees significant growth potential in both makeup and skincare categories [17][18] - The company plans to maintain a balance between online and offline growth, with a focus on enhancing customer experience and loyalty [15][40] Future Outlook - The company is optimistic about maintaining a strong growth trajectory, with a focus on sustainable practices and long-term brand value [41][42]

Core Viewpoint - The company reported a revenue of 2.588 billion yuan for the first half of 2025, reflecting a year-on-year growth of 31.3%, while net profit increased by 36.1% to 670 million yuan, indicating a slowdown compared to over 40% growth in the same period of 2024 [1][2]. Financial Performance - Revenue for the first half of 2025 reached 2.588 billion yuan, with a year-on-year increase of 31.3% [1]. - Net profit for the same period was 670 million yuan, up 36.1% year-on-year [1]. - The overall gross margin was 84.2%, showing a slight decline compared to the previous year [1]. - Product sales revenue was 2.521 billion yuan, a 32.7% increase, accounting for 97.4% of total revenue [5]. - The skincare segment also saw significant growth, with revenue increasing by over 30% [5]. Market Expansion - The company has entered the fragrance market, launching two high-end perfume series, which achieved sales of 35,000 units in just over a month, contributing 11.41 million yuan to total sales [7]. - International sales revenue surged by 503.1% year-on-year, although it still represents a small portion of total sales at only 0.05% [6]. - The company plans to strategically expand into overseas markets through department store counters and online stores [6]. Stock Performance - The company's stock price fell to 94.05 HKD per share on August 28, 2025, a decrease of 2.49%, resulting in a market capitalization of 46.1 billion HKD, down over 16 billion HKD from its peak in June [2]. Industry Context - The overall growth of the Chinese beauty market is slowing, with high-end and differentiated products becoming the focus of competition [8]. - The fragrance market is seen as a key growth area, with a projected compound annual growth rate of 15% from 2018 to 2023, and expected to exceed 44 billion yuan by 2028 [7][8]. - The company aims to maintain high market valuation by continuously exploring new growth avenues beyond makeup and skincare [8].

Core Viewpoint - The company reported strong revenue and profit growth in the first half of 2025, but the growth rate has slowed compared to the previous year, prompting a search for new growth avenues, particularly in the fragrance market [2][3][7]. Financial Performance - Revenue for the first half of 2025 reached 2.588 billion yuan, a year-on-year increase of 31.3% - Net profit was 670 million yuan, up 36.1% year-on-year - Overall gross margin stood at 84.2%, slightly down from the same period last year [2][3]. Product Sales - Product sales remain the core driver of the company's performance, with sales revenue of 2.521 billion yuan, a 32.7% increase year-on-year, accounting for 97.4% of total revenue - Makeup products contributed 55% of sales, while skincare products also saw over 30% growth, with key products generating significant retail revenue [3][4]. International Expansion - The company is strategically entering overseas markets, planning to establish department store counters and online stores to increase visibility - International sales revenue surged by 503.1% year-on-year, although it still represents a small portion of total sales at only 0.05% [4][6]. Fragrance Market Entry - The company launched two high-end fragrance series, "Guo Yun Ning Xiang" and "Wen Dao Dong Fang," marking its entry into the fragrance market - In just over a month, the fragrance products sold 35,000 units, generating revenue of 11.413 million yuan, which is 0.4% of total sales [5][6]. Industry Context - The overall growth of the Chinese beauty market is slowing, with high-end and differentiated products becoming competitive focal points - The company aims to maintain high market valuation by exploring new growth avenues, particularly in the fragrance sector and international markets [7].

Core Viewpoint - The company reported strong revenue and profit growth in the first half of 2025, but the growth rate has slowed compared to the previous year, prompting a search for new growth avenues, particularly in the fragrance market and international expansion [1][2][6]. Financial Performance - The company achieved revenue of 2.588 billion yuan, a year-on-year increase of 31.3%, and a net profit of 670 million yuan, up 36.1% [1]. - The overall gross margin was 84.2%, showing a slight decline compared to the same period last year [1]. - Product sales revenue reached 2.521 billion yuan, a 32.7% increase, accounting for 97.4% of total revenue [2]. Market Expansion - The company is strategically entering overseas markets by establishing department store counters and online stores, and is working on partnerships with global high-end department stores [3]. - International sales saw a significant increase of 503.1% year-on-year, although they still represent a small portion of total sales at only 0.05% [2][3]. Product Development - The company launched two high-end fragrance series, "Guo Yun Ning Xiang" and "Wen Dao Dong Fang," with initial sales of 35,000 units in just over a month, contributing 11.41 million yuan to total sales [4]. - The average selling price of the fragrances was 322.3 yuan per unit, with a gross margin of 77.6% [4]. Industry Context - The Chinese beauty market is experiencing a slowdown in overall growth, with high-end and differentiated products becoming the focus of competition [6]. - The fragrance market is seen as a key growth area, with a projected compound annual growth rate of 15% from 2018 to 2023, and expected to exceed 44 billion yuan by 2028 [4][6].

Investment Rating - The investment rating for the company is "Buy" (maintained) [1][6][22] Core Insights - The company has shown strong performance in the high-end domestic beauty market, with significant revenue growth and brand momentum [6][10] - The company reported a revenue of 2.59 billion RMB in H1 2025, representing a year-on-year increase of 31%, and a net profit of 670 million RMB, up 36% year-on-year [6][10] - The gross margin for H1 2025 was 84.2%, with a net profit margin of 25.9%, indicating effective cost control [6][10] Financial Data and Profit Forecast - Revenue projections for the company are as follows: - 2023: 2,886 million RMB - 2024: 3,885 million RMB - 2025E: 5,173 million RMB - 2026E: 6,852 million RMB - 2027E: 8,533 million RMB - Year-on-year growth rates for revenue are projected at 58% for 2023, 35% for 2024, and gradually decreasing to 25% by 2027 [5][13] - Net profit forecasts are as follows: - 2023: 662 million RMB - 2024: 881 million RMB - 2025E: 1,184 million RMB - 2026E: 1,542 million RMB - 2027E: 1,953 million RMB - The projected PE ratios are 64.7 for 2023, decreasing to 22.5 by 2027 [5][13] Segment Performance - The company experienced double-digit growth in both color cosmetics and skincare, with significant contributions from new product launches [6] - In H1 2025, color cosmetics revenue reached 1.42 billion RMB (up 31.1% YoY), while skincare revenue was 1.09 billion RMB (up 33.4% YoY) [6] - The fragrance segment also showed promising growth, with revenue of 11.41 million RMB, while the makeup training segment saw a decline of 5.9% [6] Channel Performance - The company has effectively released its potential across all channels, with offline revenue of 1.22 billion RMB (up 26.6% YoY) and online revenue of 1.297 billion RMB (up 39% YoY) [6] - The number of members reached 19 million, with a repurchase rate of 26.8%, indicating strong customer loyalty [6] Research and Development - The company is focused on innovation and international expansion, with new product launches planned and a research center set to support growth [6] - The company aims to penetrate the European and Asia-Pacific markets with localized teams and high-end channels [6] Brand Positioning - The company is positioned as a leading domestic beauty brand, capitalizing on the high-end color cosmetics market with a strong emphasis on unique aesthetics and product innovation [6]

Investment Rating - The report maintains a "Buy" rating for the company [1] Core Views - The company achieved a robust performance in the first half of 2025, with revenue and net profit increasing by 31.3% and 36.1% year-on-year, respectively [4] - The introduction of new fragrance products has further strengthened the company's high-end beauty positioning [8] - The company has successfully improved its operational efficiency, leading to a significant decrease in expense ratios [6][9] - The online and offline channels have both shown strong growth, with online sales increasing by 39% and offline sales by 26.6% [5] Financial Performance - In the first half of 2025, the company reported revenue of 2.59 billion yuan and a net profit of 670 million yuan, with an earnings per share (EPS) of 1.37 yuan [4] - The gross profit margin slightly decreased to 84.2%, while the net profit margin improved to 25.9% [6] - The company’s operating cash flow reached 830 million yuan, reflecting a year-on-year increase of 34.2% [7] Product and Channel Analysis - The revenue breakdown for the first half of 2025 shows that color cosmetics, skincare, fragrance, and makeup artistry training contributed 55%, 42%, 0.4%, and 2.6% to total revenue, respectively [5] - The company has expanded its offline presence with 405 self-operated counters and 32 distributor counters, marking a net increase of 27 and 1, respectively [5] Future Outlook - The company expects continued high-quality growth, with revised net profit forecasts for 2025, 2026, and 2027 set at 1.21 billion, 1.58 billion, and 2.04 billion yuan, respectively [9] - The current stock price corresponds to a price-to-earnings (P/E) ratio of 36 for 2025, indicating a favorable valuation [9]

Summary of Mao Geping Cosmetics Co. (1318.HK) Conference Call Company Overview - **Company**: Mao Geping Cosmetics Co. (1318.HK) - **Period**: 1H25 (First Half of 2025) Key Financial Metrics - **Sales**: RMB 2,588 million, up 31% year-over-year (yoy) [1][3] - **Net Income (NI)**: RMB 670 million, up 36% yoy [1][3] - **Operating Profit (OP)**: RMB 873 million, up 45% yoy [1][3] - **Gross Margin**: 84.2%, down 0.7 percentage points (ppt) yoy [10][12] - **Net Margin**: 25.9%, up 0.9 ppt yoy [13] Sales Performance By Channel - **Online Sales**: RMB 1,297 million, up 39% yoy, but 6% below Goldman Sachs estimates (GSe) [9][4] - **Offline Sales**: RMB 1,224 million, up 27% yoy, exceeding GSe by 3% [7][4] By Category - **Color Cosmetics**: RMB 1,422 million, up 31% yoy, contributing 55% of total sales [4][1] - **Skincare**: RMB 1,087 million, up 33% yoy, contributing 42% of total sales [4][1] - **Fragrance**: RMB 11 million in sales [4][1] Operating Efficiency - **Selling and Distribution Expenses**: Increased by 24.8% yoy to RMB 1,169 million, but 9% lower than GSe [11][12] - **Selling Expenses Ratio**: Declined by 2.4 ppt yoy to 45.2%, significantly below GSe of 48.8% [11][12] Future Outlook and Strategies - **Discussion Points for Upcoming Briefing**: 1. Sustainability of 1H margin and details behind selling expenses ratio decline [2] 2. Full year 2025 outlook [2] 3. Strategies for Double 11 sales event [2] 4. Skincare category strategy and online channel expansion [2] 5. Updates on fragrance line performance and new product pipelines [2] Risks and Considerations - **Key Risks**: 1. Variability in beauty consumption penetration in China [18] 2. Online penetration rates [18] 3. Development of new star SKUs, especially in skincare [18] 4. ROI on expanding consumer base [18] 5. Key person risk [18] Valuation and Price Target - **12-Month Price Target**: HK$ 86, based on a 25x 2027E P/E [17] - **Current Price**: HK$ 96.45, indicating a downside potential of 10.8% [20] Conclusion Mao Geping Cosmetics Co. has shown strong growth in sales and net income for 1H25, driven by both online and offline channels. The company is focusing on operational efficiency and has plans for future growth, particularly in the skincare category and online expansion. However, it faces risks related to market penetration and product development. The current valuation suggests a potential downside, warranting careful consideration for investors.

公告称，收入增加主要由于产品销售由上年同期的19亿元增加32.7%至截至2025年6月30日止六个月的 25.21亿元。 毛戈平(01318)发布截至2025年6月30日止六个月的中期业绩，收入25.88亿元(人民币，下同)，同比增加 31.28%;股东应占溢利6.7亿元，同比增加36.11%;每股基本盈利1.37元。 ...

Core Insights - The company reported a revenue of RMB 2.5882 billion for the first half of 2025, representing a year-on-year growth of 31.3% [1] - The net profit for the same period was RMB 670.4 million, showing a year-on-year increase of 36.1% [1] Revenue Breakdown - The sales revenue from color cosmetics reached RMB 1.4223 billion, with a year-on-year growth of 31.1% [1] - The sales revenue from skincare products amounted to RMB 1.0872 billion, reflecting a year-on-year increase of 33.4% [1] Product Innovation and Market Expansion - The company launched two new high-end perfume series, "Guoyun Ningxiang" and "Wendao Dongfang," expanding its product offerings into the fragrance market [1] - The new series emphasizes the company's philosophy of Eastern aesthetics, utilizing high-quality raw materials and craftsmanship [1] Brand Presence and Customer Engagement - As of June 30, 2025, the company has established brand counters in over 120 cities across China, including 405 self-operated counters and 32 distributor counters [2] - The company employs over 3,100 beauty consultants at its counters, making it one of the largest service teams among domestic and international beauty brands in China [2]