Investment Rating - The report maintains a "Buy" rating for the company, with the target price currently under review [1][3][16]. Core Insights - The company reported a revenue and net profit growth of 5.9% and 15.3% year-on-year for 2H23, respectively. Excluding the impact of the merger with Miaokelando, the comparable revenue growth for the year was 2.9% [1]. - The dividend payout ratio has increased from 30% to 40%, indicating a positive outlook on cash flow and profitability [1]. - The company aims for revenue growth in the low to mid-single digits for 2024, with an operational profit margin improvement target of 30-50 basis points [1]. - Despite a slowdown in industry growth, the company is focusing on high-quality development and optimizing its product mix, particularly in high-end liquid milk and cheese segments [1]. Financial Summary - For FY23E, the company expects sales revenue of RMB 99,315 million, with a year-on-year growth of 7.3%. The net profit is projected to be RMB 5,883.2 million, reflecting a 10.9% increase [2][9]. - The company anticipates a continued improvement in gross margin, with a forecasted gross profit of RMB 36,151 million for FY23E, translating to a gross margin of 36.4% [9][13]. - The earnings per share (EPS) for FY23E is estimated at RMB 1.49, with a price-to-earnings (P/E) ratio of 11.8 [2][9]. Business Strategy - The company has identified that a price-for-volume strategy is not suitable for current development, emphasizing the importance of maintaining quality [1]. - The company plans to enhance its digital marketing and channel strategies to adapt to changing consumer behaviors, particularly in the cheese segment [1]. - The company is cautious about expanding overseas due to geopolitical risks, despite strong growth in its Southeast Asian ice cream business [1].

Investment Rating - The investment rating for Mengniu Dairy is "Buy" with a target price of HKD 21.50, indicating a potential upside of 25.9% from the current price of HKD 17.08 [1][10]. Core Insights - Despite facing market headwinds, Mengniu Dairy has shown resilience with a 6.5% year-on-year sales growth in 2023, although net profit decreased by 9.3% to RMB 4.809 billion, falling short of consensus expectations by 14% [1][2]. - The company has experienced an increase in gross margin by 185 basis points to 37.2% due to lower raw milk costs, which also contributed to a slight increase in operating profit margin [1][2]. - The guidance for 2024 is disappointing, with expected sales growth in the low to mid-single digits, which is below previous expectations of 7.5% [2]. Financial Overview - Revenue for 2023 is projected at RMB 98.624 billion, with a year-on-year growth of 6.5% [3][11]. - Net profit for 2023 is expected to be RMB 4.809 billion, reflecting a decrease of 9.1% compared to the previous year [3][11]. - The company anticipates a slight expansion in operating profit margin by 30-50 basis points for 2024, while gross margin is expected to improve due to declining raw milk prices [2][11]. Segment Performance - The liquid milk segment, particularly high-end products like "Telunsu" and low-temperature yogurt, has shown strong performance, while ice cream and milk powder segments have faced challenges [1][6]. - Sales growth by category in 2023: liquid milk +5%, ice cream +7%, milk powder -2%, cheese +230% (excluding "Miaokelando" which saw a decline of 68%), and other products -32% [1][6]. - The high-end product trend continues, with fresh milk sales increasing by 16% year-on-year for premium offerings [1][6]. Future Projections - Revenue projections for 2024 are set at RMB 103.644 billion, with expected growth of 5.1% [3][11]. - The forecast for net profit in 2024 is RMB 5.482 billion, indicating a recovery with a growth rate of 14% [3][11]. - The company plans to increase its dividend payout ratio from 30% to 40% [1][2].

[Table_Title] 证券研究报告 业绩表现稳健，总裁实现交接 公司研究 [Table_ReportDate] 2024年3月28日 [Table_ReportType] 公司点评报告 [T事ab件le：_S公um司ma发ry布] 2023年业绩公告。2023年，公司实现营收人民币986.24 [蒙Ta牛bl乳e_业Sto(c2k3A1n9dR.aHnKk)] 亿元，同比+6.5%，实现归母净利润48.09亿元，同比-9.31%。其中，23H2 公司实现营收 475.05 亿元，同比+5.9%；实现归母净利润 17.89 亿元，同 投资评级 比+15.3%。 上次评级 [马Ta铮b le _ A u t食ho品r]饮 料行业首席分析师 点评： 执业编号：S1500520110001 联系电话：13392190215 ➢ 全年收入表现平稳，细分品类呈现分化。尽管行业增速有所放缓，公司 邮 箱：mazheng@cindasc.com 全年收入同比+6.5%（包含妙可蓝多并表）。分品类看，液态奶产品表现 出色，营收同比+4.9%；冰淇淋受东南亚市场增长拉动，营收同比 +6.6%；奶粉业务受市场整体影响，营收同 ...

公司研 究 证 券研究 报 告 食品饮料 2024年03月28日 蒙 牛乳业（02319.HK）2023年报点评 强 推 （维持） 目标价：25港元 盈利提升达成，聚焦增长质量 当前价：17.08港元 事项： 华创证券研究所  公司发布 2023 年年报。2023 年实现主营收入 986.24 亿元，同比+6.51%；经 证券分析师：欧阳予 营利润为 61.71 亿元，同比+13.8%；归母净利润 48.09 亿元，同比-9.31%。 2023H2实现主营收入475.06亿元，同比+5.87%；经营利润为28.96亿元，同 邮箱：ouyangyu@hcyjs.com 比-0.25%；归母净利润 17.89 亿元，同比+15.28%。剔除妙可蓝多并表影响， 执业编号：S0360520070001 23年、23H2公司营收945.8、455.2亿元，同比+2.56%、2.33%。 评论： 证券分析师：范子盼  23H2液奶稳健增长，奶酪并表增厚。分品类看，液态奶23年/23H2实现收入 邮箱：fanzipan@hcyjs.com 820.71/404.31亿元，同比+4.86%/+4.73%，延续稳健增长。其 ...

Investment Rating - The report maintains a "Buy" rating for the company, with a target price of 22.80 HKD per share, compared to the current price of 18.96 HKD [4]. Core Insights - The company reported a revenue of 98.624 billion RMB for 2023, representing a year-on-year increase of 6.51%, while the net profit attributable to shareholders was 4.809 billion RMB, down 9.31% year-on-year [2][3]. - The liquid milk segment continued to show steady growth, with revenue reaching 82.071 billion RMB, up 4.86% year-on-year. The premium product line, including organic series, maintained over 10% growth, contributing to structural upgrades [2][3]. - The company increased its dividend payout ratio to 40% for 2023, up from 30% in 2022, reflecting a commitment to returning value to shareholders [2][3]. Financial Summary - Revenue for 2023 was 98.624 billion RMB, with a growth rate of 6.51%. The projected revenue for 2024 is 102.723 billion RMB, indicating a growth rate of 4.16% [3]. - The net profit attributable to shareholders for 2023 was 4.809 billion RMB, with a forecasted increase to 5.503 billion RMB in 2024, representing a growth rate of 14.43% [3]. - The company's gross margin improved by 1.85 percentage points to 37.15% in 2023, driven by lower milk prices and structural upgrades [2][3].

Financial Performance - The group achieved a revenue growth of 6.5% to RMB 98.624 billion in 2023[2] - Operating profit increased by 13.8% year-on-year to RMB 6.171 billion, with an operating profit margin improvement of 0.4 percentage points to 6.3%[2] - The net profit for the year was RMB 4.887 billion, a decrease from RMB 5.185 billion in the previous year[6] - Basic earnings per share decreased to RMB 1.220 from RMB 1.342 year-on-year[5] - The total comprehensive income for the year was RMB 4.755 billion, compared to RMB 4.307 billion in the previous year[6] - The adjusted profit before tax for the group was RMB 6,303,713, with a net profit of RMB 4,886,975 after tax expenses of RMB 1,425,212[17] - The pre-tax profit for the current year is RMB 6,312,187 thousand, down from RMB 6,502,353 thousand in the previous year, reflecting a decrease of 2.9%[29] - Net profit attributable to equity shareholders decreased by 9.3% to RMB 4.8092 billion, with basic earnings per share of RMB 1.220, down 9.1% year-on-year[63] Market Position and Share - The group maintained its leading market share in low-temperature yogurt for 19 consecutive years, while liquid milk market share continued to expand[2] - The liquid milk segment generated revenue of RMB 82,071,069, accounting for the largest share of total revenue[17] - The liquid milk business generated revenue of RMB 94,335,586 thousand in 2023, up from RMB 87,997,985 thousand in 2022, indicating a growth of about 7.5%[22] - The low-temperature business achieved continuous growth, maintaining the number one market share for nineteen consecutive years, with probiotic beverage market share also showing an upward trend[43] - The fresh milk business achieved significant growth, outperforming the industry with a continuous profit for three years, driven by the high-end brand "Daily Fresh" leading the premium fresh milk market share[45] - The basic fresh milk segment maintained the number one market share for three consecutive years, with the launch of the "Daily Bone Strength" high-calcium milk and "Nourishing Beauty" iron-zinc milk targeting the aging population[46] Product Development and Innovation - The company launched China's first liquid protein nutritional supplement and became the first Chinese dairy company to independently develop human milk oligosaccharides (HMO)[3] - The group established the world's first fully digitalized dairy factory and launched the global first large language model in the nutrition and health field, MENGNIU.GPT[3] - The company is focusing on innovation in product categories, with new product growth rates significantly increasing and improved profit structures[44] - The infant formula segment focused on the "Ruibuen" brand, launching the world's first infant formula with MLCT structure fat, enhancing product offerings under the new national standards[47] - Key product launches include A2β-casein milk and lactose-free milk, targeting specific consumer needs[68] - The health nutrition segment launched tailored products for the elderly, focusing on whey protein and essential minerals, addressing the growing demand for adult milk powder[48] Financial Management and Investments - The total amount of share repurchase during the year was HKD 795.6 million, with a proposed final dividend of RMB 0.489 per share, totaling RMB 1.924 billion, an increase of 21.0% year-on-year[2] - Total capital expenditure for the year was RMB 6,277,598 thousand, compared to RMB 4,855,867 thousand in the previous year, reflecting an increase of approximately 29.2%[20] - The company plans to focus on R&D innovation, brand building, and digital transformation in 2024, aiming to enhance product structure and business balance[78] - The company has established a comprehensive salary system linked to business performance, granting 6,626,176 restricted stock awards during the year[76] Sustainability and Corporate Responsibility - The company is committed to sustainable practices, launching products with reduced packaging carbon footprints and promoting a "better organic" concept[41] - The company is committed to its "GREEN" strategy and "dual carbon" goals, with initiatives to reduce carbon emissions across the supply chain[74] - Mengniu has planted 97 million trees in Ulan Buh Desert, contributing to the transformation of over 200 square kilometers of desert into green land[74] - The establishment of the world's first fully intelligent dairy factory in Ningxia is expected to achieve an annual output of 1 million tons and generate RMB 10 billion in revenue[58] - The company received ISO 37301 and GB/T35770 compliance management system certifications, marking it as the first dairy enterprise globally to achieve such certifications[75] Operational Efficiency - The company continues to monitor performance across its operating segments to inform resource allocation and performance evaluation decisions[16] - The company is actively optimizing its channel structure and enhancing operational management efficiency through integrated management and centralized factory layouts[44] - Sales and distribution expenses increased by 12.7% to RMB 25.1922 billion, accounting for 25.5% of total revenue[62] - The company has recognized a deferred tax expense of RMB 164,341 thousand for the current year, down from RMB 376,195 thousand in the previous year, indicating a significant reduction of 56.3%[29] Shareholder Returns - The proposed final dividend for the current year is RMB 0.489 per ordinary share, up from RMB 0.402 per share in the previous year, marking a 21.6% increase[31] - The total declared and paid ordinary share dividends for the current year amount to RMB 1,588,015 thousand, compared to RMB 1,506,669 thousand in the previous year, which is an increase of 5.4%[31] - The board of directors proposed a final dividend of RMB 0.489 per share for the year ending December 31, 2023, compared to RMB 0.402 per share for 2022[86]

Financial Performance - For the six months ended June 30, 2023, the Group's revenue was RMB 51,118.5 million, representing a year-on-year increase of 7.1% from RMB 47,722.3 million in 2022[13]. - Gross profit for the same period was RMB 19,630.2 million, reflecting a year-on-year increase of 12.4% from RMB 17,458.8 million[13]. - Profit attributable to owners of the Company decreased by 19.5% to RMB 3,020.5 million, down from RMB 3,751.4 million in 2022[13]. - Operating profit increased by 29.9% year-on-year to RMB 3,274.9 million, with an operating profit margin rising to 6.4%, up from 5.3% in 2022[14]. - Basic earnings per share decreased by 19.4% to RMB 0.765, down from RMB 0.949 in 2022[13]. - EBITDA decreased by 5.6% to RMB 5,178.3 million, with an EBITDA margin of 10.1%, down 1.4 percentage points from the previous year[115]. - Income tax expense increased by 27.7% to RMB 644.3 million, with an effective tax rate of 17.4%, up 5.2 percentage points from 12.2% in 2022[119]. - Capital expenditure for the six months ended June 30, 2023 was RMB 1,887.2 million, a decrease of 15.0% year-on-year[122]. - Net borrowings as of June 30, 2023 were RMB 28,795.4 million, an increase from RMB 26,342.8 million as of December 31, 2022[121]. - The Group's finance costs were RMB 727.1 million, representing approximately 1.4% of revenue, an increase of 0.3 percentage points year-on-year[126]. Market Position and Growth - The Company ranked 8th in the "Global Dairy Top 10" in 2023 and was the only Chinese FMCG brand with double-digit growth in brand value, which increased by 15% year-on-year[2]. - Mengniu's revenue growth was supported by a progressive recovery in domestic consumer demand, with dairy product sales improving month by month[28]. - The overall domestic demand for dairy products and end-market sales steadily rebounded, driven by increased consumer emphasis on nutrition and health[14]. - Mengniu ranked among the top eight in the 2023 "Global Dairy Top 20" list published by Rabobank, solidifying its status as the youngest company within the global dairy industry's top ten[33][34]. - Mengniu's total annual production capacity increased to 13.60 million tons as of June 30, 2023, from 12.91 million tons in December 2022[164]. Product Innovation and Development - Mengniu developed the rare nutritional ingredient HMO, becoming the first domestic dairy company to independently develop it, with plans for future industrialization[19]. - The Group launched China's first liquid protein nutritional supplement, M-ACTION Sports Protein Drink, entering the sports nutrition market[19]. - Mengniu launched the YO!FINE DIARY high-end yogurt brand, introducing new flavors and expanding its product line to include set yogurts and chunky fresh fruit pulp products[45][46]. - Mengniu's focus on product innovation and brand communication has driven the expansion of Milk Deluxe's leading market share within the high-end milk sector[37]. - Mengniu has been collaborating with technical partners and industry leaders to enhance R&D resources and explore new fields within the dairy industry, aiming for sustainable growth[77]. Sustainability and Corporate Responsibility - Mengniu announced industry-leading carbon-neutral goals and joined the global initiative to grow, restore, and conserve one trillion trees[22]. - The Group's sustainable development efforts were recognized as the "Most Improved Enterprise in the Industry" in the inaugural "Sustainability Yearbook (China Edition)" by S&P Global[170]. - In 2022, Mengniu achieved a reduction of 180,000 tons of CO2e through its "Net Zero Carbon Emission" policy[169]. - The Group has planted 97 million trees in the Ulan Buh Desert as part of its "Zero Deforestation by 2030" initiative[165]. - The Group aims to achieve net-zero emissions through international cooperation and emphasizes research investments in high-quality dairy and nutritional products[177]. Strategic Initiatives - The Group's strategic focus on "Greener, More Nutritious and Smarter" initiatives contributed to stable and high-quality growth in its core business[14]. - The "2025 Value Sharing" strategy aims to create a complete dairy industry value chain, enhancing efficiency and sustainability in the raw milk industry[90]. - The Group will continue to optimize operational strategies and expand its product matrix to cultivate global brand influence[181]. - The Group's ranches adhered to the "Mengniu Ranch Quality and Safety Management System," ensuring 100% compliance with stringent access controls and enhancing food safety[93]. - The "Smart Ranch Management Platform" was adopted, utilizing cloud computing, IoT, and AIoT technologies for granular management of dairy cattle throughout their lifecycle[94]. Consumer Engagement and Market Expansion - As of June 2023, Mengniu's online membership exceeded 65 million, reflecting its successful expansion in new retail channels[40][41]. - The room temperature business unit extended its presence to 26,000 townships, covering over 800,000 distribution points, enhancing its market penetration rate[41]. - Mengniu's ice cream business introduced the Strawberry Soft Core Crispy Skin ice cream and developed new cheese-flavored ice cream products, winning the "Innovative and Imaginative" award in the second Mengniu Innovation Contest[63][64]. - Mengniu's ice cream brand Suibian has introduced new flavors, including Strawberry Chocolate Crunch, enhancing product variety and consumer appeal[151]. - The Group's cooperative farms have successfully re-utilized manure, promoting organic circulation in farming practices[169]. Employee and Corporate Governance - The total cost of employees amounted to approximately RMB4,424.1 million in the first half of 2023, compared to RMB4,061.4 million in 2022[171]. - As of June 30, 2023, the Group employed approximately 46,355 employees, with total employee costs amounting to RMB 4.424 billion, an increase from RMB 4.061 billion in 2022[173]. - In the first half of 2023, the Group granted 6,626,176 restricted shares to its employees as part of its performance-based remuneration system[176]. - The Group has been approved to build a "national high-skilled personnel training base" and is the first in China's dairy industry to obtain self-certification for vocational skill levels[175].

Financial Performance - For the first half of 2023, the company's revenue reached RMB 51.118 billion, a year-on-year increase of 7.1% compared to RMB 47.722 billion in 2022[2] - Operating profit grew by 29.9% to RMB 3.275 billion, with an operating profit margin rising to 6.4%, up 110 basis points from 5.3% in 2022[2] - The total comprehensive income for the first half of 2023 was RMB 2.895 billion, down from RMB 3.317 billion in the same period of 2022[7] - The basic earnings per share attributable to ordinary shareholders was RMB 0.765, compared to RMB 0.949 in the previous year[6] - The adjusted profit before tax for the company was RMB 3,703,278 thousand, compared to RMB 4,147,733 thousand in the previous year, indicating a decrease of approximately 10.7%[16] - The company reported a net profit of RMB 3,058,988 thousand for the period, down from RMB 3,643,099 thousand in the same period last year, reflecting a decline of about 16.0%[16] - Net profit attributable to equity shareholders decreased by 19.5% to RMB 3.0205 billion, with basic earnings per share of RMB 0.765, down 19.4% year-on-year[60] - Income tax expense increased by 27.7% to RMB 644.3 million, with an effective tax rate of 17.4%, up 5.2 percentage points year-on-year[61] Assets and Liabilities - As of June 30, 2023, total non-current assets amounted to RMB 82,612,072 thousand, an increase from RMB 81,036,131 thousand as of December 31, 2022, representing a growth of 1.95%[8] - Current assets totaled RMB 40,881,664 thousand, up from RMB 36,777,074 thousand, indicating an increase of 8.45%[9] - Total liabilities increased to RMB 73,372,324 thousand from RMB 67,761,407 thousand, reflecting a rise of 8.67%[9] - Net current assets improved significantly to RMB 6,785,722 thousand, compared to RMB 3,623,822 thousand, marking an increase of 87.67%[9] - The company's total assets as of June 30, 2023, amounted to RMB 123,493,736 thousand, an increase from RMB 117,813,205 thousand as of December 31, 2022[16] - The total equity attributable to shareholders was RMB 50,121,412 thousand, slightly up from RMB 50,051,798 thousand, showing a marginal increase of 0.14%[10] - The company's long-term borrowings increased to RMB 31,031,326 thousand from RMB 26,106,255 thousand, representing a rise of 18.36%[9] Revenue Breakdown - The liquid milk business generated revenue of RMB 41,640,229 thousand, accounting for approximately 81.5% of total revenue, while the ice cream business contributed RMB 4,308,698 thousand, representing about 8.4%[15] - Total revenue from customer contracts reached RMB 51,118,523 thousand, with liquid milk business contributing RMB 41,640,229 thousand, accounting for approximately 81.5% of total revenue[18] - The ice cream business generated RMB 4,308,698 thousand, representing about 8.4% of total revenue, while the milk powder and cheese businesses contributed RMB 1,894,213 thousand and RMB 2,256,051 thousand respectively[18] Market Position and Growth - The company maintained its position as one of the top 10 global dairy companies, ranking 8th in the "2023 Dairy Industry Top 20" by Rabobank[4] - The company reported a steady growth in liquid milk business, with an increase in market share for ambient liquid milk during the first half of 2023[37] - The company maintained strong demand resilience for room temperature pure milk, achieving the largest market share in the white milk segment[39] - The low-temperature division secured the number one market share for the 19th consecutive year, focusing on functional, delicious, and nutritious yogurt products[40] - The high-end brand "Daily Fresh" in the fresh milk category experienced double-digit growth, solidifying its position as the leading high-end fresh milk brand[41] Innovation and Product Development - The company achieved significant breakthroughs in innovative business, with its flagship products leading market growth, including a top market share in the liquid milk segment[2] - The company launched China's first liquid protein nutritional supplement, entering the sports nutrition sector, and developed rare nutritional component HMO, which has passed safety assessments[4] - The company launched new products, including a blueberry-flavored PET bottle yogurt series and a cold brew fresh coffee latte, to meet diverse consumer needs[42] - The company upgraded its senior nutrition product line, focusing on bone health and muscle maintenance for the elderly[44] - The company has developed a new formula for its senior milk powder series, focusing on bone health and muscle maintenance for older adults[73] Sustainability and Corporate Responsibility - The company has set industry-leading carbon neutrality goals and joined the World Economic Forum's initiative to plant a trillion trees, committing to a "zero deforestation" target across its supply chain[4] - The company is committed to achieving "carbon peak by 2030 and carbon neutrality by 2050" as part of its sustainable development strategy[75] - The company has planted 97 million trees in the Ulan Buh Desert, contributing to its goal of "zero deforestation by 2030" and mitigating supply chain deforestation risks[75] - The group has achieved a total of 27 factories recognized as national-level green factories, with energy consumption reduced by 43% compared to conventional factories[76] Digital Transformation and Technology - The company is focusing on digital transformation across the entire industry chain, from farming to consumer end[38] - The company introduced the AI-driven MENGNIU.GPT model, providing personalized nutrition and health services to families, enhancing consumer health management[55] - The company is enhancing its digital transformation strategy, emphasizing data-driven decision-making and consumer-centric approaches[55] Employee and Governance - The company’s employee benefits expenses, including salaries for directors and senior management, amounted to RMB 4,424,102 thousand, reflecting an increase from RMB 4,061,412 thousand in the previous year[22] - The audit committee consists of three independent non-executive directors: Mr. Li Hengjian (Chairman), Mr. Ye Lide, and Mr. Ge Jun[86] - The board of directors includes three executive directors, three non-executive directors, and three independent non-executive directors[89] Shareholder and Market Engagement - The company did not recommend the distribution of an interim dividend for the first half of 2023, consistent with the previous year[27] - The company repurchased a total of 13,074,000 shares at a total cost of HKD 419,334,350 during the reporting period[83] - The company expresses gratitude to shareholders and employees for their support and hard work[89]

Financial Performance - Revenue for 2022 reached RMB 92,593.3 million, a year-on-year increase of 5.1%[5] - Operating profit for 2022 was RMB 5,423.2 million, up 11.6% year-on-year, with an operating profit margin of 5.9%, an increase of 40 basis points[5] - Profit attributable to owners of the company increased by 5.5% year-on-year to RMB 5,303.0 million[5] - Mengniu's overall revenue increased by 5.1% year-on-year, with operating profit rising by 11.6% and operating profit margin improving by 40 basis points[28] - Revenue increased by 5.1% year-on-year to RMB 92.593 billion (2021: RMB 88.141 billion)[109] - Gross profit margin decreased by 1.4 percentage points to 35.3% (2021: 36.7%) due to rising raw material costs and increased depreciation[110] - Selling and distribution expenses decreased by 4.9% to RMB 22.347 billion (2021: RMB 23.488 billion), accounting for 24.1% of revenue (2021: 26.6%)[111] - Administrative expenses increased by 26.0% to RMB 4.442 billion (2021: RMB 3.524 billion), accounting for 4.8% of revenue (2021: 4.0%)[111] - Operating profit increased by 11.6% year-on-year to RMB 5.423 billion (2021: RMB 4.862 billion), with an operating profit margin of 5.9% (2021: 5.5%)[112] - EBITDA improved by 14.3% to RMB 9.121 billion (2021: RMB 7.980 billion), with an EBITDA margin of 9.9% (2021: 9.1%)[113] - Net profit attributable to owners increased by 5.5% year-on-year to RMB 5.303 billion (2021: RMB 5.026 billion)[113] - Capital expenditure decreased by 58.2% year-on-year to RMB 5.074 billion (2021: RMB 12.135 billion), with RMB 5.065 billion spent on production facilities[115] - Net cash inflow from operating activities increased by 10.4% to RMB 8.333 billion (2021: RMB 7.545 billion)[120] - Debt-to-equity ratio increased to 78.1% (2021: 64.4%) due to increased interest-bearing borrowings[122] Product Performance - Liquid milk revenue grew by 2.3% year-on-year to RMB 78,269.3 million, with strong growth in Milk Deluxe, Mengniu pure milk, and Shiny Meadow fresh milk[8] - Ice cream business revenue surged by 33.3% year-on-year to RMB 5,652.4 million, driven by innovative products like "Moutai Ice Cream"[8] - Mengniu's Milk Deluxe organic pure milk achieved the top market share in its category[29] - Mengniu's chilled product business held the top market share in the industry for 18 consecutive years[29] - Mengniu's UHT pure milk showed strong growth, with Milk Deluxe significantly widening its competitive advantage[29] - Fresh milk business achieved strong growth with Shiny Meadow ranking first in high-end fresh milk and Xiaoxianyu gaining popularity among women and teenage customers[31] - Ice cream business recorded record-high revenue, outperforming industry growth levels, with successful product launches in collaboration with Moutai Group and Shanghai Disneyland[31] - Mengniu became the absolute No. 1 in China's cheese market through cooperation with Milkground, focusing on children's cheese sticks, cheese snacks, and butter for family and professional foodservice channels[31] - Yashili capitalized on the "New National Standards" with several infant milk formula products approved for registration, enhancing market share and profitability in middle-aged, elderly, and children's milk formula segments[32] - Mengniu's room temperature pure milk brands, including Milk Deluxe and Mengniu, maintained robust growth, while the chilled yogurt business remained the market leader[46] - Mengniu's fresh milk business division outperformed the industry in terms of annual sales growth, with Shiny Meadow achieving rapid growth that far exceeded the market level[46] - Milk Deluxe organic pure milk took the lead in terms of market share, solidifying the position of Milk Deluxe as a high-end brand[52] - Just Yoghurt developed a new generation of healthy yogurt products characterized by low sugar and low calories, leading the trend of room temperature healthy yogurt products[53] - Fruit Milk Drink launched new milkshake yogurt beverages, including neroli pomelo with aloe vera and jasmine with green grape, to attract young Generation-Z consumers[54] - Mengniu and Milk Deluxe brands sold 1 million boxes of World Cup-themed products, capturing top positions in online sales and overall market share[56] - Champion's Every day's Fresh Yogurt and the Zero Sucrose Yogurt series achieved double-digit sales growth with increasing market shares[61] - Shiny Meadow, Mengniu's high-end fresh milk brand, maintained the top market share in the high-end fresh milk market with rapid growth far above the market level[63] - The newly launched Xiaoxianyu sub-brand exhibited exceptional growth in sales and market shares, targeting youngsters with its unique selling point of yummy light fresh milk[65] - The fresh milk business ranked first in China in terms of sales share in the systems of Sam's Club, Hema, Yonghui Superstores, and Aeon[66] - The Group launched the first healthcare yogurt in China, the Champion Jianzihao immune booster series, addressing consumers' growing concerns about immunity[61] - The Group introduced its first label-free products, the Yoyi C zero sucrose product series with eco-friendly packaging, in response to environmental protection policies[61] - Yashili's revenue for 2022 reached RMB 3.7382 billion, with a focus on infant milk formula and nutritional products[73] - Yashili became the first milk formula company in China to have its products assessed and certified under EU food standards (SGS)[71] - Yashili launched Reeborne Enzhi and Reeborne Jingzhi, the world's first infant milk formulas using MLCT, new OPO structural lipids, and desert organic raw milk, respectively[71] - Bellamy's launched three new milk powder products in 2022, including organic kids milk powder and GOLD+ high-end infant formula[75] - Bellamy's developed local supply chains for complementary foods, launching organic rice cereal, baby noodles, milk rusks, and puffs[76] - The Group's ice cream brands (Suibian, Mood for Green, Deluxe, Ice+) achieved rapid growth through product innovation and upgrades[79] - The Group collaborated with Moutai Group to launch "Moutai Ice Cream," which became one of the most popular crossover ice cream products[80] - The Group introduced a World Cup-themed ice cream series under the "Suibian" brand, sold exclusively at World Cup venues[81] - Ice cream business achieved rapid growth with innovative product launches, including the "奇思巧想 • 熱點風味" series and "巧冰硬實力 • 甜品脆筒" series, driving sales growth[82] - The company collaborated with Moutai to launch Moutai ice cream, combining Moutai liquor with milk, which became a highly popular cross-industry product[82] - Ice cream sales on e-commerce platforms recorded rapid growth, with efforts to expand into corporate group buying, catering, and scenic spots[83] - The cheese business introduced additive-free children's cheese sticks and the casual cheese series "Zhishifenzi", targeting young consumers[84] - Domestic table cheese and butter products saw steady sales growth, with the Ai Shi Chen Xi series of butter products expanding into professional catering applications[85] - The company completed the acquisition of Milkground, holding 35.01% of its shares, aiming to expand into the domestic and global cheese market[87][91] - Milkground is a leading cheese company in China with the largest production capacity and top market share for cheese products and children's cheese sticks[88] - The company upgraded nine major product categories, including pasteurized milk and cheese, to meet EU standards, aiming to develop "EU benchmark products"[90] - Revenue from the ice cream business reached RMB5,652.4 million, accounting for 6.1% of Mengniu's total revenue, up from 4.8% in 2021[140] - The Group launched Yoyi C zero sucrose products with eco-friendly packaging, marking Mengniu's first label-free product to align with environmental protection policies[138] - Shiny Meadow's 4.0 series fresh milk products experienced robust growth, with the launch of low-fat products targeting health-conscious female customers[139] - Suibian introduced a new generation of chocolate ice cream products, including cocoa and milk tea flavors, and collaborated with "Genshin Impact" for IP-themed ice cream[140] - Mood for Green upgraded its condensed milk and red bean products with a low-sugar formula and expanded into the high-end market with the "Zhiqing" ice cream series[141] - Deluxe collaborated with Moutai Group to launch "Moutai ice cream," which became a best-selling product, and partnered with Disney for IP-themed products[142] - Revenue from the milk formula business amounted to RMB3,862.0 million, accounting for 4.2% of Mengniu's total revenue, down from 5.6% in 2021[144] - Yashili's Reeborne brand launched innovative infant formula products, including the first to use MLCT structured lipids and organic raw milk from desert areas[144] - Yashili expanded its product line with Yourui for middle-aged and elderly customers, M8 children's milk formula, and Huicongming for students[146] - Bellamy's launched three new milk powder products in 2022, including organic kids milk powder and Bellamy's GOLD+ high-end infant milk formula, targeting children over 3 years old[147] - Bellamy's organic kids milk powder uses 1% rare organic milk source and features a special formula with "active" lactoferrin, FOS prebiotics, and high β-glucans content[147] - Revenue from other products, including cheese, accounted for 5.2% of Mengniu's total revenue in 2022, amounting to RMB4,809.6 million, up from 2.8% in 2021[150] - Mengniu upgraded its cheese product lines and introduced additive-free children's cheese sticks, targeting young consumers with the Zhishifenzi casual cheese series[150] Sustainability and ESG - Mengniu's "GREEN" sustainable development strategy aims to achieve carbon peak by 2030 and carbon neutrality by 2050[12] - Mengniu was included in the Hang Seng Corporate Sustainability Index Series for the third consecutive year[12] - Mengniu's nine major product categories met EU standards, and its Daily Fresh factory received GFSI global food safety dual certification[12] - Mengniu's "smart quality" digital management practice earned it the industry's only "National Quality Benchmark" title[12] - Mengniu unveiled its "GREEN" sustainable development strategy, committing to carbon peak by 2030 and carbon neutrality by 2050, with an MSCI ESG Rating upgraded to "A"[36] - Mengniu's MSCI ESG rating improved to an A grade, the highest in China's food industry[12] - Mengniu became the first dairy company to join the responsible business platform Sedex and refined its Supplier Code of Conduct to improve carbon management[155] - Three of Mengniu's factories obtained the German TÜV Rheinland landfill-free waste management system certification, and two factories applied for AWS international sustainable water management standard certification[155] - Mengniu's MSCI ESG rating improved to an A grade, the highest in the Chinese food industry, and it was included in the Hang Seng Corporate Sustainability Index Series[156] - Mengniu unveiled its "GREEN" sustainable development strategy, aiming for carbon peak by 2030 and carbon neutrality by 2050, with 15 specific carbon reduction measures across six major aspects[154] Innovation and Technology - The Group introduced the self-developed "aerospace bacteria strain" and enhanced technologies for grass cultivation, cow breeding, and milk production[11] - Mengniu introduced two aerospace bacteria strains in collaboration with China Space Foundation, advancing technological breakthroughs in grass cultivation, cow breeding, and milk production[38] - Mengniu's nine major product categories have been upgraded to meet EU standards, continuing to create a world quality benchmark[38] - The Group introduced the Arla Garden advanced dairy farm management system to enhance quality and safety standards[95] - The Group implemented the "10,000-tonne milk" plan to accelerate the establishment of milk source bases[94] - The Qilin Platform was developed to support the digitization of the ice cream business division[99] - The Group established a smart talent system for human resources management and developed a digital HR system[103] - The room temperature Ningxia Factory was established as a pilot project to meet the World Economic Forum's "Lighthouse Factory" standards[101] - The Group's global dairy industry talent training center provided training to 800,000 talents, focusing on topics such as digitalization, smart technologies, and the dual-carbon strategy[163] Market and Brand Positioning - Mengniu's global dairy ranking improved to 7th, making it the youngest among the top 10 global dairy enterprises[7] - Mengniu's brand value grew by 15% year-on-year in the 2022 Kantar BrandZ™ ranking, leading in brand value growth in China's dairy industry[7] - Mengniu ranked 7th in the 2022 "Global Dairy Top 20" list, up two places from the previous year[28] - Mengniu's brand value grew by 15% year-on-year, ranking first in China's dairy industry in the 2022 Kantar BrandZ™ ranking[34] - Mengniu rose two places to rank 7th in the Global Dairy Top 20 published by Rabobank, distinguishing itself as the only Chinese dairy enterprise to achieve an improved ranking[49] - Mengniu aims for high-quality development with a focus on brand, innovation, and digitalization, targeting a strong growth trajectory and global competitiveness[41] - Mengniu plans to innovate rapidly in product and technology to meet diverse consumer needs, targeting the younger generation and the silver economy with products like milk formula for the elderly and adult nutrition[173] - The company will focus on high-quality sustainable development, emphasizing fresh milk, ice cream, cheese, adult milk powder, and global market expansion to capture growth opportunities[174] - Mengniu will accelerate innovation in foodservice and snack cheese products to capitalize on the growing cheese market[173] - The company will continue to strengthen its core competitiveness, including brand power, R&D capabilities, and digital transformation, to build a consumer-centric, international, and responsible brand[171] - Mengniu will leverage the trend of high-end, functional, snack, and non-dairy product fusion to meet evolving consumer preferences[172] - The company will enhance its product offerings for the middle-aged and elderly, focusing on milk formula and adult nutritional products[173] - Mengniu will further expand its presence in the global market, aligning with its strategy to lead the upgrade and transformation of China's dairy industry[174] - The company will continue to invest in digital transformation and organizational capabilities to support its long-term growth strategy[171] Human Resources and Management - As of December 31, 2022, Mengniu had approximately 47,329 employees, with total employee costs amounting to RMB8,657.5 million, up from RMB7,476.1 million in 2021[159] - The Group employed a total of 47,329 employees in mainland China, Hong Kong, Oceania, and Southeast Asia as of December 31, 2022, an increase from 44,629 in 2021[162] - Total employee costs, including salaries for directors and senior management, amounted to RMB 8.6575 billion in 2022, up from RMB 7.4761 billion in 2021[162] - The Group granted 5,533,245 restricted shares and 44,977,913 share options to employees under its share award and share option schemes in 2022[161] - Mr. Simon Dominic Stevens led Arla Foods' UK business growth from £500 million to £2.5 billion, elevating it from the 4th to the 1st position in the FMCG dairy sector[186] - Mr. Simon Dominic Stevens managed Arla's MENA region, ensuring high growth for key brands and maintaining a safe environment for approximately 3,000 employees during COVID-19[186] - Mr. Simon Dominic Stevens joined Arla's Executive Management team as EVP International, overseeing all international business and the international supply chain starting January 1, 2021[186] - Mr. Yih Dieter was appointed as an independent non-executive director in December 2021, bringing expertise in corporate finance, capital markets, and regulatory compliance[189][190] - Mr. Li Michael Hankin, appointed in December 2021, has over 30 years of experience in financial and accounting, fundraising, mergers and acquisitions, and international business development[191][193] - Mr. Ge Jun, appointed in December 2021, has extensive experience in corporate governance, innovation mechanisms, and sustainable development[192][194] - Mr. Gao Fei, a senior vice president, has been with the company since 1999 and currently heads the UHT business unit, contributing to the rapid growth of Mengniu's market share[195] - Mr. Wen Yongping, a vice president, has been with the company since 1999 and currently heads research and development and innovation, with extensive experience in production and operations management[196] - Mr. Gao Fei, aged 46, is currently the Senior Vice President and head of the Ambient Product Business Unit, with extensive experience in dairy sales, marketing, and management[197] - Mr. Wen Yongping, aged 48, is the Vice President and head of R&D and Innovation, with a Ph.D. in Food Science and Engineering and over 20 years of experience in production and supply chain management[197] - Mr. Zhao Jiejun, aged 46, is the Vice President and head of Milk Sourcing and Animal Husbandry Industry Chain Business Unit, with nearly 20 years of experience in dairy industry sales and supply chain management[198] - Mr. Luo Yan, aged 61, is the Vice President and head of Chilled Product Business Unit and Fresh Milk Business Unit, with 30 years of experience in the food industry and management[199] - Mr. Chen Yiyi, aged 49, is the Vice President and head of Strategy Management, responsible for strategic and investment management, with extensive experience in FMCG, strategic planning, and M&A[200] Strategic Initiatives and Future Plans - The Group completed the acquisition of 20% interest

Financial Performance - For the year ended December 31, 2022, the company's revenue was RMB 92.593 billion, an increase of 5.1% compared to RMB 88.141 billion in 2021[2] - Operating profit for the year was RMB 5.423 billion, up 11.6% from RMB 4.862 billion in the previous year, with an operating profit margin of 5.9%, an increase of 40 basis points year-on-year[2] - The profit attributable to equity shareholders increased by 5.5% to RMB 5.303 billion from RMB 5.026 billion in 2021[2] - The adjusted pre-tax profit for the group was RMB 6,502,353 thousand, resulting in a net profit of RMB 5,184,804 thousand after tax expenses of RMB 1,317,549 thousand[16] - The pre-tax profit for 2022 was RMB 6,502,353,000, an increase from RMB 5,868,168,000 in 2021, representing a growth of approximately 10.8%[30] - Net profit attributable to equity shareholders increased by 5.5% to RMB 5.3030 billion, with basic earnings per share of RMB 1.342, up 5.3% from RMB 1.274 in 2021[61] Revenue Breakdown - Liquid milk revenue grew by 2.3% year-on-year to RMB 78.269 billion, driven by strong growth in brands like Telunsu and Mengniu Pure Milk[3] - Ice cream revenue saw a significant increase of 33.3% to RMB 5.652 billion, outperforming the industry[3] - Revenue from external customers in mainland China reached RMB 87,997,985 thousand in 2022, up from RMB 85,067,981 thousand in 2021, representing a growth of 3.4%[21] - Total revenue from sales of goods and processing services was RMB 92,592,407 thousand in 2022, compared to RMB 88,133,815 thousand in 2021, indicating an increase of 5.3%[24] - Revenue from liquid milk was RMB 78.2693 billion, accounting for 84.5% of total revenue, compared to 86.8% in the previous year[67] Asset and Liability Management - Total non-current assets increased to RMB 81,036,131 thousand in 2022, up from RMB 67,081,403 thousand in 2021, representing a growth of approximately 20.8%[7] - Current assets rose to RMB 36,777,074 thousand in 2022, compared to RMB 31,019,941 thousand in 2021, marking an increase of about 18.5%[7] - Total liabilities increased to RMB 67,761,407 thousand in 2022, up from RMB 58,101,912 thousand in 2021, reflecting a growth of approximately 16.7%[8] - Net assets reached RMB 50,051,798 thousand in 2022, a significant increase from RMB 41,999,432 thousand in 2021, indicating a growth of around 19.5%[8] - The company's interest-bearing bank and other borrowings rose to RMB 26,106,255 thousand in 2022, compared to RMB 18,786,328 thousand in 2021, representing an increase of approximately 39.0%[8] Capital Expenditures and Investments - Capital expenditures for the year totaled RMB 6,277,598 thousand, with significant investments in liquid milk products (RMB 3,663,569 thousand) and ice cream products (RMB 440,494 thousand)[17] - The company reported total capital expenditures of RMB 12,134,606 thousand, with significant investments in property, plant, and equipment[20] - The company completed the acquisition of a 20% stake in its low-temperature business from Danone and sold 100% of Dumex China, with a payment of RMB 2 billion made for the acquisition[83] Product Development and Innovation - The company launched its self-developed "Aerospace Strain" and achieved GFSI global food safety dual certification for its factory, enhancing its quality culture[3] - The company is actively developing cheese products, including children's cheese sticks and household cheese, in collaboration with leading cheese companies[3] - The company launched a new generation of healthy yogurt with a focus on low sugar and light burden, leading to significant sales growth in the new yogurt segment[43] - The group launched new products including the upgraded "Dream Cap" organic milk and high-calcium milk, enhancing its premium brand positioning[67] - The group introduced a new generation of healthy yogurt products under the Pure Zhen brand, focusing on low-sugar and no-additive options[68] Market Position and Brand Value - The brand value of Mengniu increased by 15% in the Kantar BrandZ™ ranking, marking the highest growth rate in the Chinese dairy industry[3] - The company maintained a strong market position in the ambient milk segment, with significant growth in sales despite macroeconomic challenges[41] - The company achieved first place in the e-commerce market share for ambient liquid milk, driven by innovative marketing strategies during the World Cup[43] Sustainability and Corporate Governance - The company has committed to a sustainable development strategy with goals of reaching carbon peak by 2030 and carbon neutrality by 2050, achieving an MSCI ESG rating upgrade to A[3] - The company aims for carbon peak by 2030 and carbon neutrality by 2050, with specific measures to reduce carbon emissions across the supply chain[79] - The company has adopted corporate governance practices in line with the listing rules, ensuring compliance throughout the fiscal year ending December 31, 2022[87] Employee and Shareholder Engagement - As of December 31, 2022, the group employed approximately 47,329 employees, an increase from 44,629 in 2021, with total employee costs amounting to RMB 8.6575 billion, up from RMB 7.4761 billion in 2021[81] - In 2022, the company granted 5,533,245 restricted shares and 44,977,913 stock options under its stock incentive plan, aiming to enhance employee satisfaction[82] - The board proposed a final dividend of RMB 0.402 per ordinary share for the year ended December 31, 2022, compared to RMB 0.381 in 2021[92]