Investment Rating - The report assigns a "Buy" rating to the company, with a revised rating to "Add" [4]. Core Views - The company is undergoing a platform transformation, with a focus on optimizing existing stores and rapidly expanding partner stores. The new "community space" model is being validated, and strong supply chain capabilities are expected to support performance recovery as the consumption environment improves [2][4]. Financial Performance Summary - For the first half of 2024, the company reported revenue of 441 million yuan, a year-on-year decrease of 37.8%, and a net profit attributable to shareholders of 70 million yuan, down 55.8% year-on-year. Adjusted net profit was 90 million yuan, reflecting a 49.1% decline [1]. - The number of stores at the end of the reporting period was 537, with a net increase of 58 stores compared to the beginning of the year, but a decrease of 116 stores compared to the same period last year [1]. - The average daily sales for direct-operated and franchised stores were 7,500 yuan, showing an overall decline of 8.5% year-on-year [1]. Future Projections - Revenue projections for 2024 to 2026 are 892 million yuan, 1.019 billion yuan, and 1.209 billion yuan, respectively. Net profit projections for the same period are 135 million yuan, 169 million yuan, and 240 million yuan, respectively [3][4]. - The current stock price corresponds to a price-to-earnings ratio (P/E) of 12x for 2024, 10x for 2025, and 7x for 2026 [2][4]. Strategic Initiatives - The company is enhancing its supply chain management capabilities and has launched several high-margin new products. The gross margin for direct stores remained at 70% despite significant promotional activities [2]. - The company is iterating its store environment using new technologies to improve consumer experience, with the "community space" model expected to generate diverse revenue streams [2].

Revenue Performance - The total revenue for the first half of 2024 was RMB 441,294 thousand, compared to RMB 709,992 thousand for the same period in 2023, indicating a decrease of 37.9%[3] - The revenue from franchise operations was RMB 130,360 thousand, representing 29.5% of total revenue in 2024, compared to 5.5% in 2023[3] - The total revenue from direct-operated businesses was RMB 310,934 thousand, accounting for 70.5% of total revenue in 2024[3] Proprietary Beverages Performance - For the six months ended June 30, 2024, the contribution gross profit from all of Helen's proprietary beverages was RMB 124,458 thousand, down from RMB 317,795 thousand in the same period of 2023, representing a decrease of 60.9%[2] - The contribution gross profit margin for Helen's proprietary beverages was 78.3%, a slight decline from 79.4% in the previous year[2] - The revenue from Helen's proprietary products accounted for 50.4% of total revenue in 2024, down from 76.3% in 2023[3] Beverage Alcohol Products - The share of beverage alcohol products in Helen's proprietary products increased from 55.6% in the first half of 2023 to 58.1% in the first half of 2024[4] - The company launched new proprietary beverages such as "Lemon Big Cup" and "Rose Big Cup," which were well-received by consumers, contributing to the increase in beverage alcohol product share[4] Third-Party Brand Beverages - The revenue from third-party brand beverages was RMB 42,773 thousand, down from RMB 66,801 thousand in the previous year, with a gross profit margin of 53.7% compared to 55.6%[2] Direct-Operated Taverns - The overall gross profit margin for direct-operated taverns remained stable at 70% despite a slight decline in contribution gross profit rates due to promotional activities[1]

Financial Performance - The company reported a revenue of HKD 500 million for the first half of 2024, representing a 15% increase compared to the same period last year[16]. - The company expects a revenue guidance of HKD 1.2 billion for the full year 2024, indicating a projected growth of 10%[16]. - Revenue for the six months ended June 30, 2024, was RMB 441.3 million, a decrease of 37.9% compared to RMB 710.0 million for the same period in 2023[26]. - Adjusted net profit for the same period was RMB 90.3 million, down 51.9% from RMB 187.7 million in 2023[27]. - The company reported a net profit attributable to owners of RMB 69.7 million for the six months ended June 30, 2024, down 55.8% from RMB 157.5 million in the same period last year[120]. - The company reported a total comprehensive income of RMB 74.9 million for the six months ended June 30, 2024, compared to RMB 175.6 million for the same period in 2023[120]. - The net cash flow from operating activities for the six months ended June 30, 2024, is RMB 39,271,000, a significant decrease of 81.8% compared to RMB 215,846,000 for the same period in 2023[123]. User Growth and Market Expansion - User data showed a growth of 20% in active users, reaching 1.2 million by June 30, 2024[16]. - Market expansion plans include entering two new regions by the end of 2024, targeting a 25% increase in market share[16]. - Total number of taverns increased from 479 at the beginning of 2024 to 581 by August 26, 2024, with 415 signed under the "Hi Beer Partner" program[31]. - The number of "Hi Beer Partner" taverns opened reached 327, covering 204 cities, including 107 in existing markets and 97 in new markets[31]. Cost Management and Efficiency - The company has reduced operational costs by 5% through efficiency improvements in the supply chain[16]. - The cost of raw materials and consumables decreased by 19.0% from RMB 196.6 million in the first half of 2023 to RMB 159.3 million in the first half of 2024[50]. - Employee benefits and human resources expenses decreased by 43.1% from RMB 169.5 million in the first half of 2023 to RMB 96.5 million in the first half of 2024[51]. - Depreciation of right-of-use assets decreased by 48.0% from RMB 61.0 million in the first half of 2023 to RMB 31.7 million in the first half of 2024[52]. - Depreciation of property, plant, and equipment decreased by 45.1% from RMB 58.6 million in the first half of 2023 to RMB 32.2 million in the first half of 2024[53]. - Short-term rental and related expenses decreased by 53.3% from RMB 39.6 million in the first half of 2023 to RMB 18.5 million in the first half of 2024[54]. Strategic Initiatives - New product launches are anticipated to contribute an additional HKD 100 million in revenue by Q4 2024[16]. - A new marketing strategy focusing on digital channels is projected to increase customer engagement by 30%[16]. - The company is investing HKD 50 million in R&D for new technologies aimed at enhancing user experience[16]. - The company is focusing on a platform-based development strategy, enhancing supply chain management and space design capabilities to improve competitiveness[45]. - The "Community Space" business model was introduced in July 2024 to connect local communities with diverse revenue streams, including in-store sales and new retail opportunities[45]. Shareholder and Governance Matters - The board has approved a share buyback program worth HKD 100 million to enhance shareholder value[16]. - The company has proposed an interim dividend of RMB 0.1573 per share for the six months ended June 30, 2024, with the total amount to be determined based on the number of qualifying shareholders[113]. - The company’s governance structure is under continuous review to assess the necessity of separating the roles of Chairman and CEO[107]. - The company has adopted corporate governance practices in accordance with the principles and code provisions set out in the corporate governance code, ensuring compliance during the reporting period[106]. Financial Position and Assets - Total assets as of June 30, 2024, were RMB 1,804.0 million, down from RMB 2,165.0 million at the end of 2023[28]. - Total equity decreased to RMB 1,498.9 million as of June 30, 2024, from RMB 1,821.4 million at the end of 2023[28]. - Non-current assets decreased to RMB 643.9 million as of June 30, 2024, from RMB 740.8 million at the end of 2023[28]. - Cash and bank balances decreased from RMB 1,278.9 million to RMB 934.2 million, mainly due to the payment of dividends at the end of 2023[73]. - The company has no bank borrowings as of June 30, 2024, making the capital debt ratio not applicable[79]. Employee and Compensation Policies - As of June 30, 2024, the company has 745 employees and 1,733 outsourced personnel, with total employee benefits and human resource expenses amounting to RMB 96.5 million for the six-month period[84]. - The company provides competitive salaries and performance bonuses to employees, with a focus on career development and training systems[84]. - The company has established a comprehensive career development path and talent training system to promote employee self-growth[84]. Other Financial Metrics - The company reported a basic and diluted earnings per share of RMB 0.055 for the six months ended June 30, 2024, compared to RMB 0.124 for the same period in 2023[120]. - The company’s total liabilities decreased to RMB 305.1 million as of June 30, 2024, from RMB 343.6 million as of December 31, 2023[121]. - The company’s investment activities resulted in a net cash outflow of RMB 88,580,000 for the six months ended June 30, 2024, compared to a net cash outflow of RMB 417,536,000 for the same period in 2023[123].

Investment Rating - The report maintains a "Buy" rating for the company [5]. Core Views - The company's short-term performance is under pressure due to the optimization of direct-operated stores, but the light asset model is expected to drive future growth [5]. - The company has adjusted its net profit forecasts for 2024-2026 to RMB 154 million (-0.72), RMB 177 million (-1.26), and RMB 217 million (-1.46), with corresponding PE ratios of 12x, 11x, and 9x [5]. - The company's H1 2024 revenue was RMB 441 million, down 37.8% year-on-year, with a net profit of RMB 70 million, down 55.8% year-on-year [5]. Summary by Sections Store Network and Sales Performance - As of H1 2024, the total number of stores is 537, a decrease of 17.8% year-on-year, with 187 direct-operated stores (down 63.7%) and 67 franchised taverns (down 51.4%) [5]. - Same-store sales decreased by 28.6%, with average daily sales of RMB 7,500 for direct-operated and franchised taverns (down 8.5%) and RMB 5,400 for partner taverns [5]. Strategic Initiatives - In July 2024, the company launched a new strategy called "Community New Life," with a minimum investment of RMB 400,000 for community space stores, aiming for a payback period of 12-18 months [5]. - The company plans to open new stores in Los Angeles, Thailand, Vietnam, Indonesia, and Malaysia by the end of 2024 or early 2025 to enhance its global presence [5].

Financial Performance - Revenue for the six months ended June 30, 2024, was RMB 441,294 thousand, a decrease of 37.9% compared to RMB 709,992 thousand for the same period in 2023[2] - Profit attributable to owners for the same period was RMB 69,677 thousand, down 55.8% from RMB 157,487 thousand in 2023[2] - Adjusted net profit for the six months ended June 30, 2024, was RMB 90,278 thousand, a decline of 51.9% from RMB 187,660 thousand in 2023[2] - Same-store sales for the six months ended June 30, 2024, were RMB 277,358.6 thousand, a decrease of 28.6% from RMB 388,207.4 thousand in 2023[8] - Total comprehensive income for the six months ended June 30, 2024, was RMB 74,926 thousand, a decline of 57.4% compared to RMB 175,561 thousand for the same period in 2023[51] - The company reported a net loss of RMB 10,498,000 from the sale of property and equipment for the six months ended June 30, 2024, compared to a loss of RMB 134,887,000 in the same period of 2023, showing an improvement[63] Tavern Operations - The total number of taverns increased from 479 at the beginning of 2024 to 581 by August 26, 2024[3] - The "Hi Beer Partner" program has signed 415 stores, with 327 already in operation, covering 204 cities[3] - Average daily revenue per tavern in first-tier cities was RMB 8.7 thousand, up from RMB 8.4 thousand in 2023[5] - The average daily revenue per "Hi Beer Partner" tavern was RMB 27 thousand as of June 30, 2024, with no data available for the previous year[7] - The number of taverns in second-tier cities decreased from 314 in 2023 to 179 as of June 30, 2024[4] Revenue Sources - Revenue from the franchise business surged by 234.4% to RMB 130.4 million, accounting for 29.5% of total revenue in the first half of 2024, up from 5.5% in the same period of 2023[12] - Revenue from tavern operations and franchising for the six months ended June 30, 2024, was RMB 310,934,000 and RMB 130,360,000 respectively, compared to RMB 670,573,000 and RMB 39,419,000 in 2023[59] - Revenue from mainland China was RMB 433,762,000 for the six months ended June 30, 2024, down from RMB 707,580,000 in 2023, indicating a decrease of about 38.6%[60] Cost Management - The cost of raw materials and consumables decreased by 19.0% to RMB 159.3 million in the first half of 2024, down from RMB 196.6 million in the same period of 2023[15] - Employee benefits and human resource expenses fell by 43.1% to RMB 96.5 million, primarily due to a reduction in employee numbers[16] - Depreciation of right-of-use assets decreased by 48.0% to RMB 31.7 million, attributed to the termination of several lease agreements for direct-operated taverns[17] - Short-term rental and related expenses decreased by 53.3% from RMB 39.6 million for the six months ended June 30, 2023, to RMB 18.5 million for the six months ending June 30, 2024[19] - Energy costs decreased by 16.4% from RMB 11.6 million for the six months ended June 30, 2023, to RMB 9.7 million for the six months ending June 30, 2024[20] Financial Position - Cash and bank balances decreased from RMB 1,278.9 million as of December 31, 2023, to RMB 934.2 million as of June 30, 2024, mainly due to the payment of dividends[38] - Total liabilities decreased to RMB 305,105 thousand as of June 30, 2024, from RMB 343,577 thousand as of December 31, 2023, a reduction of 11.2%[53] - The company’s cash and cash equivalents dropped significantly to RMB 148,724 thousand as of June 30, 2024, from RMB 625,612 thousand as of December 31, 2023[52] - The total net proceeds amount to HKD 2,980.1 million, with a remaining balance of HKD 904.6 million as of December 31, 2023[95] Dividend and Shareholder Information - The company declared an interim dividend of approximately RMB 397,474,000 for the six months ended June 30, 2024, with a proposed dividend of RMB 0.1573 per share[68] - The interim dividend proposed is RMB 0.1573 per share, with a total payout dependent on the number of qualifying shareholders as of September 16, 2024[97] - The interim dividend for Hong Kong shareholders will be paid in HKD, calculated at HKD 0.17206 per share based on the exchange rate on August 29, 2024[98] - The interim dividend for Singapore shareholders will be paid in SGD, calculated at SGD 0.028751 per share based on the exchange rate on August 29, 2024[99] Corporate Governance and Compliance - The audit committee has reviewed the interim financial results for the six months ending June 30, 2024, confirming compliance with accounting standards and regulations[96] - The company has complied with all applicable corporate governance codes during the reporting period, except for the separation of roles between the chairman and the CEO[89] Future Plans and Investments - The company plans to allocate 70.0% of the net proceeds, amounting to HKD 2,086.1 million, for opening new bars and expanding its operations over the next three years[95] - 10.0% of the net proceeds, totaling HKD 298.0 million, will be used to strengthen the talent pipeline and optimize human resource management[95] - The company will invest 5.0% of the net proceeds, equivalent to HKD 149.0 million, to enhance its operational capabilities and continue investing in technology research and development[95] - A further 10.0% of the net proceeds, amounting to HKD 298.0 million, is designated for working capital and general corporate purposes[95]

事件 8 月 2 日公司公告 2024 中报预告，1H24 收入预计 4.3~4.5 亿元， 同比-39.4%~-36.6%，净利 6700~7400 万元，同比-57.5%~-53.0%， 经调整净利 8720~9520 万元，同比-50.8%~-46.3%。 点评 上半年业绩承压源于同店基数较高、需求压力较大、二次上市费 用等。根据公司公告，上半年公司收入业绩承压主要源于：1）1H23 业绩基数相对较高（直营店占比高，单店销售基数较高）;2）受 外部环境变化影响，1H24 行业需求压力加大;3）公司于新加坡第 二上市产生上市费用约 1220 万元；4）酒馆优化及调整产生 800~900 万元亏损（1H23 约为 3020 万元）。 顺应变化积极调整，发布"社区空间"模型。根据公司公告，截 至 24 年 7 月末，公司门店总数 574 家、较 24 年初的 479 家净增 95 家。公司于 24 年 7 月发布"社区空间"复合型商业模型，聚焦 社区客群，将依托公司产品供应链及空间打造双平台优势，链接 社区内的人、店和社群，通过店内销售、外卖、酒水新零售、商 业新空间等方式多元创收。根据公司官方公众号信息，社 ...

Summary of Conference Call Industry Overview - The recent performance of the Hong Kong stock market has been notably strong, with specific reference to the Tianjin sector where many companies experienced significant corrections in the previous round [1] Company Insights - Among the companies in the Tianjin sector, Hai Lu Ji has been highlighted for having a relatively solid overall fundamental performance despite the market corrections [1]

Summary of Conference Call Company and Industry - The conference call is focused on the food marketing industry, specifically featuring the company "Hailunsi" and its financial performance [1] Core Points and Arguments - The call is part of a series aimed at discussing consumer recovery trends within the food sector [1] - The presence of Hailunsi's CFO and IR team indicates a focus on transparency and engagement with investors [1] Other Important but Possibly Overlooked Content - The introduction highlights the importance of understanding the current market dynamics and consumer behavior post-recovery [1]

Investment Rating - The report maintains a "Recommended" rating for the company [1] Core Views - The company has shifted towards a light-asset model, resulting in a strategic transformation and a reduction in direct-operated stores while increasing partner stores [1] - The company reported a revenue of 1.209 billion HKD for 2023, a year-on-year decrease of 22.49%, but achieved a net profit of 181 million HKD, marking a turnaround from losses [1] - The proposed final dividend is 0.3153 HKD per share, totaling approximately 400 million HKD [1] Financial Summary - Revenue composition shows that self-owned products accounted for 71.1% of total revenue, with beer at 10.4%, beverage alcohol at 41.3%, snacks at 19.4%, and third-party brand alcohol at 18.7% [1] - The gross margin for self-owned alcohol remained stable at 75.7%, while third-party alcohol gross margin improved to 54.8% [1] - The company has signed contracts for 383 partner stores, with 188 already opened, covering 136 cities [1] - The number of direct-operated stores decreased to 479 from 767 year-on-year, with a significant reduction in first and second-tier cities [1] - The average daily sales per store in first-tier cities was 7,500 HKD, while partner stores performed better with 9,400 HKD in first-tier cities [1] - Cost control measures led to a decrease in various expense ratios, with raw material costs at 29.8% and labor costs at 24.7% [1] Earnings Forecast and Valuation - The earnings per share (EPS) forecast for 2024 and 2025 has been adjusted to 0.16 HKD and 0.23 HKD respectively, with a new forecast for 2026 at 0.33 HKD [1] - The current stock price corresponds to a price-to-earnings (PE) ratio of 16 times for 2024, 11 times for 2025, and 8 times for 2026 [1] - The target price is set at 3.41 HKD, based on a 20 times PE for 2024 [1]

Financial Performance - Helens International Holdings Company Limited reported a revenue of HKD 1.2 billion for the fiscal year 2023, representing a year-on-year increase of 15%[1]. - The company achieved a net profit of HKD 250 million, which is a 20% increase compared to the previous year[1]. - The gross margin improved to 45%, up from 42% in the previous year, reflecting better cost management[1]. - The adjusted net profit for 2023 was RMB 280.2 million, with an adjusted net profit margin of 23.2%, compared to an adjusted net loss of RMB 240.8 million in 2022[22]. - The profit before tax improved from a loss of RMB 1,616.5 million in 2022 to a profit of RMB 152.0 million in 2023, with corresponding profit margin of 12.6%[68]. - Adjusted net profit rose to RMB 280.2 million in 2023 from a loss of RMB 240.8 million in 2022, reflecting operational improvements[72]. User Growth and Market Expansion - User data indicated a growth in active users to 1.5 million, up 25% from the previous year[1]. - Helens International is focusing on expanding its market presence in Southeast Asia, targeting a 30% increase in market share by 2025[1]. - The company plans to continue expanding its tavern network while restructuring its development model from a linear chain to a platform-based company[134]. - The "Hi Beer Partner" program has signed a total of 383 locations, with 188 already in operation, covering 136 cities[23]. Strategic Initiatives - The company is investing HKD 100 million in new product development, particularly in the beverage sector, to enhance its product offerings[1]. - Helens International plans to explore potential acquisitions to strengthen its supply chain and distribution network in the next fiscal year[1]. - The company has initiated a new marketing strategy aimed at increasing brand awareness, with a budget allocation of HKD 50 million for digital marketing campaigns[1]. - The company initiated the "Hi Beer Partner" program in 2023, aiming to enhance market share and enter lower-tier markets through a new partnership model[50]. Operational Adjustments - The number of tavern locations decreased from 767 as of December 31, 2022, to 479 by December 31, 2023, due to strategic adjustments[23]. - The company is committed to a strategic transformation towards a light-asset model and actively adjusting its direct store network[23]. - Revenue decreased by 22.5% from RMB 1,559.3 million in 2022 to RMB 1,208.6 million in 2023, primarily due to the strategic shift to a light-asset model and adjustments in the direct store network[43]. - The company reported a significant reduction in impairment losses from RMB 712.9 million in 2022 to RMB 11.3 million in 2023, as store conditions improved post-COVID-19[63]. Financial Management - Total assets as of December 31, 2023, were RMB 2,164.98 million, down from RMB 2,676.77 million in 2022[17]. - The company's total liabilities decreased significantly to RMB 343.6 million in 2023 from RMB 853.9 million in 2022[17]. - Cash and cash equivalents slightly decreased from RMB 1,298.6 million in 2022 to RMB 1,277.2 million in 2023, mainly due to dividend payments[81]. - The company has not made any bank borrowings as of December 31, 2023, and has no significant debts or loans[192]. Sustainability and Compliance - Helens International is committed to sustainability, with plans to reduce carbon emissions by 20% over the next three years[1]. - The company emphasizes the importance of environmental protection and has not encountered any significant violations of relevant laws and regulations[142]. - The company has established compliance policies to adhere to applicable laws and regulations, with no significant non-compliance issues reported during the period[197]. Shareholder Information - The company declared a dividend of approximately RMB 146.9 million to its shareholders during the reporting period, with a proposed final dividend of RMB 0.3153 per share for the year ending December 31, 2023[136]. - The board of directors will seek shareholder approval for the proposed dividend at the annual general meeting scheduled for May 14, 2024[139]. - The final dividend will be paid to shareholders listed on the register as of May 20, 2024, with payment expected around May 24, 2024[139]. Risks and Challenges - The company faces risks related to economic slowdowns in China and globally, which could adversely affect its financial performance[100]. - Recent stricter regulations imposed by the Chinese government on the tavern industry may lead to increased compliance costs and affect profitability[104]. - The company's ability to expand its business is contingent on various factors, including overall economic conditions and access to credit, which may be impacted by stricter lending policies[105].