Milkground(SH:600882) Xin Lang Cai Jing·2025-04-22 12:29Core Viewpoint - The company reported strong financial performance in Q1 2025, with revenue and net profit exceeding expectations, driven by better-than-expected performance in the restaurant and household cheese segments [1][2]. Financial Performance - Q1 2025 revenue reached 1.23 billion yuan, a year-on-year increase of 6.26% - Net profit attributable to shareholders was 82.397 million yuan, up 114.88% year-on-year - Deducted net profit was 64.941 million yuan, reflecting a year-on-year growth of 110.23% [1]. Development Trends - Cheese revenue showed a strong recovery, with significant contributions from the restaurant and household cheese segments - The company anticipates double-digit year-on-year growth in cheese revenue for Q1 2025, despite overall revenue growth of 6.3% being slower due to a focus on cheese and a reduction in trading business - The company has introduced new products, such as cheese sticks and cheese spreads, which have contributed to growth in the ready-to-eat nutrition segment [2]. Product Structure and Cost Management - Gross margin improved by 2.8 percentage points to 31.5% in Q1 2025, attributed to a decrease in low-margin trading and liquid milk revenue, lower costs of some raw materials, and economies of scale in cheese revenue - Sales expense ratio decreased by 2.7 percentage points due to reduced advertising and promotional expenses, while management expense ratio remained stable - Net profit margin increased by 3.4 percentage points to 6.7% [3]. Profit Forecast and Valuation - The company raised its net profit forecasts for 2025 and 2026 by 6.3% and 5.9%, respectively, due to better-than-expected performance in the restaurant and household cheese segments - The current trading P/E ratio is 43.4 times for 2026, with a target price increase of 40% to 28 yuan, corresponding to a P/E of 48.6 times for 2026 and an upside potential of 5.8% - The long-term growth potential in the cheese sector is significant, maintaining an outperform rating relative to the industry [4].