LMZ(SH:600249) Zheng Quan Zhi Xing·2025-06-10 08:14Core Viewpoint - The company received an inquiry letter from the Shanghai Stock Exchange regarding its 2024 annual report, prompting a detailed response about its financial disclosures and operational performance [1][4]. Financial Performance - The company reported a total revenue of 1.053 billion yuan for 2024, with the daily chemical products segment contributing approximately 929 million yuan, accounting for about 88.22% of total revenue [6][14]. - The gross profit margin for the main daily chemical products was 13.84%, which remained relatively stable year-on-year [4][14]. - The company has faced continuous net profit losses or minimal profits since 2004, indicating ongoing challenges in achieving sustainable profitability [4][6]. Cash and Borrowing Situation - The company held a significant cash balance of 1.142 billion yuan, with short-term borrowings increasing by 55.17% year-on-year to 90 million yuan [1][2]. - The average interest income from cash holdings was reported at 40.72 million yuan, with an average annual interest rate of 3.26% [3][4]. - The company justified its decision to increase short-term borrowings despite having substantial cash reserves, citing favorable borrowing rates and the need to maintain good relationships with financial institutions for future financing needs [3][4]. Industry Context - The daily chemical industry is experiencing steady growth, driven by increasing consumer awareness of oral health and rising disposable incomes, which are expected to enhance spending in this sector [6][8]. - The hotel supplies segment, operated by the subsidiary, is benefiting from the booming tourism industry, although it faces challenges such as rising costs and intense market competition [8][14]. - The company’s main products include household toothpaste and hotel consumables, with the household toothpaste segment being the largest contributor to revenue [6][14]. Competitive Landscape - The company’s gross profit margin is lower than that of competitors like Dongkang Oral Care, which has a higher market share and profitability in the oral care segment [15][16]. - The company plans to enhance its market position by focusing on product innovation, brand building, and expanding its sales channels both online and offline [16][17]. - The competitive environment in the daily chemical industry is intensifying, with new entrants and evolving consumer preferences posing additional challenges [17].