Guifaxiang(SZ:002820) Guan Cha Zhe Wang·2025-07-21 09:56Core Viewpoint - Guifaxiang, known as the "first stock of Mahua," has reported a mid-year loss for the first time in two years, raising concerns about its future development prospects in the face of multiple challenges such as weak consumer demand and a single product structure [1][4]. Group 1: Financial Performance - The company expects a net loss attributable to shareholders of approximately 3 to 5 million yuan for the first half of the year, reflecting ongoing operational difficulties [1]. - In the first quarter, Guifaxiang's revenue decreased by 8.76% year-on-year, with net profit down 64.46% to 6.645 million yuan, indicating a significant decline in performance [3]. - The estimated loss for the second quarter is projected to be around 10 to 12 million yuan, marking a severe downturn compared to previous years [3]. Group 2: Reasons for Loss - The primary reasons for the loss include persistent weak market demand, particularly in the Tianjin local market, leading to a decline in both customer traffic and average transaction value [2]. - The expansion of distribution channels has resulted in increased operational costs, including higher advertising expenses and depreciation costs for new office buildings [2]. - A decrease in investment income due to reduced investment in financial products and lower interest income has further exacerbated the financial downturn [2]. Group 3: Business Model and Strategy - Guifaxiang's revenue heavily relies on its Mahua products, which accounted for 65.91% of total revenue in 2024, highlighting the vulnerability of its single product structure [4]. - The company has increased marketing expenditures significantly, from 108 million yuan in 2022 to 153 million yuan in 2024, while reducing R&D spending by 66.2% [4]. - The company faces intense competition in the snack food industry, necessitating a shift towards product innovation and a more diversified marketing strategy to attract younger consumers [5]. Group 4: Industry Context - The snack food industry in China is experiencing rapid expansion, with increasing demand for healthier and personalized products, while traditional channels are under pressure to adapt [5]. - The competition has shifted from price wars to a focus on product innovation and consumer experience, emphasizing the need for companies like Guifaxiang to evolve [5]. - Guifaxiang stands at a crossroads, needing to balance traditional craftsmanship with modern market demands, serving as a case study for the transformation of traditional brands in the new era [6].