智通财经网·2025-11-25 03:23Core Viewpoint - UBS has downgraded the profit forecasts for China Wangwang (00151) for the fiscal years 2026 and 2027 by 9% and 8% respectively, expecting a revenue growth of 2% and a net profit decline of 9% for the fiscal year 2026 [1] Financial Performance - For the first half of the fiscal year 2026 (ending September 30), China Wangwang reported a revenue increase of 2.1% to 11.1 billion RMB, while net profit decreased by 7.8% to 1.7 billion RMB [1] - The gross margin fell by 1.1 percentage points to 46.2%, and the net profit margin decreased by 1.7 percentage points to 15.5% [1] Operational Insights - The company’s revenue met expectations, but profits fell short of market forecasts, primarily due to a 10.6% increase in operating expenses, particularly in advertising and promotional costs [1] - Management indicated that sales performance in October and November was weaker compared to last year, attributed to the later timing of the Lunar New Year in 2026 [1] Future Outlook - Management expects the gross margin in the second half of the fiscal year to remain stable compared to the first half, with potential improvements next year as the cost of imported milk powder is anticipated to decline from current high levels [1] - Long-term, the ratio of advertising and promotional expenses is expected to remain at 3% to 4% [1]