KAIYUAN SECURITIES·2024-11-27 08:20Investment Rating - The investment rating for the company is "Buy" (maintained) [2] Core Views - The company is facing significant pressure on its operating performance, with a focus on brand transformation to enhance product strength [2] - The company reported a 20.4% year-on-year decline in revenue and a 44.4% drop in net profit for the first half of FY2025, leading to a downward revision of profit forecasts for FY2025-2027 [3][4] - The company aims to improve overall operational quality and optimize channels, with five strategic guidelines expected to support healthy and stable development [3] Financial Performance - For FY2025H1, the company achieved revenue of HKD 39.408 billion, down 20.4% year-on-year, and a net profit of HKD 2.530 billion, down 44.4% year-on-year [3] - The company declared an interim dividend of HKD 0.20 per share [3] - The company's gross margin for FY2025H1 was 31.4%, an increase of 6.5 percentage points, primarily due to rising gold prices and a higher contribution from priced gold products [4] Market Performance - The company's same-store sales in mainland China for FY2025H1 decreased by 25.4%, with Q1 and Q2 showing declines of 26.4% and 24.3% respectively, mainly due to high gold price volatility affecting end-user sales [4] - The company’s revenue from mainland China and outside mainland China for FY2025H1 decreased by 18.8% and 27.9% respectively, with mainland China accounting for 83.8% of total revenue [4] Strategic Initiatives - The company is actively optimizing store quality and efficiency, closing 239 stores in mainland China during FY2025H1, resulting in a total of 6,968 stores at the end of the period [5] - The launch of the "Chow Tai Fook Chuan Fu" series in April 2024 achieved retail sales exceeding HKD 1.5 billion in FY2025H1, with priced gold products showing significant growth [5]