JONJEE(SH:600872) Changjiang Securities·2025-05-06 09:16Investment Rating - The investment rating for the company is "Buy" and is maintained [9]. Core Views - The company's Q1 2025 performance was impacted by the timing of the Spring Festival, leading to a revenue decline of 25.81% year-on-year, with total revenue at 1.102 billion yuan and net profit attributable to shareholders at 181 million yuan, down 24.24% year-on-year [2][4]. - The company is focusing on marketing reforms and expanding its distribution channels, particularly in core markets such as South China and East China, to stabilize its operations and enhance product adaptability [5][6]. - The resolution of minority equity issues is expected to continue to enhance net profit margins, with projections for net profit attributable to shareholders of 928 million yuan and 1.064 billion yuan for 2025 and 2026, respectively, corresponding to PE ratios of 16 and 14 times [7]. Summary by Sections Financial Performance - In Q1 2025, the company reported total revenue of 1.102 billion yuan, a decrease of 25.81% year-on-year, and a net profit of 181 million yuan, down 24.24% year-on-year. The adjusted net profit was 180 million yuan, reflecting a decline of 23.87% [2][4]. - The revenue breakdown shows soy sauce at 648 million yuan (down 31.57%), chicken essence at 130 million yuan (down 28.6%), and edible oil at 51 million yuan (down 50.01%) [5]. Profitability and Cost Management - The net profit margin improved by 0.34 percentage points to 16.44%, and the gross margin increased by 1.75 percentage points to 38.73%. This improvement is attributed to the continued benefits from raw material cost reductions and internal cost-cutting measures [6]. - The company completed the acquisition of a 20% minority stake in Chubang at the end of 2024, significantly reducing minority shareholder losses, which contributed positively to overall profitability [6]. Strategic Outlook - The company aims to drive growth through both organic and external strategies, focusing on enhancing management efficiency and product innovation while expanding into overseas markets [7]. - The company plans to stabilize its core markets and increase the number of distributors, which rose by 491 in Q1 2025, indicating potential for future growth [5].