SIRIO(SZ:300791) CMS·2025-08-26 01:34Investment Rating - The report maintains a "Strong Buy" investment rating for Xianle Health [1][4] Core Views - The company has shown revenue improvement quarter-on-quarter, with a year-on-year revenue growth of 4.66% and a net profit growth of 1.13% in Q2 2025. The overall revenue performance is expected to continue improving throughout the year [1][3] - The company is positioning itself as a leader in the global nutrition and health food industry, focusing on developing a comprehensive product matrix and exploring high-potential sectors such as maternal and child health, women's health, probiotics, and modern Chinese medicine [1][4] - The report highlights the potential for significant improvement in profitability following the planned divestiture of the Best Formulations (BF) personal care business, which has been a source of losses [1][4] Financial Performance Summary - For H1 2025, the company achieved revenues of 2.042 billion and a net profit of 161 million, reflecting a year-on-year increase of 2.57% and 4.30% respectively [3] - In Q2 2025, the company reported revenues of 1.087 billion and a net profit of 92 million, with respective year-on-year growth rates of 4.66% and 1.13% [3] - The company’s gross margin for Q2 2025 was 33.27%, with a net profit margin of 8.50% [3] - The report projects EPS for 2025 and 2026 to be 1.17 yuan and 1.35 yuan respectively, reflecting adjustments due to the impact of the BF business [4][5] Market and Regional Performance - The report indicates a slight decline in revenue from the China region in Q2 2025, while the Americas showed improvement and Europe continued to experience high growth [3] - The company’s revenue from the Americas increased due to the removal of tariffs, while the European market saw double-digit growth despite external pressures [3] Product Performance - In H1 2025, the company’s revenue from soft capsules, tablets, gummies, and hard capsules grew by 6.47%, 33.37%, 6.35%, and 11.0% respectively, while powdered products and beverages saw declines of 36.02% and 20.84% [3]