JONJEE(SH:600872) EBSCN·2025-10-27 06:21Investment Rating - The report maintains a "Buy" rating for the company [1] Core Views - The company is undergoing significant reforms, which are currently impacting its performance negatively. The focus is on channel inventory digestion and establishing a stable pricing system to create a healthy long-term channel ecosystem [8] - Despite the short-term challenges, the company is actively pursuing long-term growth opportunities, particularly in the restaurant channel and enhancing internal operational efficiency [8] - The report projects a decline in revenue and net profit for 2025-2027, with expected revenues of 44.31 billion, 47.77 billion, and 51.23 billion respectively, and net profits of 5.57 billion, 6.37 billion, and 7.27 billion [9] Financial Performance Summary - For the first three quarters of 2025, the company achieved revenue of 31.56 billion, down 20.01% year-on-year, and a net profit of 3.80 billion, down 34.07% year-on-year. In Q3 alone, revenue was 10.25 billion, down 22.84% year-on-year, and net profit was 1.23 billion, down 45.66% year-on-year [4][5] - The core subsidiary, Meiwai Xian, reported revenue of 31.07 billion for the first three quarters, down 18.40% year-on-year, with Q3 revenue at 10.09 billion, down 19.37% year-on-year [4] Revenue Breakdown - Revenue by product category for the first three quarters showed declines: soy sauce (-17.50%), chicken essence and powder (-22.76%), cooking oil (-42.67%), and others (-4.90%). In Q3, the declines were more pronounced, particularly in soy sauce (-19.2%) and chicken essence and powder (-24.2%) [5] - Revenue by sales model indicated a decline in distribution channels (-21.06%) but an increase in direct sales (+43.99%) for the first three quarters. In Q3, distribution revenue fell by 23.07%, while direct sales rose by 57.44% [5] Cost and Margin Analysis - The company’s gross margin improved to 39.2% for the first three quarters, up 1.84 percentage points year-on-year, primarily due to favorable raw material costs. However, the expense ratio increased to 25.7%, up 6.33 percentage points year-on-year [7] - In Q3, the gross margin was 39.5%, with a slight year-on-year increase, while the expense ratio rose to 26.9% [7] Future Outlook - The company is expected to continue facing challenges due to ongoing reforms, but there is optimism regarding its long-term growth potential as it focuses on channel management and operational efficiency [8] - The report emphasizes the importance of monitoring the company's inventory digestion and pricing recovery processes, as well as its expansion into restaurant clients [8]