JGJC(SZ:000799) Southwest Securities·2025-11-03 11:14Investment Rating - The report does not specify a clear investment rating for the company [1] Core Insights - The company has shown signs of improvement with a marginal recovery in Q3, indicating that deep adjustments are beginning to yield results [8] - Revenue for the first three quarters of 2025 was 760 million yuan, down 36.2% year-on-year, while the net profit attributable to the parent company was a loss of 10 million yuan, down 117.4% year-on-year [8] - The Q3 revenue reached 200 million yuan, reflecting a 0.8% year-on-year increase, and the net profit attributable to the parent company was a loss of 20 million yuan, showing a significant narrowing of losses [8] - The company is focusing on channel innovation and strengthening sales, with a new product launched in collaboration with a retail partner gaining consumer recognition [8] - The company is maintaining rigid expenditure on marketing and promotion despite weak market demand, aiming to boost sales and improve cash flow [8] Financial Summary - Projected revenue for 2024 is 14.23 billion yuan, with a significant decline of 49.7% year-on-year, followed by expected revenues of 10.32 billion yuan in 2025 and 10.66 billion yuan in 2026 [3][11] - The net profit attributable to the parent company is projected to be 0.12 billion yuan in 2024, decreasing to 0.07 billion yuan in 2025, before recovering to 0.32 billion yuan in 2026 and 0.52 billion yuan in 2027 [3][11] - The earnings per share (EPS) are expected to be 0.04 yuan in 2024, dropping to 0.02 yuan in 2025, and then increasing to 0.10 yuan in 2026 and 0.16 yuan in 2027 [3][11] - The return on equity (ROE) is projected to improve from 0.31% in 2024 to 1.28% in 2027 [3][11] Market and Product Strategy - The company is implementing a "two low, one small" product strategy to align with current consumer trends [8] - The company is focusing on its core market in Hunan and enhancing terminal coverage and sales efficiency through refined management practices [8] - The company is leveraging resources from its controlling shareholder to expand cooperation opportunities with state-owned enterprises [8] Cash Flow and Cost Management - The gross margin for the first three quarters of 2025 was approximately 66.7%, down 5.2 percentage points year-on-year [8] - The net cash flow from operating activities for the first three quarters of 2025 was a negative 330 million yuan, although this was an improvement of 90 million yuan year-on-year [8] - The company is experiencing pressure on cash flow due to cautious payment collection from distributors amid weak market demand [8]