Summary of the Conference Call for Meili Tianyuan Company Overview - **Company**: Meili Tianyuan - **Industry**: Beauty and Health Services Key Financial Metrics - Adjusted net profit margin reached **13.1%**, a historical high [2] - Operating cash flow increased by **84%** to **¥410 million** [2] - Cash and cash equivalents grew by **28%** to **¥2 billion** [2] - Revenue for the first half of 2025 was **¥1.46 billion**, a **28.2%** year-on-year increase [3] Business Segment Performance - **Lifestyle Beauty and Health**: Revenue of **¥810 million**, up **30%**; active membership increased by **46%** to **112,000** [2][4] - **Medical Aesthetics**: Revenue of **¥500 million**, a **13%** increase; active medical beauty membership rose by **28%** to **24,000** [5] - **Sub-health Medical Services**: Revenue doubled to **¥154 million**, accounting for over **10%** of total revenue [5] Market Dynamics - **Super First-tier Cities**: Contributed **60%** of total revenue, with a growth rate exceeding **50%** in the first half of 2025; pre-tax profit margin reached **25%** [6] - Four core cities achieved single-store revenue exceeding **¥100 million** [6] Acquisition and Integration - **Nairui Integration**: Post-acquisition revenue of **¥277 million**; adjusted net profit margin improved from **6%** to **10.5%** [7] - Annualized revenue per store increased from **¥5.8 million** to **¥7.2 million** [7] Future Growth Strategy - **Revenue Growth Target**: Full-year revenue expected to maintain strong growth, with adjusted net profit projected to increase by **30%** year-on-year [8] - **Expansion Plans**: Focus on both organic growth and acquisitions, targeting leading lifestyle beauty institutions and regional leaders [12] Digital Transformation - Nairui upgraded its digital capabilities from **Smart Beauty 1.0 to 2.0**, enhancing customer experience through a closed-loop model of detection, conditioning, and re-detection [9][10] - Revenue from mini-program distribution reached **¥50 million** in the first half of 2025 [10] Operational Efficiency - Overall gross margin improved from **47%** to **49.3%** [19] - The company aims to enhance operational efficiency through supply chain optimization and increased penetration of value-added services [18] Market Positioning - The company is focused on high-potential markets, particularly in super first-tier cities, to maximize operational efficiency and brand influence [14] - Plans to penetrate new first-tier cities with significant growth potential [16] Customer Engagement - Customer traffic increased by over **45%** in 2025, with same-store sales growth exceeding **5%** [28] - Average customer visits per month are **6**, with semi-annual spending around **¥12,000 to ¥13,000** [28] Conclusion - Meili Tianyuan is positioned for robust growth in the beauty and health services sector, leveraging strategic acquisitions, digital transformation, and operational efficiencies to enhance profitability and market share. The company is optimistic about achieving its ambitious revenue and profit targets for the remainder of 2025 and beyond.