Have you ever dreamed of running a1 billion US dollars business. I definitely have not. Have you ever imagined that one day you would become the CEO of the leading food companies in Thailand.I definitely have not. Have you ever envisioned yourself that one day you would own the leading cat food brand in Thailand with a revenue of more than 80 million US. I definitely have not.Looking back, I have accomplished so much in my 41 years of age and I could not have done it all without the support from people arou ...

Group 1 - Freshpet, Inc. will report its second quarter results for the period ended June 30, 2025, on August 4, 2025, before market open [1] - A conference call with the executive management team is scheduled for August 4, 2025, at 8:00 a.m. ET to discuss the results [2] - The conference call will be available for live broadcast on the company's website and will be archived for later access [3] Group 2 - Freshpet's mission is to provide fresh food for pets, using locally sourced ingredients and cooking in small batches to maintain quality [4] - The company's products are available in various retail formats across the U.S., Canada, and Europe, as well as online in the U.S. [5]

Investment Rating - The report upgrades Gambol from Neutral to Buy, with a revised target price (TP) of Rmb120, indicating a 25% upside from the closing price on July 10 [9][33]. Core Insights - The pet food industry is experiencing significant growth, with Gambol's domestic sales expected to rise by 32% year-on-year in 2Q25, while the overall market remains fragmented, presenting opportunities for market share gains [2][9]. - The report anticipates a 19% year-on-year growth in Gambol's topline for 2Q25, driven by strong domestic performance despite challenges in overseas markets due to tariffs [1][11]. - New product development and domestic margin expansion are critical for future growth, with Gambol's innovative product offerings expected to capture market share from long-tail brands [3][8]. Summary by Sections Company Performance - Gambol's stock price has declined by 25% since the downgrade to Neutral, but the report suggests this correction is overdone, providing a favorable entry point for investors [2]. - The company is expected to achieve a net profit (NP) growth of -2% year-on-year in 2Q25, primarily due to increased expenses related to staff incentives and new factory depreciation [1][11]. Market Dynamics - The pet food market is characterized by a trend towards premiumization, with established brands like Gambol and China Pet Foods leading in sales growth [8][13]. - The report notes that long-tail brands represent 70% of the market share, indicating a potential for consolidation as consumers increasingly focus on food quality and functionality [2][9]. Financial Projections - For 2025E, Gambol's domestic revenue is projected to grow by 34% year-on-year, with a domestic net profit margin (NPM) expansion of 1.2 percentage points [32]. - The report revises the net income estimates for covered pet food companies by 0-5% to account for tariff impacts, while maintaining a positive outlook on Gambol and China Pet Foods [9][32].

Investment Rating - The report does not explicitly state an investment rating for the pet food industry in China Core Insights - The pet food market in China is experiencing robust growth, with online GMV across major platforms increasing by 18% YoY in May 2025, driven by a 22% rise in volume despite a 4.3% decline in average selling price [2] - Douyin is leading the growth in the market, with a 54% YoY increase in GMV, significantly outperforming JD and Tmall [2] - The top 10 pet food brands accounted for 39.7% of the market share in May, showing an increase of 1.7 percentage points MoM and 3.2 percentage points YoY [3] Sales Trends - Gambol's online retail sales increased by 42% YoY in May, with its premium cat food brand, Fregate, surging by 147% YoY [4] - China Pet Foods (CPF) recorded an 18% YoY growth in online sales in May, with its brand Toptrees growing by 50% [5] - Petpal's core brand, Meatyway, saw a 14% YoY increase in online sales in May and a 38% YoY rise for the January–May period [5] Cost Trends - The average cost of raw materials for pet treats and staple food declined by 7% and 2% YoY, respectively, in May 2025, primarily due to lower prices for chicken, duck, and soybean meal [6] Market Share Dynamics - The market share for Myfoodie and Fregate increased by 0.5 percentage points and 1.6 percentage points YoY, respectively [4] - CPF's aggregate online sales for January–May were up 24% YoY, with Toptrees' market share increasing to 1.1% [5] Online Sales Channels - Online channels for pet food are showing significant growth, with Tmall, JD, and Douyin all contributing to the overall increase in GMV [27][29]

11 June 2025 | 12:11AM HKT China Consumer Staples: May Check In and Consumer Corp. Day Wrap: A bumpy road with policy swings, channel shift amid deflation We hosted multiple staple companies at our Consumer & Leisure Corporate Day and performed channel checks in the past weeks. We are seeing a bumpy road of demand recovery and still largely slow 2Q-to-date run-rates across staples sub-sectors, esp. for spirits, beer, and dairy. Recent policy tightening in alcohol consumption by government officers and civil ...

Core Viewpoint - The article discusses three stocks—Target, Celsius Holdings, and Freshpet—that have underperformed but may have potential for recovery in the near future, despite their current challenges [1][2][3]. Group 1: Target - Target's stock has decreased by 33% over the past year, attributed to negative store comps and declining net sales over two consecutive quarters [4][5]. - The stock's yield has risen to 4.6%, and the company has a history of increasing dividends for 53 consecutive years, with expectations for a potential hike soon [5][6]. - Target faces challenges in regaining customer trust due to political controversies that have alienated both conservative and liberal shoppers [8][9]. - The company has a payout ratio of less than 50% of its trailing earnings, indicating room for dividend increases while aiming for a turnaround [6][10]. Group 2: Celsius Holdings - Celsius Holdings has experienced a 42% decline in stock value over the past year, despite being one of the year's biggest market winners with over 60% growth [11]. - The company has seen significant revenue growth in previous years, but recent quarters have shown year-over-year declines [12]. - The acquisition of Alani Nu is expected to positively impact market share and revenue, with results anticipated to improve starting from the current quarter [13]. Group 3: Freshpet - Freshpet's stock has dropped by 39%, holding a 3.5% share of the dog food market but dominating the fresh or frozen pet food segment with 96% market share in brick-and-mortar retailers [14]. - The company has consistently achieved over 27% top-line growth for seven years, but it has revised its growth expectations down to 15% to 18% for the current year [15]. - Despite the decline, Freshpet's stock remains at a premium valuation, trading at three times sales and 37 times next year's earnings, indicating potential for recovery if growth resumes [16].

Summary of China Pet Foods Corporate Day Company Overview - **Company**: China Pet Foods (002891.SZ) - **Industry**: Consumer & Leisure, specifically pet food Key Takeaways 1. **Sales Growth and 618 Shopping Festival**: - Strong year-over-year (yoy) growth observed in April, attributed to distributors front-loading orders for the 618 shopping festival - The company anticipates a full-year domestic sales growth of 30% yoy - Discounts during the festival are expected to be higher than those on Women's Day, but overall yoy discounts are projected to remain stable with larger ticket sizes due to price hikes on two classic treat products [2][7][10] 2. **New Product Development**: - The Little Golden Shield series is projected to achieve sales of Rmb100 million by 2025, contributing approximately 50% to Wanpy's growth - New products, including the Little Golden Shield and Dry Food with raw meat and soup, are expected to achieve gross profit margins (GPM) of over 50%, compared to the historical core GPM of 30% for Wanpy - A Targeted Feed series is set to launch at the Asia Pet Exhibition in August, featuring premium products for pets with special needs [2][10][11] 3. **Overseas Business Performance**: - Stable growth in overseas business, particularly outside the US - Sales from China to the US may have been impacted by tens of millions quarterly, with profits affected by a few million, although growth in the Cambodia factory partially offsets this - Orders from US clients for products produced in China were noted in May, despite high tariffs, with expectations for increased orders in July [2][9][11] 4. **Raw Material Cost Trends**: - Raw material prices for chicken and beef have increased sequentially, leading to lower margins in March-April, but improvements are expected in May-June - The Cambodia factory continues to benefit from favorable raw material prices, similar to trends in China [2][11] 5. **Long-term Growth Potential**: - China Pet Foods is positioned as the only Chinese pet food company with established capacity in North America, yet holds a small market share in the premium treats market (approximately 0.1% of a US$100 billion market) - The company sees significant growth potential in this segment [12] 6. **Financial Outlook**: - The company maintains a target price of Rmb63.00, with a current price of Rmb66.17, indicating a downside of 4.8% - Revenue projections for the next few years are as follows: - 2025: Rmb5,350.2 million - 2026: Rmb6,449.2 million - 2027: Rmb7,803.7 million - Expected EBITDA and EPS growth are also outlined, with a focus on maintaining a strong financial position [13][14] Risks and Considerations - Key risks include slower-than-expected domestic revenue growth, food safety issues, foreign exchange fluctuations, rising freight and raw material costs, and potential additional tariffs on pet food exports to the US [13] Conclusion - China Pet Foods is positioned for growth with a clear strategy focused on product development and market expansion, particularly in the premium segment. The company is optimistic about achieving its sales targets and enhancing its brand presence in both domestic and international markets [2][12]

Core Viewpoint - Freshpet Inc. is facing significant challenges despite some growth in retail presence and revenue, with a bearish outlook on its stock due to poor fundamentals and unrealistic market expectations [4][6][22]. Company Performance - Freshpet's revenue increased by 18% year-over-year in 1Q25, driven by a 15% volume gain and a 3% favorable price/mix [4]. - Adjusted EBITDA rose from $31 million in 1Q24 to $36 million in 1Q25, but this figure is considered misleading [5][7]. - The company missed earnings estimates in its 1Q25 report and lowered its full-year adjusted EBITDA guidance to $190-$210 million from a previous estimate of at least $210 million [6]. Financial Health - Freshpet has consistently burned cash, with negative free cash flow (FCF) annually since 2017 and in 34 of the last 36 quarters [12][13]. - Cumulatively, Freshpet has burned through $1.2 billion in FCF since 2019, which is 29% of its enterprise value [13]. - The company's total operating expenses averaged 106% of revenue over the last five years, increasing from 96% in 1Q24 to 104% in 1Q25 [10][11]. Market Position - Freshpet holds just over 1% market share in a pet food industry dominated by larger companies like Nestle and Mars, which together account for 61% of the market [17][18]. - The company faces competition from both large corporations and private label brands, making it difficult to gain market share [16][19]. Profitability Issues - Freshpet's net operating profit after tax (NOPAT) fell to -$10 million in 1Q25 from $9 million in 1Q24, indicating declining profitability [20]. - The company's return on invested capital (ROIC) decreased from a peak of 4% in 2024 to 2% in the TTM ending 1Q25 [20]. Valuation Concerns - The current stock price implies that Freshpet must grow profits at accelerated rates and capture significant market share, which is deemed unrealistic [22][23]. - To justify its price of approximately $80 per share, Freshpet would need to generate $11.7 billion in sales by 2034, which is 12 times its TTM sales [23]. - Alternative scenarios suggest a potential downside of 40% to 68% based on more realistic growth expectations [25][26]. Long-term Outlook - Freshpet's economic book value is estimated to be less than $1 per share, indicating that equity investors may not see significant returns [33].

Freshpet (FRPT) 2025 Conference Summary Company Overview - Freshpet is a leader in fresh pet food in the United States, consistently growing at double digits and tracking to over $1 billion in fiscal 2025 revenue [1] Industry Insights - The pet food industry is experiencing challenges, with economic uncertainty affecting consumer behavior, particularly in decisions related to pet ownership [2][5] - Long-term tailwinds for the industry remain strong, as consumers continue to prioritize better nutrition for themselves and their pets [3][4] Key Financial Metrics - Freshpet's growth rate for the second quarter is approximately 13%, with steady performance observed [7] - The company adjusted its net sales target to a growth range of 15% to 18% and EBITDA guidance from $190 million to $210 million [29] Strategic Initiatives - Freshpet is focusing on deepening consumer insights to target "Most Valuable Pet Parents" (MVPs), a demographic that shows high interest in purchasing Freshpet products [11][15] - The company has identified 2 million MVPs currently, with a potential market of over 7 million [15] - Initiatives include enhancing media targeting, adjusting creative strategies, and improving distribution points to better serve MVPs [15][36] Competitive Advantages - Freshpet differentiates itself through its unique product offerings, manufacturing expertise, and a robust refrigerated supply chain [22][23] - The company is investing in new manufacturing technology to improve efficiency and product variety, with a new production line expected to start in Q4 [26][27] Marketing and Advertising Strategy - Freshpet is shifting its marketing focus towards digital platforms and streaming services to better engage with consumers [69][70] - The company is experiencing a breakdown in the correlation between advertising spend and sales, attributed to economic stress among consumers [60][61] Distribution Strategy - Freshpet is expanding its distribution network, focusing on both retail and e-commerce channels, with a significant increase in e-commerce sales observed [49] - The company aims to leverage its existing distribution points to enhance online shopping experiences [49] Future Outlook - Freshpet remains committed to its long-term financial targets, including a gross margin of 48% and EBITDA of 22% [80] - The company is optimistic about its ability to adapt to market conditions and maintain growth, despite current challenges [81] Conclusion - Freshpet is positioned for significant growth in the pet food industry, with a strong focus on innovation, consumer engagement, and strategic marketing initiatives [18][19][107]

1 May 2025 | 10:37PM HKT China Export Tracker Number 2: What corporates are telling us (week of Apr 28, 2025) The China Export Tracker is a research product series put together by the GS China team, focusing on the changing dynamics of China exports to the US, amid the intensified uncertainty around export activity due to the US-China tariff escalation. In this tracker, we present our proprietary work across 48 corporates, with products representing nearly 70% of China export value by product group to the U ...