Core Viewpoint - Haitong International's report indicates that Shuiyang Co. achieved growth in both revenue and profit in H1 2025, driven by its own brand which enhanced overall gross margin [1] Financial Performance - In H1 2025, the company reported revenue of 2.5 billion yuan, representing a year-on-year increase of 9.02%, attributed to ongoing optimization of business layout and focus on high-end brand development [1] - Operating cash flow saw a significant increase of 369.0% to 166 million yuan, primarily due to effective management practices including procurement planning and inventory optimization [1] Strategic Initiatives - The company plans to continue its stock incentive program and maintain stable expense allocation in the second half of the year, emphasizing refined management [1] - The transformation and upgrade of the company's own brand towards high-end and global markets have been preliminarily completed [1] Brand Development - The French luxury skincare brand EDB has undergone product optimization and is expanding its presence in both online and offline channels [1] - In online channels, the company is reducing reliance on top influencers and increasing the proportion of self-broadcasting and direct sales; in offline channels, it aims to accelerate store openings, planning to establish 50 stores nationwide by 2027, with over ten already opened in key cities [1]

Core Viewpoint - Water Sheep Group (S'Yong Group) reported a significant increase in both revenue and profit for the first half of 2025, driven by the growth of its proprietary brands and an overall improvement in gross margin [2]. Financial Performance - In H1 2025, the company achieved revenue of 2.5 billion yuan, a year-on-year increase of 9.02%, attributed to ongoing optimization of business layout and focus on high-end brand development [2]. - Proprietary brands generated revenue of 1.039 billion yuan, accounting for 41.55% of total revenue, with a gross margin of 76.83%, up 5.7 percentage points year-on-year [2]. - The overall gross margin for H1 2025 was 64.6%, an increase of 3.1 percentage points, due to a higher proportion of high-end brands and optimization of low-efficiency businesses [2]. - The net profit attributable to shareholders was 123 million yuan, a year-on-year increase of 16.54%, with a net profit margin of 4.93%, up 0.32 percentage points [2]. - In Q2 2025, the company reported revenue of 1.414 billion yuan, a year-on-year increase of 12.16%, and a net profit of 81.41 million yuan, up 23.8% [2]. Investment in Operations - The company increased its investment in online traffic and R&D, resulting in a significant improvement in operating cash flow, which grew by 369.0% to 166 million yuan [3]. - The sales expense ratio for H1 2025 was 48.94%, up 2.1 percentage points, primarily due to increased online traffic costs [3]. - R&D expenses accounted for 1.75% of revenue, with a focus on building a global R&D team and expanding laboratories in Paris and Tokyo [3]. Brand Development and Market Expansion - The company has completed the initial phase of high-end and global transformation for its proprietary brands, with the French luxury skincare brand EDB optimizing its product offerings and expanding both online and offline channels [4]. - The RV brand in the U.S. has shown strong performance, with a doubling of business volume in China and steady growth in the U.S. market [4]. - The company plans to open 50 stores nationwide by 2027, having already established over ten stores in key cities [4]. - The light luxury brand PA is set to launch a complete product matrix by the end of the year, while the traditional brand Yuni Fang is attempting to expand into the U.S. market through e-commerce [4].