Core Viewpoint - The funeral industry, particularly represented by Fushouyuan, is experiencing a significant downturn, with average grave prices halving to 63,400 yuan, indicating the end of a highly profitable era in the sector [1] Group 1: Company Performance - Fushouyuan's average grave sales price has dropped by 47.5% year-on-year, marking a substantial decline in revenue [1] - The company reported its first loss since going public in its mid-2025 report, highlighting a drastic shift in financial performance [1] Group 2: Industry Trends - The once lucrative funeral industry, characterized by high profit margins (over 80% at one point), is now facing challenges as both grave and land sales decline [1] - The average price of graves, which previously exceeded 100,000 yuan for less than half a square meter, has significantly decreased, reflecting changing market dynamics [1]

Core Viewpoint - The leading company in the domestic funeral industry, Fushouyuan International Group Co., Ltd., has announced its first profit warning since its listing, projecting a loss of between 235 million to 265 million yuan for the first half of 2025, compared to a net profit of approximately 299 million yuan in the same period last year, marking its first loss since its IPO in 2013 [1][2] Group 1: Financial Performance - Fushouyuan's revenue peaked at 2.628 billion yuan in 2023 but fell by 20.95% to 2.077 billion yuan in 2024, while net profit dropped by 49.04% from 976 million yuan in 2023 to 497 million yuan in 2024, returning to levels seen in 2016 [2][4] - The company's operating cash flow decreased from 1.103 billion yuan in 2023 to 709 million yuan in 2024, indicating a significant decline in cash generation [4] Group 2: Business Segments and Challenges - The main revenue source for Fushouyuan comes from three segments: cemetery services, funeral services, and other services, with cemetery services accounting for 82.3% of total revenue, which decreased by 21% to 1.709 billion yuan in 2024 [4][10] - The company faces challenges such as high goodwill, increased inventory turnover days, and a cautious consumer spending environment influenced by macroeconomic factors [2][5][10] Group 3: Market Trends and Consumer Behavior - The funeral industry is experiencing a shift in consumer behavior, with a growing preference for alternative burial methods and a trend towards "thick nurturing and thin burial," impacting traditional cemetery service sales [7][8] - Despite rising prices in the high-end cemetery market, with average sales prices increasing from 1.025 million yuan in 2018 to approximately 1.212 million yuan in 2024, the company is facing inventory management issues due to prolonged inventory turnover days, which reached a historical high of 694.61 days in 2024 [7][8][10]