Core Viewpoint - The company reported its 2024 annual results and Q1 2025 results, showing a slight decline in revenue and net profit, indicating pressure from external market conditions [1] Revenue and Profit Performance - In 2024, the company achieved revenue of 2.2 billion yuan, a year-on-year decrease of 1.3%, and a net profit of 290 million yuan, down 15.9% year-on-year [1] - For Q1 2025, revenue was 800 million yuan, a decline of 4.3% year-on-year, with a net profit of 140 million yuan, down 9.3% year-on-year [1] Product Structure and Sales Channels - The product structure continues to optimize, with significant growth in self-operated sales outside the region. In 2024, high-end, mid-range, and low-end products generated revenues of 1.53 billion, 510 million, and 130 million yuan, respectively, with year-on-year changes of +4.3%, -8.2%, and -20.5% [2] - In Q1 2025, revenue from high-end, mid-range, and low-end products was 620 million, 130 million, and 30 million yuan, with year-on-year changes of +8.8%, -30.7%, and -41.0% [2] - The company’s direct sales channel showed resilience, with revenue of 490 million yuan in 2024, up 90.9% year-on-year, and 200 million yuan in Q1 2025, up 69.9% year-on-year [2] Gross Margin and Cost Structure - The gross margin for 2024 was 52.3%, an increase of 4.1 percentage points year-on-year, while Q1 2025 saw a gross margin of 48.8%, a decrease of 3.1 percentage points year-on-year [3] - The sales and management expense ratios for 2024 were 11.9% and 4.1%, respectively, with increases of 2.5 percentage points and 0.5 percentage points year-on-year [3] - The net profit margin for 2024 was 13.1%, down 2.4 percentage points year-on-year, while Q1 2025 had a net profit margin of 18.0%, down 1.3 percentage points year-on-year [3] Strategic Initiatives and Future Outlook - The company is undergoing significant transformation, focusing on core products and optimizing its marketing system to enhance sales team performance [4] - New product launches and external sales efforts are expected to drive growth, particularly in high-end product segments [4] - Profit forecasts for 2025-2027 are projected at 320 million, 370 million, and 430 million yuan, with corresponding EPS of 0.68, 0.77, and 0.90 yuan [4]