Core Insights - The company held a half-year online performance briefing on August 22, 2025, where key executives discussed business development and financial status with investors [1] Group 1: Business Development and Innovations - The company is focusing on health and functional food ingredient innovations, with a new food bead production line launched and steady progress in non-meat thermal reaction material capacity [2] - In the daily fragrance business, the company is expanding its domestic market presence and enhancing R&D efforts, while also establishing connections with international clients [2] Group 2: Financial Performance and R&D Investment - In the first half of 2025, the food flavor business generated sales revenue of 3.19 billion yuan, a year-on-year decrease of 22.54%, with a gross margin of 61.43% [3] - The company invested 71.195 million yuan in R&D during the same period, maintaining a high investment ratio, and has a total of 316 patents, including 176 invention patents [3] Group 3: Business Adjustments and Supply Chain Strategy - The decline in food flavor business revenue is attributed to changes in downstream market demand and proactive adjustments in customer structure [4] - The company is building an integrated supply chain with upstream raw material extraction centers and multiple production bases, while planning for R&D and capacity in Southeast Asia [4] Group 4: Cost Management and International Expansion - The increase in sales and management expenses is mainly due to the termination of stock incentives, and the company plans to enhance cost efficiency through digital transformation [5] - The company is pursuing a dual strategy of "internationalization + localization" to expand into Southeast Asia and Africa, leveraging technological advantages and local consumer trends [5] Group 5: Addressing Profit Decline and Future Projects - To counteract declining profitability, the company is focusing on innovation, market positioning, and digital transformation [6] - Ongoing projects include a new food technology base in Indonesia and a food bead production line, which will serve ASEAN and international markets [6]

Group 1: Business Performance - The revenue from the food flavoring business decreased by 22.54% year-on-year, amounting to 319 million yuan [3][4] - The food ingredient business saw a revenue increase of 4.80%, reaching 196 million yuan [4] - The daily-use fragrance business experienced a revenue growth of 34.47%, totaling 75 million yuan [4] Group 2: Profitability Metrics - The gross profit margin for the food flavoring business was 61.43% [4] - The gross profit margin for the food ingredient business was 27.44% [4] - The gross profit margin for the daily-use fragrance business was 46.93% [4] - The net profit decreased by 87.95%, with core profitability indicators hitting new lows [7] Group 3: Research and Development - The company invested 7,119.50 thousand yuan in R&D, maintaining a high proportion of investment compared to industry peers [4] - The company holds 316 patents, including 134 invention patents and 176 utility model patents [4] - The company has initiated 12 new technology projects and has 29 ongoing projects [4] Group 4: Strategic Initiatives - The company is focusing on innovation and market expansion, particularly in Southeast Asia and Africa [6][7] - Plans to enhance the product structure and develop new products based on market demand, including natural flavoring and innovative products [5][6] - The company aims to strengthen its supply chain and local customer service teams to support international business growth [6][7] Group 5: Financial Management - Sales and management expenses increased by 16.35% and 24.77% respectively, primarily due to the termination of stock incentives [6] - The company is implementing a smart management system to enhance expense control and operational efficiency [6] - Cash flow from operating activities decreased due to reduced sales receipts, while investment cash flow declined due to increased capital expenditures [9] Group 6: ESG and Sustainability - The company integrates ESG principles into its strategic framework, focusing on carbon reduction and sustainable practices [10] - The company has improved its ESG rating from A to AA, reflecting its commitment to sustainable development [10]

Group 1: Company Strategy and Vision - The company aims to be a "leader in delicious living," focusing on "green, nutritious, and healthy" missions while strengthening mergers and acquisitions to enhance core capabilities and market presence [2][3] - The company plans to expand into the daily chemical sector, integrating innovative technology and established channels to unlock growth potential [3] Group 2: Research and Development - The company has established a national recognized enterprise technology center and multiple overseas R&D centers, employing 298 R&D personnel, including 79 perfumers, to drive innovation [3][4] - The company emphasizes technological innovation as a key driver for enhancing competitiveness in the flavor and food ingredient sectors [4] Group 3: International Expansion - The company is accelerating its overseas market presence, particularly in Southeast Asia and the Middle East, with a new food technology base in Indonesia set to enhance its international operations [3][4] - The company aims to build a stable overseas market position, focusing on high-growth potential regions [3] Group 4: Profit Improvement Measures - The company plans to leverage technological innovation and global development strategies to enhance operational efficiency and profitability [4] - Strategies include capturing consumer trends, exploring new product markets, and optimizing supply chain management [4] Group 5: Client Base and Market Position - The company has established a diverse client base across various sectors, including partnerships with major brands like Yili and Luckin Coffee [5] - The company’s food ingredient business is a key focus for strategic transformation and growth [5] Group 6: Financial Performance and Future Outlook - The company reported a net loss for 2024 due to goodwill impairment related to edible flavor assets, but aims to enhance its food ingredient business through strategic acquisitions [5] - Future growth will focus on integrating resources across subsidiaries to drive diversification and scale in the food ingredient sector [5][6]