Core Viewpoint - The company reported its H1 2025 performance, showing a decline in revenue but an increase in net profit, indicating a resilient profit margin despite revenue challenges [1][2]. Financial Performance - H1 2025 revenue was 8.04 billion yuan, down 10.5% year-on-year, while net profit attributable to shareholders was 770 million yuan, up 8.7% [2]. - In Q2 2025, revenue was 3.77 billion yuan, down 8.8%, with net profit of 300 million yuan, up 8.0% [3]. Business Segment Analysis - The department store segment faced pressure on revenue due to lower customer spending, despite improvements in foot traffic and average transaction value [3]. - The supermarket segment is expected to maintain slight revenue growth due to ongoing store adjustments [3]. - The appliance segment experienced a revenue decline of approximately 15% in June due to the temporary suspension of national subsidies and a narrowing of the subsidy scope [3]. - The automotive trade business is transitioning from traditional fuel vehicles to a consignment sales model for new energy vehicles, impacting reported revenue [3]. Profitability and Cost Management - H1 2025 gross margin improved by 1.78 percentage points year-on-year, with Q2 showing a 2.2 percentage point increase [4]. - The automotive trade segment saw significant gross margin improvement due to changes in sales models and product matrix optimization [4]. - Total expenses decreased by 5.3% in H1 2025, supported by organizational optimization and cost reduction efforts [5]. Investment Outlook - The company is expected to benefit from resilient consumer demand in Chongqing and proactive adjustments across various business segments, leading to stable growth [5]. - The forecast for net profit attributable to shareholders for 2025 and 2026 is 1.38 billion yuan and 1.47 billion yuan, respectively, with a current valuation of 9x, indicating a safety margin [5].