Core Viewpoint - In the first half of 2025, Qianwei Yangchun faced significant challenges in the restaurant supply chain industry, reporting a revenue decline of 0.7% year-on-year to 886 million yuan and a net profit drop of 39.7% to 35.79 million yuan, indicating stagnation in core business growth and shrinking profit margins [1] Group 1: Product Iteration Challenges - The company's reliance on traditional product lines, particularly staple and snack categories, has led to a decline in sales as core products like fried dough sticks and sesame balls lose market appeal [2] - Efforts to develop new products in baking and prepared dishes have not yielded significant results, with these segments still too small to drive substantial revenue growth [2] - The shift towards lower-margin products has further pressured overall profitability, revealing a gap in product transition between old and new offerings [2] Group 2: Channel Distribution Pressures - The company maintains a weak recovery in its direct sales channel, primarily due to strong ties with major clients like Yum China and Hema, but faces pressure as these clients demand better pricing [3] - The decline in the distribution channel is more alarming, with over 300 channel partners lost in six months, leading to a significant drop in sales from distributors [3] - Rising costs of raw materials, such as flour and oils, have made it difficult for the company to pass on these costs to customers, resulting in profit erosion [3] Group 3: Trust Crisis and Industry Transparency - The prepared food industry is experiencing a trust crisis, with increasing consumer scrutiny over ingredient processing, compelling restaurant clients to enforce stricter supply chain standards [4] - The company must invest more in quality control, traceability, and transparency, but these efforts are unlikely to yield immediate financial returns [4] Group 4: Need for Strategic Reform - The company's performance reflects the broader challenges faced by restaurant supply chain businesses during industry adjustments, with traditional business pressures and new business investment pains [5] - To regain balance, the company needs to focus on three areas: product innovation, optimizing distribution channels, and developing dynamic cost adjustment capabilities [5] - However, market patience is waning due to regulatory changes, shifting consumer preferences, and capital valuation adjustments, necessitating urgent internal reforms [5]

Investment Rating - The investment rating for the company is maintained as "Buy" [7] Core Insights - The company achieved a revenue of 889 million yuan in H1 2025, a slight decrease of 0.7% year-on-year, with a net profit attributable to shareholders of 40 million yuan, down 39.7% [1] - The revenue from baking and cooked dishes showed positive growth, while new retail channels experienced significant growth [2] - The company is focusing on expanding its product lines and sales channels, particularly in the B2B and new retail sectors, to increase revenue [5] Revenue Breakdown - In H1 2025, the main food and snack categories accounted for 47% and 22% of revenue, respectively, generating 410 million yuan and 200 million yuan, both showing declines of 9.1% and 6.6% year-on-year due to market competition and product lifecycle impacts [2] - The baking and frozen prepared dishes categories, which accounted for 23% and 7% of revenue, respectively, generated 210 million yuan and 70 million yuan, with increases of 11.0% and 67.3% year-on-year [2] Sales Model Performance - In H1 2025, the revenue from the distribution and direct sales models was 450 million yuan and 430 million yuan, reflecting a year-on-year change of -6.4% and +5.3% [3] - The increase in direct sales revenue was primarily driven by partnerships with major retail chains and a significant rise in online sales, which grew by 44.9% year-on-year to 40 million yuan [3] Profitability Metrics - The gross margin for H1 2025 was 23.6%, a decrease of 1.6 percentage points, attributed to the faster growth of lower-margin product categories [3] - The net profit margin fell to 4.0%, down 2.6 percentage points year-on-year, due to increased expenses related to new retail channels and online sales [3] Future Projections - Revenue forecasts for 2025 to 2027 are projected at 1.94 billion yuan, 2.10 billion yuan, and 2.26 billion yuan, representing year-on-year growth rates of 3.6%, 8.5%, and 7.4% respectively [5] - The net profit attributable to shareholders is expected to be 80 million yuan, 100 million yuan, and 110 million yuan for the same period, with a slight decline in 2025 followed by growth in subsequent years [5]

Group 1: Financial Performance and Taxation - The company will continue to recognize stock incentive expenses in 2025, specifically for 21,100 restricted shares allocated to 5 incentive recipients from the 2021 plan [1] - The income tax expense for Q4 2024 reached CNY 15 million, primarily due to the reduction in deductible amounts related to stock payment expenses after the lifting of restrictions on restricted shares [1] - The increase in sales expenses by CNY 10 million in Q1 is attributed to online promotion costs, which are considered non-recurring [2] Group 2: Business Development and Strategy - The 2025 business development plan includes increased investment in R&D and production resources for baked goods and frozen prepared dishes, aiming to meet customer demands for rapid innovation [2] - The company plans to explore C-end business opportunities, leveraging its R&D advantages to develop differentiated products and diversify sales channels, including e-commerce and traditional retail [2] - Efforts will be made to enhance operational efficiency across all business segments, focusing on cost control in procurement, production, and logistics [2] - Brand building and customer service quality will be prioritized to ensure sustainable and high-quality growth [2] Group 3: Production and Capacity Management - The company operates through self-production, commissioned processing, and outsourcing, with most core products being self-produced [3] - In 2024, 20,000 tons of products were processed through commissioned processing, primarily for items like sesame balls and spring rolls, which are produced using standard equipment and processes [3] - Future decisions on converting commissioned processing to self-production will depend on market conditions and operational assessments [3] Group 4: Financing Plans - The company plans to raise CNY 300 million through a simplified procedure for issuing shares to specific investors, pending approval from the 2024 annual shareholders' meeting [4] - The specific use of the funds for acquisitions or expansion of production has not yet been determined, and further disclosures will be made as developments occur [4]

Core Insights - The company reported a revenue of 1.868 billion yuan in 2024, a year-on-year decrease of 1.71%, and a net profit of 84 million yuan, down 37.67% year-on-year [1] - Despite significant growth in the prepared food sector, overall performance was pressured by a substantial decline in revenue from fried and baked products [4] Revenue Breakdown - The main business involves providing customized, standardized semi-finished products, categorized into fried, baked, steamed, and dish products [4] - Revenue from fried products decreased by 11.87% year-on-year, while baked products also saw a notable decline [4] - In contrast, steamed products experienced growth, driven by an increase in savory buns and the consolidation effect from the subsidiary Weibaofeeding [4] - Revenue from dish products and others surged by 273.39% year-on-year, becoming the sole highlight of the company's performance [4] Sales Model Analysis - The sales model is divided into direct sales and distribution, with direct sales revenue reaching 809 million yuan, a year-on-year increase of 4.34% [5] - The number of major clients increased by 8.81% to 173, primarily consisting of national chain restaurant brands [5] - Conversely, distribution revenue declined by 6.04% due to market competition and consumer price sensitivity, impacting small and medium-sized restaurant enterprises [5] Cost and Profitability Challenges - The company's gross margin was 23.38%, a slight decrease of 0.03% year-on-year, with overall cost pressures remaining significant [6] - Sales expenses rose to 100 million yuan, an increase of 13.33%, leading to a sales expense ratio of 5.40% [6] - Stock incentive expenses significantly impacted net profit, with a net profit of 84 million yuan, down 31.99% when excluding stock incentive effects [6] - The company faces multiple challenges, including intensified market competition, declining core product revenue, and rising cost pressures, necessitating strategies for maintaining growth [6]

Core Viewpoint - The company, Qianwei Yangchu, has experienced a significant decline in net profit and revenue, marking a shift from previous high growth to substantial losses in 2024 [1][2]. Financial Performance - In 2024, the company reported a revenue of 1.868 billion yuan, a year-on-year decrease of 1.71%, with a first-quarter revenue increase of only 1.5% [1]. - The net profit attributable to shareholders plummeted by 37.67% in 2024, with a further decline of 37.98% in the first quarter [1]. - The stock price has been in a continuous decline since August 2023, currently at only 40% of its peak [1]. Business Segments - Traditional business lines have faced significant declines, with fried, baked, and steamed products experiencing growth rates of -11.87%, -4.28%, and 5.41% respectively in 2024, compared to over 20% growth in 2023 [2]. - The core revenue sources, such as staple food products, saw a decrease of 6.88%, while snack food revenue dropped by 13.79% [3]. - The frozen prepared dishes segment grew by 273.39%, but its revenue was only 142 million yuan, accounting for less than 8% of total revenue [3][5]. Cost Structure - The company increased sales and management expenses significantly, with sales expenses rising by 13.33% and management expenses by 12.56% in 2024 [3]. - The sales expense ratio increased by 0.72 percentage points to 5.4%, while the management expense ratio rose by 1.38 percentage points to 10.93% [3]. Market Dynamics - The competitive landscape in the frozen food sector is intensifying, with major players expanding capacity and smaller players adopting low-price strategies [5]. - The company has seen a rise in the number of major clients by 8.81% to 173, but sales from the top two clients decreased by 11% and 15% respectively, indicating growing dependency risks [2]. Future Outlook - The company has three ongoing projects, with a total designed capacity of 196,600 tons and an actual capacity of 123,800 tons, leading to a capacity utilization rate of only 63% due to declining sales [6]. - Fixed assets have increased by 65% to 1.045 billion yuan since 2022, while revenue has only grown by 25%, raising concerns about potential impairment risks if capacity cannot be utilized effectively [6].

Investment Rating - The report maintains a "Recommended" rating for the company [2][7]. Core Views - The company faced short-term pressure with a revenue of 1.868 billion yuan in 2024, a year-on-year decrease of 1.71%, and a net profit attributable to shareholders of 84 million yuan, down 37.67% year-on-year [3][7]. - New channels are highlighted as a growth driver, with direct sales revenue increasing by 4.34% to 809 million yuan, while distribution channel revenue decreased by 6.04% to 1.051 billion yuan [4]. - The company is expanding its customer base, with the number of major clients increasing by 8.81% to 173, while the number of distributors rose by 26.74% to 1,953 [4]. Revenue and Profitability - The company’s revenue from fried products decreased by 11.87% to 767 million yuan, while revenue from steamed products grew by 5.41% to 393 million yuan, driven by increased demand for prepared dishes [5]. - The gross margin for 2024 was 23.66%, a slight decrease of 0.04 percentage points year-on-year, and the selling expense ratio increased by 0.72 percentage points to 5.40% due to heightened competition [6]. Financial Forecasts - The company’s net profit forecasts for 2025, 2026, and 2027 are projected to be 93 million yuan, 104 million yuan, and 113 million yuan, respectively, with corresponding EPS of 0.95, 1.07, and 1.16 yuan [7][13]. - The current stock price corresponds to PE ratios of 28, 25, and 23 for the years 2025, 2026, and 2027 [7].

Core Viewpoint - The company reported a decline in revenue and net profit for 2024, with a focus on improving product offerings and expanding customer base in response to market challenges [1][4]. Financial Performance - In 2024, the company achieved revenue of 1.868 billion yuan, a year-on-year decrease of 1.71%, and a net profit attributable to shareholders of 84 million yuan, down 37.67% year-on-year [1]. - For Q1 2025, revenue was 470 million yuan, reflecting a year-on-year growth of 1.5%, while net profit attributable to shareholders was 21 million yuan, down 37.98% year-on-year [1]. - The revenue breakdown for 2024 showed declines in fried and baked products, with revenues of 767 million yuan and 340 million yuan, down 11.87% and 4.28% respectively, while cooked dishes saw a significant increase of 21.84% to 360 million yuan [1]. Sales Channels - Direct sales and distribution channels generated revenues of 809 million yuan and 1.051 billion yuan respectively, with direct sales increasing by 4.34% and distribution sales decreasing by 6.04% [2]. - The company focused on developing large clients, increasing the number of major clients to 173 by the end of 2024, up 8.81% from 159 at the end of 2023 [2]. - Online sales surged to 42 million yuan, a year-on-year increase of 96.14%, with significant growth in various product categories [2]. Cost and Profitability - The gross margin and net margin for 2024 were 23.66% and 4.48%, respectively, with a slight decrease in both margins compared to the previous year [3]. - The expense ratio increased to 16.24%, up 1.71 percentage points year-on-year, with sales and management expenses rising [3]. - For Q1 2025, the gross margin was 24.42% and the net margin was 4.56%, with an increase in the expense ratio to 17.77% [3]. Future Outlook - The company aims to deepen its focus on the restaurant supply chain and enhance R&D innovation, projecting revenues of 1.952 billion yuan, 2.086 billion yuan, and 2.295 billion yuan for 2025-2027, with respective growth rates of 4.5%, 6.87%, and 10% [4]. - Expected net profits for the same period are 88 million yuan, 96 million yuan, and 108 million yuan, with growth rates of 5.48%, 8.56%, and 12.75% [4].

Investment Rating - The report maintains a "Recommended" rating for the company [2][7]. Core Views - The company experienced a revenue decline of 1.71% year-on-year in 2024, with total revenue reaching 1.868 billion yuan. The net profit attributable to shareholders decreased by 37.67% to 84 million yuan [3]. - The company is facing short-term pressure, but new channels are seen as a bright spot for growth [4][7]. - The company has expanded its customer base, increasing the number of major clients to 173, which is an 8.81% year-on-year increase [4]. Revenue and Profitability - In 2024, the company's revenue from direct sales was 809 million yuan, up 4.34% year-on-year, while revenue from distribution channels fell by 6.04% to 1.051 billion yuan [4]. - The company’s gross margin for 2024 was 23.66%, a slight decrease of 0.04 percentage points year-on-year [6]. - The company’s sales expense ratio increased by 0.72 percentage points to 5.40% due to intensified competition and increased marketing efforts [6]. Product Performance - Revenue from fried products decreased by 11.87% to 767 million yuan, while revenue from steamed products grew by 5.41% to 393 million yuan, driven by strong demand for prepared foods [5]. - The company’s revenue from prepared dishes and other products increased by 21.84% to 360 million yuan, indicating a growing market for prepared foods [5]. Future Earnings Forecast - The company’s net profit is projected to be 93 million yuan in 2025, 104 million yuan in 2026, and 113 million yuan in 2027, with corresponding earnings per share (EPS) of 0.95, 1.07, and 1.16 yuan respectively [7][13].

Core Viewpoint - Qianwei Yangchu, known as the "first stock of the catering supply chain" in A-shares, reported a decline in both revenue and net profit for the year, attributing the performance pressure to the competitive market environment [1][2]. Financial Performance - In 2024, Qianwei Yangchu achieved operating revenue of approximately 1.868 billion yuan, a year-on-year decrease of 1.71% [2]. - The net profit attributable to shareholders was about 84 million yuan, down 37.67% year-on-year [2]. - The net profit after deducting non-recurring gains and losses was approximately 83 million yuan, a decline of 32.57% year-on-year [2]. - Excluding the impact of stock incentives, the net profit attributable to shareholders was 100 million yuan, a decrease of 31.99% [2]. Product Revenue Breakdown - Revenue from fried products decreased by 11.87% to 766.88 million yuan [4]. - Revenue from baked goods fell by 4.28% to 340.07 million yuan [4]. - Revenue from steamed products increased by 5.41% to 392.80 million yuan [4]. - Revenue from dishes and others rose significantly by 21.84% to 359.65 million yuan [4]. - Overall, total revenue from main products was approximately 1.859 billion yuan, down 1.79% year-on-year [4]. Sales Channels and Strategies - The company primarily serves chain restaurants, group meals, hotels, banquets, and new retail brands with customized and standardized frozen products [9]. - In 2024, the revenue from the distribution channel was approximately 1.051 billion yuan, accounting for 56.50% of total revenue, with a year-on-year decline of 6.04% [12]. - Direct sales revenue was approximately 808.80 million yuan, with a year-on-year increase of 4.34% [10][11]. - The number of major clients increased by 8.81% to 173 by the end of 2024 [10]. Future Plans - In 2025, the company plans to increase investment in research and development, production resources, and customer expansion in the baking and frozen prepared dishes segments to meet customer demands for rapid innovation [1].