Core Viewpoint - Qiaqia Food has reported its largest decline in net profit since its listing in 2011, with a projected net profit drop of 71.05% to 76.25% for the first half of 2025 compared to the previous year [2] Group 1: Financial Performance - The company expects a net profit of approximately 80 million to 97.5 million yuan for the first half of 2025, with a significant decline in both net profit and non-net profit [2] - In Q1 2025, Qiaqia Food's revenue decreased by 13.76% year-on-year, and net profit fell by 67.88% [2] - The decline in net profit further worsened in Q2 2025, indicating ongoing financial challenges [2] Group 2: Cost Pressures - The primary reason for the profit decline is the rising cost of raw materials, particularly sunflower seeds, which has led to a significant drop in gross margin [2][3] - The company has acknowledged the impact of rising costs on its operations, citing increased procurement prices for sunflower seeds and nuts [2][3] - Qiaqia Food has attempted to mitigate cost pressures by raising product prices multiple times over the past few years, but the positive impact on gross margin has diminished [3] Group 3: Supply Chain and Procurement - Qiaqia Food employs a mixed procurement model for sunflower seeds, which may weaken its control over quality and cost [3] - The company plans to optimize its procurement strategy by increasing the proportion of direct purchases [3] Group 4: Channel Strategy - In response to market conditions, Qiaqia Food is adjusting its channel strategy, increasing its focus on direct sales channels, which saw a revenue increase of 38.29% to 1.462 billion yuan in 2024 [4] - Despite the growth in direct sales, the gross margin for this channel has declined, with e-commerce channels showing particularly low margins [4][5] - The company aims to enhance e-commerce profitability through product structure optimization and is also exploring new channels such as snack wholesale systems and membership stores [5]

Investment Rating - The report maintains a "Positive" outlook for the food and beverage industry [2] Core Insights - The food and beverage sector is experiencing a weak recovery, with structural opportunities dominating. Focus on "category innovation + channel efficiency" is essential for capturing profit recovery and differentiation opportunities [4][6][37] Summary by Sections Industry Overview - In 2024, the food and beverage industry achieved a total revenue of CNY 1,091.58 billion, a year-on-year increase of 3.92%, while net profit attributable to shareholders grew by 5.51% to CNY 217.11 billion. The first quarter of 2025 saw revenue growth of 2.54% and a slight net profit increase of 0.27% [4][23] Alcoholic Beverages - The wine sector is facing a weak macro environment, with revenue growth slowing to 1.68% in Q1 2025. The sector is under pressure from inventory levels and a recent ban on alcohol, which is expected to suppress demand in the short term [5][24][26] Snack Foods - The snack food sector is projected to grow by 12.74% in 2024, but growth slowed to 0.29% in Q1 2025. Despite challenges, there are opportunities in specific categories like konjac products, which have seen growth rates exceeding 70% [6][39][54] Condiments - The condiment sector is benefiting from cost reductions due to falling raw material prices, with gross margins improving to 36.38% in Q1 2025. However, demand is showing signs of divergence between B2B and B2C segments [7][14] Frozen Foods - The frozen food sector is under pressure, with revenue and profit declining further in Q1 2025. However, the baking segment is experiencing significant growth due to new retail formats and consumer demand [8][19] Dairy Products - The dairy sector is witnessing a recovery in profitability as raw milk prices stabilize. In Q1 2025, major companies like Yili and Bright Dairy reported net profit increases of 24.19% and 2.45%, respectively [9][20] Key Companies and Forecasts - Key companies such as Kweichow Moutai and Three Squirrels are expected to maintain strong performance, with Moutai projected to achieve a revenue growth of around 9% in 2025 [12][35][58]

Core Viewpoint - Despite being the global sales champion for five consecutive years, Qiaqia Food (002557.SZ) has faced increasing pressure on its performance in recent years, with a significant decline in revenue and net profit in the first quarter of 2023 [2]. Group 1: Financial Performance - In Q1 2023, Qiaqia Food reported revenue of 1.57 billion yuan, a year-on-year decrease of 13.76%, and a net profit of 77.25 million yuan, down 67.88%, marking the worst quarterly performance since its listing [2]. - The decline in revenue is attributed to the timing of the Spring Festival and a high base from the previous year, while the sharp drop in net profit is due to rising costs of sunflower seeds and certain nut raw materials, which have negatively impacted gross margins [2][5]. - The company's overall sales volume decreased by 4.62% in 2023, with sunflower seed revenue experiencing a year-on-year decline for the first time in six years [5]. Group 2: Pricing Strategy and Cost Management - Qiaqia Food has relied on price increases to offset rising raw material costs, with significant price hikes implemented in 2018, 2021, and 2022, which initially led to revenue growth [4]. - However, in 2023, the previous pricing strategy failed to enhance profits, resulting in a 5.36% decline in sunflower seed revenue [5]. - The overall gross margin fell from 28.78% in 2024 to 19.47% in Q1 2023 due to increased procurement costs [7]. Group 3: Channel Structure and Revenue Sources - In 2024, revenue from distribution and other channels reached 5.67 billion yuan, accounting for 79.49% of total revenue, marking the first time this channel's revenue share fell below 80% since 2021 [9]. - Direct sales revenue increased from 1.06 billion yuan in 2023 to 1.46 billion yuan in 2024, with a revenue share rising from approximately 15% to 20.51% [9][10]. - The rapid expansion of discount snack stores has disrupted traditional distribution channels, with Qiaqia Food's gross margin from distribution channels at 29.75%, compared to 25.01% from direct sales, which has decreased by 4.32 percentage points year-on-year [11][12]. Group 4: E-commerce and Market Competition - E-commerce, another important direct sales channel, generated 779 million yuan in 2024, a year-on-year increase of 8.86%, but with a gross margin of only 19.39%, significantly lower than offline sales [12]. - Compared to competitors like Three Squirrels and Good Products, which have higher online gross margins and revenue, Qiaqia Food faces challenges in capturing the e-commerce market [12].