Hangzhou Tongshifu Cultural and Creative (Group) (664) investor relations material

Executive summary

• Revenue for H1 2026 rose 10.8% year-over-year to RMB341.5 million, driven by offline store expansion and consignment network growth.

• Gross profit increased 7.7% to RMB116.4 million, but gross margin declined to 34.1% due to higher raw material and manufacturing costs.

• Net profit dropped 95.8% to RMB1.3 million, mainly due to a 71.2% surge in selling and marketing expenses, production capacity expansion, higher R&D, and a one-off FX loss from HKD proceeds.

• Adjusted net profit (non-IFRS) fell 61.0% to RMB16.7 million; adjusted EBITDA declined 35.9% to RMB36.0 million.

• The company completed its Hong Kong IPO in March 2026, raising net proceeds of RMB337.9 million after FX losses.

Financial highlights

• Revenue: RMB341.5 million (+10.8% YoY); gross profit: RMB116.4 million (+7.7% YoY); gross margin: 34.1% (down from 35.1%).

• Net profit: RMB1.3 million (down from RMB30.2 million YoY); basic EPS: RMB0.02 (vs. RMB0.53 YoY).

• Direct sales revenue grew 13.6% to RMB270.9 million; consignment revenue rose to RMB22.4 million from RMB14.4 million.

• Selling and marketing expenses surged 71.2% to RMB68.4 million, reflecting the net addition of 55 self-operated stores year-over-year.

• R&D expenses increased 31.7% to RMB20.4 million, supporting new product and IP development.

Outlook and guidance

• Management expects benefits from strategic investments in offline stores, capacity, and R&D to materialize as new stores mature and new products launch, but short-term profitability will remain under pressure.

• Focus remains on channel diversification, original design, capacity optimization, and product extension.

• Plans to open about 90 self-operated stores by end-2026 and further diversify product lines and channels.