Shanghai Forest Cabin Cosmetics (2657) investor relations material

Executive summary

• H1 revenue rose 42.6% YoY to RMB1,499.7m; profit for the period increased 40.7% to RMB255.9m and adjusted profit rose 42.1% to RMB285.4m.

• Growth was driven by new and upgraded products, essence oil, lotion and toner, face cream, and stronger e-commerce activity.

Financial highlights

• Gross profit increased 41.4% to RMB1,224.4m; gross margin eased to 81.6% from 82.4%.

• Profit before tax rose 42.2% to RMB302.5m; basic and diluted EPS was RMB1.81, versus restated RMB1.45.

• Selling and distribution expenses rose 38.8% to RMB805.8m; marketing and promotion costs increased 43.8% to RMB518.5m.

• R&D expense increased 88.8% to RMB34.0m, reflecting greater product development and research activity.

Outlook and guidance

• Strategy centers on premiumization, multi-brand development and globalization, supported by a 1 + 4 + N portfolio and stronger offline and online channels.

• Priorities include improving store productivity and experience, expanding Douyin, Tmall and JD.com, and building private-domain retention and omnichannel conversion.

• Plans include a Hong Kong Black Gold image store and measured Southeast Asia expansion; a three-year dividend guideline proposes annual cash dividends of at least 50% of parent-attributable net profit, subject to approval.