Dong-E-E-Jiao Co. (000423) Q2 2024 earnings summary

Executive summary

• Revenue for H1 2024 reached ¥2.75 billion, up 26.8% year-over-year, with net profit attributable to shareholders at ¥738 million, a 39% increase year-over-year.

• Core business remains in Ejiao and related TCM products, with strong brand leadership and ongoing innovation in product lines and R&D.

• The company maintained its position as the top brand in the tonic health sector and was listed 15 times in the China 500 Most Valuable Brands.

• A mid-year cash dividend of ¥11.44 per 10 shares was declared, totaling ¥736.7 million, nearly 100% of H1 net profit.

Financial highlights

• Operating income: ¥2.75 billion, up 26.8% year-over-year; net profit: ¥738 million, up 39% year-over-year.

• Gross margin for core Ejiao products reached 75.36%, up 2.48 percentage points year-over-year.

• Operating cash flow: ¥922 million, up 22.6% year-over-year.

• Total assets at period end: ¥12.5 billion, down 6.06% from year-end 2023; net assets: ¥10.24 billion, down 4.52%.

• Non-recurring profit items contributed ¥38.8 million to net profit.

Outlook and guidance

• The company will continue to focus on brand leadership, product innovation, and expanding into new health and wellness segments, including male health.

• Strategic focus on dual-engine model: pharmaceuticals and health consumer products, with R&D investment in new categories and functions.

• Plans to maintain high dividend payout and seek external growth opportunities.