Herbs Generation Group Holdings (2593) H2 2025 earnings summary

Executive summary

• FY2025 revenue fell 7.2% YoY to HK$227.9m; gross profit declined 13.5% to HK$157.5m, and results swung to a HK$23.0m net loss from HK$13.0m profit.

• Lower revenue and gross profit amid deeper promotions, higher advertising and promotion spending, and increased staff costs drove the loss.

Financial highlights

• Revenue was HK$227.868m vs HK$245.490m in FY2024; gross profit was HK$157.549m vs HK$182.056m.

• Operating result was a HK$26.513m loss vs HK$19.813m profit; loss before tax was HK$27.587m vs HK$18.677m profit.

• Net loss was HK$23.009m vs net profit of HK$12.965m; basic and diluted EPS was a loss of HK17.26 cents vs earnings of HK12.82 cents.

• Selling and distribution costs rose 28.4% to HK$135.7m; administrative and other operating expenses rose 31.0% to HK$51.3m, reflecting higher promotion and staff costs.

• Gross margin fell 5.1 percentage points to 69.1%; the Board recommended no FY2025 final dividend, vs HK$20.0m for FY2024.

Outlook and guidance

• 2026 priorities include carefully selected store openings, new products and brands, stronger online sales, value-added services, and tighter cost and inventory controls.

• Capital expenditure is expected to rise with business growth, principally for property, plant and equipment; funding is planned from operating cash flow and remaining listing proceeds.