Shanghai Chicmax Cosmetic (2145) H2 2024 earnings summary

Executive summary

• FY2024 revenue rose 62.1% YoY to RMB6,792.5m; gross profit increased 69.2% to RMB5,109.4m and profit for the year rose 74.0% to RMB803.3m.

• KANS drove growth, generating RMB5,591.0m, or 82.3% of revenue; online channels contributed 90.5% of revenue.

Financial highlights

• Gross margin was 75.2%, up from 72.1% in 2023; higher KANS gross margin was cited as the main driver.

• Selling and distribution expenses rose 76.2% to RMB3,947.3m, equal to 58.1% of revenue versus 53.5%; marketing and promotion spending increased 90.0% to RMB3,316.6m.

• Administrative expenses increased 15.8% to RMB242.8m; R&D costs rose 43.0% to RMB179.9m, while finance costs fell 62.3% to RMB6.1m.

• Profit before tax was RMB927.0m; net profit attributable to ordinary equity holders was RMB781.2m and basic and diluted EPS was RMB1.96, versus RMB1.16 in 2023.

• Operating cash flow was RMB547.0m versus RMB746.2m in 2023; cash and cash equivalents were RMB459.4m at year-end versus RMB697.7m.

Outlook and guidance

• The six-part strategy prioritizes talent, R&D, AI-enabled management, marketing networks, intelligent production and platform-based business development; no numerical financial guidance was stated.

• Planned growth areas include mass skincare, washing and personal care, maternal and baby products, skin medical beauty, makeup, and high-end skincare and instruments.

• R&D plans focus on anti-aging, skin-barrier repair, new raw materials, technologies and formulas; channel plans emphasize online e-commerce and offline omnichannel development.

• The strategic ambition is to expand international R&D, business presence and brand awareness, and build a world-class cosmetics group.