Want Want China (151) H2 2023 earnings summary

Executive summary

• Revenue increased 2.9% year-over-year to RMB 23,586 million for FY23, with growth in dairy, beverages, and candies segments, and strong performance in emerging and overseas channels.

• Gross margin improved by 270bps to 46.6% due to lower costs for some raw materials and enhanced production efficiency.

• Profit attributable to equity holders rose 18.4% year-over-year to RMB 3,990 million, with EPS up 18.7% to RMB 33.65 cents.

• Share repurchases totaled 70 million shares, about 0.6% of total issued shares.

Financial highlights

• Operating profit increased 15.7% year-over-year to RMB 5,610 million, with operating margin up to 23.8%.

• Income tax rate decreased by 330bps to 26.3%.

• Cash and bank balances rose to RMB 16,006 million, with net cash at RMB 10,655 million.

• Total dividends and share repurchases for FY23 amounted to USD 431 million (c. RMB 3,080 million).

Outlook and guidance

• Plans to maintain channel diversification and accelerate overseas expansion, including Southeast Asia market entry.

• Focus on scenario marketing and enhancing consumer interaction.

• Continued improvement in resource allocation efficiency and channel profitability.