Zhongmin Baihui Retail Group (5SR) H1 2025 earnings summary

Executive summary

• HY2025 revenue fell 7.5% YoY to RMB452.4m, while profit after tax rose to RMB27.2m from RMB1.6m, supported by higher gross margin, associate/JV earnings and a large lease-derecognition gain.

• Fewer stores and weaker gold and concessionaire sales weighed on revenue; outlet performance improved in Wuxi and Changsha, while underperforming Fujian stores were closed.

Financial highlights

• Revenue decreased 7.5% YoY to RMB452.4m; gross profit declined 1.1% to RMB111.9m, while gross margin improved to 24.7% from 23.1%.

• Profit before tax was RMB32.1m versus RMB1.2m; profit after tax was RMB27.2m versus RMB1.6m, including a RMB19.8m gain on derecognition of right-of-use assets.

• Other income rose 38.6% to RMB59.9m, mainly due to the lease-derecognition gain; selling and administrative expenses fell 6.5% and 12.1%, respectively.

• Finance costs increased 6.4% to RMB10.3m, attributed to higher borrowings; income tax was an expense of RMB5.0m versus a credit of RMB0.4m.

Outlook and guidance

• Focus remains on managing retail presence in a challenging environment; adjustments include closing underperforming stores, while outlet operations in Wuxi and Changsha improved.

• No interim dividend was declared, with the board citing the need to conserve resources for business activities.