ZJLD Group (6979) H1 2024 earnings summary

Executive summary

• Revenue for the six months ended June 30, 2024, increased 17.5% year-over-year to RMB4,133.2 million, driven by strong growth in premium and above baijiu products across all major brands.

• Adjusted net profit (non-IFRS) rose 26.9% to RMB1,018.1 million, with adjusted net profit margin improving to 24.6%.

• Net profit attributable to equity shareholders dropped 52.6% to RMB751.7 million due to one-off, non-cash items in 2023 and share-based payment expenses in 2024.

• Gross profit margin improved to 58.8% from 57.9% year-over-year, reflecting a higher contribution from premium and deluxe products.

• The group continued to invest in production capacity, brand promotion, and ESG initiatives, including green packaging and renewable energy.

Financial highlights

• Revenue: RMB4,133.2 million (+17.5% YoY); gross profit: RMB2,428.7 million (+19.2% YoY).

• Adjusted net profit: RMB1,018.1 million (+26.9% YoY); adjusted net profit margin: 24.6% (up from 22.8%).

• Net profit: RMB751.7 million (-52.6% YoY); net profit margin: 18.2% (2023: 45.0%, impacted by one-off items).

• Basic EPS: RMB0.230; diluted EPS: RMB0.227; adjusted basic EPS: RMB0.311 (up 3.5% YoY).

• Net cash from operating activities: RMB574.9 million (+166.2% YoY).

Outlook and guidance

• Confident in further strengthening market position in premium and sauce aroma baijiu segments for sustainable growth.

• Plans include new product launches, distributor quality improvement, brand strengthening, and increased base liquor storage.

• Zhen Jiu to focus on dual-channel strategy and distributor network optimization; Li Du to expand outside Jiangxi and broaden product range.

• Continued focus on optimizing distributor quality, expanding storage, and enhancing brand power.

• Confident in long-term growth prospects for China's baijiu industry and the group.