GUOQUAN Food's 2024 revenue increased by 6.2% year-on-year, operating profit grew by 3.1%, and gross margin slightly declined | Financial Report Insights

In 2024, GUOQUAN's food revenue increased by 6.2% year-on-year, while net profit decreased by 8.4%. As of December 31, 2024, the total number of GUOQUAN stores reached 10,150, maintaining a scale of over 10,000 stores. On the 28th, GUOQUAN released its annual performance announcement for 2024: Revenue: In 2024, GUOQUAN achieved revenue of 6.47 billion yuan, a year-on-year increase of 6.2%; Net Profit: Net profit was 241 million yuan, a year-on-year decrease of 8.4%; Operating Profit: Core operating profit was 311 million yuan, a year-on-year increase of 3.1%; Gross Profit: Gross profit was 1.417 billion yuan, a year-on-year increase of 4.9%; Gross Margin: 21.9%, compared to 22.2% in the same period last year; Cash Reserves: Increased by 9.8% from 1.936 billion yuan on December 31, 2023, to 2.125 billion yuan, with the debt ratio further decreasing to 3.2%. GUOQUAN announced a significant increase of 39.8% in annual shareholder dividends, with a total dividend amount of approximately 200 million yuan. Core Business: Franchise Store Expansion and Online Channel Development GUOQUAN's core competitiveness lies in its vast offline store network. By the end of 2024, the total number of stores reached 10,150, with nearly 100% being franchise stores. Notably, the company made significant progress in the township market, with a net increase of 287 township stores, demonstrating the company's focus on lower-tier markets. In addition to offline, GUOQUAN is also actively embracing online channels. Through the GUOQUAN APP, WeChat mini-programs, third-party delivery platforms, and social e-commerce platforms like Douyin, it achieves synergy between online and offline. Particularly, the total exposure on the Douyin channel exceeded 6.21 billion times, and products like the "99 yuan beef tripe hot pot set" have been well received by consumers, with total sales exceeding 500 million yuan. Regarding membership, as of the end of 2024, the number of registered members reached approximately 41.3 million, a year-on-year increase of 48.2%, and the prepaid card deposit amount reached approximately 990 million yuan, a year-on-year increase of 36.6%, indicating an improvement in member loyalty. Supply Chain Upgrade: Self-built Factories Strengthen Cost Advantages In 2024, GUOQUAN strengthened its vertical integration efforts on the industrial side. Throughout 2024, GUOQUAN added three new food production factories through self-construction and acquisitions, focusing on the production and processing of freshwater products, shrimp slices, and sour soup products. As of December 31, 2024, GUOQUAN had six self-owned food production factories, doubling from the same period in 2023, which increased the proportion of products sold from self-owned factories to 20%. Vertical integration of the supply chain not only ensures product quality and supports stable gross profit but also serves as a foundational guarantee for further expansion of store scale The financial report emphasized the digital capabilities of GUOQUAN's supply chain. By covering production, procurement, warehousing, and logistics, GUOQUAN can timely control the supply and demand dynamics from the procurement end to the store end, achieving efficient management of the overall supply chain. On this basis, GUOQUAN's inventory turnover days decreased by 25% compared to the same period in 2023. Through cooperation with warehousing and logistics suppliers, and leveraging 18 digital central warehouses across the country along with a digital inventory and barcode management system, GUOQUAN has achieved next-day delivery for the vast majority of store orders nationwide. In July 2024, GUOQUAN announced the opening of its supply chain capabilities and will continue to move towards becoming a platform-based enterprise in the food industry. Stable and Rapid Development New Stage: Instant Retail and Overseas Business Become the Second Growth Curve Looking ahead, GUOQUAN mentioned that it will consolidate its existing advantages, including continuing to expand and deepen its sales network, continuously exploring lower-tier markets, and achieving a phased goal of 20,000 stores within five years. It aims to solidify its membership ecosystem and empower brand reach through IP. GUOQUAN will promote industrial layout, strengthen the supply chain system, consolidate core product competitiveness, and enhance both average transaction value and sales frequency. In addition, GUOQUAN also mentioned its outlook on new growth points. The financial report stated that GUOQUAN will continue to innovate sales channels. By improving regional market penetration and developing instant retail business, it can reach a broader consumer base more frequently, driving further performance growth. At the same time, relying on IoT, big data, and AI technology, GUOQUAN will attempt to transform some instant retail stores into smart unmanned retail formats to further extend store operating hours, serving more dining-at-home consumption scenarios and creating a smart retail network that covers all time periods. GUOQUAN also mentioned its future overseas plans in the financial report, stating that it will build a new paradigm for Chinese food supply chain enterprises going abroad by combining Chinese flavors with regional supply chains, attempting to create a Chinese taste storm in Hong Kong and Southeast Asian markets, and exploring overseas sales growth points. These two strategic directions will become GUOQUAN's second growth curve, ushering the company into a new stage of stable and rapid development