On June 25, Want Want China Holdings Co., Ltd. (hereinafter referred to as "Want Want") released the company's financial results for the 2023 fiscal year ended March 31, 2024.
According to the report, the company achieved revenue of 23.586 billion yuan during the reporting period, a year-on-year increase of 2.9%; Profit attributable to equity holders of the Company reached RMB3.99 billion, representing a year-on-year increase of 18.4%. This performance reversed the simultaneous decline in revenue and net profit in fiscal year 2022, allowing people inside and outside the industry who pay attention to Want Want to see the resilience and strength of enterprise development.
01
The growth of key data is gratifying, and Want Want is very "prosperous"
According to the data, Want Want is a veteran enterprise, as a Taiwan-funded enterprise established in the early 90s, it was listed on the Hong Kong Stock Exchange in 2008. The company's advertising slogan of "people are prosperous, wealth is prosperous, you are prosperous, I am prosperous, everyone is prosperous" has made it a well-known brand, and it has also accompanied countless post-80s, 90s and even post-00s childhood.
Want Want's peak period was in fiscal year 2013, with revenue of US$3.818 billion (about 27.7 billion yuan at current interest rates) and net profit of US$687 million (about 5 billion yuan), and since then its performance has fluctuated greatly and declined several times. According to the data, in fiscal year 2022, Want Want's revenue will only be 22.928 billion yuan, a year-on-year decrease of 4.41%; The net profit attributable to the parent company was 3.372 billion yuan, a sharp decrease of 19.77% year-on-year. Revenues and net profits were declining, exposing the company's difficult situation at the time.
In fiscal year 2023, the company finally ushered in a double increase in revenue and net profit after performance fluctuations, and many industry insiders expressed surprise.
In terms of categories, Want Want's products continue to maintain a balanced development trend. As the company's largest business segment, dairy and beverage achieved revenue of 11.956 billion yuan, a year-on-year increase of 7.4%.
In FY2023, the popular "56 ethnic cans" Wangzi milk will return, and the attractive ethnic characteristics will stimulate consumers' willingness to buy and collect, and promote the growth of Wangzi milk. For the student group, Want Want uses a total of 6 kinds of nuts, such as Xinjiang walnuts and American almonds, with milk, to bring new nutritional choices to specific consumers. In addition, the company's healthy dairy products "Drink Milk Every Day" and low-sugar O bubble fruit milk products using raw milk as raw materials have also been launched one after another to further meet the different needs of consumers.
The revenue of rice cracker products increased by 2.3% year-on-year to RMB5.977 billion. During the reporting period, Want Want actively promoted the development of overseas rice cracker markets and continued to achieve stable growth. With a new taste and health concept, the new product "Little Millet Crisp" using glutinous rice as raw material, the revenue exceeded 40 million yuan during the reporting period.
Combined with the performance reports disclosed by Want Want in previous years, it is not difficult to find that the growth of its candy business has been stable and gratifying in recent years. According to the "2024 Global Top 100 Candy Companies List" released by international media Candy Industry, Want Want ranks among the top 10 on the list with annual net sales of candy of 3.22 billion US dollars, allowing the world to see Chinese brands in the list dominated by European and American brands.
Want Want introduced in the financial report that the revenue of its candy business increased over the same period, relying on the consumption scenario of "happy family events" to do links and marketing interactions, and the revenue of Want Want Milk Candy achieved double-digit growth. At the same time, creative products such as inflatable chewing candy, Fix X Body power generation salt steam tablets, and super QQ also bring consumers a fresh experience, riding the free ride of emerging channels and continuing to empower the brand.
In addition, Want Want's other financial results for fiscal year 2023 also have many bright spots. The five major sectors of revenue, gross profit margin, profit attributable to equity holders, operating profit and earnings per share were all in the red. Among them, benefiting from the decline in the cost of some raw materials and packaging materials, as well as the optimization of production and employment strategies, Want Want's profit in 2023 will increase by 18.4%, and the gross profit margin will also increase by 2.7% year-on-year to 46.6%, which is much higher than that of Master Kong (30.42%) and Uni-President (30.5%).
02
Years of ups and downs in performance, old brands need new vitality
Want Want's achievements in fiscal 2023 are certainly gratifying, but in the long term, we can still see the hidden crisis behind this old company.
At the product level, in fiscal year 2023, the revenue of snack food, one of the "three pillars" of Want Want China, declined, that is, the realized revenue was 5.502 billion yuan, a year-on-year decline of 5.5%. The company explained that the main ice product sub-category was due to factors such as the pace of operation, and the revenue declined over the same period.
Want Want Snack Gift Packs, Want Want Snow Cakes, Want Want Small Steamed Buns, etc. were all the "childhood memories" of a generation, but with the rise of leisure snack brands such as Three Squirrels and BESTORE, as well as consumers' more refined requirements for snack purchase channels and product ingredients, Want Want's market share has been repeatedly squeezed.
Some industry experts believe that the decline of snack food is a bad sign, indicating that the Want Want brand needs further renewal in the minds of the younger generation, and the first batch of Want Want fans may have grown up and some may have become parents, so the key to attracting the next generation needs to find new emotional links.
Of course, Want Want is also working hard to create new performance growth points. In recent years, the company has continued to develop new products in dairy and beverage products, and has launched more than 100 new products, including fruit juices, coffee, energy drinks and low-alcohol wines.
Want Want recently launched a new energy drink product under the brand name "Dali", which is now available on the shelves of Want Want's online flagship store.
It is worth noting that this is Want Want's seventh foray into the energy drink market. From 2015 to 2022, the company launched six energy drink products one after another, but unfortunately, none of them succeeded in gaining a foothold in the market. The sales volume of the "big profit" launched this time is only 47, and the market prospect is still not objective.
Objectively speaking, Want Want still has a long way to go if it wants to win more markets in the new era.
The industry believes that Want Want, as a veteran food and beverage company, has been insisting on launching new products in recent years, which is telling consumers that the company is keeping up with the trend of the times and constantly meeting the needs of consumers. At the same time, from Want Want's super profitability beyond Master Kong and unification, we can see the power of enterprise growth, and the future of Want Want is still worth looking forward to.