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- Chief Business Intelligence
Introduction: The A-share "Three Musketeers of Medical Beauty" who once relied on "hyaluronic acid" to kill all sides collectively stalled, and women's money is not easy to earn?
With medium-long hair and double ponytails, Zhao Yan's iconic image to the outside world, this post-60s generation has become a veritable "hyaluronic acid queen" by harvesting women's "appearance" business.
She started her business in 1989 and created a 100 billion hyaluronic acid business empire of Bloomage Biotech.
In the past ten years, she has developed rapidly, earning a net worth of more than 50 billion, and will become the richest woman in Shandong in 2021.
She has stepped on every cusp of the times accurately, and it seems that since last year, she has not been able to stand alone in this era of ups and downs.
Take over the loss-making enterprise and become the queen of hyaluronic acid
As a native of Yunnan, Zhao Yan's first pot of gold was earned in Hainan, and this money made Zhao Yan's wealth bigger and bigger.
Hainan Gold Rush
She invested her money in a clothing business and invested hundreds of thousands of dollars to buy three pieces of land.
In 1992, the real estate market in Hainan began to explode, rising nearly three times in one year.
Just in time for the crazy bubble of Hainan real estate, the three pieces of land that Zhao Yan bought before hundreds of thousands of yuan soared to more than 3 million.
accurately stepped on the context of the times, seized the wave of wealth set off by the times, and bought the land with prideful money, making Zhao Yan a millionaire.
At that time, many ordinary workers were paid no more than 100 yuan, and "all of a sudden, somehow, they became financially free," Zhao Yan said in an interview.
However, in 1993, Hainan's real estate market also collapsed quickly, and Zhao Yan sold all the assets in her hand to cash out and left Hainan with money.
The story of the relationship with hyaluronic acid originated from the fact that in 2000, when Zhao Yan was studying MBA in Beijing, she met Ling Peixue, who was one of the heads of Shandong Freda Biochemical Co., Ltd. and had a lot of research on hyaluronic acid.
Ling Peixue, academician of the International Eurasian Academy of Sciences
Don't look at the name of this company, but it has invented the biological fermentation technology method of hyaluronic acid, which can not only greatly increase the production of hyaluronic acid, but also reduce the cost of extraction.
Because at that time, hyaluronic acid was still a very luxurious thing for us, and the mainland basically relied on imports, and about 200 kilograms of chicken comb (about 20,000 chickens) could extract 1 kilogram of hyaluronic acid, and the cost was as high as 100,000 US dollars.
Unexpectedly, this technology, which was "stuck in the neck" by the United States, was broken through by Ling Peixue's team.
However, due to too much R&D investment, the company has been in a state of operating loss, so Freda is in urgent need of external investment.
At that time, hyaluronic acid was still a new word, and no one knew what it could do, let alone invest in it.
Zhao Yan was no exception, but at that time, she was shocked by the sentence "one hyaluronic acid can lock 1,000 water molecules", and she felt that hyaluronic acid must have great commercial potential.
Therefore, she bought 50% of the shares of Shandong Freda Biochemical Co., Ltd. at a high price of 12 million yuan, and under the reshaping of Zhao Yan, Freda did reverse the long-term loss situation.
In 2001, Freda achieved a profit of more than 3 million.
Later, Zhao Yan got the entire equity of Freda and changed its name to Bloomage Biotechnology. Ling Peixue also parted ways with Bloomage Biotech.
In 2003, when the company's annual income was only more than 20 million, Zhao Yan dared to spend nearly 100 million yuan to establish his own factory, set up a research and development center and a production center.
This big gamble made Zhao Yan bet right again. In 2005, after this factory was put into operation, relying on technical barriers, in 2007, Bloomage Biotech became the world's largest hyaluronic acid R&D and production enterprise, with a profit of 50 million.
In 2008, Bloomage Biotech was listed on the Hong Kong Stock Exchange, and in 2019, it was listed on the Science and Technology Innovation Board in China.
Taking advantage of the "beauty economy", Bloomage Biotech hit an all-time high of 314.99 yuan per share in July 2021, with a market value of more than 140 billion yuan, which can be described as the limelight.
Since its listing, Bloomage Biotech's revenue has also maintained a growth trend, rising from 1.886 billion yuan in 2019 to 6.359 billion yuan in 2022, of which the revenue growth rate in 2021 has reached 87.93%.
In 2020, she ranked 74th on the "2020 Forbes China 400 Rich List" with a wealth of 44.97 billion yuan, and the "Queen of Hyaluronic Acid" became famous.
Drop 100 billion market value!
Both performance and stock price dived
But as time goes by, beauty lovers are no longer satisfied with basic hydration, and the business of hyaluronic acid is getting worse and worse.
On August 23, the 2024 semi-annual report released by Bloomage Biotech showed that the company achieved revenue of 2.811 billion yuan in the first half of the year, a year-on-year decrease of 8.61%; net profit was 341 million yuan, down 19.51% year-on-year; deducted non-net profit of 316 million yuan, a year-on-year decrease of 12.38%.
Source: Bloomage Biotech's 2024 semi-annual report
The company's revenue and net profit both declined, of which the net profit fell by nearly 20%.
And in the secondary market, just three years after its peak in 2021, the stock price has been beaten back to its original shape.
As of the close of trading on September 30, Bloomage Biotech was 70.5 yuan per share, with a total market value of 33.958 billion.
Compared with the highest point of 313.1 yuan / share, the stock price has fallen by more than 70%, and the market value has shrunk by more than 100 billion.
In fact, this performance in the first half of 2024 is only a continuation of the decline in 2023.
Since 2023, Bloomage Biotech has never dissipated the haze of declining performance. In the latest financial report, Bloomage Biotech directly positioned 2024 as the "first year of change".
However, judging from the current performance, the growth of hyaluronic acid, which Bloomage Biotech has been relying on, has gradually peaked, and the main functional skin care sector has declined sharply, and the second growth curve has not run out.
Judging from the financial report, among the four business segments of Bloomage Biotech in the first half of this year, the functional skin care products segment declined the most, achieving a revenue of 1.381 billion yuan, a decrease of 29.74%, which is also the reason for the collapse of its performance.
Because, the functional skin care products sector has always been the "highlight" of Bloomage Biotech, and its Runbaiyan, Quadi, Mirepair and BM Muscle are all well-known skin care brands, among which Runbaiyan has created the packaging form of "sub-throwing" and became famous in one fell swoop.
Moreover, Runbaiyan and Quadi are both skin care brands with revenues of 1 billion yuan, which have made significant contributions to the business of Bloomage Biotech's functional skin care products sector.
With the surge in revenue, the revenue of functional skin care products has become the most important core income of Bloomage Biotech
It can also be seen from the growth rate of each business since its listing that the functional skin care business has been declining since 2021.
I have to admit that this once growth engine is now starting to be dumb.
In the final analysis, young people nowadays don't love hyaluronic acid.
With the education of the market slowly spreading, hyaluronic acid is no longer a mysterious ingredient for everyone, and relying on domestic technology, the price of hyaluronic acid is getting lower and lower.
Due to its low price, the properties of hyaluronic acid, such as its unclear efficacy and inability to penetrate the skin, have also begun to be discussed, and some people have even named it an "IQ tax".
In addition, since the rise of the ingredient party, various "star ingredients" have appeared in the field of skin care products, especially recombinant collagen, which focuses on anti-aging, and hyaluronic acid is no longer a favorite of consumers.
At present, Jinbo Biotech, the only approved recombinant collagen injection class III device, disclosed in this year's semi-annual report that the company's functional skin care products achieved revenue of 480 million yuan, a year-on-year increase of 53.94%. Among them, single-ingredient functional skin care products achieved revenue of 11.8724 million yuan, a year-on-year increase of 149.49%.
In the past few years, hyaluronic acid was the mainstream of the skin care and medical beauty market, however, with the advancement of technology and changes in market demand, hyaluronic acid has lost its advantage, and a good hand cannot resist the fierce market competition.
Nearly 10 billion marketing smashed 3.3 billion net profits
Bloomage Biotech's functional skin care products segment has declined so much, in addition to the general environmental reasons, but also because of its high sales expenses.
After all, it is a skincare product sold to consumers, and it is inevitable that it will be heavily marketed.
It can be said that Bloomage Biotech's sales expenses are higher than those of many companies in its peers. In the first half of 2024, Bloomage Biotech's sales expenses will be as high as 1.179 billion yuan, more than three times the net profit.
In 2023, Bloomage Biotech's sales expenses will reach 2.842 billion yuan, accounting for 46.7% of the company's total revenue, and the company's net profit this year will only be 593 million yuan.
Source: Bloomage Biotech's 2023 annual report
From 2019 to 2022, during the reporting period, Bloomage Biotech's sales expenses grew rapidly, with 521 million yuan, 1.099 billion yuan, 2.436 billion yuan, and 3.049 billion yuan respectively, and the sales expenses in 2023 were 2.842 billion yuan, with a cumulative expenditure of about 9.947 billion yuan in five years, close to 10 billion yuan in sales expenses.
The net profit in the past five years was only 586 million yuan, 646 million yuan, 782 million yuan, 971 million yuan and 341 million yuan respectively, and the cumulative net profit in the five years was 3.326 billion yuan, accounting for only one-third of the sales expenses.
The high marketing expenses have also led to the low profit margin of Bloomage Biotech. That is to say, the more you sell, the less you earn, because the money is earned for marketing expenses, who says that it is not hard money.
The highest part of the sales expenses is Bloomage Biotech's online promotion service fee, accounting for more than 50%.
Source: Bloomage Biotech's 2023 annual report
In the early days of entrepreneurship, Bloomage Biotech took advantage of the live broadcast e-commerce outlet, which did make Bloomage Biotech's products play a momentum, but it was also marketed and failed to be marketed, and it has always relied on external traffic, which has brought that profitability is difficult to improve.
In the first half of 2024, Bloomage Biotech's sales expense rate will still remain at the level of more than 40%, but its revenue has declined significantly.
In this way, Bloomage Biotech does need to change, but how to achieve a beautiful turn and remodeling?
However, it is certain that "her economy" will always be hot and hot, as long as a woman's beauty-loving nature remains unchanged, Bloomage Biotech will not lose this wealth code.
What do you think about this? Welcome to leave a message in the comment area to discuss and express your opinions or opinions, thank you.
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