Written | Planet
Source | Bedouin Finance
Qiaqia melon seeds seem to be less "fragrant".
On August 24, Qiaqia Food Co., Ltd. (SZ: 002557, hereinafter referred to as "Qiaqia Food"), a "large nut roaster" released its 2023 semi-annual report. From the perspective of financial data, the performance of Qiaqia Food in the first half of 2023 is not impressive. Not only does it increase revenue but not increase profits, but it also has problems of rising costs and falling sales.
Through this unsatisfactory financial report, the hidden worries behind Qiaqia Foods, the "China's first roasted seeds and nuts" that entered the market in 2011, gradually surfaced.
1. Increase revenue without increasing profits, leading products are in trouble
The financial report shows that Qiaqia Foods achieved operating income of 2.686 billion yuan in the first half of 2023, a year-on-year increase of 0.28%; For the first time in five years, Qiaqia Foods experienced a decline in its interim net profit.
Regarding the slight increase in revenue and the double-digit decline in net profit, Qiaqia Food explained in its financial report that it was mainly due to the impact of the Spring Festival holiday, the company's cautious stocking of nut gift boxes before the holiday, and the rising cost of sunflower seed raw materials.
After entering 2023, the performance decline of Qiaqia Foods will appear. The company achieved revenue of 1.336 billion yuan in the first quarter of 2023, a year-on-year decrease of 6.73%; net profit of 178 million yuan, a year-on-year decrease of 14.35%; Double down situation.
Beido Finance learned that the main income of Qiaqia Foods is contributed by its "star product" sunflower seeds. In the first half of 2023, the company’s revenue from sunflower seeds was 1.800 billion yuan, accounting for 67.02%; nuts, as the second growth curve of Qiaqia Foods, achieved revenue of 533 million yuan, accounting for 19.85%.
Qiaqia Foods stated in its financial report that in the first half of 2023, the company will continue to focus on the melon seeds and nuts business. The global marketing department has achieved rapid sales growth through brand traffic integration, communication with brand users, and co-creation of new products. increase.
But in terms of performance growth, the sales of Qiaqia Foods are not as optimistic as they said. In the first half of 2023, the company's revenue from sunflower seeds fell by 2.38% compared with the 1.844 billion yuan in the same period in 2022, and it did not advance but retreated; the food revenue from nuts increased slightly by 1.59% year-on-year.
Thanks to the penetration of potato chip products through mass-market snack channels and the expansion of Douyin channels, Qiaqia Foods’ revenue from other products will continue to grow well in the first half of 2023, achieving revenue of 31.947 million yuan, a year-on-year increase of 27.34%. However, the revenue of this business accounted for only 1.23%, which can only be said to be rare.
2. It is difficult to increase cost and increase efficiency, and the gross profit rate is under pressure
As Qiaqia Foods said in its financial report, the decline in its performance is closely related to the increase in raw material costs. Specifically, the company's operating costs in the first half of 2023 will be 2.027 billion yuan, an increase of 7.04% over the same period in 2022, of which the increase in direct material costs is the most significant.
Even though Qiaqia Foods mentioned in the financial report that it will increase the joint research and development and promotion cooperation of sunflower seeds, continue to reserve and test new varieties, promote the upgrading of the supply chain, and continuously improve operational efficiency, the company's direct material costs will still increase by 2022. The 1.530 billion yuan in half a year will increase to 1.651 billion yuan in the same period in 2023, an increase of 7.91%.
Beido Finance found that, in the context of rising raw material prices, Qiaqia Foods also failed to achieve "small profits but quick turnover". In the first half of 2023, the company's sales volume was 94,200 tons, a decrease of 4.69 percentage points from 98,800 tons in the same period of 2022; the output was 90,500 tons, a year-on-year decrease of 5.60%, and both production and sales volume declined.
The double attack from upstream and downstream puts pressure on the gross profit margin of Qiaqia Foods. The company's gross profit margin for the first half of 2023 was 24.1%, down 7.46 percentage points from the same period in 2022. But it is worth noting that soaring costs and declining performance have not stopped Qiaqia Food from stopping its marketing.
The financial report shows that the sales expenses of Qiaqia Foods in the first half of 2023 will be 257 million yuan, a year-on-year increase of 7.91%, even exceeding its net profit. Among them, more than 50% of the sales expenses were invested in advertising and promotion, and the advertising and promotion expenses also increased from 121 million yuan in the first half of 2022 to 135 million yuan in the same period in 2023.
Qiaqia Food stated in its financial report that it has reached cooperation with stores such as Snacks Are Busy, Zhao Yiming, Snacks Youming, Haoxianglai, etc., seeking to expand the sales channel of mass-market snack stores, and actively promote the expansion of membership stores, catering channels and other channels. layout and continue to carry out channel intensive cultivation.
In addition, Qiaqia Food focuses on user connections and services on the four social platforms of WeChat Ecology, Weibo, Xiaohong.shu, and Douyin. " and other circle-level topic marketing activities, interact with consumers with social content, and convey brand value.
It is not difficult to see that the conversion rate of sales expenses of Qiaqia Foods is not high, and it is difficult to prevent the decline in performance. At the same time, it is difficult to grow long-term by exchanging sales for growth. How to use brand awareness and other advantages to seek broader incremental space in the current involution of the snack food industry will be a long-term proposition brought by the market to Qiaqia Food.