HONG KONG, Mar 31, 2025 - (ACN Newswire) - Guoquan Food (Shanghai) Co., Ltd. (“Guoquan” or the “Company”, Stock Code: 2517.HK), a leading and fast-growing brand of dining-at-home food products in China, announced its annual results for the year ended 31 December 2024.
In 2024, despite a highly challenging market environment, the Company achieved simultaneous growth in both revenue and gross profit through its robust supply chain capabilities, innovative channel strategies, and efficient membership operations. For the year ended December 31, 2024, Guoquan reported annual revenue was RMB6,469.8 million, representing a year-on-year increase of 6.2%; gross profit was RMB1,416.8 million, representing a year-on-year increase of 4.9%; and core operating profit was RMB310.8 million, representing a year-on-year increase of 3.1%. Meanwhile, Guoquan places particular emphasis on shareholder returns. The Board of Directors has resolved to recommand a final dividend of RMB0.0746 per share for the year 2024, representing a return to shareholders of over RMB200 million.
Consolidate the infrastructure of its 10,000+ stores and strategically penetrate lower-tier markets
In 2024, Guoquan has proactively grasped changes in consumption trend, improved stores’ capabilities of operation and management by optimizing product portfolio, and embraced multi-faceted initiatives such online leads, which formed a holistic and instant retail store network. The number of stores increased from 9,660 as at 30 June 2024 to 10,150 as at 31 December 2024, with its retail store network covering 31 provinces, autonomous regions and municipalities. Meanwhile, based on in-depth understanding of markets in lower-tier cities, the Company also has achieved outstanding performance on expansion of stores in township-level market. There were 287 net new township-level stores for the year of 2024. The new township-level stores differs in product structure, store display and other aspects from the standard stores, and better meet the needs of consumers from township-level markets.
Online and offline dual-wheel drive, omni-channel sales network to pry the multi-scene consumer ecology
To empower franchisees and facilitate their sales growth as well as further expand consumer reach and offer more flexible shopping experience, the Company has also developed multiple online sales networks, including the Company’s Guoquan APP, WeChat mini-program, third-party food delivery platforms as well as on popular social commerce platforms such as Douyin to promote interplay between offline stores and online leads. In 2024, the Company continued to conduct consumer reach for Guoquan’s products on its multi-level Douyin accounts, gaining a total exposure of over 6.21 billion times throughout the year. In addition, Guoquan successively launched“RMB99 Beef Tripe Freedom Hotpot Set”,“RMB99 Sauerkraut Fish Freedom Hotpot Set”and other product portfolio with high quality-price ratio that is popular with consumers. Among them, the “RMB99 Beef Tripe Freedom Hotpot Set”and other beef tripe hotpot sets successively launched since late May were well received by consumers with accumulated sales exceeding RMB500 million in 2024.
Quality member ecosystem empowers growth, and systematic innovation enhances consumer stickiness.
Guoquan’s membership program built close online and offline connections and engagement with consumers and fostered consumer loyalty. In the second half of 2024, the Company has thoroughly upgraded the membership system and increased member benefits by making adjustments to tiered membership system, so as to further promote the membership growth and stickiness. As at 31 December 2024, the number of the Company’s registered members reached approximately 41.3 million, representing a year-on-year increase of 48.2%. The Company continued to enhance and develop the prepaid cards program. The value stored in prepaid cards for the year ended 31 December 2024 was approximately RMB0.99 billion, representing a year-on-year increase of 36.6%.
Deepening the upstream industry layout and building a "tasty and value-for-money" moat
Adopting a one-product-one-factory model, Guoquan has strategically acquired food ingredient production capabilities to achieve stronger control over the production and supply of its staple products. The Company has created industrial layout of essential ingredients of hotpot at all levels. As at 31 December 2024, the Company had six food ingredient production plants, namely, Heyi Plant for the production of its beef products, Wanlai Wanqu Plant for the production of meatballs, Chengming Plant for the production of its hotpot soup base products, Huanhuan Plant for the production of aquatic products, Daixiaji for the production of paste products and Taijiang Plant for the production of sour soup base products. The Company has continuously enhanced its bargaining power in upstream procurement, increasingly realized economies of scale of production and continuously optimized production costs by development and deployment of industry.
In 2025, Guoquan will focus on the development strategy of "brand, product and channel", deepen the synergistic effect of "production, supply and marketing", continue to integrate the upstream and downstream supply chain, embrace AI and unmanned retailing, realize the integrated development of online and offline, and actively explore the overseas market to deliver the good taste of China.
Firstly, expanding and deepening the network and continued expansion of low tier markets. Guoquan plans to expand the multi-level sales network, improve market penetration, and promote new regions’ network expansion via new store types of stores for town-level and county-level markets, covering more towns and counties. Meantime, the Company will continue to launch products and services to meet consumers’ demand from low-tier markets, in order to capture more market share in low-tier markets.
Secondly, strengthening the membership ecosystem construction to empower brand reach by IP. Guoquan will continue to extend the channels for expanding customers, encourage members to introduce new customers, improve public and private traffic, and reach consumers through popular TV commercials, offline advertising and social media and e-commerce platforms, such as Douyin, so as to expand the Company’s member groups. The Company will continue to optimize the membership benefits program by enriching the points redemption portal and upgrading the member’s rights system. The Company will gradually create and distribute various contents with high quality in the form of image text and videos focused on our brand’s cartoon image of IP “Guobao” to emotionally connect with consumers, so as to better convey our brand value concept. The Company will enhance the understanding of consumer behaviours to provide the most suitable marketing, services and products, so as to raise engagement velocity.
Thirdly, strengthening its position as community central kitchen by increasing real-time retails and intelligent retails. Guoquan will continue to deepen the diversify consumption scenarios. The Company will also continue to innovate sales channels by vigorously developing the business model of "one shop, one store, and one warehouse", providing an unlimited shopping experience and breaking free from the limitations of the retail space of physical stores. Relying on the Internet of Things, big data, and AI technology, the Company will transform some instant retail stores into intelligent unmanned retail stores, further extending the business hours of stores, serving more home - dining consumption scenarios, and creating a 24/7 intelligent retail network.
Fourthly, expanding its presence in the industry, consolidate supply chain system and build up core competencies of products. Guoquan will continue to adopt its one-product-one-factory strategy to achieve economies of scale and increase its cost advantage. The Company plans to expand its presence in the industry through investment or collaboration and further integrate its upstream resources and source quality food ingredients by joining hands with selective and qualified domestic and overseas food suppliers who have market potential and can achieve synergy with the Company, developing a strong industrial supply chain.
Fifthly, exploring overseas markets to deliver the good taste of China. The Company plans to initially explore overseas regional markets by prudently evaluating and selecting suitable locations, such as Hong Kong, Southeast Asia and other regions. The Company will try to arrange the sales of its products, export its supply chain capability to abroad, and deliver the good taste of China, so as to continuously improve its global recognition and explore overseas sales growth points.
ABOUT GUOQUAN FOOD (SHANGHAI) CO., LTD. (2517.HK):
Guoquan Food (Shanghai) Co., Ltd. ("Guoquan"; Stock Code: 2517.HK) is the leading one-stop home meal products brand in China, offering a variety of ready-to-eat, ready-to-heat, ready-to-cook and prepared ingredients, with a focus on at-home hotpot and barbecue products. Leveraging the Group’s robust supply chain capabilities, a strategic industrial layout with self-owned factories, a nationwide network of around 10,000 instant retail stores, and a carefully curated product portfolio, the Group offer a variety of home meal products solution under the "Guoquan Shihui" brand, catering to different dining scenarios.