Just now, Yili simultaneously released its 2020 annual report and Q1 2021 performance report.

-01-

2020 Achieved High Growth Against the Trend; Q1 Created Historical Best

According to the 2020 annual report, despite numerous challenges, Yili still achieved high growth against the trend in 2020, with total revenue of 96.886 billion yuan, up 7.38% year-on-year; net profit of 7.099 billion yuan, up 2.13%. In addition to the growth in 2020, the Q1 report released at the same time was also impressive. The Q1 2021 report shows that Yili's revenue in Q1 reached 27.363 billion yuan, up 32.49% year-on-year; net profit surged 147.69% to 2.831 billion yuan. This Q1 report can be called the "best in history." Yili's explanation for this is simple: due to increased product sales during the reporting period.

-02-

Liquid Milk Maintains Growth; New Growth Points Perform Well

From the annual report data, in 2020, Yili's liquid milk product revenue increased by 3.2% compared to the previous year, while revenue from milk powder and dairy products series increased by 28.15%, and revenue from cold drinks series also achieved a year-on-year growth of 9.35%. It is worth mentioning that in terms of products, Yili continues to improve its product matrix through innovative categories and optimized structure, constantly creating new performance growth points. Data shows that in 2020, sales revenue of key products under Yili, including "Jindian," "Ambrosial," "Changqing," "Jinlingguan," and "Qiaolezi," increased by 9.6% compared to the same period last year. During the same period, new product sales revenue accounted for 16%. Products such as "Yili" cheese series, "Jindian" low-temperature milk, and the upgraded formula "Jinlingguan" infant formula all had breakthrough performances. The core liquid milk business retail sales increased by 12.7% year-on-year, with organic liquid milk retail sales up 35.1% and market share reaching 50.6%. Yili also disclosed its 2021 performance target: In 2021, Yili plans to achieve total operating revenue of 107 billion yuan and total profit of 9.3 billion yuan.

-03-

Channel Strength Continuously Enhanced

Yili's channel refinement continues. From the annual report, Yili's control over all channels is constantly strengthening. As of the end of 2020, Yili served nearly 1.096 million township and village outlets, an increase of 5.5% from the previous year. At the same time, the company's channel penetration level is also continuously improving. Kantar Retail data shows that as of the end of December 2020, the market penetration rate of room-temperature liquid dairy products was 84.7%. While deeply cultivating offline channels, Yili is also focusing on new e-commerce retail. In 2020, its performance in new e-commerce retail was commendable and is becoming a "powerful engine" for performance growth. Data shows that in 2020, Yili's e-commerce business revenue increased by 55% compared to the previous year. According to third-party research firm CIC data, Yili ranked first in the industry in terms of B2C dairy market share across the entire network in 2020 on three dimensions: "6·18," "Double 11," and the full year. Entering 2021, Yili's e-commerce growth momentum continues. As of February 2021, Yili's e-commerce channel market performance growth rate reached 77.6%, far exceeding the industry average of 53.8%. Its e-commerce channel market share exceeded the 30% mark, firmly ranking first in B2C liquid milk share, further expanding its advantage.

-04-

Overseas Market Breakthroughs

In overseas markets, Yili has also made breakthrough progress. In 2020, the factory opened in Indonesia completed its main construction, and after production, it will enhance Yili's performance in the local market; "Ambrosial" precisely positioned itself in the Southeast Asian high-end yogurt market with differentiation, ranking among the top in the large yogurt category; after acquiring Thailand's largest local ice cream enterprise, Chomthana, the enterprise achieved comprehensive and healthy development in production and operation, and the company's annual sales in the Thai market also increased by 68% year-on-year. At the same time, Yili's Oceania Dairy layout in New Zealand achieved rapid growth, and Westland, acquired in 2019, has also shown new growth potential through capacity upgrades.

-05-

Empowering Partners

In addition to continuously strengthening itself, Yili is also continuously strengthening its empowerment of partners. In recent years, Yili has established the Partner Development Academy and, with platforms such as industry chain inclusive finance, provides capacity building, financing, and other services to upstream and downstream partners in the dairy industry, building a win-win "healthy industry ecosystem" and comprehensively promoting industry development. Once the tip is adopted, a payment of 400-2000 yuan will be made.