According to New Distribution, on March 20, Master Kong Holdings, listed in Hong Kong, released its 2017 results, with annual revenue of 58.953 billion yuan, up 6.07% year-on-year; net profit attributable to shareholders of 1.819 billion yuan, up 56.59%; basic earnings per share of 32.45 cents; proposed dividend of 2.49 US cents per share. Instant Noodle Business Recovers, Countering Food Delivery According to the financial report, in 2017, Master Kong's instant noodle business revenue was 22.6202 billion yuan, up 4.91% year-on-year. Although the overall FMCG industry in 2017 was overshadowed by rising raw material costs, due to distribution cost savings and the implementation of a multi-price-band product strategy, by continuously consolidating high-priced noodles and developing premium noodles, the sales trend of slow-cooked broth products in the premium segment was favorable. According to Nielsen data, the instant noodle industry showed a recovery trend in 2017, with overall market volume growth of 0.3% and value growth of 3.6%. In 2017, Master Kong's volume share was 44.2% and value share was 50.6%, firmly ranking first in the market. 1. High-priced noodles: Expanding consumption scenarios and creating demand space with multiple specifications. In the year celebrating Master Kong's 25th anniversary, it continuously strengthened brand communication and interaction, carried out sports marketing, and conveyed a safe and healthy brand image. 2. Premium noodles: In 2017, it continued to focus on the slow-cooked broth series with the appeal of "less additives, rich flavor, delicious, healthy, and nutritious," and launched various new flavors and specifications. Emphasizing bone broth deliciousness, it gained consumer recognition with the concept of healthy and delicious new trends, achieving doubled sales growth overall. 3. Mid-priced noodles/Crispy noodles: Mid-priced noodles focused on consolidating the market, meeting the demand for value and large portions, and through advertising resource investment, resource integration, and penetration improvement, promoted "Jinshuang Ramen" to maintain market leadership. Beverage Business: Maintaining Position Through Communication and Promotion In 2017, Master Kong's overall beverage revenue was 34.7543 billion yuan, up 6.96% from the same period last year, while the beverage gross margin decreased by 3.14 percentage points year-on-year to 29.82%. Due to the year-on-year increase in revenue and savings in advertising and marketing expenses, financial expenses, and exchange losses, the beverage segment's profit attributable to shareholders grew 141.75% year-on-year to 426 million yuan. In 2017, Master Kong continued its strategy of focusing on evergreen categories and consolidating core products, using multiple price bands and specifications to meet diversified market demand. Nielsen data shows that in 2017, China's beverage industry steadily improved, with overall market volume growth of 9.5% and value growth of 10.2% year-on-year. In 2017, Master Kong's beverage segment held a 50.7% volume share in ready-to-drink tea (including milk tea), continuing to rank first; its juice brand held an 18.1% volume share, ranking second; and its packaged water held a 14.1% volume share, temporarily ranking third. 1. Ready-to-drink tea: In 2017, to consolidate the mass consumer market, Master Kong attracted young consumers and the family market through various creative activities. For example, Master Kong Iced Black Tea formed a strategic partnership with the NBA; the Jasmine Tea series collaborated with the hit drama "Eternal Love" to consolidate its category leadership. 2. Packaged water: Master Kong mineral water is positioned in the mass market, with multiple specifications to meet consumer needs; "Youyue" water cultivated and attracted white-collar consumers through film and TV collaborations and conference sponsorship. 3. Carbonated beverages: Pepsi, Mirinda, 7UP, etc., occupied the market through channel diversification, multi-specification products, expanding drinking occasions, and strengthening online and offline consumer interaction. 4. Juice: By creating consumption scenarios and expanding diverse channels such as catering and food delivery, it continued to consolidate its leadership in Chinese-style juice and simultaneously drove the development of Western-style juice. 5. Functional drinks/Lactic acid bacteria drinks: Gatorade continued to strengthen consumer education on thirst, establishing a professional sports drink brand image through sports marketing. "Weiquan Ambient Lactic Acid Bacteria" consolidated growth in the Yangtze River Delta and Shanghai markets while gradually expanding nationwide, achieving double-digit healthy growth in 2017. 6. Coffee beverages: In 2017, "Frappuccino" followed Starbucks' store expansion in regional coverage and city penetration, actively focusing on e-commerce business and special channel development, further extending product sales locations and drinking occasions. New Distribution noted that after Master Kong released its financial report, its stock price rose accordingly, and by the close, the total market value was HK$89.5 billion. Regarding Master Kong's 2017 annual report, Zhu Danpeng, a Chinese food industry analyst, said: "Although the entire instant noodle industry is recovering, it still needs continuous consolidation, innovation, and upgrading. This innovation includes both internal process innovation and innovation in production, formulas, and other aspects." "External innovation needs to be arranged, such as communication and interaction with consumers, building sticky fan bases, and laying out the Belt and Road Initiative," Zhu Danpeng said. Instant noodles are actually growing in Japan and South Korea, and Master Kong and Uni-President can also go abroad to explore overseas markets because our Chinese enterprises have a high degree of industrialization and our quality is not inferior. Zhu Danpeng believes that currently, whether it is Master Kong or Uni-President, the entire Chinese instant noodle industry is in a period of running-in, adaptation, and adjustment. As the leading player in Chinese instant noodles, Master Kong certainly faces more problems. Therefore, during this adjustment period, Master Kong should also allocate more resources to reorganize and shoulder the industry. Click Read Original to see more highlights of the 4th FMCG + Internet Conference... -END-