On November 13 (today) at noon, Want Want China announced that for the six months ended September 30, 2018, the company achieved revenue of RMB 9.248 billion (same unit below), a year-on-year increase of 3.2%; gross profit of RMB 4.117 billion, up 6.0% year-on-year; and profit attributable to equity holders of the company of RMB 1.364 billion, up 7.1% year-on-year. In the first half of fiscal year 2018, all channels and all three major product categories in mainland China saw revenue growth. The proportions of the three major product categories to total group revenue were: rice crackers and snacks combined accounted for 49.0%, and dairy and beverages accounted for 50.7%. Among them, the rice cracker category declined slightly by 0.7% year-on-year, achieving revenue of RMB 1.8593 billion; dairy and beverage revenue grew 2.8% year-on-year, reaching RMB 4.6903 billion; and snacks grew 7.2% year-on-year, achieving revenue of RMB 2.6758 billion.
Rice Crackers In the first half of fiscal year 2018, the rice cracker category declined slightly by 0.7% year-on-year, achieving revenue of RMB 1.8593 billion, mainly due to temporary slowdown in sales in overseas regions due to shipping time effects, and also because of strategic restrictions on shipments of low-margin sub-brand rice crackers based on profitability considerations. However, in mainland China, the rice cracker category still achieved single-digit growth, with core products such as the main rice cracker brand and gift packs achieving varying degrees of growth, indicating that rice crackers remain firmly in the leading market position. In 2018, the rice cracker category launched a series of distinctive new products, bringing new momentum to channel growth: the potato rice chips, mainly sold in traditional channels, were well received upon launch; personalized new products launched on e-commerce channels, such as the "600g Jingbao Gift Pack" and "Want Want Snack Box," became popular hits among young consumers. In the maternal and infant channel, through channel expansion, such as direct cooperation with well-known maternal and infant platforms and opening Baby Mama e-commerce flagship stores, the "Baby Mama" series expanded its consumer reach and market share.
Dairy and Beverages In the first half of fiscal year 2018, dairy and beverage revenue grew 2.8% year-on-year, reaching RMB 4.6903 billion. The "Want Want Milk" revenue, which accounts for over 90% of this segment's performance, grew 3.3% year-on-year, and achieved growth across all channels, both traditional and emerging. It is worth noting that the dairy and beverage category continued to maintain doubling growth momentum on e-commerce channels, and achieved mid-single-digit growth in modern channels; traditional channels progressed steadily, particularly outstanding in second- and third-tier cities. In addition, amid strong performance, the company increased new product launches, such as lactic acid water, Bond Coffee, and Kuku Tea, providing differentiated products for consumers with different needs.
Snacks In the first half of fiscal year 2018, snacks grew 7.2% year-on-year, achieving revenue of RMB 2.6758 billion. Among them, the main product, candy, achieved double-digit growth; beans, nuts, and others (mainly jelly and biscuits) grew high single digits year-on-year; and ice cream sales also achieved high single-digit growth year-on-year. Snacks also showed balanced development momentum with mid-to-high single-digit growth across all channels, as detailed below:
Ice Cream: In 2018, the ice cream subcategory launched a "heavyweight" new product - the aseptic packaged milk-containing ice cream "Dongchi." Through strong product strength and extensive online and offline promotion, the product quickly became known and loved by consumers, achieving revenue exceeding RMB 100 million upon launch.
Candy: Against the backdrop of a recovering soft candy market, "Want Want QQ Candy" achieved double-digit growth across all channels in the first half of fiscal year 2018 through optimized pricing strategies and strengthened special display promotions.
Continued Differentiation and Diversified Marketing The announcement stated that in the second half of fiscal year 2018, the group will continue its strategy of differentiated products and diversified marketing, developing new products, cultivating emerging channels, exploring blank markets, and enhancing brand-consumer contact through novel and precise brand marketing combined with online and offline efforts. In the past two years, Want Want has continued to launch new products. Among them, the Want Want Extra Rich Milk launched in 2017 and Dongchi launched in 2018, each with less than one year on the market, have both exceeded RMB 100 million in single-product sales. In the second half of the year, the company will focus on promoting the consumption upgrade product Extra Rich Milk and the "Langwei Xian" series, and will successively launch new beverage products such as "Nutrient Drink - Sha" and "Bond Milkshake."
Compiled from Want Want's financial report and Food Board -END-