Guoquan’s core operating profit slumps in third quarter
Hotpot and home dining ingredient supplier Guoquan Food (Shanghai) Co. Ltd. (2517.HK) said on Thursday that its third-quarter core operating profit was between 30 million ($4.5 million) and 40 million yuan, representing a 43% to 57.3% year-on-year decline. Its quarterly revenue was between 1.9 billion yuan and 2 billion yuan, representing a year-on-year change of between a 3.3% decline and a 1.8% increase.
The company said higher traffic from online platforms last year had created a high revenue comparison base a year earlier. Increased investment this year in brand building and new businesses to attract younger consumers and expand dining occasions also weighed on its profit.
The company had 12,142 stores at the end of September, up by 1,381 year-on-year, including 3,478 stores in township markets, up by 916. Its registered membership grew 54.9% to approximately 88.45 million, while third-quarter gross merchandise value through stores’ proprietary online shopping channels increased by more than 50%.
The company’s shares opened lower on Friday and traded at HK$1.13 by the midday break, down 8.5%. The stock is down 69% year-to-date.
By Lee Shih Ta
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