tekken7arcade| Sales of quick-frozen flour rice fell, and Sanquan Food's revenue fell for the first time since its launch
Frozen rice products slow down, Sanquan Foods (002216) revenue and profit fell both. Recently, Sanquan Foods released its 2023 financial report showing that its operating income was 70%.Tekken7arcade56 billion yuan, down 5% from the same period last yearTekken7arcade.09%Tekken7arcadeThe net profit was 749 million yuan, down 6.55% from the same period last year. This is the first decline in revenue since Sanquan Food went public in 2008, which may be related to a decline in revenue and sales of traditional frozen rice products, which are the main sources of revenue. As the growth rate of the frozen rice products market continues to slow, Sanquan Foods needs to find new growth points.
Revenue of frozen noodles declines
The decline in the performance of Sanquan Food has something to do with the decline in revenue from frozen noodles in the traditional business.
Frozen flour products are the leading business of Sanquan Food, and the traditional three kinds (dumplings, dumplings and zongzi) have always been the main revenue force. In the business structure of Sanquan Food, the business income of quick-frozen rice products accounts for more than 80% of the total business income. However, the operating income of frozen rice products in 2023 was 5.829 billion yuan, a decrease compared with the same period last year.Tekken7arcade9.46%; sales were 609500 tons, down 6.14% from the same period last year; and accounted for 82.62% of total revenue, down about 4% from the same period last year.
This is the year that Sanquan Foods has contributed the least income from frozen rice products in four years. From 2020 to 2022, the business segment earned 6.231 billion yuan, 6.032 billion yuan and 6.438 billion yuan respectively, with year-on-year growth rates of 12.98%,-3.19% and 6.73%, respectively.
On the performance and product revenue and other issues, Beijing Business Daily reporter sent a letter to contact Sanquan Food, as of the press release has not received a reply. Sanquan Food Secretary publicly explained that 2023 is a year of pressure on the company's traditional business growth, frozen food has the nature of hoarding, due to the high performance base in 2022 and the relative weakness of the terminal consumer market in 2023, resulting in a decline in revenue. In addition to the changes in the consumer side, the industry competition is also more fierce, frozen food enterprises are in the fierce market competition.
The fierce market competition is also written in the financial report by Sanquan Foods. Sanquan Food said in the financial report that the consumer side showed a weak recovery during the reporting period, especially in the fourth quarter of 2023, the competition for dumplings products was more fierce, in addition, there is a certain correlation between the sales of stuffing products such as dumplings and pork prices, and the long-term weakness of pork prices has a negative impact on the sales of such products. At the same time, due to the festival attributes of some products superimposed with the fluctuation of economic restoration, the recovery differences are obvious in different quarters.
Data show that the current frozen dumpling industry has formed Sanquan Food, missing Food, Wanchai Wharf as the "Big three", Haiba Wang, Anjing Food (603345) and other leading enterprises competing for hegemony, CR10 (the market share of the top 10 companies in the industry) is as high as 73.3%.
In recent years, however, sales of frozen dumplings have declined as a whole. The market share of frozen dumplings fell by 1.26% and 3.21% in 2022 and 2023, respectively, according to the online retail monitoring network of Quick win. During the Spring Festival in 2024, sales of frozen dumplings in offline channels across the country fell by 19.26% compared with the same period last year.
Wu Daiqi, CEO of Shenzhen Siqisheng Company, said the decline in sales of frozen food may be related to the growing choice of prepared dishes, self-heating food and other categories. Frozen food is popular among consumers because of its speed and convenience, but it also takes a certain amount of cooking time. When there are more and more convenient categories such as prepared dishes, consumers have more and more choices, which has affected the decline of frozen food sales to a certain extent.
When the market tends to be saturated, the competition will naturally become more fierce, and those who can seize more of the market will have more competitive advantages. And Sanquan Food seems to have a great advantage in the market competition, from the financial report, the same main frozen food listed enterprises Anjing Food, Qianwei Central Chef's performance is growing.
According to the financial report, in 2023, Anjing Foods achieved operating income of about 14.045 billion yuan, an increase of 15.29 percent over the same period last year. Net profit belonging to shareholders of listed companies was about 1.478 billion yuan, an increase of 34.24 percent over the same period last year, of which revenue from frozen rice noodle products increased by 5.4 percent over the same period last year. The operating income of Qianwei Central Kitchen last year was 1.901 billion yuan, an increase of 27.69% over the same period last year. The net profit belonging to shareholders of listed companies was 134 million yuan, an increase of 31.43% over the same period last year, of which income from frozen food increased by 27.68%.
Fierce battle for B-end catering business
As the market of frozen rice products tends to be saturated, finding new growth points has become an important work for many brands. Anjing Foods said bluntly in the financial report that quick-frozen rice products are in the mature stage of the industry, of which the traditional three are currently in the late mature stage, and the prefabricated food is a Chaoyang track with strong certainty. As a result, Anjing Food is rapidly laying out the field of prefabricated dishes. In 2023, the company's revenue from frozen food products was about 3.927 billion yuan, an increase of 29.84% over the same period last year, accounting for 27.96% of the total revenue. The production, sales and inventory of frozen dish products increased by 29.52%, 32.71% and 61.12% respectively compared with the same period last year.
Miss Food is not yet on the market, there is no specific performance data released. But from this year's Lantern Festival popular network-wide "persimmon Ruyi" dumplings sales, we can see that enterprises are also making efforts to differentiate the track. Miss food said that due to the serious homogenization of quick-frozen products, it is difficult for categories such as glutinous rice dumplings to create breakthrough differentiation selling points, so they have developed and launched 3D glutinous rice dumplings and promoted them through social channels such as Little Red Books. This new product, persimmon Ruyi tangyuan, which was launched only in October last year, has sold more than 100 million yuan in the first few months on the market, and has quickly become a Top1 in the category of Little Red Book tangyuan.
Sanquan Food is no exception, from the financial report, group meals, catering and other businesses are becoming Sanquan Food new business. For a long time, the competition of quick-frozen rice products enterprises is mainly concentrated in the C-end market, which has formed a fully competitive market pattern, but with the increasing demand for semi-finished food materials in the catering industry, the demand potential for quick-frozen noodle rice products increases. The catering end has become a new blue ocean in the quick-frozen noodle industry.
Sanquan Foods said in the financial report that the company adjusted the business strategy of chain catering channels last year and attached importance to the development of customized products. Sanquan Food specially launches brands such as "Sanquan Green Standard" and "Fast Kitchen" for catering channels to carry out product development and production around the catering market. According to the financial report, the company's catering market achieved revenue of 1.43 billion yuan in 2023, an increase of 17.9% over the same period last year, and its gross profit margin increased by 4.02% over the same period last year.
However, in terms of revenue share, the catering market accounts for only 20.27%, which has not yet better supported the performance of Sanquan Food. From the market level, in addition to Sanquan Food, many enterprises in the industry began to pay attention to the B-end catering market, and the competition gradually increased. For example, Anjing Food adjusted its business strategy at the end of 2018 and launched the sub-brand "Mr. Frozen", which is specially positioned in the catering materials category and cut into the catering channel; missing Foods has also set up the BP Division, which is mainly aimed at chain catering, group meals, convenient cooked food, restaurant banquet channels to provide products for catering customers, and gradually began to develop B-end catering business.
In the view of Zhu Danpeng, a Chinese food industry analyst, Sanquan Foods has some problems such as brand aging, product aging, and operating system aging, which have caused great constraints on the company's development, and the innovation and upgrading have lagged behind in the iterative acceleration. Can not keep up with the pace of the whole consumption change. Although Sanquan Food has increased its layout in group meals and catering, the overall effect is not very obvious. With the entry of more leading enterprises in the industry in the future, the original brand scale effect of Sanquan Food will gradually weaken.
Jiang Han, a senior researcher at Pangu think tank, suggested that Sanquan Foods should pay attention to the changes in consumer demand and the development of market trends, adjust its product structure and management strategy in time, and increase R & D and innovation, such as launching healthier and delicious quick-frozen foods for young consumers, or developing frozen rice products with local characteristics. At the same time, strengthen advertising, carry out online and offline promotional activities, enhance brand image, establish close cooperative relations with e-commerce platforms, supermarket chains and other partners, broaden sales channels and improve market coverage.
Beijing Business Daily reporter Guo Xiujuan Zhang letter