2023 semi annual report | More nutritious, smarter, and greener. Mengniu is committed to high-quality growth
On August 30th, Mengniu Dairy released its interim performance announcement for 2023. The announcement shows that in the first half of this year, Mengniu's revenue increased by 7.1% against the trend, reaching RMB 51.12 billion, operating profit was RMB 3.27 billion, a year-on-year increase of 29.9%, and the operating profit margin continued to increase to 6.4%, expanding by 1.1 percentage points, achieving comprehensive high-quality growth. Among them, the sales of milk brands such as ambient temperature Trunsu and Mengniu have led the industry's growth, while the low-temperature sector has held the top market share for 19 consecutive years. The fresh milk sector has continued to grow rapidly, and the ice cream sector has achieved double-digit compound growth for three consecutive years.
In the first half of this year, Mengniu focused on consumer value creation as its core driving force, accelerated the transformation of RTM channels, further consolidated its business foundation, and deepened its efforts in the three dimensions of "green, nutrition, and intelligence", achieving comprehensive leadership in innovation, brand power, digital intelligence, and sustainable development. With higher quality and more valuable development, Mengniu is steadily moving towards the strategic goal of "creating another new Mengniu".
More nutritious, leading a better life value service
In the first half of the year, Mengniu adhered to consumer value driven innovation, continued to create new products, explore new tracks, and continuously meet consumers' aspirations for a better life.
Mengniu's largest single product in the global dairy industry, "Trensu", focuses on the brand proposition of "desert organic, is better organic", leads the high-end upgrading of the dairy industry, and continues to expand its leading advantage in the high-end milk market share; In response to the trend of enhancing consumer immunity and returning to low-temperature yogurt, the low-temperature sector has launched a new series of "fresh yogurt" products. Its subsidiary Guanyi Milk has positioned itself as the only "health brand" yogurt in China and launched immunity enhancing products, achieving Mengniu's low-temperature business to maintain market share for 19 consecutive years; The new benchmark of high-end fresh milk, "Daily Fresh Language," has launched a new product called Juan Shan 4.0 fresh milk, promoting the upgrading of fresh milk consumption nutrition and driving Mengniu's fresh milk business to continue to outperform the industry; In February of this year, Mengniu officially entered the professional nutrition track and launched the sports nutrition brand "Maisheng". With China's pioneering liquid protein technology, it opened up a new track for domestic liquid protein supplements.
At the same time, Mengniu adheres to independent research and development, deeply cultivates nutrition and health technology innovation, and continuously breaks through the industry's "bottleneck" problem: in the field of low-temperature yogurt, in May this year, Mengniu's independently developed local probiotic PC-01 Lactobacillus paracasei won the Chinese Patent Silver Award, which is the highest award in the dairy industry in China's patent field; In the field of breast milk research, actively promote the industrialization process of independent breast milk oligosaccharide HMOs; In the seed industry, Mengniu has independently developed the liquid phase genome chip "Modern 1" and launched the "Million Cow Gene Improvement Plan" to continuously improve indicators such as cow yield level, health and longevity, and population uniformity.
Smarter, leading the digital upgrade of the entire industry chain
Digitalization is the only way for the dairy industry to achieve efficiency leaps and business model changes. Mengniu regards digitalization as a core component of its FIRST strategy, aiming not only to achieve digitalization of the entire industry chain from grass to glass, but also to become a leader in digitalization for future healthy ecosystems. Recently, Mengniu officially released the Digital Intelligence 3.0 strategy, focusing on building AI driven digital intelligence dual flying wheels, achieving a comprehensive intelligent upgrade from the supply side to the consumption side.
On the supply side, the world's first fully intelligent factory, Mengniu Ningxia Factory, was officially completed and put into operation in May this year. The factory has achieved the "Three 100's" - with 100 employees, an annual production capacity of 1 million tons, and an annual output value of 10 billion yuan. The per capita efficiency has increased by 20 times compared to traditional factories, creating the highest annual human efficiency ratio in the global dairy industry. In addition, the "Cloud Cattle Farming" smart ranch created by Mengniu has achieved precise care for each cow through IoT technology, currently covering 341 ranches and nearly one million cows.
On the consumer side, Mengniu empowers townships and villages to sink through digital tools, seizing opportunities in new retail channels and scenarios such as O2O, community, and live streaming, accelerating RTM channel transformation, and strengthening omnichannel control capabilities. In April, Mengniu launched the "WOW Health+" digital intelligence platform, which provides comprehensive personalized services to help consumers have a healthier and more energetic lifestyle, achieving good "emotional interaction" and "digital links" with consumers. In addition, Mengniu has also released the world's first nutrition and health field model - MENGNIU GPT, based on this model, has also introduced "AI Nutritionist Meng Meng" to consumers, aiming to provide 24/7, high-quality, and personalized nutrition and health services for Chinese families, focusing on solving the problems of low coverage of Chinese nutritionists and high costs of using health services in households.
Greener, leading low-carbon and sustainable development
Since the beginning of this year, Mengniu has been continuously promoting the implementation of GREEN's sustainable development strategy. Through carrying out 15 issues and 28 actions, it has driven comprehensive carbon reduction in the six major links of the entire industry chain and continuously led the transformation of green development in the dairy industry.
In the upstream, Mengniu has achieved comprehensive carbon reduction in upstream pastures by optimizing the structure of its cattle herd, adjusting feed composition, optimizing manure management, and improving energy efficiency. Its subsidiary, China Holy Animal Husbandry, has also planted 97 million trees in the Ulanbuh Desert, greening over 200 square kilometers of the desert, and sequestering 110000 tons of carbon, creating the world's only desert organic milk source; In the production process, Mengniu's national level green factories have increased to 27, and Qujing factory has become the first domestic and international dual certified zero carbon factory in China's dairy industry. Qingyuan factory and three other factories have obtained the zero waste factory certification issued by T Ü V Rheinland in Germany; In the downstream, Mengniu continues to promote the "greenization" of its products, and multiple products under its umbrella, such as Ruibu En, have obtained carbon neutrality certification. Four products from Future Star have been selected in CGF's "Golden Design Principles Case Set".
In addition, to lead industry chain partners in practicing green development, Mengniu has also issued forest protection policies, committing to achieving the goal of "zero deforestation by 2030" and eliminating deforestation risks throughout the entire supply chain. At the same time, Mengniu has also joined the WEF World Economic Forum's "Global Leading Initiative for Planting Trillion Trees" and launched the "Every Goal counts as a Tree" activity, aiming to encourage more public participation in the "Reducing Carbon and Greening the Earth" initiative.
As one of the top ten preferred brands for Chinese consumers, Mengniu adheres to a long-term brand philosophy and insists on supporting China's aerospace industry as a gold medal partner for 20 years. The two sides also launched a new phase of strategic cooperation for the next 10 years in April this year. At the same time, Mengniu has partnered with FIFA for the fourth time to become the official global sponsor of the 2026, 2030 FIFA World Cup, and 2027 FIFA Women's World Cup, continuously collaborating with world top event IPs to bring health and happiness to consumers worldwide.
"True world leadership depends not only on scale and sales, but also on whether it can bring more value and contribution to the industry, consumers, and the world," said Lu Minfang, CEO of Mengniu. He stated that in the future, Mengniu will continue to focus on the three strategic directions of "nutrition, intelligence, and green", continuously meet the diversified needs of consumers, accelerate the construction of a world-class Chinese dairy enterprise, and comprehensively lead the high-quality development of China's dairy industry.
