Looking at New Consumer Trends from Half Year Reports (Economic Focus)

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The rapid growth of catering consumption, the continuous recovery of flight numbers, and the improvement of smart home appliance sales... The warmth of consumption is not only reflected in macro data, but also in micro performance. Recently, multiple listed companies have successively disclosed their semi annual performance reports. From the overall performance perspective, while the revenue of consumer listed companies has increased, their profitability has also significantly improved, reflecting the strong vitality of consumer demand growth and continuous market expansion in the first half of the year.

Tourist attractions are crowded, movie box office records have been set, and railway summer travel has reached a new high... This summer, consumer vitality continues to be released. According to data from the National Bureau of Statistics, the total retail sales of consumer goods exceeded 20 trillion yuan in the first half of this year, reaching 22.8 trillion yuan, a year-on-year increase of 8.2%, significantly faster than the full year of last year; In the first seven months of this year, the retail sales of services increased by 20.3% year-on-year.

Consumer warmth is not only reflected in macro data, but also in micro performance. Recently, multiple listed companies have successively disclosed their semi annual performance reports. What new ideas are surging in the warmth of observing the consumer market through the semi annual reports of listed companies? What are the consumption expectations for the second half of the year? The reporter interviewed relevant departments, listed companies, and industry experts.

The demand for service consumption is strong, and the profitability of enterprises has significantly increased

Lingnan fragrant and refreshing skin chicken, Guangdong style crispy glutinous meat with tempting aroma, Lingnan window flowers, and colorful embroidery decoration around, the dining environment is full of characteristics... In May this year, the first store of Guangzhou Restaurant, a time-honored Cantonese restaurant, opened in Shanghai, attracting East China diners to try Cantonese cuisine.

"The rapid growth of catering consumption has driven us to accelerate our store layout and expand the catering market." Chen Yang, the Secretary of the Board of Directors of Guangzhou Restaurant, said that since the beginning of this year, the consumption scene has gradually recovered, and the implementation of consumption promotion policies has been effective. The company has achieved a synergistic linkage between the two main businesses of "catering+food", expanding the market while also enhancing brand awareness. The time-honored brand is shining with new brilliance. In the first half of the year, Guangzhou Restaurant is expected to achieve a year-on-year increase of 22.57% in revenue and a year-on-year increase of 39.86% in net profit.

On one hand, there is a comprehensive recovery in catering consumption, and on the other hand, there is a concentrated release of tourism demand.

"Anniversary free tickets" and "popular ticket sales"... Recently, the Spring and Autumn Airlines 10000 ticket special promotion has sparked a wave of ticket buying. "The passenger occupancy rate continues to rise, turning losses into profits in the first half of the year!" Zhang Wu'an, spokesperson for Spring Airlines, said that in the first half of this year, the domestic flight volume exceeded the same period in 2019, and international routes also accelerated the recovery. More than 100 countries and regions resumed group tourism, fully unleashing the willingness of tourists to travel, driving the company's main business to significantly improve.

Zhang Wu'an introduced that in the first half of the year, the net profit of Spring Airlines is expected to be 650 million to 850 million yuan. "From the current booking situation, the demand for tourism during the National Day and Mid Autumn Golden Week is even stronger. In the second half of the year, with the further recovery of international routes, in addition to explosive growth during holidays, daily travel will also accelerate growth." Zhang Wu'an analyzed.

According to statistics from the Shanghai Stock Exchange, in the first half of the year, listed companies in the cultural, tourism, hotel, and catering industries on the Shanghai Stock Exchange accelerated their recovery. As of August 15th, 13 such listed companies have released mid-term performance data and are expected to achieve a total net profit of 1.6 billion yuan, achieving a significant turnaround in losses comprehensively.

"As of August 18th, the disclosure rate of performance reports and profit forecasts for the first half of the year of listed companies is close to 50%. Based on the disclosed company performance, the service consumption industry has shown good recovery elasticity in the first half of the year. With the recovery of offline passenger flow and travel activities, there has been a certain degree of supply shortage in some areas, which has also provided some support for price increases." Li Qiusuo, Chief Domestic Strategy Analyst of the Research Department of China International Capital Corporation, said that the service consumption sectors such as catering, tourism, hotels, offline retail, and cinema lines have recovered quickly, indicating a trend of China's consumption pattern gradually shifting from commodity consumption as the main focus to both commodity and service consumption.

From the overall performance perspective, while the revenue of consumer listed companies has increased, their profitability has also significantly improved. As of August 15th, data from 38 retail and wholesale listed companies in the Shanghai Stock Exchange that have disclosed their mid-term performance data shows that they are expected to achieve a total net profit of 13.2 billion yuan, a year-on-year increase of 36%.

As of August 23, a total of 38 daily consumer listed companies in Shenzhen have disclosed their 2023 semi annual reports, achieving a total operating income of 291.861 billion yuan, a year-on-year increase of 11.57%; Realized a net profit of 8.614 billion yuan, a year-on-year increase of 348.09%. Among them, 36 companies saw a year-on-year increase in revenue, while 18 companies saw a year-on-year increase of over 20% in revenue; A total of 34 companies achieved profitability.

Upgraded product sales growth, integrated development of online and offline

"Look, this is the top mounted constant temperature fresh freezing system of the refrigerator, which allows the temperature fluctuation of frozen ingredients to be less than 0.2 degrees Celsius, greatly improving the freshness retention rate and reducing bacterial growth." On August 22, at the Hefei Department Store, citizen Zhang Shaohua, after careful comparison with the staff, purchased Changhong Meiling's "frozen fresh" refrigerator. "We have a large family and a strong demand for frozen and fresh ingredients. Take advantage of the summer shopping mall's promotional activities to try high-tech new products," said Zhang Shaohua.

"The domestic home appliance market has entered a mature period, and the competition in the industry is very fierce. However, the constantly upgrading consumer demand has opened up new market increments for us." Zhong Ming, President of Changhong Meiling Co., Ltd., introduced that in response to consumers' higher requirements for refrigerator preservation, the company has increased research and development efforts and accelerated product structure upgrading. In the first half of the year, the company's refrigerator and freezer business revenue increased by 22.54% year-on-year.

"Not only does the upgrading of traditional household appliances such as refrigerators, air conditioners, and washing machines provide strong support for performance, but new products such as small household appliances also bring new growth momentum." Zhong Ming analyzed that in the first half of the year, the company's intelligent tea art machines and other small household appliances and kitchen and bathroom businesses achieved revenue of about 853 million yuan, a year-on-year increase of 17.21%.

"From the performance of listed companies in the commodity sales category in the first half of the year, the automotive and home appliance sectors achieved good profit growth, while some companies' overseas exports maintained resilience, providing support for performance. At the same time, the sales of upgraded products grew rapidly, and the growth trend of new consumption related to young people was good, including sales growth of small appliances, medical beauty, cosmetics, trendy toys and other new consumption, which was better than the overall growth of consumption." Li Qiusuo said.

According to the analysis of the Shanghai Stock Exchange, based on the semi annual reports of listed companies on the Shanghai Stock Exchange, the consumer group and demand have shown a diversified and upgrading trend, with many highlights: the performance of the home appliance industry has maintained growth, and smart home appliances are favored by young consumer groups; The rise of domestic beauty products has led to the expected net profit of 800 million yuan, a year-on-year increase of 83%, for four listed companies in Shanghai, including Perrier and Shanghai Jiahua; The product structure of the food industry has been upgraded, and prefabricated dishes have become a new type of consumer product. 35 food and beverage companies are expected to achieve a net profit of 47.5 billion yuan, a year-on-year increase of 20%

At the same time as stable growth in product sales, the profitability of listed companies in the category of product sales has also improved. Li Qiusuo's analysis: "With the decrease in upstream raw material costs, the cost pressure on the consumer industry has eased compared to the past two years, and the gross profit margin has generally improved, especially in the manufacturing industry where raw materials such as automobiles and household appliances account for a relatively high proportion."

In the view of Tian Lihui, Dean of the Financial Development Research Institute at Nankai University, there is another distinctive feature in the six-month performance of the consumer sector - continuous growth in online consumption, and significant growth in sales revenue of e-commerce and traditional retail enterprises through e-commerce channels.

"The company achieved a year-on-year increase of 32.58% in revenue and 47.41% in net profit in the first half of this year. As the main entry point for new consumers, online channels provided strong support for performance growth." The relevant person in charge of Thomson Bejian Co., Ltd. stated that the online channel revenue of the main brand of Thomson Bejian increased by over 60% year-on-year in the first half of the year.

"Many listed companies have strengthened the integration of online and offline development, gradually forming new retail models to meet the dual needs of consumers for shopping experience and convenience. In addition, branding has become an important means for listed companies to cope with consumer upgrading. Some companies have improved their product added value and premium ability by enhancing their brand image, strengthening brand marketing, and other means." Tian Lihui analyzed.

Optimize product and service supply, promote consumption improvement and upgrading

"While seizing the key competitive advantage of taste, Guangzhou Restaurant is committed to combining traditional cuisine, regional culture, and emerging consumer concepts to meet more levels of catering needs," said Chen Yang.

"On the basis of maintaining safety bottom lines, Spring Airlines strengthens data mining and analysis, continuously improves flight punctuality, optimizes product portfolio and travel services through its own channels, and further stimulates travel demand," said Zhang Wuan.

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Listed companies are not only an important window for observing the consumer market, but also a strong driving force for promoting high-quality development.

"Retail and consumer category listed companies on the Shanghai Stock Exchange represent leading domestic production technologies and marketing concepts, and have played a significant leading role in the recovery of consumption in the first half of the year." Yang Delong, Chief Economist of Qianhai Open Source Fund, analyzed that on the one hand, listed companies have stronger resource allocation capabilities and can respond to the latest consumption hotspots and changes in a timely manner. They also cultivate new consumption habits by continuously strengthening product innovation and exploring consumption patterns; On the other hand, leading enterprises can cultivate and incubate more new consumer industry chain companies and strengthen the consumer industry circle through external investment and mergers and acquisitions.

Li Qiusuo believes that the high-quality development of consumer listed companies not only ensures the stability of the supply side, but also meets the new consumption needs of residents for a better life through continuous innovation and upgrading, which helps to expand domestic demand, promote consumption upgrading, and accelerate the formation of a higher level dynamic balance of demand driven supply and supply created demand.

Since the beginning of this year, various departments have successively launched policies to promote consumption of home and electronic products, and support consumption promotion policies such as new energy vehicles. With the implementation and effectiveness of policies, as well as the gradual stabilization of economic development and household income, experts believe that there is still great potential for consumption expansion and upgrading in the next stage. Listed companies should continue to be the "locomotive" and lead the industry in improving quality and upgrading.

"China's industrial upgrading will continue to be an important foundation for consumption upgrading, and the continued recovery of service consumption is still an important trend. Listed companies should actively increase research and development investment, closely integrate products with new technology applications, and further improve supply quality." Li Qiusuo believes that with the help of innovative technology, various types of consumption are expected to continue to develop in a more comfortable, convenient, clean, beautiful, and healthy direction.

Tian Lihui suggests that listed companies should optimize product and service supply by strengthening technological innovation and research and development, improving supply chain efficiency, improving product quality, and strengthening brand building, in order to continuously promote the high-quality development of the consumer market.