Three Squirrels' Revenue Up 16.42% While Net Profit Down 29.51% in 1H 2020

Three Squirrels has released its 2020 semi-annual report. The report shows that the company recorded revenue of CNY 5.25 billion, a year-on-year increase of 16.42%; net profit attributable to the parent was CNY 188 million, a year-on-year decrease of 29.51%.

The third-party e-commerce platform generated CNY 4.44 billion revenue, accounting for 84.54% of the operating income, while the self-operated APP experienced CNY 25 million revenue, accounting for 0.48% of the operating income.

Specifically, the gross profit margin was 25.7%, a year-on-year decrease of 5%. The gross profit margin of various products declined collectively. Among them, the gross profit margin of nut products with the most significant revenue was 23.94%, a year-on-year decrease of 6.64%. For other products such as bakery, meat products, dried fruits, the margin decreased by 2.31%, 5.40%, and 4.32%, respectively.

In terms of stores, 38 outlets opened. As of the end of the period, a total of 139 stores achieved operating income of CNY 310 million, accounting for 5.90% of operating income; 209 new alliance stores opened, with a total of 478 stores as of the end of the period, achieving operating income of CNY 157 million, accounting for 2.99% of operating income.

Three Squirrels claimed that the flow of online platforms was further dispersed, and the multiple flow entrances caused the flow of mainstream e-commerce channels to decline, and the growth of online sales to slow down. The company has taken active measures to expand the e-commerce channel through emerging tools such as live broadcasts and short videos with the help of digital technology, which has increased customer acquisition costs while ensuring sales growth.