CBO reporter Guo Fen
In terms of cosmetics, Freda Biotech still maintained a strong growth momentum, with an increase of 117.01% year-on-year for the whole year, achieving operating income of 1.495 billion yuan. Among them, Dr. Yaoer achieved an operating income of 744 million yuan in the whole year, an increase of 272.14% year-on-year.
Yesterday (April 14), Lushang Development, the parent company of Shandong Freda Biological Co., Ltd. (hereinafter referred to as Freda Biological Shares), released its 2021 annual financial report.
According to the financial report, in 2021, the company achieved operating income of 12.363 billion yuan, a year-on-year decrease of 9.2%, a total profit of 644 million yuan, a year-on-year decrease of 24.58%, and a net profit attributable to the owners of the parent company of 362 million yuan, a year-on-year decrease of 43.34%.
For the decrease in revenue and net profit, Lushang Development explained in the annual report that the main reason is that the market situation in the second half of the year is grim, the sales price is down, and the company has recorded an asset impairment of 187.8 million yuan for some healthy real estate project products; and the settlement income of healthy real estate has decreased by about 20% compared with the same period last year, and the gross profit has declined, affecting the net profit attributable to the shareholders of the listed company.
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Year-on-year increase of 117.01%
Freda Beauty sold 1.495 billion yuan in 2021
It is worth noting that although the health local business sector has declined due to the impact of the market downturn, the biomedical sector has continued to grow, and the cosmetics, pharmaceutical, raw materials and additives businesses have continued to exert strength. In particular, cosmetics still maintained a strong growth momentum, with a year-on-year increase of 117.01% year-on-year, achieving operating income of 1.495 billion yuan. In addition, the gross profit margin was 63.68%, up 4.54% year-on-year, and the operating cost also increased by 92.89%.
For the growth of the cosmetics business, the company said that on the one hand, the company pays attention to the development of its own brands, forms the company's brand matrix with product differentiation strategy, improves the brand reputation, reduces oem processing at the same time, and significantly increases self-selling products; on the other hand, in the post-epidemic era, the sales of offline supermarkets have declined, and the company has successively withdrawn from RT-Mart, Qingdao Fuxingxiang and other supermarkets, actively expanding sales models, developing more than 100 direct stores and franchise stores.
It is reported that after a diversified layout and improvement, Freda Bio has formed a differentiated brand matrix based on Yilian, Dr. Yaoer, Ipal Khan, Shanyan, UMT, Yirun, etc.
From the perspective of sales channels, the cosmetics business of Freda Biotech is mainly divided into online sales and offline sales. Online mainly rely on Tmall, Taobao, JD.com, Youzan and other platforms to sell, opened a number of brand flagship stores, and through douyin and other social platforms, live sales. Offline sales mainly rely on supermarkets and dealer models, and have now covered hundreds of stores such as Ginza and Hualian in Shandong Province.
In 2021, the turnover of the online sales channel of the cosmetics business of Freda Bio co., Ltd. was 1.396 billion yuan, an increase of 144.84% year-on-year, accounting for 93% of the total revenue of cosmetics; the gross profit margin was 64.38%, an increase of 3.36% year-on-year; the turnover of other sales channels was 98.641 million yuan, down 16.82% year-on-year, and the gross profit was 53.86%, an increase of 3.77% year-on-year.
At the R&D level, the company continued to increase R&D investment during the reporting period, and the R&D investment in pharmaceutical cosmetics accounted for 4.96% of the revenue of the pharmaceutical cosmetics business. In 2021, a total of more than 160 new products will be developed (of which 84 are self-owned brands have been listed), and more than 40 product upgrades will be carried out. Applied for 25 patents, including 7 invention patents. At the same time, the company also takes scientific and technological research and development as the guide, and has successively launched patented ingredients such as silanized hyaluronic acid and brown algae, building brand and technical barriers, and achieving sales breakthroughs in a number of products.
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Dr. Yair's revenue in 2021 is 744 million yuan
In the future, Freda will realize the "4+N" brand development strategy
Specific to the brand, in 2021, the performance of the two brands of Yilian and Dr. Yier grew rapidly, the Yilian brand achieved operating income of 646 million yuan in the whole year, an increase of 73.08% year-on-year, and Dr. Yier achieved operating income of 744 million yuan for the whole year, an increase of 272.14% year-on-year.
In the creation of different brands, Freda Bio co., Ltd. selects different channels through different market strategies, highlighting the differentiated way of playing.
Take the micro-ecological skin care brand Dr. Yaoer as an example, in 2021, Dr. Yaoer has outstanding ability to create explosive products. The four explosive products are cleansing honey, banana mask, probiotic water milk, and leading essence, and the four major products account for about 70% of total sales. In April 2021, Dr. Yaer launched a new product, anti-gravity water milk, adding a patented ingredient of brown algae fermentation, and its sales exceeded 10 million in the months of going online.
At the same time, in terms of sales model, Dr. Yaoer brand adopts the idea of comprehensive online and offline layout and multi-channel common development, online channels are mainly Tmall flagship stores, and the volume of vibrato is rapid; offline construction of new retail system, force colorist, KKV, Sanfu fashion, Xiyan and other CS channel new formats, has been laid out in more than 100 cities, covering more than a thousand core business districts across the country.
It is worth noting that due to the optimism about the development of Freda Biologics shares, In 2021, Tencent Venture, a subsidiary of Internet giant Tencent, will contribute 351 million yuan, accounting for 8.04% of the total share capital after the completion of the capital increase, becoming the second largest shareholder of Freda Biologics.
At the same time, based on the forward-looking judgment and research on the prospects of the cosmetics industry and its own development potential, Shandong Freda Pharmaceutical Group Co., Ltd. launched the construction of the Zhimei Science and Technology Innovation Park project in 2019, one of which is a new cosmetics factory, which has been completed and put into operation in 2021. The industrial park plans to design 35 cosmetics production lines such as water emulsion, mask, spray, and secondary throw, with an annual output value of more than 4 billion yuan, which can meet the capacity expansion needs of Freda Biotech in the next 3-5 years.
For the future, Lushang Development said in the financial report that the cosmetics sector will implement the "4 + N" brand development strategy, continue to enlarge the brand potential, build a high-quality resource system, and drive the efficient growth of various brands. That is, with the four main brands of Yilian, Dr. Yaoer, Shanyan and Iparhan and the corresponding skin care technology track, relying on the core advantages of "cosmetics homology, scientific and technological skin beautification", we will explore more emerging skin care technologies such as high-end ingredients of light medical beauty, precious Chinese herbal skin care ingredients and cutting-edge gene therapy, realize the innovative development of skin care products of all ages, and continuously expand the company's industrial chain, innovation chain, supply chain and value chain. In terms of brand, adhere to the brand drive, do explosive business, do private domain traffic, and exert force on live broadcast channels to achieve rapid growth of offline stores.