On April 25th, Huazhi Liquor Store (300755. SZ) announced the first quarter of 2024, the company's operating income in the first quarter was 4.133 billion yuan, a year-on-year increase of 10.42%, and the net profit attributable to shareholders of listed companies was 130 million yuan, a year-on-year increase of 28.24%. In recent years, the trend of high-end and high-quality domestic alcohol consumption has become increasingly prominent, and the market share has further concentrated to mainstream brands. According to the annual financial report of Huazhi Liquor Store, in 2023, the company will achieve operating income of 10.121 billion yuan, a year-on-year increase of 16.22%.
Regarding the 2023 annual results, Huazhi Liquor Company said, " 2023 is a year full of challenges, in the face of the extremely complex international environment and arduous tasks of reform, development and stability, as well as the continuous recovery of the domestic consumer alcohol market, the company has further consolidated and deepened the long-term cooperative relationship with well-known wineries and wine merchants at home and abroad, continuously strengthened the layout of the omni-channel marketing network covering the whole country, continuously improved the construction of high-quality marketing team, improved the service level, and adjusted the marketing strategy in a timely manner according to market changes, so as to consolidate the company's leading position in the domestic market in the field of wine circulation. ”
Efforts will be made to promote the comprehensive upgrade of the 3.0 store system
In 2023, under the background of weak recovery and deep adjustment of the development of the liquor industry, Huazhi Liquor Store will take the core area as the anchor point, actively promote the comprehensive upgrade plan of chain stores, continue to build diversified and differentiated stores, and adopt the large-store model, high-end model and boutique model to promote the development of new stores and store upgrades to present a new trend of "synergy and progress".
During the reporting period, the company's flagship stores successively landed in Beijing, Changsha, Hefei, Haikou, Kunming, Qingdao, Ningbo, Dalian and other places. From the Shanghai World Financial Center to the Zhujiang New Town in Guangzhou, from Chenghu Road in Suzhou to the Bell Tower in Xi'an, Huazhi Liquor Store has opened stores in more and more provincial capitals and sub-provincial cities, and the scope of its marketing network system has continued to expand, effectively stimulating the consumption potential of high-tier cities and further highlighting its brand influence.
At the same time, the company is based on 3.0 stores that integrate wine purchase, tasting, leisure and entertainment, banquets, cultural exchanges, etc., closely connecting core cities and expanding the sinking market. During the reporting period, a total of 201 Huazhi Liquor Store 3.0 stores were developed, the quality, area and image of the stores were significantly improved, and the scene of the integration of multiple composite business formats was gradually constructed, bringing consumers an all-round and three-dimensional experience of "immersive wine tasting", meeting the diversified needs of customers, and enhancing the attractiveness of Huazhi Liquor Store to franchisees and consumers. At present, Huazhi Liquor Store has a huge sales network covering 2,000+ stores and 30,000+ outlets in the offline terminal, which promotes the company to always maintain a leading position in the "channel is king" liquor industry, especially in the field of circulation.
More importantly, under the industry trend of consumption upgrading and expanding domestic demand, the company actively builds an omni-channel marketing network system including Huazhi chain stores, retail outlets, KA stores, group buying, and e-commerce, and focuses on expanding the scale of online channels. At present, the company's self-operated e-commerce platform "Huazhi Liquor Store Flagship Store" has developed steadily, and has simultaneously deployed channels such as JD.com and Tmall and increased marketing efforts to promote the sales growth of e-commerce business.
Huazhi Liquor Store said that in 2024, it will deepen the layout of the core market, continuously standardize the operation and management behavior of stores, achieve "precise development, gradual upgrading, and orderly exit", and gradually realize the full-chain management of the chain store supply chain, so as to further maintain the social credibility and market competitiveness of the Huazhi brand.
Strive to create a "one super and many strong" product matrix
The upgrade of stores and the improvement of channels have promoted Huazhi Liquor Store to have closer ties with franchisees and consumers. In terms of product innovation and upgrading, in 2023, as the dominant force of liquor consumption shifts to business consumption and mass consumption, the company will fully strengthen its interaction with end consumer groups, actively participate in product development based on the insight and analysis of market demand, on the one hand, select high-quality liquor with high brand awareness and quality-price ratio for sales, and on the other hand, cooperate with liquor companies to jointly develop new products that meet market demand, and provide consumers with diversified and personalized choices.
At present, the company's 3.0 stores can provide more than 4,000 high-quality, fidelity mid-to-high-end liquor products. During the reporting period, the company relied on the stable cooperation with well-known upstream wine companies and wine merchants for many years, and expanded and upgraded the cooperative products. For example, during the reporting period, the company jointly launched the "Golden Internal Reference" with Jiuguijiu Liquor to expand the product matrix of "Golden Signboard", jointly launched the "Gujinggong Ancient 20 Ice and Snow Collector's Edition" with Gujinggong Distillery, jointly launched the "Lai Gaohuai Works Collector's Edition" with Lai Gaohuai, and upgraded its strategic cooperation with Penfolds to become the exclusive agent of the Penfolds Tribute Series 178th Anniversary Limited Edition and Penfolds Dragon Limited Edition.
It is worth noting that in recent years, Huazhi Liquor has further met the needs of high-net-worth customers in terms of banquets, gifts and tastings, gradually built a two-wheel driven business model of "famous wine + fine wine", and continued to make efforts and increase marketing investment in fine wine. Since 2021, the company has cooperated with domestic liquor companies to develop high-quality liquor products such as "Kweichow Moutai Liquor (Gold)", Lotus "Jade" series, "Diaoyutai Fine Liquor (Iron Cover)", "Gujing Gongjiu 1818", "Hutou Fenjiu" and "Xijiu Cellar 1988 (Gild)", and the market popularity continues to rise. Among them, Lotus Liquor Jinrui Tianhe won the "Grand Gold Award", the highest award of the 2022 "Oscar of the Wine Industry" Brussels International Spirits Grand Prix in Belgium. In terms of marketing, in 2023, the launch conference of "Golden Internal Ginseng" will be held at the foot of Nanhua Mountain, the ancient city of Phoenix in Xiangxi, Hunan Province, to show the unique cultural connotation of "Golden Internal Ginseng" with drama and dance art and immersive experience.
Huazhi Liquor Store insists on developing high-quality liquor, which has significantly enhanced the brand tonality and influence, and provided new momentum for the company's performance growth. The joint development of new products with well-known wineries and winemakers not only ensures product quality, but also strengthens the cooperative relationship. It is reported that in 2024, the company will also launch more high-quality products focusing on mid-to-high-end consumers, creating a matrix of "one super and many strong" boutique wines to meet the rich choices and advanced needs of consumers.
Guoyuan Securities said, "In the short term, we are optimistic about the improvement of the company's profitability brought about by the increase in the proportion of fine wine and the effective control of expenses, and in the long term, we are optimistic about the company's core competitive advantages established by the improvement of its own brand operation ability and the efficiency of a single store." ”
Launched the brand of "Gold Medal Waiter of Famous Distillery".
Famous liquor resources and channel advantages are the core competitiveness of Huazhi Liquor Store, and the increasing improvement of the product matrix is relying on the resources of a number of famous liquor brands, and the company has established long-term and stable strategic cooperative relations with well-known domestic and foreign liquor companies such as Kweichow Moutai, Wuliangye, Fenjiu, Jiuguijiu, Lafite, Penfolds, etc. While providing high-quality and rich products for end consumers, the company is also providing efficient and convenient services for production enterprises, and has gradually become a key link between well-known wineries and the mass consumer market.
In 2023, Huazhi Liquor Store will continue to uphold the values of "always be a gold medal waiter of a famous winery", cooperate deeply with upstream famous wineries, strengthen stickiness with downstream outlets, and build a market-leading supply chain management system. For the downstream, Huazhi Liquor Store's fidelity measures such as sealing labels and bottle labels intuitively reflect the brand credit in the appearance of the product and increase the credit premium for the product. For the upstream, the fidelity system can maintain the product quality system that manufacturers are most concerned about, ensure that the products sold to the downstream are genuine, and enhance the confidence of the winery in Huazhi channels. Relying on the company's multi-level, wide-coverage, and direct supply terminal channel advantages for the whole country, upstream production enterprises can directly distribute products to all parts of the country through the company, and strengthen their control over the quality of products in the terminal market.
In addition, during the Reporting Period, the Company successfully opened a Moutai store and the first batch of Moutai Stores in China, bringing consumers a more convenient, high-quality and efficient consumption experience.
Based on the precise service to cooperative brands, consumers and franchisees, in 2023, the brand value of Huazhi Liquor Store will reach a new high, reaching 27.186 billion yuan, and it will win the first place in the 2023 China Customer Satisfaction Index "Liquor Chain", and the company will be awarded the "National Product and Service Quality Integrity Demonstration Enterprise" and "National Advanced Enterprise of Quality and Integrity" in the 2023 "3.15" International Consumer Rights Day "Product and Service Quality Integrity Commitment" theme activity sponsored by the China Quality Inspection Association National liquor chain sales industry, quality leading brand" and many other honors.
Guosheng Securities believes that Huazhi Liquor Bank is a leading distributor in the field of domestic liquor circulation, with stable upstream cooperative relations, strong channels, brand and operational capabilities, and gradually expands the boutique liquor business, optimistic about the scarcity of high-end leaders and the growth ability of the sub-high-end track under the continuous integration of the liquor pattern in the future, and recognizes the value of diversified category layout. Referring to the company's 2023 performance, maintain a "buy" rating.