Miao Kelan is more than 30 billion, bet on Wang Yibo can turn over?

Produced by Radar Finance and Economics, edited by Li Yihui, Deep Sea

Miaokelando, whose performance frequently "alarms", officially announced the replacement of its spokesperson.

On May 9, Miaokeland posted on the official Weibo, announcing actor Wang Yibo as the new brand spokesperson, and related topics quickly appeared on the hot search list. The use of obvious spokespersons to strengthen brand endorsement and recognition is one of the communication strategies of Microcolan, and the company has also placed it on CCTV, Dragon TV, Focus and other media platforms to maintain the brand communication volume.

However, Microcolando, which claims to be the No. 1 cheese brand, is experiencing a slowdown in performance growth. In 2023, the company will usher in the first decline in revenue and profit after listing, which has attracted market attention. In the first quarter of this year, the company's revenue continued to decline.

In addition to the dismal results, the company's market value has shrunk significantly. The share price of Microcolando reached a high of 84.5 yuan per share in May 2021, and the market value once exceeded 40 billion yuan. But up to now, the company's market value has only more than 7 billion yuan, which has also caused its major shareholder Mengniu to suffer a lot of losses.

It is worth mentioning that on the same day that the new spokesperson was officially announced, Microcolando was also caught in the "trans fatty acid" controversy. The reason is that the ingredient list of Microcolando cheese products contains an ingredient called "edible oil products", and the name is actually another name for trans fatty acids, the daily intake of trans fatty acids should not exceed 2.2g, excessive intake of trans fatty acids can increase blood cholesterol, thereby increasing the risk of cardiovascular disease. This has also caused concern among many netizens.

The official announcement of the replacement of the spokesperson

On May 9th, Microcolando held its new brand spokesperson official announcement and new product launch conference on Yuyuan Road, Shanghai, with the theme of "Cheese Together, Awesome".

At this event, Wang Yibo was officially introduced as the new brand image spokesperson, and Microcolando released the news on its Weibo, WeChat and other channels.

At the same time, at the press conference, Microcolando also launched a series of new products, including flower cheese sticks, cod cheese, shredded cheese, etc.

It is reported that the launch of the new spokesperson and the launch of the new spokesperson is one of the actions of the transformation of the business strategy. In recent years, Microcolando has launched a variety of innovative products for adult consumer groups while iterating on the large single product of cheese sticks.

The Sakura Roselle Flavored Flower Cheese Stick and Osmanthus Oolong Flavored Flower Cheese Stick launched this time belong to the adult ready-to-eat nutrition series, which is characterized by a sucrose-free, low-GI formula.

Enhancing brand image and popularity through celebrity endorsement is one of Microcolando's communication strategies in recent years. On September 20, 2020, the company officially signed a contract with film and television star Sun Li to fully endorse Microcolando's cheese sticks, mozzarella, cheese slices and other products.

According to the 2020 annual report, it is an important measure for Microcolanto to strengthen precision marketing and market launch by enhancing brand image through celebrity endorsements, improving consumer awareness through consumer interaction and joint marketing, and at the same time carrying out brand marketing on multiple platforms, dimensions and channels such as e-commerce marketing, TV advertising, building advertising, high-speed rail advertising, offline promotion, online celebrity live streaming, and new media.

Also from 2020, the sales expenses of Microcolando have increased significantly, from 359 million yuan in the previous period to 710 million yuan year-on-year, due to the company's cheese business is in a period of rapid expansion, channel investment and brand building have led to an increase in advertising and promotion expenses, and the increase in the number of sales personnel has led to an increase in employee compensation.

Since then, Microcolando's sales expenses have continued to pass. Flush iFinD data shows that from 2021 to 2023, the sales expenses of Microcolando will be 1.159 billion yuan, 1.219 billion yuan and 939 million yuan respectively, and the research and development expenses in the same period will be 40 million yuan, 51 million yuan and 46 million yuan respectively, which is only a fraction of the marketing expenses.

According to the 2023 annual report, in addition to celebrity endorsements and precise placement on major mainstream media platforms, the company also exclusively titled classic programs such as "Mamma Mia Season 8" and "Tide Boy World", and carried out hot topic marketing activities during the popularity of many dramas.

In terms of content marketing, the company increased the investment in digital media, carried out multi-dimensional brand marketing on WeChat, Weibo, Xiaohongshu, Douyin and other platforms, and actively interacted with consumers.

Some analysts have pointed out that cheese is a fast-moving consumer product, mainly driven by marketing, but it is not a one-time solution. According to the data, from 2017 to 2022, the sales expense ratio of Microcolando increased from 12.47% to 25.24%.

Perhaps aware of the pressure brought about by the rapid growth of marketing expenses, the company will reduce its advertising and promotion expenses in 2023, from 822 million yuan in the previous period to 554 million yuan, resulting in an overall year-on-year decrease of 23% in sales expenses in the same period.

However, even with the implementation of the above-mentioned fee reduction measures, the gross profit margin of Microcolando has declined instead of rising in the past year. According to the data, from 2021 to 2023, the company's gross sales margin will be 38.21%, 34.15% and 29.24% respectively.

In 2023, revenue and net profit will both decline

It is worth noting that on the same day that the new spokesperson was officially announced, the topic of "Microcolan Multi Trans Fatty Acids" rushed to the hot search on May 9, arousing consumers' attention to the food safety of trans fatty acids.

The reason is that some netizens discovered that the ingredient list of Microcolando cheese products contains an ingredient called "edible oil products". The netizen believes that behind this "pseudonym", the actual ingredient is trans fat.

According to the literature, trans fatty acids are unsaturated fatty acids produced during industrial processing and are usually found in hydrogenated vegetable oils, which are often used to make pastries, biscuits, fast food and some dairy products. Consuming too much trans fatty acids may increase total cholesterol and drop HDL significantly, increasing the risk of atherosclerosis and coronary heart disease.

In this regard, some netizens commented, "It's terrible", "Is this for the flowers of the motherland". However, some media said that Miaokeland said in response that it is recommended that children eat slowly, and that all products are produced in line with national standards, and they are also paying attention to this matter, and will reply with subsequent results.

According to the 2023 annual report, Microcoland's main business is the research and development, production and sales of specialty dairy products with cheese as the core, of which cheese sticks, cheese slices and mozzarella cheese are the core products during the reporting period, which are the main driving factors for the company's performance growth.

Kantar data shows that in 2023, the market share of Microcolando cheese will exceed 35%, and the market share of cheese sticks will exceed 40%, ranking first in the industry.

However, even if it occupies the leading position in the industry, the performance of Microcolando has continued to decline.

According to the financial report, in 2022, the company will achieve a total operating income of 4.83 billion yuan, a year-on-year increase of 7.8%; The net profit attributable to the parent company was 135 million yuan, a year-on-year decrease of 12.3%. The company attributed the decline in net profit to factors such as poor transportation and logistics, rising raw material prices, intensified competition, and weak consumption.

In 2023, Microcoland's revenue will be 4.049 billion yuan, a year-on-year decrease of 16.16%; The net profit attributable to the parent company was 63.44 million yuan, a year-on-year decrease of 53.9%, which was also the first time that the revenue and profit of Miaokeland fell after its listing.

Regarding the decline in profits, Microcolando said that the net profit decreased mainly due to the slowdown in the growth rate of the industry in 2023, the increase in the cost of main raw materials for cheese compared with the same period last year, the decrease in the company's foreign exchange lock-up income, and the increase in net interest expenses compared with the same period last year.

According to the revenue structure, as the company's revenue pillar, the cheese business achieved revenue of 3.137 billion yuan last year, a decrease of 18.91% over the same period last year. At the same time, due to the dual fluctuations of the raw material market and exchange rate, the cost of main raw materials increased compared with the same period last year, resulting in a year-on-year decrease of 3.72 percentage points in the gross profit margin of the company's cheese segment.

Overall, the cheese business, which accounts for nearly 80% of the company's total revenue in recent years, determines the direction of Microcolando's overall performance. However, some data show that on the one hand, the cheese industry is cooling down significantly, and on the other hand, the industry is becoming more and more competitive.

Based on the data in the offline retail monitoring network, from January 2022 to the present, the overall sales of the cheese category have shown a significant downward trend. In terms of average sales, in 2022, 2023 and the first quarter of 2024, the average value of the cheese category is in a downward channel.

In the dairy category, the share of cheese has fallen from a peak of 5.92% in January 2022 to about 3.5% in the first quarter of 2024, a decline of about 40%, which is almost halved.

In addition, in the past few years, cheese products have been regarded by dairy companies as one of the most important directions for expanding their categories, and giants have entered the market. Dairy companies such as Mengniu, Sanyuan, Guangming, and New Dairy have almost increased the research and development and market launch of this category.

In this case, the "first cheese stock" Microcolando will also face more pressure. The latest results show that in the first quarter of 2024, the company's net profit attributable to the parent company increased significantly year-on-year, but the revenue decreased by 7.14% year-on-year.

The market value has shrunk sharply, and Mengniu has lost money

The predecessor of Miaokeland is a ill-fated Shandong pesticide.

Tianyancha data shows that in 1988, Shandong Dacheng Pesticide Co., Ltd. was established. In 1995, Dacheng Co., Ltd. landed on the Shanghai Stock Exchange, and the company's main business at that time was dichlorvos, dimethoate and other chemical pesticides and chlor-alkali.

In 2012, Dacheng Co., Ltd. placed all the chemical pesticide assets and liabilities, and at the same time placed 100% equity of Hualian Mining, and fully transformed into an enterprise with iron ore mining and dressing as its main business.

The good times did not last long, and Hualian Mining once again brewed restructuring after achieving negative growth in performance for three consecutive years. And this time it was Chai Xiu, the founder of Miaokelando, who took over.

Chai Xiu, from Yanbian, Jilin Province, once worked in Zhongbai Commercial Building, a state-owned commercial enterprise, and later went to the sea to start a business as an agent for leisure food. "When the business was good, I could sell 3 potato chips of the Train Leather Hometown brand in one month." You know, another business counted by train cars is the former richest man Mou Zhong.

In this way, Chai Xiu spent 98 million yuan to develop Baicheng New Century Plaza only three years after going to the sea. After entering the commercial real estate, Chai Xiu took out 50 million yuan in 2001 to establish Jilin Guangze Dairy, and in 2008, he began to lay out the cheese industry.

Eight years later, in 2016, Microcolando landed in the capital market through asset restructuring through backdoor Guangze shares. Since then, what has made Miaokelan a lot of noise is that it has caught up with the dairy giant Mengniu.

On January 6, 2020, Microcolando announced that Mengniu signed the Share Transfer Agreement with a number of shareholders of the company, and Mengniu acquired 20,467,853 unrestricted tradable shares of Microcolando at a price of 14 yuan per share, accounting for 5% of the total share capital of Microcoland, with a total price of about 287 million yuan.

By July 2021, Mengniu once again increased its shareholding ratio to 28.46% with a fixed increase of 3 billion yuan, becoming the controlling shareholder of Microcoland.

According to the first quarter report of 2024, Inner Mongolia Mengniu Dairy (Group) Co., Ltd. holds 36.51% of the shares of Microcoland, and Chai Xiu directly holds 14.81%.

After "hitchhiking" Mengniu, the share price of Microcolando ushered in a rapid rise, hitting the highest point of 84.5 yuan per share at the end of May 2021, but it has been declining since then, and the closing price as of May 10 was 14.39 yuan per share. According to media statistics, Mengniu's several holdings have a total floating loss of more than 2 billion yuan.

"Last year, my financial statements were not good, and I was also very sad, our stock fell from 84 yuan to less than 13 yuan today, and our billions of net worth are gone." At the 2024 China Business Mulan Annual Meeting held recently, Chai Xiu, founder and CEO of Microcoland, said.

She also admits that the company has encountered some challenges, such as the cheese industry, which declined at a rate of 20% last year. However, due to the fact that after the Miaokeland cheese stick became a hit, hundreds of cheese stick companies were established in China, and the company was faced with the problem of how to go next.

In addition to being sad, Chai Xiu is also reflecting, she said that last year, the company's cost rose by more than 100 million yuan due to supply chain problems. Therefore, it is hoped that with the expansion of the scale of the enterprise, the cost advantage can also be created, and become another moat in addition to the brand.

Can Chai Xiu get his wish? Radar Finance will continue to pay attention.