Strategic Brands Revenue and Group Profitability Momentum both Heightened despite Persisting Macro Challenges
HONG KONG, Aug. 30, 2023 /PRNewswire/ -- Goodbaby International Holdings Limited ("Goodbaby International" or the "Company", HKEX stock code: 1086, together with its subsidiaries, the "Group"), a leading global parenting products company, announced its unaudited interim results for the six months ended 30 June 2023 (the "Period"). Revenue of the Group's strategic brands and profitability momentum accelerated during the Period. Revenue of the strategic brands returned to positive growth, with stronger momentum into the second quarter. With its positive momentum of profitability improvement continuing into the Period from the second half of 2022, the Group's operating profitability had significantly improved. The Group also generated strong operating cash inflow during the Period.
During the Period, Group revenue was approximately HK$3,889.2 million (1H 2022: HK$4,372.8 million). Reported gross profit increased by 5.9% to approximately HK$1,784.8 million (1H 2022: HK$1,684.9 million). In addition, the reported operating profit surged by 499.5% to approximately HK$112.7 million (1H 2022: HK$18.8 million). Net profit amounted to approximately HK$29.9 million (1H 2022: HK$2.4 million), representing a remarkable increase of 1,145.8%.
CYBEX achieves record high revenue and operating profit and successfully gains market share
Despite the persistently challenging market conditions and the presence of geopolitical conflicts, the CYBEX brand recorded strong growth of 11.2% (a 14.4% increase on a constant currency basis) in the Period to reach a record first half revenue of approximately HK$1,814.8 million (1H 2022: HK$1,631.8 million). Consumer demand for CYBEX products remained very strong, resulting in record high half year revenue and operating profit. The growth momentum was primarily driven by very strong brand position, innovative product portfolio, and continuous expansion of its global omni-channel distribution network. In particular, the successful launch of its e-commerce platform in Europe and the United States has played a significant role in driving this growth. CYBEX has consistently outperformed market players, gaining market share in key markets, reinforcing its global leading position as the premium "technical-lifestyle" brand.
gb remains committed to right-sizing its business in response to the changing consumer behaviors in the post-pandemic era and decline in birth rate
Revenue from the gb brand was approximately HK$638.6 million (1H 2022: HK$791.7 million). The brand consistently pursued business right-sizing and underwent transformation to adapt to the changing consumer behaviors in the post-pandemic era and birth rate decline in China. In addition, gb continued to enrich its consumer-centric retail strategy through an enhanced product portfolio. During the Period, the brand received an award from the prominent iF design organization, in recognition of its upgraded innovative products.
Evenflo displays resilience by outperforming competitors and expanding its market share
Revenue of the Evenflo brand amounted to approximately HK$1,101.3 million (1H 2022: HK$1,229.7 million). Despite the impact from destocking by major retailers in the United States, Evenflo continued to outperform the competition and expand its market share in the key US market through growth in digital channels, strong consumer acceptance of its innovative products, elevated product portfolio and brand image. The brand also recorded promising momentum in its gross margin evolution, driven by a successfully improved product mix and input costs decrease.
Outlook
Looking ahead, CYBEX will continue its global growth strategy across all key geographical regions and further increase its market share with an innovative product portfolio, new product launches, category extensions, e-commerce platforms and expansion of national distribution platforms in new geographic territories. Conscious cost control measures, combined with the stabilization of key supply chain costs, will continue to improve profitability. The gb brand will further right-size and transform its business to provide a strong focus on profitability and maintain positive cash flow. It will continue its brand upgrade, further development of social media-based owned channels, complete the reformation of its wholesale distribution channel, and focus on product innovation, technologies and new product launches, which will establish the foundation for profitability improvement. Evenflo will continue to launch new and more profitable products and gain new business from major retailers, as the brand is recognized for its commitment to overall brand enhancement and product innovation. The improved product mix and stabilization of supply chain costs will continue to contribute to the brand's gross margin development.
Mr. Tongyou LIU, CEO of Goodbaby International said, "Despite facing macro challenges, the Group has demonstrated strong resilience and achieved favorable performance in the first half of 2023. We maintain cautious optimism for the rest of the year, considering potential headwinds such as retailer and customer destocking in certain markets, weaker consumer sentiment and slow economic recovery globally. However, by leveraging the Group's one-dragon vertically integrated platform of own diversified brands, globally balanced omni-channel distribution platforms, and own manufacturing and operational services, we are confident in our ability to continue gaining market share and sustaining global competitiveness. Furthermore, the Group is well-equipped to navigate through macro uncertainties and drive long-term, profitable growth."
About Goodbaby International Holdings Limited
Goodbaby International Holdings Ltd. (stock code: 1086) is a world-leading parenting products company. The Group serves millions of families around the world through design, research and development, manufacture, marketing and sales of children's car safety seats, strollers, apparel and home textile products, feeding, nursing and personal care products, cribs, bicycles and tricycles and other children's products.
For more information, please visit Goodbaby's corporate website: www.gbinternational.com.hk.
