In 2023, the Chinese economy showed a sustained recovery and steady improvement. Despite the challenges, which posed threats to consumer-oriented enterprises, Guoquan responded by effectively managing the supply chain and enhancing operational efficiency, thereby bolstering the profitability. During the Reporting Period, Guoquan recorded the revenue of RMB6,094.1 million, the gross profit of approximately RMB1,350.9 million, reflecting an 8.2% year-on-year growth, and the gross profit margin of approximately 22.2%, improving 4.8 percentage points from 17.4% in the same period of 2022. Furthermore, Guoquan achieved the net profit of approximately RMB263.4 million, representing an increase of 9.3% compared to the same period in 2022. The adjusted net profit reached approximately RMB318.0 million, marking a year-on-year increase of 23.8%. Besides, the operating cash flow represents a year-on-year increase of 137.7% to reach RMB678.3 million.

On November 2, 2023, Guoquan was listed on the Main Board of the Hong Kong Stock Exchange, marking a new milestone in the development. Starting from March 4, 2024, Guoquan officially accessed to the Hong Kong Stock Connect, which is expected to enhance the liquidity of the Company’s stock and gradually highlight its investment value. Additionally, to better reward shareholders, the board of directors proposed the payment of final cash dividend of RMB 0.0521 per share (inclusive of tax), with an estimated total distribution of RMB 143 million, demonstrating Guoquan’s emphasis on shareholder interests.

Expansion of offline stores and acceleration of online channels

In terms of channels, Guoquan has established a nationwide store network to occupy market share. During the Reporting Period, Guoquan’s store network expanded despite the sluggish consumption trend. As of the end of 2023, Guoquan had 10,307 retail stores, covering 31 provinces, autonomous regions, and municipalities, a net increase of 1,086 in the number of stores compared to the end of 2022, further expanding the market influence.

Meanwhile, to empower franchisees and facilitate the sales growth as well as further our consumer reach and offer more flexible shopping experience, we have established multiple online channels, including Guoquan APP, WeChat mini-program, third-party food delivery platforms, Douyin and other popular social commerce platforms. In 2023, through multi-level Douyin accounts for live streaming of Guoquan products or posting related short videos, the total views exceeded 6 billion times.

By establishing close online and offline connections and interactions with consumers, Guoquan achieved a record high number of members, with the top-up amount increasing by 18% annually to approximately RMB720 million. As of the end of 2023, Guoquan had approximately 27.9 million registered members.

Continuous Enrichment of product matrix and digital intelligence driving product innovation

Guoquan has provided offered diversified, tasty, convenient and affordable home meal products in a one-stop shop manner for consumers across a wide range of dining scenarios.

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