China Mengniu Dairy Co on Thursday reported a drop in first-half revenue, while its gross profit margin saw an improvement over the period.
The Chinese dairy giant’s revenue for the first six months of 2025 slumped 6.9 percent from a year earlier to about 41,567 million yuan ($5.81 million), according to its interim financial statement. Its gross profit margin rose 1.4 percentage points to 41.7 percent, while its operating profit margin climbed 1.5 points to 8.5 percent.
Gao Fei, the company’s chief executive officer and executive director, said certain parts of the industry continue to face challenges; combined with shifting consumer demand and changing retail channels, these factors have weighed on the sector’s overall development.
But several of Mengniu’s business segments delivered revenue growth in the first half, as the company’s efforts to optimize its product mix began to take effect, Gao added.
The fresh milk segment recorded double-digit growth, outperforming the broader industry and driving notable market share gains. Revenue from its milk formula business also rose, increasing by over 40 million yuan than last year to 1,675.6 million yuan.
ALSO READ: Chery 'near HK listing' as billion-dollar IPOs return to city
Meanwhile, profit attributable to shareholders came in at 2,045.5 million yuan for the period. The group said it plans to scale up its share repurchase in the following 12 months to further enhance shareholders returns and long-term value.
Looking ahead, Chief Financial Officer Zhang Ping predicts that profitability is likely to remain under pressure in the second half due to a slower-than-expected consumption recovery. However, full-year operating margins are expected to be flat compared with last year.
The group also expressed confidence in margin expansion over the longer term, supported by its evolving product portfolio. Zhang said non-milk products have achieved average operating margin improvements of around 1 percentage point in recent years, and are expected to surpass the margins of the room-temperature milk segment within the next two to three years.
China Mengniu Dairy Co’s Hong Kong-listed stock dropped 2.22 percent to close at HK$15.84 per share on Thursday.
Contact the writer at gabylin@chinadailyhk.com
