China Want Want's revenue grows without profit increase; channel shift prioritizes profit reduction

Rising costs, surging expenses, and channel transformation are jointly squeezing China Want Want’s profit performance.

On June 30, China Want Want Holdings Limited disclosed its annual results for the year ending March 31, 2026.

During the reporting period, the company achieved revenue of 24.401 billion yuan, a year-on-year increase of 3.8%; sales volume saw high single-digit growth year-on-year; profit attributable to equity holders was 3.837 billion yuan, a decrease of 11.5% compared to last year.

Rising raw material costs, increased expenses following organizational adjustments, and heightened investment during the transition between old and new channels have collectively squeezed the profit margin.

On the cost side, affected by increased unit consumption costs of imported whole milk powder and palm oil, the company’s gross margin dropped from 47.6% last fiscal year to 46.3%, down 1.3 percentage points year-on-year.

Compared to the external hard inflation brought by raw materials, the surge in operating expenses due to internal organizational restructuring has been the main internal driver for the decline in operating profit.

In fiscal year 2025, Want Want’s distribution costs increased by 16.9% year-on-year to 3.54 billion yuan, accounting for 14.5% of revenue; administrative expenses rose 11.4% year-on-year to 3.352 billion yuan, making up 13.7% of revenue.

Previously, Want Want reorganized its product categories and set up new business units accordingly. After organizational segmentation, the number of staff positions increased, and employment costs rose in tandem, resulting in an 8.9% year-on-year increase in total compensation for fiscal year 2025.

Meanwhile, to enhance consumer awareness of new and niche products among different groups, Want Want ramped up its investment in marketing and cross-promotional activities. During the reporting period, advertising and promotional expenses accounted for 3.8% of revenue, up 1.1 percentage points year-on-year.

Looking at major product performance, Want Want still relies on its core categories, but growth momentum has become differentiated.

Dairy and beverages remain the largest source of income. In fiscal year 2025, this segment achieved 12.343 billion yuan in revenue, a year-on-year increase of 1.9%, accounting for about 51% of total revenue.

Within this segment, Want Want Milk saw a slight decline of 0.3% in revenue year-on-year, affected by the overall sluggish dairy market. As Want Want’s most important major product, Want Want Milk still provides a solid foundation, but its single explosive product pull has lessened compared to the past.

Rice crackers achieved revenue of 5.936 billion yuan, a year-on-year increase of 0.5%, with sales volume posting low single-digit growth; snack foods recorded revenue of 5.915 billion yuan, up 10.4% year-on-year, making it the best-performing segment among the three major categories, with sales volume posting double-digit growth.

Candy subcategory saw low double-digit growth in annual revenue year-on-year, reaching a historic high; ice products, snack cakes and pastries, beans, jellies and other subcategories also achieved high single-digit to low double-digit growth.

The changes in category structure are essentially the result of a shift in channel focus.

In fiscal year 2025, traditional wholesale and modern channels, accounting for nearly 70% of Want Want’s total revenue, saw high single-digit declines year-on-year. Meanwhile, snack wholesale and emerging channels are quickly filling the gap, now accounting for about 15% of total revenue.

Online and other emerging channels have likewise become sources of incremental growth. The financial report shows e-commerce, OEM and other emerging channel revenue achieved double-digit growth year-on-year, accounting for low double-digit proportions of total revenue.

Channel directions are already being adjusted, but short-term effects still appear as rising expenses and declining margins.

Chairman Tsai Eng-Meng confessed in his letter to shareholders that the group’s “Conquer the Cities, Want Win the World” strategy, implemented over nearly two years, “has not been very ideal overall, and still has a certain distance from the set goals.”

To address this, the board has decided to moderately reduce the final dividend ratio for fiscal year 2025 to retain more cash reserves to cope with short-term uncertainties such as domestic consumption weakness.

For fiscal year 2025, Want Want plans to pay a final dividend of US$0.0138 per share, compared to US$0.0204 per share last year. Calculated per share, this is a decrease of US$0.0066, a decline of about 32.4%.

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