Introduction:The star product of Yangyuan Beverage, Six Walnuts, once became a nationwide sensation with its slogan "Use your brain often? Drink more Six Walnuts." However, in recent years, it has faced challenges such as declining revenue and a lack of product diversification. In the first half of 2024, the company saw a slight drop in revenue but an unexpected rise in net profit, which raised questions in the market. This article delves into the highlights and concerns of its financial report, exploring how Yangyuan Beverage can find new growth points in the plant-based protein beverage market.
When it comes to plant-based protein beverages, many consumers immediately think of "Six Walnuts." Thanks to its catchy slogan, "Use your brain often? Drink more Six Walnuts," this product once achieved astonishing sales. However, as the market environment has changed, the performance of its parent company, Yangyuan Beverage, has started to fluctuate. According to its 2024 semi-annual report, the company's revenue in the first half of the year was approximately 2.942 billion yuan, a slight year-on-year decline of 2.02%, but its net profit reached 1.03 billion yuan, marking a year-on-year increase of 12.97%, presenting a peculiar phenomenon of "revenue down, profit up."
Notably, on the day the semi-annual report was released, Yangyuan Beverage’s stock price plummeted to a daily limit down, closing at 19.23 yuan, a drop of 8.82%, with its total market value shrinking to 24.335 billion yuan, reflecting investors' concerns about its future development. In fact, since its IPO in 2018, the company’s market value once peaked at 60.999 billion yuan, but has been declining year by year and has yet to return to its peak.
Yangyuan Beverage’s flagship product, Six Walnuts, has long accounted for over 90% of the company’s revenue. However, in recent years, the sales growth of this star product has significantly slowed, even showing signs of decline. The industry generally believes this is related to the brand’s over-reliance on a single product, high market saturation, and diversified consumer choices. Meanwhile, the company’s newly launched product line — the Yangyuan Plant Milk series — generated only about 1.315 million yuan in revenue for the entire year of 2023, which is almost negligible compared to the 5.7 billion yuan scale of the walnut milk product line.
A deeper analysis of its financial structure reveals that Yangyuan Beverage has long pursued a business strategy of "heavy marketing, light R&D." According to public data, between 2014 and 2018, the company’s advertising expenses totaled as much as 2 billion yuan, while R&D investment during the same period was only 0.19 million yuan, a disparity exceeding 100 times. Even in the first half of 2023, sales expenses were still as high as 318 million yuan, 22 times that of the 13.98 million yuan spent on R&D. Such resource allocation has clearly left the company lagging behind market trends in innovation and product iteration.
Regarding the decline in first-half revenue, the company explained that it was mainly due to weakened market demand, but it did not elaborate on the reasons behind the unexpected profit growth. Industry analysts believe this may be related to effective cost control. Semi-annual report data shows that operating costs, advertising expenses, and administrative expenses all decreased — by 5.33%, 0.07%, and 1.91% respectively — which helped mitigate the impact of the revenue decline to some extent.
However, the risks of long-term reliance on Six Walnuts are becoming increasingly apparent. As Chinese consumers become more health-conscious, competition in the plant-based protein beverage market is intensifying. Emerging categories such as sugar-free drinks, oat milk, and almond milk are constantly emerging, giving consumers more diverse choices. If Yangyuan Beverage fails to adjust its product mix, increase R&D investment, and successfully develop new star products soon, its future market competitiveness will continue to be tested.
In summary, Yangyuan Beverage is facing a transformation challenge of "thriving because of Six Walnuts, struggling because of Six Walnuts." In today’s rapidly evolving market for plant-based milk and healthy beverages, only by accelerating innovation, optimizing its product portfolio, and re-evaluating its brand positioning and marketing strategies can it find a way forward in the fierce market competition and write a new chapter for the brand.
The above content is compiled by CoffeeHunters, a coffee news website.
