Itsuwa Interim Report: Operating Revenue Decreases by 24% to 120M Yuan, Contract Manufacturing Business Sees 29.55% Drop

Recently, Shenzhen Itsuwa Co., Ltd. (833767) released its 2024 interim report.

The report shows that in the first half of 2024, the total operating revenue was approximately 120 million yuan, a decrease of 24% compared to the same period last year. The gross profit margin was 27.46%, a decrease of 7.73% from the previous year. 

The net loss attributable to shareholders of the listed company was approximately 19.35 million yuan, a decrease of 184.42% compared to the same period last year.

The report stated that the company continued to focus on overseas markets such as Europe and America in the first half of the year. By the first half of 2024, there was fierce competition among e-cigarette products, with the company's differentiated advantage not being clear, resulting in a decrease in sales.

Among them, the revenue from self-owned brands was approximately 39.22 million yuan, a decrease of 9.02% compared to the same period last year, with a gross profit margin of 25.91%, down by 3.48% from the previous year; revenue from OEM/ODM was approximately 82 million yuan, a significant decrease of 29.55% compared to the same period last year, with a gross profit margin of 28.21%, down by 9.13% from the previous year.

Furthermore, due to a decrease in outsourcing orders, the company reported a 76.50% decrease in domestic sales revenue compared to the same period last year, as well as a 2.58% decrease in domestic gross profit margin. This is primarily because of intense competition in the overseas e-cigarette market for homogenized products, leading to a decrease in prices for sales to companies holding e-cigarette tobacco business licenses (brand-holding enterprises) compared to the same period last year.

Due to intense competition in the overseas market for homogenized products in the first half of the year, export revenue decreased by 23.39% compared to the same period last year, while export costs decreased by 13.92% compared to the same period last year.

The company stated that their research and development focus in the first half of 2024 will be on pod e-cigarettes and cartridge e-cigarettes, as well as promoting their own brands VAPESOUL and VOOM in the high-end e-cigarette market.