This is an English adaptation of a FoodBud historical article originally published on August 28, 2022.
FoodBud's late-August 2022 FB Inspire roundup focused on a wave of mid-year filings from Chinese foodservice chains and suppliers, plus a few international restaurant-tech and governance items.
In the first half of 2022, Helens reported revenue of RMB 874 million, broadly flat year on year. Adjusted net loss was RMB 99.936 million, while net loss was RMB 300 million.
Helens' own products contributed 75.8% of revenue in the period.
As of August 21, 2022, Helens had 821 stores. Between the end of June and August 21, it had a net closure of 25 stores.
Performance weakened versus the prior year: average daily sales per directly operated store fell from RMB 12,000 to RMB 7,200 in the first half, and same-store sales declined 32.6%.
Bakery brand Ganso reported first-half revenue of RMB 1.0 billion, up 4.4% year on year. Net profit was RMB 62.036 million, roughly flat year on year.
Online sales revenue grew 31% year on year in the first half, surpassing offline sales revenue.
Ganso had 743 stores, a net increase of 35 versus the prior year. Its ending balance of prepaid card and voucher receipts was RMB 830 million. Revenue from unused stored-value cards exceeded RMB 15 million in the first half.
Lady M's China agency company announced via its public account that it would close all Lady M mainland China stores on September 10, 2022.
FoodBud noted that if the business had been sufficiently strong, the operator might have tried a local rebrand, comparing the idea to the Russian Starbucks successor changing stores to Star Coffee.
Baoli Foods, a Yum China T1 supplier, reported first-half 2022 revenue of RMB 911 million, up 26.07% year on year. Net profit attributable to listed-company shareholders was RMB 92.7639 million, down 3.86%.
Its Kitchen A-Fen business, mainly Kongke pasta, generated RMB 400 million in first-half revenue and RMB 20.84 million in net profit.
By first-half receivables, Baoli's top five counterparties were Yum China, Sunner, Tyson China, Shandong Fengxiang and Dicos.
Other Yum China T1 supplier figures:
Meituan reported first-half 2022 revenue of RMB 97.2 billion, up 20.3% from RMB 80.775 billion in the prior-year period. Its loss for the period narrowed 16.9% to RMB 6.819 billion from RMB 8.2 billion.
In Q2, revenue from core local commerce was RMB 36.779 billion, including:
As of the end of June 2022, Meituan had 680 million transacting users and 9.2 million active merchants.
As of August 2022, Meituan's drone delivery had landed in four commercial districts in Shenzhen, with routes covering more than 10 communities and office buildings and over 75,000 consumer orders completed. Meituan's autonomous delivery vehicles had been operating routinely in Beijing Shunyi for more than two years, covering over 50 communities, with more than 2.4 million outdoor delivery orders and autonomous-driving mileage exceeding 97%.
Jiahe Foods, a non-dairy creamer supplier to the milk-tea sector, reported first-half revenue of RMB 960 million, down 13.3% year on year. Net profit attributable to listed-company shareholders was RMB 33.615 million, down 53.32%.
Beyond non-dairy creamer, Jiahe was developing coffee and plant-based businesses. Coffee had become Jiahe's second-largest business, with its revenue share rising from 3.54% the prior year to 7.96%.
Its core coffee brand Jinmao Coffee generated first-half revenue of RMB 83.6 million and a net loss of RMB 3.305 million.
FoodBud noted that bad-debt control appeared relatively sound, but warned that supplying fast-changing new beverage brands can require strict risk management: selling inputs into a hot category is not automatically a good business.
Receivables were roughly 10% of sales revenue. Earlier IPO materials had disclosed major customers including Mixue Bingcheng, Guming, Auntea Jenny and Yihotang.
Jiahe's external investments included:
Shake Shack founder Danny Meyer invested USD 10 million in voice-AI company ConverseNow. As part of the transaction, Meyer would join ConverseNow's board.
In August 2021, ConverseNow completed a USD 15 million Series A round. At the time of the article, cumulative financing had reached USD 28.8 million.
FoodBud framed the investment around drive-thru ordering, a larger use case in many international markets. ConverseNow helps restaurants handle voice order recognition, and McDonald's was also working on the area.
The article also noted that delivery ordering in many international markets still relied on call centers, while Chinese service platforms had already gone through years of call-center digitization and mobile-internet migration. FoodBud's view was that Chinese companies may have advantages in internationalizing service technology, though voice recognition had not become universally adopted in China either.
McDonald's board was undergoing changes. Sheila Penrose, who had served on the board for more than 15 years, resigned. Marriott's CEO, Johnson & Johnson's global chairman and Salesforce's president and CFO were set to join McDonald's board in October 2022.
Penrose had overseen sustainability and corporate responsibility matters. She had previously been challenged by billionaire Carl Icahn, who criticized McDonald's handling of pregnant pigs.
Icahn bought USD 500 million worth of McDonald's shares over the issue and nominated a director candidate, but the nomination was rejected.
According to a recently disclosed first-instance criminal judgment from the People's Court of Tianxin District, Changsha, Hunan Province on China Judgments Online, three Wenheyou Food Company employees, including then legal representative Liao, were sentenced for duty encroachment and accepting bribes as non-state employees. The case involved more than RMB 1 million.
The judgment said Liao became head of Wenheyou Food Company at the end of 2020 and legal representative on February 26, 2021. During the period, Zhou headed logistics and Fan worked in merchant selection.
The three employees solicited payments from four supplier companies through kickbacks: Hunan Dongting Yulang Food Co., Ltd., Changde Fenzhiyuan Food Co., Ltd., Yueyang Yuzhiyuan Food Co., Ltd. and Canguang Food Co., Ltd.
Liao and Zhou jointly accepted RMB 1.88 million in kickbacks. Liao actually received RMB 1.316 million, Zhou RMB 564,000, and Fan received RMB 5,000 from Zhou.
The Tianxin District court ruled:
The court also ordered confiscation of Liao's illegal proceeds held in a China Merchants Bank account, RMB 372,937.91, plus RMB 943,000 returned by Liao. Zhou's illegal proceeds of RMB 564,000 and Fan's RMB 5,000 were to be further recovered and confiscated. Zhou was ordered to compensate the victim company RMB 1.101 million.
On August 23, 2022, Wenheyou publicly said it had actively cooperated with the police investigation after the case was filed and had zero tolerance for corruption. CEO Feng Bin said on WeChat Moments that the company would prevent similar incidents and that personnel and business operations were stable.
Jiumaojiu Group was mainly betting on Tai Er Sauerkraut Fish and Song Hot Pot. In the first half of 2022, it opened 37 new stores: 35 Tai Er stores and two Song Hot Pot stores.
Tai Er's table turnover fell from 3.7 in the prior year to 2.9 in the first half of 2022. Same-store sales revenue declined 23%.
Song Hot Pot's table turnover rose slightly, from 2.2 to 2.4. Same-store sales grew 18.7%.
FoodBud noted that Tai Er, Song Hot Pot and Lai Meili Grilled Fish were all looking for ways to increase beverage revenue. Tai Er had recently collaborated with Haohao Coffee to launch a sauerkraut coffee.
Huashi Foods, the supply-chain company associated with Wallace, reported first-half revenue of RMB 2.88 billion, up 16.6% year on year. Net profit was RMB 51.746 million, down 51%.
The company acquired Shanghai Rongying Brand Management Co., Ltd. for RMB 62.126 million. As of January 31, 2022, the audited company had total assets of RMB 69.37 million, total liabilities of RMB 7.25 million, total receivables of RMB 29.58 million, net assets of RMB 62.126 million, revenue of RMB 8.22 million and net profit of RMB 3.64 million.
Ajisen Ramen's momentum was weakening, according to FoodBud. In the first half of 2022, Ajisen China moved into loss, with revenue of RMB 680 million and a net loss of RMB 100 million.
It still had 669 stores. FoodBud speculated whether a consortium might pursue an acquisition, given the shell value and store assets, with market capitalization at only HKD 900 million at the time.
Zhou Hei Ya reported first-half revenue of RMB 1.181 billion, down 18.7% year on year. Profit attributable to owners of the parent was RMB 18.377 million, down 92%. Gross profit was RMB 672 million, down 21.7%, with a gross margin of 56.9%.
At the end of the first half, Zhou Hei Ya had 3,160 stores, versus 2,270 in the prior-year period. The network included 1,342 self-operated stores and 1,818 franchised stores, covering 297 cities across 27 provinces, autonomous prefectures and municipalities in China.
The company also highlighted online emerging channels. As of June 30, 2022, its community fresh-food channel covered more than 170 cities and over 4,000 front warehouses. On content-commerce platforms, it increased investment in live commerce and strengthened self-operated livestreaming stores. In the first half, livestreaming exceeded 5,000 hours and reached more than 500 million people.
Note: IPO, financing, shareholding, board-appointment and forward-looking figures in this adaptation are historical, as reported around August 28, 2022.