On August 23, Qijia net (Qiyi Technology 1739.HK) released its performance report for the first half of 2023, which showed that the total income in the first half of 2023 was 497 million yuan, an increase of 15.1% over the same period last year, a gross profit of 252 million yuan, a gross profit of 50.8%, a net loss of 16.6 million yuan in the first half, and an adjusted net profit of 8.2 million yuan. The company has abundant cash reserves, with cash and cash equivalents and other liquidity of 1.109 billion yuan as of June 30, 2023.
In the first half of 2023, the home decoration industry showed a state of intensified competitive pressure but insufficient purchasing power of users. user demand rose sharply in the first quarter and fell rapidly in the second quarter, which also had a great impact on the recovery and development of the home decoration industry. In order to cope with external challenges, Qijia Network adjusts its strategy and further refines its operations. at present, losses continue to narrow, the basic set of business remains stable, and the cash position remains strong.
The basic market of business is stable, and the loss continues to narrow.
The financial report shows that Qijia's business is mainly composed of three parts: SaaS and extension services, interior design and construction business and innovation business. Of this total, revenue from SaaS and marketing services in the first half of the year was 225 million yuan, down 6.9 percent from 240 million yuan in the same period last year; revenue from interior design and construction business in the first half was 253 million yuan, up 50.9 percent from the same period last year. In terms of the proportion of business, SaaS and extended services account for 45.3% of the total revenue, which is still its core business.
In the first half of the year, Qijia net realized a gross profit of 252 million yuan, an overall gross profit of 50.8%, and a net loss of 16.32 million yuan, but an adjusted net profit of 8.2 million yuan. The core business SaaS and marketing services still maintain a high gross margin of around 97 per cent, at a relatively stable level. The gross profit margin of the supply chain business was 14.2%, up 2.7% from 11.5% in the same period last year, and the profit situation continued to improve. As of June 30, 2023, cash, cash equivalents and other liquidity amounted to 1.109 billion yuan, and abundant funds have reserved "food" for its follow-up development.
The improvement of profitability benefits from the strengthening of fine operation measures of Qijia net, that is, to grasp "cost reduction" on the one hand and "efficiency" on the other. In terms of cost reduction, it is mainly through strict cost discipline and strict control of period expenses; in terms of efficiency, through continuous optimization of delivery strategy, actively explore and try low-cost customer acquisition model, through the continuous production of high-quality content to enhance user stickiness and conversion rate, to achieve effective control of sales expenses. According to the financial report, Qijia's sales expenses for half a year were 203 million yuan, down 3 percent from 209 million yuan in the same period last year. At the same time, Qijia net also through the adjustment and optimization of organizational capacity, continue to improve human efficiency and operational efficiency, to achieve cost reduction and efficiency, management fees in the first half of the year decreased by 0.8% compared with the same period last year. After continuing to reduce costs and increase efficiency, Qijia net's core business is still stable.
Industry analysts believe that although the industry fluctuates due to the impact of comprehensive factors, Qijia's performance reflects the extremely resilient side of its business, and its rapid adjustment has not only improved the overall efficiency, but also strengthened its profitability. It is believed that with the steady recovery of the industry, its business scale and profitability will continue to improve.
Help businesses resume their development and continue to explore new opportunities in the industry
In the case of large fluctuations in the industry and the impact on merchants' business, Qijia net, as a vertical platform in the industry, has given great support to merchants to help them resume their development. In terms of helping businesses reduce costs and increase efficiency, Qijia Network continues to promote the enabling strategy with SaaS as the core, through full-link digital technology to help merchants transform and upgrade, and improve their marketing, operation and site management efficiency. At the same time, Qijia net helps businesses to reorganize and optimize their organizational structure, strengthen the training of digital talents, activate the organizational efficiency of the team, and help them improve their operational capacity in an all-round way, so as to reduce costs and increase efficiency.
In terms of helping businesses stabilize their business, Qijia adjusts merchant ratings and user profile layering, and improves the accurate matching of merchants' supply and user demand by optimizing the matching model, so as to improve merchants' advertising efficiency and user satisfaction. The platform has also increased the flow support, through the "real money and silver" subsidies to benefit merchants, so that merchants can steadily get customers. According to the financial report, the revenue contributed by each lead of Qijia fell 26.7% to 516 yuan from 703 yuan last year.
In order to help merchants improve and transform, Qijia net also helps merchants build and enhance brand reputation. On the one hand, it helps them build brand image through platform stores, strengthening installation enterprise cases, service standards, and user evaluation. At the same time, through Qijiabao and other indemnificatory products to help them enhance their sense of trust. On the other hand, the platform also strengthens the building of professional roles, through the forms of "national designer competition" and "site competition", to help businesses cultivate professional roles such as star designers and star foremen, and build brand projects such as gold medal construction sites. to help it build a professional and reliable image. Through a series of assistance measures, it is also beneficial for the platform to continue to adhere to high standards of user service and user experience in the face of poor industry environment.
In order to continuously optimize the user experience, the platform also further raises the threshold of business audit, strict qualification audit, and improve the overall service quality of the platform. Qijia also continues to share high-quality original content and real decoration cases through a variety of channels, such as short video platform, social platform and recommendation platform, so as to spread decoration expertise and help users avoid the pit.
The diversified layout of business will also help to improve the user experience of the platform and improve the service system of the platform. Qijia net has created decoration brands "Borrosen" and "grapefruit" in the field of self-operated home decoration, and has established a series of standard processes in product standardization, construction standardization, delivery standardization, organization standardization and so on. Explore high-quality standardized home decoration business model. In the first half of 2023, it opened new stores of Borrosen and grapefruit brands in Nanchang and Beijing respectively, with revenue of 64.25 million yuan and 43.85 million yuan respectively. It is believed that with the standardization of self-made home improvement and the establishment of large-scale replication capability, the comprehensive service capability of the platform will be further enhanced.
With the introduction of all kinds of favorable policies, household decoration consumption is expected to continue to repair, coupled with indemnificatory rental housing, urban village transformation, urban renewal and other projects are becoming an important part of the real estate market, and the market scale of this part is still huge. I believe that the home decoration industry will usher in more new development opportunities. It is understood that Qijiawang will continue to adhere to the fine operation strategy in the future to help businesses seize the development opportunities under the policy stimulus and actively restore development. Qijia net also said, "We will continue to explore the landing of the combination of new technologies and industries, continue to improve and improve the efficiency of the industry, and strengthen the exploration and layout of the integration of upstream and downstream resources in the industry, so as to seize new structural opportunities in the industry." explore new business opportunities. "