Zhitong Finance App News, H&H International Holdings (01112) announced that in 2023, according to reports and similar comparison benchmarks, the group achieved high unit revenue growth. The increase was mainly driven by high profits from all three strategic business pillars (including adult nutrition and care products, infant nutrition and care products, and pet nutrition and care products) and double-digit growth in nutritional supplement revenue.

Among them, the adult nutrition and care products segment achieved strong double-digit growth, driven by the following factors: the strong demand for health products from consumers in various regions after COVID-19, and the Group's commitment to launch innovative categories, such as the SwissePlus+ series and gummies, in line with the Group's high-end quality, scientifically proven, desirable and interactive (PPAE) model. Notably, SwissePlus+ brought a significant double-digit contribution to total revenue from adult nutrition and care products in mainland China in 2023. Furthermore, the NAD+ series in the group's SwissePlus+ has achieved a leading position in the anti-aging category, seizing a very high market share, while Swisse Clean Liver tablets maintain their leading position in the high-end thistle segment in mainland China. Swisse has regained its top position in the Australian overall vitamin, herbal and mineral supplements market, and is ranked first in major categories such as multivitamins, oral beauty, digestive and liver health, and muscle health.

The infant nutrition and care products segment achieved a low double-digit decline in revenue. Despite unfavorable market conditions, the group limited the decline in infant formula revenue to the middle double digit level in 2023. The positive performance of the infant probiotics and nutritional supplements segment mitigated the impact of the decline in the infant formula business. Sales of probiotics and nutritional supplements for infants continued their long-term upward trend, achieving high unit volume growth in 2023. The diversified product portfolio, which focuses on Biostime probiotics and nutritional supplements, continues to expand its market share, helping the Group address systemic challenges affecting the overall infant formula industry in mainland China, as well as increased competition during the transition to the new national standard.

The Pet Nutrition and Care segment achieved strong double-digit growth compared to the previous year. Both the North American and mainland China markets experienced strong growth during this period. In the North American market, Zesty Paws remained number one on Amazon and topped the list in the pet supplement category at Walmart stores in less than two years.

Furthermore, the Group's adjusted comparable EBITDA in 2023 is expected to achieve a lower double-digit increase compared to 2022. The adjusted comparable EBITDA rate for 2023 is expected to remain at a steady medium double digit level.

The Group's adjusted comparable net profit in 2023 is expected to increase by the number of units compared to 2022. As far as the group's reported net profit reported in accordance with IFRS is concerned, it is expected to reflect a decrease in the number of units. The decline in the Group's reported net profit was mainly due to the following adverse effects: (i) one-time inventory write-off and provision of RMB 178 million for imported infant formula products still awaiting approval from the new national standard (national standard), while as of the date of this announcement, seven other infant formula series had been approved by the new national standard; (ii) impairment of non-cash goodwill and intangible assets related to past acquisitions of Aurelia and Good Goût in Europe; and (iii) depreciation of approximately RMB 100 million in interest rates against the US dollar after the US Federal Reserve interest rate hike value, This has led to an increase in financing costs.

As of December 31, 2023, after repaying the three-year term loan of US$140.6 million in 2023 according to the installment repayment schedule, the group maintained a steady liquidity position with a cash balance of approximately RMB 1.37 billion.