NONGFU SPRING's revenue in the first half of the year increased by 15.6% year-on-year, and net profit grew by 22.1%. The tea beverage business surpassed bottled water for the first time | Financial Report Insights

NONGFU SPRING achieved double-digit growth in both revenue and net profit in the first half of the year, with its tea beverage business surpassing packaged water for the first time, recording revenue of RMB 10.089 billion, a sharp increase of 19.7% year-on-year, accounting for 39.4% of total revenue. The "Oriental Leaves" series is the core growth engine.

On the 26th, NONGFU SPRING announced its performance for the first half of 2025:

• Total revenue for the mid-2025 period was RMB 25.622 billion, a year-on-year increase of 15.6%;
• Profit attributable to equity holders of the parent company was approximately RMB 7.622 billion, a year-on-year increase of 22.1%;
• Gross margin increased from 58.8% in the same period last year to 60.3%, mainly due to the decline in raw material costs such as PET.
• Basic earnings per share were RMB 0.677, a year-on-year increase of 22.0%.

Core Business Progress:

• Tea beverage business surpassed packaged water for the first time, becoming the company's largest source of revenue, recording revenue of RMB 10.089 billion, a year-on-year increase of 19.7%, accounting for 39.4% of total revenue. The "Oriental Leaves" series is the core growth engine.
• Packaged water business gradually rebounded from last year's public opinion impact, recording revenue of RMB 9.443 billion, a year-on-year increase of 10.7%. Its revenue share decreased from 38.5% to 36.9%.
• Juice beverage business recorded revenue of RMB 2.564 billion, a year-on-year increase of 21.3%, showing breakthroughs in the high-end product line.

Tea Beverages as the New Engine, Packaged Water Business Recovers

Financial report data shows that beverage products under NONGFU SPRING are becoming the core engine driving growth. In the first half of 2025, the total revenue of beverage products, including tea, functional drinks, and juice, increased by 18.7% year-on-year, accounting for 62.7% of total revenue.

Among them, tea beverage products performed the best, with revenue of RMB 10.09 billion and a growth rate of 19.7%, becoming the largest category within the company. The financial report shows that the "Oriental Leaves" series continues to expand its market influence by launching seasonal limited products, conducting "win prizes by opening caps" activities, and introducing new flavors like dried tangerine peel white tea. Additionally, the company launched a new carbonated tea beverage "Ice Tea," further enriching its product matrix.

At the same time, the packaged drinking water business, which accounts for 36.9% of total revenue, is also showing a steady recovery trend. In the first half of the year, this business's revenue increased by 10.7% year-on-year, which the company attributed to the reduction of last year's online public opinion impact. Through deepening the promotion of "natural water sources, transparent factories" sourcing activities, launching zodiac commemorative bottles, and new edible ice products, this segment's sales are gradually rebounding. Additionally, juice beverages and functional drinks also maintained stable growth, with revenue increasing year-on-year by 21.3% and 13.6%, respectively

Cost Reduction Boosts Gross Margin to 60.3%

While revenue is growing, NONGFU SPRING's profitability has also significantly improved. In the first half of 2025, the company's gross profit reached 15.46 billion yuan, a year-on-year increase of 18.6%. The gross margin increased by 1.5 percentage points year-on-year to 60.3%. The company attributes this to the "decline in the procurement prices of PET raw materials, as well as the decrease in procurement costs for packaging materials such as cartons and raw materials like white sugar."

During the reporting period, the proportion of sales and distribution expenses to total revenue decreased from 22.4% in the same period last year to 19.6%. The company explained that this was mainly due to a decrease in advertising and promotional expenses compared to the same period last year, as well as a decline in logistics rates influenced by the product sales structure. Other expenses surged from 6 million yuan in the same period last year to 127 million yuan, mainly due to 50 million yuan in donation expenses and 66 million yuan in foreign exchange losses.

On a strategic level, internationalization has become the next goal for NONGFU SPRING. The financial report disclosed that its core products officially entered the Hong Kong market in June 2025, covering over 3,500 terminals. The company stated that it will also explore other overseas markets in the future, striving to expand international business and create new growth opportunities for the group