Jiumaojiu International Holdings Limited Annual Report 2025: Key Highlights and Shareholder Insights

Jiumaojiu International Holdings Limited (“Jiumaojiu”, HKEX: 9922) has released its annual report for the year ended December 31, 2025. The report presents a comprehensive overview of the company’s financial performance, corporate governance, risk factors, and future outlook. Below, we detail major news and developments that shareholders and investors should pay close attention to, including price-sensitive information and corporate actions that could impact share value.

Financial Performance and Profitability

• Revenue Decline: The Group reported revenue of RMB 5,233 million, a decrease from RMB 6,074 million in 2024. This represents a significant drop, raising concerns about the company’s growth trajectory.
• Profitability: Profit for the year was RMB 51.2 million, up from RMB 44.8 million in 2024. However, core operating profit fell dramatically to RMB 138 million from RMB 252 million, and core operating profit margin dropped to 2.6% (2024: 4.2%). This signals margin compression and operational challenges.
• Impairment Losses: The company recorded property, plant, and equipment impairment losses of RMB 29.4 million (2024: RMB 111.6 million). Although improved, these losses remain material.
• Other Losses: Other net losses amounted to RMB 33.2 million, compared to RMB 74.7 million in 2024.

Capital and Dividend Actions

• Share Repurchase: In 2025, Jiumaojiu repurchased 6,965,000 shares, costing HKD 14.1 million, representing 0.5% of issued shares, with most repurchased shares subsequently cancelled. The Board cited confidence in long-term prospects as the rationale. Share repurchase activity often signals management’s belief that shares are undervalued and can positively affect share prices.
• Final Dividend: The Board proposes a final dividend of HKD 0.02 per share for 2025, consistent with the prior year (2024: HKD 0.02 final and HKD 0.02 special dividend). The dividend will be paid in Hong Kong dollars, subject to shareholder approval at the AGM scheduled for June 5, 2026. The record date for dividend entitlement is June 12, 2026, with expected payment by June 26, 2026.
• Dividend Policy: The company does not have a pre-determined payout ratio; dividends depend on financial conditions and Board discretion.

Major Investments and Corporate Actions

• Strategic Acquisition: On February 27, 2026, Jiumaojiu entered into agreements to acquire 74 million Class A preferred shares in Big Way Group Inc. for a total USD 43 million, increasing its equity interest in Big Way Group Inc. from 10% to 49%. This is a transformative move, shifting the company’s interest from a minority stake to near-control and could materially affect future earnings and strategic direction. RMB 21.1 million of loans to Big Way Group Inc. was offset against the purchase price.
• Change in Associate Classification: As a result of the above transaction, Big Way Group Inc. will be accounted for as an associate, which may significantly impact consolidated financials in future periods.

Balance Sheet and Financial Position

• Net Assets: Net assets reached RMB 3,217 million (2024: RMB 3,151 million).
• Cash Position: Cash and cash equivalents increased to RMB 1,018 million from RMB 607 million in 2024, indicating improved liquidity.
• Pledged Assets: As at December 31, 2025, bank loans were secured by pledged deposits of RMB 207.4 million and land-use rights of RMB 25.9 million.
• Contingent Liabilities: The Group reported no material contingent liabilities or legal claims.

Risk Factors and Uncertainties

• Revenue and Margin Risks: The decline in revenue and core operating margins, alongside impairment losses and other net losses, highlight ongoing challenges in restaurant operations and market competition.
• Strategic and Market Risks: Expansion into new markets faces intense competition and regulatory delays. There are risks related to shifts in consumer taste, economic downturns, and disruptions to supply chain or restaurant operations from disasters or external events.
• Valuation Sensitivity: The valuation of unlisted equity investments and limited partnership stakes is sensitive to market comparables and discount for lack of marketability. A 1% change in valuation parameters can move other comprehensive income by RMB 600,000 to RMB 700,000.

Corporate Governance and Compliance

• The Board confirms full compliance with Hong Kong’s Corporate Governance Code and Listing Rules during the year.
• No material breaches of laws or regulations in operational jurisdictions; all necessary licenses and permits obtained.
• Directors and senior management have undertaken relevant professional training.

Shareholder Rights and Communication

• Shareholders are entitled to convene extraordinary general meetings with sufficient voting capital.
• All resolutions at shareholder meetings will be voted by poll and results published immediately.
• The company maintains an active website and regular communication with institutional investors and analysts.

Outlook for 2026

• The Group aims to focus on culinary excellence, optimize its restaurant network, strengthen supply chain support, and continue prudent expansion and risk management.
• The outcome of the Big Way Group Inc. investment is expected to be a major driver of future performance.

Other Notable Points

• Donations for the year totaled RMB 2.4 million.
• No connected or continuing connected transactions requiring disclosure under HKEX rules during the year.
• The Group is assessing the impact of new IFRS standards effective 2026 and 2027, including IFRS 18, which could affect future financial statement presentation and disclosures.

Potential Price-Sensitive Developments

• The acquisition of a near-controlling stake in Big Way Group Inc. for USD 43 million is a significant corporate action that could materially affect Jiumaojiu’s future earnings, risk profile, and share price.
• Share repurchase and dividend declaration, combined with improved cash position, may support share value.
• Revenue decline and margin compression raise concerns about growth and profitability, possibly affecting investor sentiment.

Disclaimer

This article is based on the official annual report of Jiumaojiu International Holdings Limited for the year ended December 31, 2025. The information contained herein is for informational purposes only and does not constitute investment advice. Investors should consult their financial advisors before making any investment decisions. The author accepts no liability for any loss arising from reliance on the information presented above.

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