New stock news | Newmans submits documents to the Hong Kong Stock Exchange again. The company's best-selling nutritional product is algal oil DHA.

According to the disclosure by the Hong Kong Stock Exchange on September 30, Newman's Own Health Food Holdings Limited (Newman's Own) has submitted its application to the Main Board of the Hong Kong Stock Exchange again, with CFT International Financial Ltd. as its sole sponsor. The prospectus reveals that Newman's Own is mainly engaged in the marketing, sales, and distribution of finished nutritional products in China. The company's nutritional products are sold under exclusive brands (namely "Newman's Own" and "Nemans" in English), and can be broadly categorized into five main types: algae oil DHA, probiotics, vitamins, multivitamins, and algae calcium products. Algae oil DHA products are the company's main products, accounting for a large portion of its revenue during the performance period. In the fiscal years 2021, 2022, 2023, the 6 months of 2023, and the 6 months of 2024, the sales of the company's algae oil DHA products accounted for approximately 91.9%, 92.7%, 94.7%, 93.5%, and 96.2% of total revenue respectively. According to Frost & Sullivan, the Chinese maternal and infant algae oil DHA market can be divided into products introduced by international and domestic players, with domestic products further classified into those using locally sourced and imported algae oil DHA raw materials. In 2023, domestically manufactured brands using imported algae oil DHA raw materials accounted for 28.5% of the retail value of algae oil DHA products in China, with the company holding approximately 20.5% in 2023. Based on the retail value of algae oil DHA products made from imported raw materials, the company is the largest domestic brand. Leveraging the success of algae oil DHA products, the company has been marketing other nutritional products such as probiotics, vitamins, multivitamins, and algae calcium. During the performance period, the company's best-selling nutritional product was the algae oil DHA product, with revenues in the fiscal years 2021, 2022, 2023, the 6 months of 2023, and the 6 months of 2024 being approximately 310 million yuan, 341 million yuan, 404 million yuan, 180 million yuan, and 140 million yuan, respectively, accounting for about 91.9%, 92.7%, 94.7%, 93.5%, and 96.2% of total revenue in the respective years/periods. During the performance period, the sales volume and revenue of the company's overseas processed algae oil DHA products (i.e., New Zealand DHA products and US DHA products) were significantly higher than the company's Chinese DHA products. According to Frost & Sullivan, the directors believe that this highlights consumer behavior, as products using imported raw materials are popular among consumers in the Chinese maternal and infant nutrition industry. Reportedly, China's maternal and infant algae oil DHA industry currently has about 100 players, including international and domestic players sourcing algae oil DHA raw materials from overseas suppliers. As for domestically manufactured maternal and infant algae oil DHA products using raw materials supplied by overseas suppliers among Chinese domestic brands, the market is dominated by approximately 35 players, but the number of players with a significant market share is limited, making it relatively concentrated based on retail sales in the fiscal year 2023. Newman's Own points out in the prospectus that during the performance period, the increase in revenue and gross profit of the company was mainly due to the increase in revenue from the sale of algae oil DHA products. The total gross profit margin remained relatively stable in the fiscal years 2021, 2022, 2023, the 6 months of 2023, and the 6 months of 2024, at approximately 73.0%, 74.4%, 75.2%, 75.8%, and 71.9% respectively. The company's net profit decreased from approximately 120 million yuan in the fiscal year 2021 to about 87.522 million yuan in the fiscal year 2022, mainly due to a non-recurring asset-related loss of about RMB 81.477 million recognized in the fiscal year 2022 from the sale of powdered milk products.