Supor’s Slowdown: Profit Plunge, Executive Share Sales, and Challenges Under Foreign Control

Supor (002032), long regarded as a leading small‑appliance manufacturer, is confronting clear operational headwinds. The company’s 2025 third‑quarter report shows revenue for the first three quarters rose 2.33% year‑on‑year to ¥16.897 billion, while net profit attributable to owners declined 4.66% to ¥1.366 billion. In the third quarter alone, revenue fell 2.30% to ¥5.42 billion and net profit dropped 13.42% to ¥426 million, signaling a simultaneous contraction in both top‑line and core profitability.

The company’s reliance on cookware and kitchen appliances, coupled with slow progress in new business areas, has contributed to an aging brand profile and weakening product competitiveness. Structural imbalances in the business mix, limited R&D investment and instability in internal management are eroding Supor’s competitive position.

Supor’s historical performance trajectory shows a peak in 2018 followed by oscillating declines. Revenue and profit growth turned negative in 2020, and since then net profit has remained in a low‑growth or contractionary phase, with a brief rebound in 2021 that was not sustained. Gross margin and net margin each declined year‑on‑year across the first three quarters: gross margin fell by 0.51, 1.08 and 0.70 percentage points respectively versus the same periods in 2024, while net margin declined by 0.17, 0.65 and 1.01 percentage points.

Receivables and credit costs are rising. Accounts receivable increased to ¥3.133 billion at the end of Q3 from ¥2.690 billion at year‑end, a 16.47% rise over nine months, while credit impairment losses expanded 40.95% year‑on‑year. These figures suggest weakening downstream distributor cash collection and a lengthening receivables cycle with heightened bad‑debt risk. Concurrently, rising sales and financing expenses are compressing profitability: cumulative selling expenses reached ¥1.715 billion and financial costs rose 61.37%, the latter reflecting lower interest income and higher short‑term borrowings due to discounted bank acceptance bills.

Liquidity dynamics also weakened. Net cash from investing activities fell 93.19% year‑on‑year, with substantial funds parked in low‑liquidity financial assets. Net increase in cash and equivalents decreased 133.54%, leaving monetary funds of ¥1.766 billion at period end, down 28.81% from the opening balance. Short‑term borrowings doubled, primarily as a result of discounted acceptance bills at subsidiary level.

Supor’s business model is under pressure. Domestic sales, the company’s primary revenue engine, are losing momentum as China’s appliance market transitions from broad expansion to a mixed incremental‑and‑stock environment. Consumer demand is increasingly bifurcated: premium segments emphasize quality and brand positioning while basic categories compete intensely on price. Supor’s traditional markets for cookware and basic kitchen appliances are approaching saturation, and emerging categories such as home environment and personal care appliances have yet to achieve meaningful scale. Distributor confidence has weakened, evidenced by contract liabilities (mainly distributor prepayments) falling 53.53% to ¥506 million at quarter‑end, reflecting reduced stocking and tighter channel inventory control.

On the export side, Supor’s overseas performance is highly correlated with its major shareholder SEB Group and affiliated channels. Since the 2006 strategic cooperation agreement, Supor leveraged SEB’s distribution network to expand abroad; by 2024, revenue had grown roughly tenfold versus pre‑cooperation levels. SEB now holds more than 83.19% of Supor’s shares. Exports have consistently accounted for about 30% of annual revenue since 2020, with related‑party transactions comprising roughly 28% of sales. Such concentration exposes Supor to SEB’s operational and sourcing adjustments: in 2025 SEB redirected certain European orders from Supor’s domestic base to a Vietnam plant and expanded U.S. local production in response to changing U.S. tariff policies, diverting volumes and exerting margin pressure on Supor’s domestic operations. In H1 2025, Supor’s export revenue reached ¥3.716 billion, up 7.55%, a marked deceleration from 2024’s 21.07% growth.

Investment allocation shows a persistent imbalance between marketing and R&D. From 2022 to 2024, cumulative R&D expenditure amounted to ¥1.317 billion compared with ¥6.418 billion in selling expenses—nearly five times the R&D level. In the first three quarters of 2025, R&D expense marginally increased 2.97% to ¥337 million, but remained under one‑fifth of sales spending. Management indicates elevated marketing investment to contend with intensified competition, but insufficient R&D investment may constrain the company’s capacity to transform and regain product competitiveness.

Governance and management developments have further unsettled stakeholders. Early in 2025, general manager Zhang Guohua resigned more than a year before his scheduled 2026 term end, with CFO Xu Bo assuming acting general manager responsibilities. Subsequently, Delphine SEGURA VAYLET, a non‑independent director nominated by SEB Group and a senior HR executive at SEB, resigned for personal reasons. These personnel changes triggered market speculation regarding coordination between the foreign majority shareholder and the local management team.

Shareholder returns and insider sales have been prominent. Supor maintained a high‑payout dividend policy for many years; aside from 2007, dividends were distributed annually since 2005, with payout ratios remaining elevated in recent years. Shortly after the company completed its annual dividend at the end of May this year, three executives—board director Su Xianzhe, deputy general manager Ye Jide and CFO Xu Bo—disposed of shares totaling approximately ¥5.4292 million. These managers had previously executed share disposals in mid‑2024 amounting to 132,100 shares. The Su family has also periodically reduced holdings since 2011. Concentrated insider and promoter sell‑downs during a period of performance deterioration tend to be interpreted by the market as a signal of diminished confidence, a view consistent with Supor’s muted share price performance in 2025; the stock closed at ¥47.70 on October 31, up 1.47% year‑to‑date.

The combination of management turnover, executive divestments and complex ownership—where SEB’s strategic priorities may at times diverge from local market imperatives—highlights governance risks. While SEB supplies export volumes and technical support, its majority position can constrain Supor’s strategic autonomy. The recent executive departures and board changes may indicate a recalibration of that balance, with the new leadership’s strategic direction still unclear and adding to the company’s transformation uncertainty.

Despite these challenges, Supor retains leading market positions in kitchen small appliances. According to AVC data, Supor ranked first for both online and offline kitchen small‑appliance market share in H1 2025 and expanded its lead over the nearest competitor. Converting this market leadership into sustained revenue and profit growth amid intensifying competition, rising costs and shifting demand remains the principal management challenge. Once the sector’s flagship cookware stock, Supor now stands at a strategic inflection point; whether it can restore momentum and achieve a financial turnaround will warrant continued observation.