Recently, a "bowl of noodles" incident in Zhengzhou, Henan Province went viral—so much so that even the national menswear brand Fujian Septwolves Industry Co., Ltd. got dragged into the controversy.
Here's what happened: On August 16, a noodle shop owner jokingly referred to seven customers demanding "extra noodles" as "seven wolves" in a short video. Netizens, with their wild imagination, directly pulled the Septwolves brand into the public opinion whirlpool. By August 18, numerous netizens flooded into Septwolves' official livestream, shouting "We won't buy clothes unless you sue the noodle shop." Customer service staff in the livestream tried desperately to persuade viewers to be rational, but with limited effect.
What started as a trivial noodle shop incident instantly turned into a brand crisis—on one side were netizens' gossiping mentality, on the other was the innocent implication of brand image, forcing Septwolves to respond while caught in the storm.
However, this isn't Septwolves' only "trouble." The bigger problem actually lies hidden in the 2025 half-year report.
**Red Alert in Septwolves' Half-Year Report: Net Profit Decline Worse Than Being Halved**
Fujian Septwolves Industry Co., Ltd., established in Jinjiang, Fujian in 1990, was once the "leader" in China's national menswear industry.
"Jacket = Septwolves" almost became a generational consumer consensus, and that advertising slogan—"Men have more than one side, character remains consistent"—was utterly brainwashing. Wearing a Septwolves jacket was like adding a "wolf spirit buff," instantly switching to combat mode. With this momentum, it dominated China's jacket market for 24 consecutive years, firmly holding the throne as the "King of Jackets."
Unfortunately, fortunes change with time, and young people have long grown tired of stories about "wolf spirit." In the past, the narrative of "jacket = striver" could firmly capture a generation of consumers. But now, who cares whether you're the "King of Jackets"? When the 2025 half-year report was released, this "wolf" was directly doused with cold water.
On August 21, Septwolves announced its first-half revenue of 1.374 billion yuan, down 5.93% year-over-year; non-GAAP net profit was only 29.1 million yuan, more than halved with a 61.35% decline. The company explained this as "complex external environment + intense industry competition," sounding like the usual excuse veteran singers use on variety shows: it's not that I'm not good enough, it's that the times have changed.
More heart-wrenching was the operating cash flow of -22.59 million yuan—selling goods but not collecting the money, which is undoubtedly an alarm bell for retail companies.
While costs seemingly decreased a bit, it's not particularly encouraging. In the first half, Septwolves closed 54 directly-operated stores and 74 franchise stores, with total store count significantly shrinking compared to last year. Meanwhile, sales expenses surged 16.68%, from 468 million yuan to 546 million yuan. This indicates that while money was spent, the results weren't pulled up. Management expenses were somewhat reduced, but financial expenses actually rose 42.24% due to decreased interest income.
Looking at R&D, this wolf clearly "retracted its claws"—investing 19.1 million yuan, down nearly 42% year-over-year. The company claimed it was "optimizing resources" by moving R&D upstream to the supply chain. But the problem is, while cost-cutting looks easy in the short term, from a long-term perspective, if new products can't keep up with aesthetic changes, relying on old jacket styles will likely push young people further away.
Of course, not everything in the financial statements was bad news. For instance, government subsidies increased slightly, other income rose 35.82%; bad debts decreased, asset disposal gains earned 141.6% year-over-year, and non-operating expenses were cut by nearly 81%, with 1-3 year inventory balances also down 7.2%. However, these figures, against the backdrop of plummeting net profits, are like throwing a bone to a wolf pack—something to gnaw on, but not filling.
**Septwolves' "Two-Legged" Approach: One Leg Selling Clothes, One Leg Trading Stocks**
Precisely because the main business is struggling, Septwolves has had to open new battlefields elsewhere—the investment sector has become a "lifeline" for profits.
From Septwolves' financial data, as of the end of June 2025, total monetary funds were 653 million yuan, accounting for 6.62% of total assets, down from 924 million yuan at the end of last year by nearly 2 percentage points. At first glance, it seems like cash has shrunk considerably, but accounts receivable decreased by about 107 million yuan, and inventory slightly decreased by 95 million yuan, indicating the company still has orderly collection and inventory management.
The second quarter happened to be the off-season for procurement and warehousing, with accounts payable and notes payable decreasing by 208 million yuan and 164 million yuan respectively, which also explains the slight fluctuation in cash flow. Additionally, prepayments increased by 33 million yuan compared to the beginning of the year, mainly for advance stocking of autumn and winter new products, essentially "stocking up for the second half," reflecting a relatively stable supply chain operation rhythm.
Furthermore, Septwolves' trading financial assets increased slightly from about 1.9 billion yuan at the beginning of the year to 1.956 billion yuan at period-end. Combined with other equity instrument investments and non-current financial assets, total financial assets reached 2.397 billion yuan, about 54 million yuan more than at the beginning of the period.
In other words, this wolf has completely unleashed its claws in the capital market—holding a basket of "star stocks": Tencent Holdings, Hang Seng ETF, Ping An Insurance, CNOOC, China Mobile, PICC, Kweichow Moutai, CATL, China Shenhua, and CICC Alpha Kerui 107 Single Asset Management Plan. It seems Septwolves' investment philosophy is simple and crude—if it's not "top-tier," "I" don't want it.
The total assets of these securities investments have reached 1.85 billion yuan. From a capital allocation perspective, Septwolves' investment vision is indeed stable, precise, and selective.
Looking at specific asset performance, Tencent Holdings' fair value change gains reached 52.63 million yuan, Ping An Insurance contributed 3.72 million yuan, and Kweichow Moutai also brought 660,000 yuan in appreciation gains. Although Hang Seng ETF's book value at period-end fell to 267 million yuan, profits were still made through intermediate trading spreads.
As for energy stocks like CNOOC and China Shenhua, there were ups and downs, but the overall portfolio remained stable. This shows that Septwolves isn't following trends in investment but rather selecting quality assets with steady progress, balancing returns and safety.
In capital operations, this wolf is also quite active. On August 19 this year, Septwolves increased its holdings by 330 million shares through Beijing Ruiteng Yihong Investment Management Co., Ltd., purchasing from Sunshine Insurance, raising its shareholding ratio from 0.87% to 3.74%. This move not only brings investment returns but also increases strategic voice, giving the company more operational space in financial markets.
Overall, Septwolves' operational logic is clear: while the main business faces pressure, the investment sector supports half the sky. Even if clothing sales turn cold, investment returns can still "support the family." This "dual-pronged" strategy both cushions volatility and leaves room for maneuvering in capital markets.
Of course, financial investment is just icing on the cake and cannot replace the main business. After all, its roots are still in clothing—jackets and shirts are the foundation, while the investment sector can only be considered an auxiliary engine, providing the company with additional stability amid market fluctuations.
**Mid-Life Crisis of Traditional Menswear: Who Can Run Faster?**
Ultimately, traditional menswear brands are all about the same "age," and those "middle-aged" companies all face the same proposition—when main business growth is weak, how to tell new stories?
Looking around, peers are showing their abilities in various ways.
First, let's look at Lilanz, once a resounding brand in China's menswear industry. This year's first-half performance had both highlights and concerns. Group overall revenue increased 7.9% year-over-year to 1.73 billion yuan, gross margin steadily maintained at 50.2%, and profit attributable to shareholders was 243 million yuan, looking quite decent.
However, the development trends of the two main brands under the group were different. The main brand Lilanz's revenue slightly decreased 0.2% to 1.19 billion yuan. This was mainly due to one-time revenue deductions when advancing DTC business models in Shandong and Chongqing. Meanwhile, the light business series Lilanz LESS IS MORE performed quite brilliantly, with revenue surging 31.8% to 537 million yuan, thanks to outstanding performance from stores and new retail businesses.
Looking at Jiumuwang, its semi-annual performance forecast shows that net profit attributable to listed company shareholders for the first half of 2025 is expected to be between 150 million and 180 million yuan, a year-over-year increase of 200% to 260%—these figures look quite stunning. But upon closer examination, there's some "trickery" involved.
Jiumuwang revealed in its performance forecast that during the reporting period, fair value change gains and losses from financial assets held by the company are expected to be 20-25 million yuan, compared to -111.32 million yuan in the same period last year. This back-and-forth means fair value change gains increased by about 130 million yuan compared to the same period last year.
In the first quarter of this year, Jiumuwang's investment income surged 4,022.02% year-over-year to about 12.45 million yuan, mainly due to increased investment income from disposing of trading financial assets. It was precisely this income that enabled Jiumuwang to achieve 77.25% net profit growth in the first quarter.
Youngor's performance was less than ideal. In the first quarter of this year, revenue was 2.795 billion yuan, down 15.60% year-over-year; net profit was 803 million yuan, down 13.33% year-over-year. From the revenue composition, branded apparel business accounted for 65.01% of total revenue, real estate business 28.24%, and other businesses 6.76%. Regarding the renewed decline in performance, Youngor explained it was due to factors including industrial layout adjustments overlapping with weak consumer demand.
In comparison, some clothing brands targeting young people are performing well.
For example, Jeanswest has been thriving in the e-commerce field. Since they couldn't beat e-commerce, they decisively joined it. From 2020 to 2024, e-commerce sales grew more than 13-fold, with 2024 full-year e-commerce network sales breaking through 6 billion yuan, and estimates suggest 2025 could continue rising.
HLA achieved beyond-expected growth in Q1 2025, with net profit attributable to parent company of 935 million yuan, up 5.46% year-over-year. The company operates diverse business models, including chain operations of proprietary brands, traditional production operations of HLA Group Purchase, FCC retail business cooperating with Adidas, and JD Outlet business cooperating with JD.com.
Additionally, its online sales revenue was 1.014 billion yuan, up about 20% year-over-year. Driven by online sales, HLA achieved revenue of 6.187 billion yuan in Q1 2025, up 0.16% year-over-year, with inventory also reduced to 10.597 billion yuan, indicating HLA achieved good results in both channel expansion and inventory management.
Septwolves' predicament is also a microcosm of the menswear industry—when the main business doesn't deliver, they can only rely on other sectors to sustain life. However, peers' "life-sustaining" methods vary: some rely on scale and digitalization to hold on, some use diversification and financial management to recover, and others dive headfirst into the e-commerce track for aggressive growth.
But ultimately, who can laugh last depends on who first captures young people's hearts. After all, menswear isn't selling fabric, but lifestyle. To truly stand firm, the main business must be solid.
After all, in a wolf pack, only the smart one gets to eat well.
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