Everbright Securities released a research report indicating that NONGFU SPRING (09633) achieved revenue of RMB 52.553 billion in 2025, a year-on-year increase of 22.5%. Net profit attributable to shareholders reached RMB 15.868 billion, rising 30.9% compared to the previous year. All business segments reported double-digit revenue growth, with accelerated growth in the second half of the year. Packaged drinking water revenue amounted to RMB 9.266 billion, up 24.9% year-on-year, driven by the company's expansion of product specifications and reinforcement of its natural water source advantages, which helped recover market share. The report suggests that the company has maintained strong operational performance since the beginning of 2026, supported by a powerful brand, robust supply chain, superior distribution channels, and refined product offerings that underpin long-term development.
Key details from the report are as follows: NONGFU SPRING disclosed its 2025 annual report, reporting revenue of RMB 52.553 billion, up 22.5% year-on-year, and net profit attributable to shareholders of RMB 15.868 billion, up 30.9%. In the second half of 2025, revenue reached RMB 26.931 billion, increasing 30.0% year-on-year, while net profit attributable to shareholders was RMB 825 million, up 40.2%. All business segments recorded double-digit revenue growth, with second-half growth accelerating sequentially.
By product category: 1) Packaged drinking water revenue totaled RMB 18.709 billion in 2025, up 17.3% year-on-year. In the second half, revenue reached RMB 9.266 billion, rising 24.9%, primarily due to the company's efforts to diversify product specifications and enhance its natural water source advantages, leading to a recovery in market share for packaged water. 2) Ready-to-drink tea revenue amounted to RMB 21.596 billion in 2025, growing 29.0% year-on-year despite a high base. Second-half revenue reached RMB 11.507 billion, up 38.4%, driven by the launch of new flavors, larger packaging to broaden consumption scenarios, and the success of promotional activities such as "open-to-win" campaigns. 3) Functional beverage revenue reached RMB 5.762 billion in 2025, increasing 16.8% year-on-year. Second-half revenue was RMB 2.864 billion, up 20.2%, benefiting from rapid industry growth, targeted branding linked to sports scenarios, and precise customer positioning. The company launched a new "electrolyte" beverage in March 2026, continuing the "open-to-win" marketing strategy, with nationwide distributor placement already completed. 4) Juice beverage revenue totaled RMB 5.176 billion in 2025, rising 26.7% year-on-year. Second-half revenue was RMB 2.612 billion, up 32.5%, as the company actively introduced new products, expanded into channels such as membership supermarkets, and achieved strong market performance with its 17.5° and NFC series. 5) Other products revenue reached RMB 1.309 billion in 2025, increasing 10.7% year-on-year. Second-half revenue was RMB 680 million, up 7.3%, supported by continued diversification of product specifications and flavors, as well as expansion into membership supermarket channels.
Cost advantages and economies of scale contributed to improved profitability, with the sales expense ratio declining year-on-year in 2025. The company's gross margin reached 60.5%, up 2.4 percentage points year-on-year, while the second-half gross margin was 60.7%, up 3.4 percentage points, mainly due to lower raw material costs such as PET, cardboard, and sugar, combined with stabilized distribution pricing through controlled e-commerce channels and positive revenue scale effects. The sales expense ratio and administrative expense ratio for 2025 were 18.6% and 4.7%, down 2.8 percentage points and up 0.1 percentage points year-on-year, respectively. In the second half, these ratios were 17.8% and 5.1%, down 2.5 percentage points and up 0.1 percentage points year-on-year, respectively. The decline in the sales expense ratio was attributed to reduced advertising and promotional spending, as well as lower logistics costs due to changes in product mix.
By segment, operating profit margins for packaged drinking water, ready-to-drink tea, functional beverages, juice, and other products in 2025 were 37.4%, 48.0%, 46.8%, 34.3%, and 35.9%, up 6.3, 2.9, 4.6, 9.4, and 2.7 percentage points year-on-year, respectively. The notable improvement in juice margin was mainly due to product mix optimization and revenue scale effects. Other income and gains for 2025 totaled RMB 1.720 billion, down 19.2% year-on-year, primarily due to lower interest income from declining interest rates and reduced government subsidies. Overall, benefiting from a higher gross margin and lower sales expense ratio, the net profit margin attributable to shareholders reached 30.2% in 2025, up 1.9 percentage points year-on-year.
Since the beginning of 2026, the company has maintained solid operational performance, with balanced growth across all categories. Marketing expenses are expected to increase due to 30th-anniversary celebrations and new product launches. On the cost side, facing PET price pressures since 2026, the company has implemented price-locking measures and currently has no plans for product price adjustments, relying on its supply chain capabilities to mitigate cost fluctuations. Overall, the company adheres to a development philosophy of "steady, slow, and long-term," focusing on enhancing product quality, strengthening supply chain capabilities, building brand loyalty, and deepening channel partnerships to ensure sustainable growth. Additionally, the company is steadily advancing its global expansion, with ample long-term growth drivers. Amid intense industry competition, it is well-positioned to navigate market cycles and reinforce its leading position.
Risks include intensified market competition, slower-than-expected new product launches, weakening channel control, and potential contamination of water sources.
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