Jinhui Liquor's revenue last year was 2.9 billion yuan, down 3.4% year-over-year, reintroducing employee stock ownership plan after 7 years

Amid the overall decline in performance among listed companies in the Baijiu industry, Gansu’s leading liquor company Jinhui Liquor (603919.SH) has recently reported a slight decrease in earnings.

On the evening of March 20, Jinhui Liquor released its 2025 annual report: the company achieved operating revenue of 2.918 billion yuan, down 3.4% year-over-year, and net profit attributable to shareholders of the parent company reached 354 million yuan, down 8.7% year-over-year.

Financial news notes that the company also announced a draft for the second employee stock ownership plan, marking the company’s return to such plans after many years.

Both revenue and net profit declined

Regarding the overall industry situation, Jinhui Liquor stated in its annual report that in 2025, the Baijiu industry is experiencing a deep adjustment characterized by “policy regulation, consumption transformation, and stock competition” stacking together. Challenges such as declining industry output, high inventory levels, and inverted prices have become prominent. Small and medium-sized liquor companies are under increasing pressure, and market share is rapidly consolidating toward leading enterprises. The total Baijiu production of enterprises above designated size nationwide was 3.549 billion liters, a decrease of 12.10% year-over-year. The industry faces full-chain pressure, and its development model is undergoing profound transformation—from high-speed growth to high-quality development—with increasingly evident structural differentiation.

Last year, Jinhui Liquor’s alcohol business achieved revenue of 2.777 billion yuan, a decrease of 4.29% year-over-year, with a gross profit margin of 65.37%. Other business income was 140 million yuan.

When discussing its own situation, Jinhui Liquor stated, “In a complex market environment, we have stabilized the fundamentals of development and demonstrated strong resilience.”

Specifically, last year, revenue from products priced above 300 yuan was 709 million yuan, up 25%; revenue from products priced between 100 and 300 yuan was 1.532 billion yuan, up 3%; and revenue from products below 100 yuan was 536 million yuan, down 36.88%.

Jinhui Liquor said that last year, the company’s product structure was further optimized and adjusted. Consumer recognition of products above 300 yuan continued to improve, and terminal sales were good, with sales volume increasing by 37.52% compared to the previous year. Sales of products between 100 and 300 yuan remained steady, increasing by 1.05%. Sales of products below 100 yuan were affected by weak consumption and other factors, decreasing by 33.56% year-over-year.

In terms of channels, last year, the distributor channel generated revenue of 2.583 billion yuan, accounting for 92.99% of liquor revenue; online sales performed well, achieving revenue of 118 million yuan, a 40.26% increase; and direct sales (including group buying) steadily grew to 77 million yuan, up 4.36%.

Regarding dividends, Jinhui Liquor’s profit distribution plan for 2025 proposes a cash dividend of 3 yuan per 10 shares (tax included), totaling approximately 149 million yuan (tax included). In the first three quarters of 2025, the company had already paid a cash dividend of 2 yuan per 10 shares, totaling 99.37 million yuan. Accordingly, the total cash dividend for 2025 is expected to reach 248 million yuan, accounting for 70.11% of net profit attributable to shareholders of the listed company.

Employees can buy shares at half price, with a cap of 800

On the same day, Jinhui Liquor also announced the draft for its second employee stock ownership plan, further improving incentive mechanisms and binding core talent. The plan is expected to involve no more than 800 participants, including company directors (excluding independent directors), senior management, middle management, and key business backbone personnel. The stock purchase price is 10.05 yuan per share, with a total shareholding scale not exceeding 10.4289 million shares.

Jinhui Liquor stated that the core purpose of this employee stock ownership plan is to improve the company’s co-creation and sharing mechanism, strengthen the bond between shareholders, the company, and core employees, and optimize the benefit-sharing and risk-sharing mechanisms.

The company’s 10 directors and senior executives are expected to subscribe to a maximum of 1.8 million shares, accounting for 17.26% of the total shares allocated in this plan.

The average stock trading price over the past 20 trading days was 20.09 yuan per share, and the purchase price for this plan is set at 50% of that price.

Financial news notes that Jinhui Liquor launched an employee stock ownership plan many years ago, and some shares from the first phase have yet to be fully divested or exited.

On the evening of the 20th, Jinhui Liquor also disclosed a postponement notice for the first phase of the employee stock ownership plan, announcing an extension of the plan’s validity by 12 months, until May 24, 2027. As of now, the first phase of the employee stock ownership plan holds 3.2 million shares, representing 0.63% of the company’s total share capital.

In June 2018, Jinhui Liquor disclosed the draft for the first phase of its employee stock ownership plan. On May 24, 2019, the first phase purchased approximately 4.93 million shares through a private placement.

Last year, Jinhui Liquor completed the repurchase of shares corresponding to the second phase of its employee stock ownership plan. In early March, the company disclosed that it had repurchased approximately 10.43 million shares through centralized bidding, representing 2.06% of total share capital, with a maximum purchase price of 20.94 yuan per share, a minimum of 15.49 yuan per share, and an average price of 18.49 yuan per share, totaling 193 million yuan (excluding transaction fees).