Half-year revenue of 500 million! Big sales but net profit dropped by 44.34%

The sales of protective products, home appliances and home furnishings, which were very popular during the 2020 epidemic, soared, and the big sellers made a lot of money. This has made industry insiders more concerned about whether these big sellers can continue to rise amid the fluctuations of the global epidemic in 2021?

Kangtai Medical's half-year net profit fell 44.34%

The 2020 epidemic has brought a lot of protective equipment to the forefront, and some companies specializing in the sale of protective equipment have also become very popular. For example, Kangtai Medical, which we are familiar with, had a net profit of more than 600 million in 2020; Intech Medical, which mainly exports protective gloves, had a net profit of more than 20 times; and Huashengchang, a big brand of Amazon temperature guns, had a net profit increase of nearly 3 times. These profits are really enviable. However, with the differentiated impact of the global epidemic, the sales of these products and the company's revenue and profits are quietly changing.

Recently, Kangtai Medical, a benchmark for the export of medical device products, released its 2021 semi-annual report. The report data shows that in the first half of 2021, its revenue was 515 million yuan, a decrease of 31.45% compared with 751 million yuan in the same period of 2020. Its net profit attributable to shareholders of listed companies was 202 million yuan, a decrease of 44.34% compared with 364 million yuan in the same period of 2020.

From the perspective of product types, Kangtai Medical's medical products that are most affected by the epidemic can be divided into the following categories:

Sales of products such as blood oximetry and analytical testing instruments (especially medical infrared thermometers) declined , especially blood oximetry products, with revenue of 282 million yuan, a decrease of 32.59% compared with the same period in the first half of 2020.

Sales of monitoring, ultrasound, electrocardiogram and other products all increased slightly, among which the monitoring category revenue was 81 million yuan, a 103.17% increase compared with the same period in 2020, but its cost also increased by 95.02% compared with the same period last year.

The oxygen concentrator business has grown significantly , and its market share has gradually increased as the user scale expands .

In terms of market share, revenue in Europe slowed down, with revenue of 104 million yuan, an increase of 17.77% compared with the same period in 2020; but the Americas was not so lucky, with revenue of 157 million yuan, a decrease of 50.97%.

Regarding the decline in profits, Kangtai Medical said that it was mainly due to the high performance base last year, the increase in human and logistics costs, and the fact that the company no longer enjoys the preferential policies for social security exemptions in 2021. It also stated that the company is currently on a healthy and benign development track. With the continuous enhancement of the company's innovative R&D capabilities, the enrichment of product categories, the advancement of key construction projects, and the strengthening of the competitive advantages of its main business, the company's future profitability is stable and sustainable.

Kangtai Medical's overseas revenue accounted for 80.56% in the first half of 2021

As one of the giants in the cross-border medical field, Kangtai Medical mainly focuses on the research and development, production and sales of blood oxygen, electrocardiogram, ultrasound, monitoring and analytical testing products. Its products are mainly sold through platforms such as Amazon, eBay and Wish . The North American market is its largest sales market , followed by Europe, Asia, Africa and the Middle East.

The semi-annual report data shows that Kangtai Medical's overseas revenue accounted for 80.56% of its main business revenue in the first half of 2021. However, with the rapid expansion of production capacity in the medical device industry, market demand in developed countries such as Europe and the United States has become saturated , and prices and supply have returned to normal. However, market demand in countries such as India, South America and Southeast Asia remains at a high level, and the anti-epidemic battle line is lengthening. These demands may just be able to stabilize Kangtai Medical's profits.

There are reasons for Kangtai Medical's success:

We attach great importance to independent intellectual property rights and product research and development . While enriching the product variety, we can also fully meet the needs of customers from different countries and at different levels for product functions and prices.

Establish a complete industrial chain to avoid fluctuations in supply and demand and the market, and reduce production costs while improving risk resistance.

Establish a global marketing network . While exploring the potential of market segments in developed countries in Europe and America, we will increase our efforts to explore areas with severe epidemics, such as Southeast Asia.

The country has continuously introduced favorable policies to improve the construction of the public health system. The residents' health awareness has increased, stimulating the continuous growth of the medical device market.

In the future, the global aging rate will accelerate, and the demand for the medical device industry will continue to increase. According to relevant agency data, the global sales of medical devices in 2019 was 492.9 billion US dollars. The global outbreak of the epidemic in 2020 has driven the expansion of its market size to more than 500 billion US dollars. At present, the COVID-19 epidemic is still ongoing, and the industry's annual compound growth rate is expected to exceed 6% in the next three years . It is also a good choice for cross-border sellers.

Home appliances continued to rise, with Morning North Technology's net profit increasing by as much as 50%

The epidemic has not only made protective equipment popular, but also the home appliance category under the booming stay-at-home economy. After all, if you can't go out, it's better to stay at home and show off your cooking skills. The most important thing is to eat happily. Vesync (Morning North Technology), a big seller in Shenzhen, is undoubtedly one of the beneficiaries of the stay-at-home economy.

Recently, the performance forecast released by Morning North Technology showed that its net profit in the first half of 2021 increased by 35%-50% compared with the same period last year. However, compared with the net profit growth of 758.8% in 2020, Morning North Technology's momentum this year seems to have slowed down.

Regarding the growth in net profit , Morning North Technology said that it was mainly due to the growth in sales during the reporting period, which was mainly due to the following two reasons:

1. Sales in various retail channels in the European market continue to grow, and sales generated by the increase in purchase orders from VC accounts on Amazon North America are also growing.

2. Sales of private-label brands Levoit and Cosori increased during the reporting period.

In fact, Morning North Technology has three core brands, namely Levoit (home appliances), Etekcity (smart small appliances, health monitoring equipment, etc.) and Cosori (kitchen appliances, etc.). Levoit is undoubtedly the best one, not only labeled as the best-selling air purifier in the United States, but also the largest and most profitable brand of Morning North Technology.

In addition, JS Global Lifestyle, another major seller of small home appliances, also released its first half performance forecast for 2021. Data shows that as of June 30, 2021, JS Global Lifestyle's comprehensive profit was no less than US$205 million , far exceeding the US$106.7 million in the same period of 2020, which is equivalent to doubling.

As for the reasons for the profit growth, JS Global Lifestyle stated that a large part of it came from the North American and European markets. In addition to the improvement in its management efficiency and supply chain collaboration capabilities, the lower loan interest rates after debt replacement and the savings in interest expenses were important reasons for promoting profit growth.

In general, the explosion of many products requires an opportunity, and the epidemic is undoubtedly an important part of it. The explosion of products has driven the company's profits to soar. But for sellers, what is more important is how to grasp this wave of dividends and expand in the later stage, so as to extend and stabilize profits and continue to rise.

In addition, when selling on the Amazon platform, sellers need to comply with the relevant policies of the platform and operate in compliance, and not touch the red line, because all kinds of non-compliant behaviors will eventually be discovered and rectified. In addition, Amazon's account blocking trend has not stopped, so it is best to be cautious!

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