Andre Juice's Growth Stalls After Bumper Period
China's leading maker of apple juice concentrate reported its revenue contracted in the third quarter, ending a period of strong gains in the previous year and a halfKey Takeaways:Andre Juice's revenue fell 5% in the third quarter, reversing a 50% gain in the first half of the year and a 62% rise in 2024The company's Hong Kong and Shanghai listed shares look overvalued, following a 70% rally this yearIs Yantai North Andre Juice Co. Ltd. (2218.HK; 605198.SH) running out of juice?That's the big question on investors' minds, after one of China's leading makers of juice concentrate abruptly saw its business start to contract in the third quarter, after reporting strong growth in the previous year and a half. Frustratingly, the company provides no explanation for the sudden business slowdown in its latest quarterly report released on Thursday, reflecting a tendency by some Chinese companies to only provide detailed commentary in their annual reports.But the financial data in the third-quarter report, filed concurrently in Shanghai and Hong Kong, where its shares are dually listed, provides some clues. The most telling detail is the company's inventory, which plunged by 40% by the end of September compared with the end of last year.At the same time, China's apple crop also looks weaker than usual this year, with the country expected to produce about 38 million tons, down 5% year-on-year, according to Bosch Boden Spies, which tracks the global fruit industry. That would mark a second year of decrease for the market, which fell by 10.2% in value last year, ending a five-year rising trend, according to another report by IndexBox. Such shrinking supplies often result in rising costs for companies like Andre Juice.In its last annual report for 2024, the company also noted that it significantly increased its production volume last year "in the face of various risks and challenges such as increasing ingredient fruit price and U.S. ...Full story available on Benzinga.com
