健合集团(1112.HK)2026上半年业绩大超预期：收入+23.7%、调整后净利润+153%，全年指引上调，股价已涨超21%

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Introduction & Market Context
Health and Happiness (H&H) International Holdings (HKEX:1112) presented its interim results for the first half of 2026 on August 26, showcasing strong double-digit growth across all business segments while significantly improving profitability and reducing leverage. The Hong Kong-listed wellness company’s stock surged 20.23% to $17.83 following the announcement, trading near its 52-week high of $17.86, with the current price reaching $17.96, reflecting a 21.11% gain.
The presentation highlighted what management described as "a great start" to the company’s three-year growth plan, with revenue growth of 23.7% on a like-for-like basis and adjusted EBITDA margin expansion to 21.8%, driven by operating leverage, portfolio premiumization, and improved spending efficiency.
Executive Summary
H&H operates a diversified portfolio of wellness brands across three main segments: Adult Nutrition & Care (Swisse, Aurelia), Baby Nutrition & Care (Biostime, Dodie, Good Goût), and Pet Nutrition & Care (Zesty Paws, Solid Gold). The company’s first-half performance demonstrated broad-based momentum, with all three segments contributing to growth while maintaining healthy profitability.
As shown in the following overview of key financial metrics, H&H achieved strong double-digit growth while maintaining healthy profitability and strong cash flow generation:
Chairman Luo Fei stated: "2026 is the first year of the implementation of our three-year growth plan. Thanks to our team’s effort and our business partner, we are very happy to see that we have achieved a great start in the first half of 2026."
Group CEO Akash Bedi emphasized that "this growth did not come at the expense of profitability," noting the company reached an adjusted EBITDA margin of 21.8% while accelerating revenue growth.
Detailed Financial Analysis
The company’s revenue reached RMB 8,695.9 million in the first half of 2026, representing 23.7% growth on a like-for-like basis. This growth was driven by all business segments, with particularly strong performance in the Baby Nutrition & Care division.
The following breakdown illustrates the CEO’s key commentary on segment performance and strategic achievements:
Profitability metrics showed substantial improvement across the board. Adjusted EBITDA increased 71.9% year-over-year to RMB 1,891.9 million, while adjusted net profit surged 153.2% to RMB 919.2 million. The adjusted net profit margin reached double digits at 10.6%, up from 5.2% in the prior year period.
Gross margin expansion was a key driver of profitability improvement. As demonstrated in the following analysis, overall gross margin expanded from 62.5% to 65.4%, attributed to operating leverage, portfolio premiumization, and supply chain excellence:
The margin expansion was broad-based across product categories, with VHMS products improving from 67.5% to 70.2%, infant formulas rising from 55.4% to 60.1%, and probiotic and kids nutritional supplements jumping from 69.5% to 76.7%.
Operating efficiency also improved significantly. The selling and distribution expense ratio declined from 41.1% to 38.1% of sales, driven by investment phasing and scale benefits, particularly in the BNC segment. The company attributed this to improved spending efficiency while maintaining strategic investments in growth initiatives.
Segment Performance Breakdown
The following chart shows how all three business segments contributed to growth, with BNC showing particularly strong acceleration:
Adult Nutrition & Care (ANC): The segment delivered 13.9% LFL growth, contributing 45.7% of total revenue. Swisse maintained its position as the #1 VHMS brand in Chinese mainland’s online market and in Australia. The Chinese mainland ANC business grew 20.5%, with particularly strong performance in emerging channels—Douyin channel revenue increased 57.5%, while new retail channel revenue grew 34.2%. Expansion markets revenue grew 20.5%, now contributing 7.8% of ANC sales.
Baby Nutrition & Care (BNC): The segment achieved remarkable 45.2% LFL growth, contributing 41.8% of total revenue. Infant milk formula revenue in Chinese mainland surged 58.0%, significantly outperforming the overall IMF market which declined 3.5%. Biostime’s super premium IMF market share reached a new high of 20.6%, up from 14.8% in the prior year. The successful rollout of the first-ever imported HMO infant formula supported this growth, along with effective new mother education programs.
Pet Nutrition & Care (PNC): The segment delivered 4.8% LFL growth, contributing 12.5% of total revenue. Pet supplements, the higher-margin category, grew 16.5% on a LFL basis. In North America, Zesty Paws grew 16.7% while Solid Gold returned to positive LFL growth of 6.3%. The brands are now present in more than 23,000 and 4,000 stores respectively across the US.
The following detailed P&L summary shows the comprehensive financial improvement across all metrics:
Balance Sheet Strengthening
H&H made significant progress on deleveraging during the first half, accelerating its debt reduction ahead of schedule. The company reduced gross debt by over RMB 1 billion, bringing total outstanding debt to RMB 7,790 million from RMB 8,790 million at year-end 2025.
The following chart illustrates the company’s substantial progress in reducing leverage and optimizing its capital structure:
The net leverage ratio improved dramatically from 3.45x as of December 31, 2025 to 2.05x as of June 30, 2026. CFO Jason Wang described this as part of a "consistent four-year deleveraging path" and noted the company is now ahead of its original timetable, expecting to reach approximately 2.0x by year-end 2026.
Finance costs declined significantly to RMB 311.9 million in H1 2026 from RMB 579.5 million in H1 2025, with normalized interest expense after hedge benefits of RMB 236.4 million. The company signed a new term loan facilities agreement equivalent to USD 320 million, further lowering its finance costs with an annualized interest expense margin after hedging benefits of 5.65%.
Operating cash flow remained strong at 100% of adjusted EBITDA, demonstrating the company’s ability to convert earnings into cash. The cash balance stood at approximately RMB 1,976.5 million as of June 30, 2026, with additional undrawn liquidity of RMB 1,260 million in RMB credit lines and USD 20 million in revolving credit facilities.
The board declared an interim dividend of HK$0.82 per share, representing 50% of adjusted net profit and totaling approximately RMB 460 million, maintaining the company’s commitment to shareholder returns while continuing to deleverage.
Strategic Initiatives & Market Leadership
H&H’s growth framework focuses on three strategic pillars: winning in core markets, globalization and diversification, and investing for the future. The company demonstrated progress across all three areas during the first half.
In core markets, Swisse maintained its #1 position in the VHMS category across multiple sub-categories in both Chinese mainland and Australia. In Chinese mainland, Swisse ranked #1 in beauty, women’s health, men’s health, detox, heart health, NAD/NMN, and anti-aging categories on CBEC platforms. In Australia, Swisse held the #1 position in multivitamins, detox, muscle support & recovery, sleep, and hair, skin & nail categories, with overall market share increasing from 12.1% to 12.6%.
Biostime strengthened its competitive position in the super premium infant formula segment, with market share reaching 20.6% in Chinese mainland. The brand recruited 550,000 new Stage 1 consumers in the first half, representing approximately 80% of full-year 2025 recruitment. Management attributed this success to effective new mother education programs and the introduction of innovative HMO formulations.
The company’s expansion markets showed strong momentum, with Asian markets growing 31.7% on a LFL basis and European markets advancing 7.8%. In Singapore, Swisse sustained its #1 position in liver health and men’s health categories. In Italy, Swisse ranked #1 in the hair, skin and nail category and #2 in the beauty VHMS market. Biostime retained its #1 position in organic IMF and goat milk categories in French pharmacy channels with market shares of 41.8% and 57.9% respectively.
The following visualization demonstrates the company’s EBITDA mix and margin expansion across segments:
Forward-Looking Statements & Guidance
Based on the strong first-half performance, H&H raised its full-year 2026 outlook across all key metrics. The company now expects group-level net sales revenue growth in the mid-to-high teens, adjusted EBITDA margin in the mid-to-high teens, and adjusted net profit margin in the mid-to-high single digits.
The following strategic outlook details the company’s plans for continued growth, healthy profitability, and maintaining a healthy capital structure:
By segment, management provided the following updated guidance:
- Adult Nutrition & Care: low-teens revenue growth with approximately 20% adjusted EBITDA margin
- Baby Nutrition & Care: more than 30% revenue growth with mid-to-high teens adjusted EBITDA margin
- Pet Nutrition & Care: high-single-digit revenue growth, with Zesty Paws expected to grow in the high teens
For ANC, the company plans to maintain market leadership in Chinese mainland through sustained investment, executing a mega-brand strategy, and expanding presence in high-growth channels including Douyin and new retail. In ANZ and expansion markets, the focus is on strengthening domestic leadership through innovation and channel expansion while sustaining strong growth in Thailand, Indonesia, and the Middle East.
The BNC strategy centers on continuing to gain market share in the super-premium IMF segment through product innovation, particularly HMO formulations, new mother education, and Stage 3 conversion. The company also plans to expand presence in the broader children’s nutrition category to extend the consumer lifecycle beyond infancy.
For PNC, management aims to strengthen Zesty Paws’ market position in North America through disruptive category innovation and an omni-channel strategy, while driving Solid Gold’s growth in high-margin categories and accelerating e-commerce channel growth. The company also plans to continue localizing supply and growing new high-margin supplement categories for Solid Gold in Chinese mainland, while expanding Zesty Paws into new markets including Europe, UK, Asia, and ANZ.
CEO Akash Bedi emphasized the company is "focused" and "winning in our core markets," adding that the strategy is designed for long-term sustainable growth rather than short-term gains. He noted that tighter regulation in China’s cross-border e-commerce market should benefit established, compliant players like H&H by raising barriers to entry and favoring science-backed brands.
ESG Commitments & Progress
H&H continued to advance its ESG roadmap during the first half, turning commitments into tangible outcomes. The company achieved a 56% reduction in Scope 1 emissions group-wide in 2025 versus 2024, while renewable electricity from on-site solar generation now covers 5% of consumption, up from 3.4% in 2024.
The company maintained strong ESG ratings, including Hang Seng (A+) and MSCI (AA), and was featured in the S&P Global Sustainability Yearbook (China Edition) for the second consecutive year with a score of 56/100. More than 1,500 employees participated in World Community Day, and the company achieved China Healthy Workplace Gold Standard Certification for 2026-2027.
H&H’s status as a Certified B Corporation underscores its commitment to balancing purpose and profit, using business as a force for good across its operations and supply chain. The company’s innovation pipeline continues to focus on advancing good health through science-backed products across all three business segments.
Full presentation:
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