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Strong Unsweetened Tea Sales Drive Nongfu Spring's First-Half Profit

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Strong Unsweetened Tea Sales Drive Nongfu Spring's First-Half Profit

Chinese beverage producer Nongfu Spring (HKG:9633) recorded stronger attributable profit in the first half amid what it calls a complex macro environment in China's beverage sector, as unsweetened tea revenue helped expand its top line.

The company's attributable profit grew nearly 17% to 8.89 billion yuan from 7.62 billion yuan in the year-ago period. Earnings per share rose to 0.79 yuan from 0.677 yuan, according to its earnings report filed after market hours on Tuesday.

Total revenue increased 16% year over year to 29.7 billion yuan from 25.6 billion yuan. Tea beverage products led the growth, surging 30% to 13.1 billion yuan from 10.1 billion yuan, while functional beverage revenue jumped about 16% to 3.35 billion yuan from 2.90 billion yuan.

Nongfu Spring attributed the strong performance of its sugar-free tea and functional lines, such as its East Leaf brand and electrolyte beverage series, to consumer trends favoring ingredient transparency and cleaner drink formulations.

Meanwhile, packaged water sales jumped 2.1% year over year to 9.64 billion yuan. Nongfu Spring also added two new water sources in Yunnan and Hainan, increasing the number of major water sources across China to 17.

Looking ahead, Nongfu Spring said it will continue to scale up product innovation, supply chain development and channel capabilities to meet evolving customer needs.

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