Tianchang Group Reports Sharp Decline in E-cigarette Business Revenue in First Half of 2025, Revenue Drops by Over 50% from Previous Year

Key Points:

·E-cigarette business revenue: In the first half of 2025, e-cigarette business revenue was approximately 22.389 million Hong Kong dollars, accounting for 8.8% of the total group revenue, a decrease of 52.5% from 47.142 million Hong Kong dollars in the same period in 2024. 

·Profitability: The gross profit of the e-cigarette business was approximately 2.556 million Hong Kong dollars, lower than the 5.737 million Hong Kong dollars in the same period of the previous year; the gross profit margin slightly decreased from 12.1% to 11.6%, mainly due to a decrease in sales volume leading to an increase in fixed costs per unit. 

·Business model: Manufacturing disposable e-cigarettes, refillable e-cigarettes, battery rods, atomizers, and heating tobacco devices as an OEM, selling them to overseas and mainland Chinese markets. 

·Compliance qualifications: Obtained the Tobacco Monopoly Administration of China's tobacco monopoly production enterprise license, valid until 2026. 

·Research and development investment: Research and development expenses for the period were approximately 7.4 million Hong Kong dollars, mainly used for the upgrade of core technology in e-cigarettes.

2Firsts, September 1, 2025 - Tianchang Group Holdings Limited (stock code: 2182) recently announced its interim performance for the six months ending on June 30, 2025.

The e-cigarette business data for the reporting period is as follows:

E-cigarette product revenue: approximately 22.389 million Hong Kong dollars, accounting for 8.8% of the total group revenue. This represents a decrease of about 52.5% from the same period in 2024, with a reduction of over half.

Profit from the e-cigarette business amounted to approximately HK$2.556 million, which is lower than the HK$5.737 million recorded in the same period last year.

Gross margin decreased slightly from 12.1% to 11.6%. The main reason for the decrease was a reduction in sales volume, which led to an increase in the allocation of fixed costs per unit product.

Business characteristics and strategies.

·Business model: The company acts as an original equipment manufacturer (OEM) producing disposable e-cigarettes, refillable e-cigarettes, battery rods, atomizers, and heating tobacco devices for sale in both overseas and domestic Chinese markets. 

·Compliance qualifications: The group has obtained a tobacco monopoly production license issued by the Chinese State Tobacco Monopoly Administration, valid until 2026. 

·Research and development investment: R&D spending during the period was approximately 7.4 million Hong Kong dollars, primarily used for upgrading the core technology of e-cigarettes.

According to reports, Tianchang Group is an integrated injection molding solution provider, focusing on mold design and production services as well as injection component design and manufacturing services. In recent years, the business has expanded to manufacturing e-cigarette products through OEM. Tianchang Group has previously provided OEM services for the e-cigarette brand "blu" under Imperial Tobacco.