Chinese dairy giant Mengniu has conducted personnel changes: the history of company leaders
Source: The DairyNews
According to Jiangxi Business Daily, Shanghai Mengniu Yogurt Technology Co., Ltd. was established at the beginning of 2024 with a registered capital of 10 million yuan. Its activities include internet sales, brand management, supply chain management services, home goods sales, food sales, and other areas. The sole shareholder of the company is Inner Mongolia Mengniu Dairy (Group) Co., Ltd.
On March 26, Mengniu made important personnel changes. According to the company's official statement, the group's president, Lu Minfan, was appointed vice chairman with the functional role of executive director. Gao Fei, former senior vice president and head of the fresh product division, assumed the position of company president and became an executive director.
On March 27, at the Mengniu 2023 performance conference, new president Gao Fei stated that regardless of who holds the position of president today, Mengniu's strategy remains unchanged. Currently, the industry is facing some challenges, and Mengniu will actively respond to them.
The annual report showed that in 2023, Mengniu Dairy achieved operating income of 98.624 billion yuan, an increase of 6.5% over the previous year, while net profit was 4.809 billion yuan per year, a decrease of 9.31% from the previous year.
At a briefing on March 27, Lu Minfan stated that the decrease in net profit was mainly due to the devaluation of large packages of powdered milk caused by excess fresh powdered milk storage, dividend taxes, intensified market competition, and increased sales expenses.
In 2020, Mengniu Dairy's operating profit was 76.035 billion yuan. In 2023, operating profit was closest to the target of 100 billion yuan set by Lu Minfan in 2017.
Mengniu has long held a leading position in the dairy industry. The company was founded in 1999 by Niu Genshen. In just 8 years, Mengniu became the two-time champion of the global liquid milk market and China's dairy industry.
Niu Genshen's successor, Yang Wenzhun, continued his efforts. In 2007, Mengniu Dairy's operating profit reached 21.318 billion yuan, surpassing Yili's 19.360 billion yuan, becoming the largest dairy company in China. This status was maintained until 2010.
In 2011, Mengniu Dairy's operating profit reached 37.388 billion yuan, ranking second in China. In 2012, Yili's operating profit reached 41.991 billion yuan, while Mengniu Dairy's operating profit fell to 36.080 billion yuan.
In 2012, Sun Yiping, who worked at Coca-Cola, became the third president of Mengniu Dairy. In 2014, Sun Yiping pushed Mengniu to acquire 75.3% of Yashili's shares for 11.3 billion Hong Kong dollars. However, during Sun Yiping's era, Mengniu slowed its growth pace, while Yili accelerated, widening the gap between them.
After Lu Minfan took over the company, he carried out a series of radical reforms and large-scale mergers and acquisitions to achieve the goal of increasing profits to 100 billion.
Mengniu Dairy acquired Modern Dairy in 2017 and Shengmu Hi-Tech in 2018. From 2020 to 2021, it controlled Magic Lando, and in 2022, it acquired Shanghai-based Danone's business for low-temperature products.
After these acquisitions, Mengniu Dairy's operating profit exceeded 60 billion yuan in 2017, approached 80 billion yuan in 2019, and approached 100 billion yuan in 2023. However, whether it is operating profit or net profit, the gap between Mengniu Dairy and Yili remains significant.
In 2022, Yili's operating profit will reach 123.171 billion yuan. For the first nine months of 2023, Yili's operating profit was 97.404 billion yuan, close to Mengniu Dairy's annual operating income.
The gap in net profit is even greater. For the first nine months of 2023, Yili's net profit was 9.380 billion yuan, almost double that of Mengniu Dairy.
Analysts believe that the key factors contributing to Mengniu's growth slowdown are poor sales of fresh white milk and devaluation of significant volumes of powdered milk. The company often participates in actions to reduce prices for fresh milk, leading to increased costs. In addition, previous mergers and acquisitions did not meet expectations.
How will Gao Fei change the situation after taking over leadership?
Gao Fei, 47, joined Mengniu in 1999 and held positions as vice president of sales, general sales manager, marketing general manager, and group vice president.
Analysts say that China's dairy industry is currently facing problems such as excess raw milk and intensified competition in the industry, entering a period of growth constraints. The hope that Gao Fei brings to Mengniu and the market is that besides being a veteran of Mengniu and charismatic, Gao Fei's advantage lies in understanding the market and being good at marketing.
"He is one of those who knows Mengniu best and has created the company's most successful products," colleagues say.
On March 27, at the Mengniu 2023 performance conference, new president Gao Fei stated that regardless of who holds the position of president today, Mengniu's strategy remains unchanged. Currently, the industry is facing some challenges, and Mengniu will actively respond to them.
The annual report showed that in 2023, Mengniu Dairy achieved operating income of 98.624 billion yuan, an increase of 6.5% over the previous year, while net profit was 4.809 billion yuan per year, a decrease of 9.31% from the previous year.
At a briefing on March 27, Lu Minfan stated that the decrease in net profit was mainly due to the devaluation of large packages of powdered milk caused by excess fresh powdered milk storage, dividend taxes, intensified market competition, and increased sales expenses.
In 2020, Mengniu Dairy's operating profit was 76.035 billion yuan. In 2023, operating profit was closest to the target of 100 billion yuan set by Lu Minfan in 2017.
Mengniu has long held a leading position in the dairy industry. The company was founded in 1999 by Niu Genshen. In just 8 years, Mengniu became the two-time champion of the global liquid milk market and China's dairy industry.
Niu Genshen's successor, Yang Wenzhun, continued his efforts. In 2007, Mengniu Dairy's operating profit reached 21.318 billion yuan, surpassing Yili's 19.360 billion yuan, becoming the largest dairy company in China. This status was maintained until 2010.
In 2011, Mengniu Dairy's operating profit reached 37.388 billion yuan, ranking second in China. In 2012, Yili's operating profit reached 41.991 billion yuan, while Mengniu Dairy's operating profit fell to 36.080 billion yuan.
In 2012, Sun Yiping, who worked at Coca-Cola, became the third president of Mengniu Dairy. In 2014, Sun Yiping pushed Mengniu to acquire 75.3% of Yashili's shares for 11.3 billion Hong Kong dollars. However, during Sun Yiping's era, Mengniu slowed its growth pace, while Yili accelerated, widening the gap between them.
After Lu Minfan took over the company, he carried out a series of radical reforms and large-scale mergers and acquisitions to achieve the goal of increasing profits to 100 billion.
Mengniu Dairy acquired Modern Dairy in 2017 and Shengmu Hi-Tech in 2018. From 2020 to 2021, it controlled Magic Lando, and in 2022, it acquired Shanghai-based Danone's business for low-temperature products.
After these acquisitions, Mengniu Dairy's operating profit exceeded 60 billion yuan in 2017, approached 80 billion yuan in 2019, and approached 100 billion yuan in 2023. However, whether it is operating profit or net profit, the gap between Mengniu Dairy and Yili remains significant.
In 2022, Yili's operating profit will reach 123.171 billion yuan. For the first nine months of 2023, Yili's operating profit was 97.404 billion yuan, close to Mengniu Dairy's annual operating income.
The gap in net profit is even greater. For the first nine months of 2023, Yili's net profit was 9.380 billion yuan, almost double that of Mengniu Dairy.
Analysts believe that the key factors contributing to Mengniu's growth slowdown are poor sales of fresh white milk and devaluation of significant volumes of powdered milk. The company often participates in actions to reduce prices for fresh milk, leading to increased costs. In addition, previous mergers and acquisitions did not meet expectations.
How will Gao Fei change the situation after taking over leadership?
Gao Fei, 47, joined Mengniu in 1999 and held positions as vice president of sales, general sales manager, marketing general manager, and group vice president.
Analysts say that China's dairy industry is currently facing problems such as excess raw milk and intensified competition in the industry, entering a period of growth constraints. The hope that Gao Fei brings to Mengniu and the market is that besides being a veteran of Mengniu and charismatic, Gao Fei's advantage lies in understanding the market and being good at marketing.
"He is one of those who knows Mengniu best and has created the company's most successful products," colleagues say.
