China Mengniu Dairy vice chair resigns from business

CHINA – Jeffrey Minfang Lu, vice chairman and former CEO of China Mengniu Dairy, has officially stepped down from his role, marking a shift in leadership for the Chinese dairy giant. 

Lu, who served as CEO from 2016 until March this year when Gao Fei succeeded him, also resigned from Mengniu’s strategy and development committee and its sustainability committee, citing a desire to focus on personal commitments and his family.

In a filing dated 10 October, Mengniu Dairy revealed that Wang Xi has been appointed as a non-executive director, alongside his new role as a member of the company’s strategy and development committee. 

Wang brings extensive experience from his time with COFCO Corporation, where he serves as the deputy director of the group’s strategy department and the general manager of the direct investment division. 

His previous roles include positions at China Development Bank Capital and Deutsche Bank’s investment banking division in Hong Kong.

COFCO Corporation, through its subsidiaries, holds significant shares in Mengniu Dairy. COFCO Dairy Investments, which owns 82.16% of COFCO Dairy Holdings, holds approximately 21.5% of Mengniu’s total issued share capital, while COFCO Corporation has an indirect stake of around 2.64%.

Financial performance highlights

Mengniu’s financial performance for the year has shown resilience. The company’s revenue increased by 6.5%, reaching 98.62 billion yuan (US$13.96 billion). 

This growth was driven by its expanding share in China’s liquid milk market, with liquid milk sales surpassing 82 billion yuan. Chilled yogurt sales saw “counter-trend growth” despite market challenges.

However, the milk formula segment, which includes infant formula, experienced a slight decline of 1.3%, generating 3.81 billion yuan in revenue. Mengniu’s Bellamy’s brand, acquired in 2019, contributed strong sales growth to the company’s overall performance.

While operating profit rose by 13.8% to 6.17 billion yuan, Mengniu faced challenges with net profit attributable to owners falling 9.3% to 4.81 billion yuan. This decline was attributed to higher tax expenses and a reduction in net finance income.

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