H&H Group’s pet business grows on supplements despite margin pressure

The Pet Nutrition and Care (PNC) segment of Hong Kong-based Health and Happiness (H&H) Group recorded revenue growth of 8.7% for the fiscal year (FY) 2025, which ended 31 December 2025, totaling RMB 2.5 billion ($360M/€300M).

This growth was driven by strong performance from its pet supplements brand Zesty Paws, as well as investments in expanding markets. Pet supplements alone reported RMB 1.54 billion ($220M/€190M) in revenue, up 14.7% YoY.

The PNC segment contributed 15% of total group revenue, roughly in line with the previous year (15.1%). Despite revenue growth, adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) fell from 4.8% in 2024 to 3.1% in 2025.

Performance by market

The North American PNC segment contributed 80.1% of total revenue, at RMB 1.7 billion ($240M/€210M).

Another 17.5% came from Mainland China, at RMB 375.6 million ($54M/€47M), and the remaining 2.4% from other territories, including Asia and Europe, totaling RMB 52.6 million ($7.6M/€6.6M).

Tariffs contributed to a decline in the pet business in Mainland China in the second half (H2) of FY2025. The pressure on profitability prompted a proactive shift toward supply localization – moving from imported to domestic products – which temporarily affected sales, the company says.

Meanwhile, supplement products in the country experienced a 123% increase in revenue.

Solid Gold

The pet food brand Solid Gold underwent a premiumization and restructuring process in Mainland China, which helped the PNC segment return to growth (8.6%) in the region.

These changes also helped it to offset its losses in North America. “The restructuring of Solid Gold was completed, and its decline has since begun to narrow (13.1%), with the decline stabilized in the second half of 2025,” the company says.

The pet food brand was supported by e-commerce, which accounted for 83.1% of sales, and was available in more than 4,000 stores nationwide.

“We’ve finalized the restructuring of Solid Gold to support our channel optimization and the premiumization of our product portfolio – a measure that is already paying off, as we’re seeing the brand’s overall decline in the market improving, especially in the second half of the year,” says Suceka Li, CEO for China at H&H Group.

Zesty Paws

In North America, Zesty Paws delivered 12.8% like-for-like (LFL) growth, supported by e- commerce, mainly Amazon and Chewy, according to Li, and global pet health trends.

The group’s rotating CEO adds that major retailers such as Walmart, PetSmart, Petco, Tractor Supply, Target, Sam’s Club, CVS and Menards also supported performance.

Zesty Paws is currently available in more than 20,000 stores across the US and was launched in the EU and UK markets in 2025 through omnichannel strategies.

Company-wide performance

Total group sales returned to a positive double-digit growth trajectory of 10.3% YoY, reaching RMB 14.3 billion ($1.9B/€1.8B).

The company reported a 13.2% increase in gross profit to RMB 8.9 billion ($1.2B/€1.1B), while adjusted EBITDA rose 5% YoY to RMB 2 billion ($280M/€250M).

Adjusted EBITDA margin reached 14.3%, while adjusted net profit grew 22.7% to RMB 664.1 million ($90M/€80M).

Outlook

In FY2026, H&H expects Zesty Paws to continue driving growth in North America through “disruptive category innovation” and the expansion of its omnichannel strategy.

For Solid Gold, the group will focus on high-margin products in North America, “aiming for a sales contribution exceeding 37.4%,” it states, while expecting to complete the localization of supply in Mainland China by the end of 2026.