I'll now pass it over to Mr. Luo Fei for his opening remarks. Thank you.
Good morning and good evening, investors and friends. Welcome to today's webcast for H&H Group 2020 Annual Results. 2020 marks the beginning of the third decade of 21st century, as well as the beginning of the third decade of the H&H Group. At the beginning of the year, we had a very clear strategy to rapidly push forward our development. After the sudden outbreak of the COVID-19, we had to quickly adjust, reallocate the resource, and fine-tune our strategy to ensure the stable development of our business, particularly in mainland China, our largest market. As a result, we continued growth of our indeed. On the contrary, the profitability compared to 2019. In Australia and New Zealand, our second-largest market, both governments closed their borders at the beginning of the pandemic, which had a huge impact on the sales and profitability of our Daigou export business.
Our agency bravely faced these challenges, changing their strategy and redirecting resources to focus on domestic consumer market. In particular, the growing demand for immunity-boosting products. We quickly make headway growing our local market share in the ANZ market in 2020. Thanks to the strong efforts of our team, we also achieved double-digit growth in our other markets, with the exception of the Hong Kong market. While, as we know, those markets are still in the investment stage. I'm pleased to say that some have already become profitable, providing an excellent foundation for our future growth. In the face of a global pandemic, we see our mission of making people healthy and happy as being more important than ever. The health of a pet is an important part of this, with pet nutrition being a very fast-growing category.
Through our early acquisition of Solid Gold, we immediately entered two important pet nutrition markets in the United States and China. Our pet nutrition and care category, or we call PNC, will be the fastest-growing segment in the future. Preserving a healthy cash position and net debt leverage is also very important to our operations, and I'm delighted to announce that we continue to pay a dividend of 60% of net profit. I thank you, our shareholders, for your continuous support. When faced with any challenge, we always position H&H Group as a mission-driven, sustainable, and fast-growing company. Our main growth contributors will remain organic growth in our existing markets, expanding into new markets and into the new product category, and through strategic mergers and acquisitions. We also strongly believe that sustainable development is a necessity and not a choice.
We have developed a robust development plan for the next three years. It outlines how we must return to our original faster-growing path of achieving sustainable profit growth and growing our market share in all main categories in all our main markets. I now invite our Chief Executive Officer, Laetitia Garnier, to present to you all. Thank you.
Good morning, everyone. Thank you, Fei, for your opening remarks. Thank you for being with us today. We are pleased to announce another year, our consecutive year of increased revenue and net profits as a H&H Group, continuing our track record of profitable growth. As Fei just mentioned, in this very unprecedented environment, we have made as a group improvements in our core markets. We have improved our net profitability and our return on invested capital, and we have continued to focus on driving share value for the broader society and the planet, driving value for our stakeholders. The results that we have announced yesterday night reflect our team's ability to shift and to respond to huge changes in our environment while maintaining focus on our strategy.
Despite the pandemic, we have retained our consumer-led approach, which is at the core of our purpose, and we have combined this with a strong innovation capability to accelerate some of our plans. At the same time, our financial principles and our prudent capital management also meant that we have been able to continue to invest in our brands in core and new markets with financial discipline, but also invest for the long term, such as the acquisition of Solid Gold, while maintaining healthy cash flows and leverage levels. Now I'm going to our presentation, and before going into the numbers themselves, I hope that you will appreciate the design of our cover page, which we have done with all of our heart and which is a mix of pictures of our own team members with their smiling faces.
Despite the environment we're living in, despite the business challenges we have faced, we are seeing today a very high team engagement because our employees are proud to be working for a purpose-led organization which is growing, which is creating value, and which mission is to make people healthier and happier. Thank you. Not sure why Yes. You've got on this slide our 2020 performance overview. As just mentioned, we have, despite all the challenges, the pressure we have faced in ANZ, we have, as a total group, been able to achieve another year of profitable growth. We have achieved a 2.5% revenue growth, supported particularly by the double-digit growth in our Mainland China business, as Fei just mentioned. We have reported a - 3.2% in our adjusted EBITDA, linked to the pressure we have faced from the operating deleverage in ANZ.
While we have been, as you can see, proactively able to adjust our spending, our OPEX, and refocus our investments in the right parts of the business to minimize the impact on our EBITDA. As a result, we have still reported a double-digit net profit growth of 10.1%, which shows our ability to adjust, to invest smartly, to have an efficient capital management, and also to lower the cost of our debt. As a result, we have also reported a continuous earning growth of 12.7% and also an operating cash flow as a percentage of EBITDA of 100.7%. I think that is also an important metric because it shows the high cash flow conversion that we have from our business and sales to EBITDA, the light asset business model, and a very high cash generative business.
As a result of this healthy leverage, high cash conversion, we have been able, as Fei mentioned, to achieve and to reward our shareholders with a 50% dividend payout, which is the second consecutive year of paying this dividend to reward our shareholders. Key financial highlights of this year, 2020. This is the stage, actually. I guess the main driver that we want to call out for our growth during the pandemic and this 2020 unprecedented year are two things. The first one is the strong demand for immunity products across categories, both in BNC and ANC, and also the acceleration of digital sales and online. We have been talking about that before 2020, but we have accelerated that during the year to capture those trends and make sure we answer consumer demands in those two growing trends.
The revenue from Mainland China has grown 10.0% year-on-year, which is a strong performance, and accounted for 82.8% of our total group revenue. Within that Mainland China business, IMF is obviously our largest category. It has grown 2.7% year-on-year. Probiotic has grown 12.7%. Other pediatric products, mainly Dodie diapers, has increased 21.9%. Our Swisse business in China has achieved a strong growth of 25.4%, now accounting for 61.2% of our total Swisse revenue. Of course, now our largest market for total Swisse business. Our revenue in ANZ has been obviously more challenging, -32%. The pressure has been obviously focused on the diaper channel, where we've been experiencing pressure as a result of the border closure, the lack of tourists coming into the country. We have, at the same time, seen strong momentum from domestic demand.
Our third geographical pillar, which we call Other Markets, outside from Mainland China and ANZ, has been able to achieve 2.2% growth year-on-year and a double-digit growth if we exclude Hong Kong and SAR. Beyond financial numbers, just four things that I would like to highlight for 2020 in terms of the way we have managed our business. The first of all is the supply chain management, because you're seeing and covering a lot of companies, and I'm sure you're seeing a lot of disruption in business and eventually translating into results from supply chain disruptions because of the pandemic, whether these are quality issues, supply shortages, or cost increase. I think we can say as a business that we have been managing this part pretty well, very proactively, and so kept our product quality intact. Supply chain continuity has been ensured.
We haven't seen any major disruption to our business, and we have managed our costs pretty well. The second part is new product launches. We are a product organization driven by innovation. Our ability to put new products to the market is very key to answer the consumer demand. As a result, we have not been affected by the pandemic in terms of launching our new products on time. This has been on track, and I think that I want to highlight that as a great performance from the team to keep innovation on track and answer consumer-led trends despite the pandemic. The third part is that whether that's ANC, BNC, or now PNC, our product categories are resilient to crisis, and last year has demonstrated that. We have actually seen an upside of demand from immunity-related products.
Beyond the pandemic, we think that we are in resilient and growing categories, which is definitely an asset for us to grow in the future. The fourth one is beyond business itself. 2020 has really witnessed a focus or reinforced focus on sustainability and the importance of having a sustainable business. We have reinforced all of our efforts despite the pandemic and kept our focus to become a best-in-class sustainable organization. We will come back to that. Our strategy is still the same, and we have carried it forward through the pandemic.
We had two very strong business pillars of BNC and ANC, Baby Nutrition and Care and Adult Nutrition and Care, and we have created in 2020 a new pillar of growth for the business, PNC, which now enables us to cover the whole family nutrition and wellness needs with our different premium, proven, aspirational, and engaging brands. I think that puts us in a unique position with these three pillars to continue to grow in the future. I've been talking about product innovation. We are a product organization, so our ability to innovate, to follow consumer trends, but also in our DNA, we have science-backed products in our genes. Everything we put to the market has to have efficacy, but also has to follow consumer trends.
We have highlighted here four trends that have been accelerated last year and where we have been able to innovate and put new products. Plant-based is obviously one of these trends. Immunity, we spoke about that. Pre and probiotic HMO, moving into more new formats such as kids gummies. Our ability to launch new products in that immunity supplement range has been very important. Beyond physical wellness, mental wellness, sleep, mood, CBD, management of stress. We have been one of the only organizations who's been able to launch very quickly and very efficacious CBD related products, and mental wellness proposition in general has been increased and improved for Health and Happiness as a group in 2020, which I think is a great performance. Swisse is very strong in beauty, in general, beauty from within.
Beyond skincare, taking care of your skin and of your beauty from within has been in our genes and Swisse's genes, and we have continued to innovate and launch new products, including collagen products, very efficacious and also consumer led throughout the course of 2020. Consumer trends, we have spoken about them, everyone's aware, but it's important still to reinforce three things. The first is that broader health cautiousness, beyond just physical health, it's body and mind, which fits very well with our three pillars of wellness at Health and Happiness that we have been talking about for a long time, nutrition, movement and mindfulness. Our ability to answer that beyond just immunity, and this broader wellness proposition is becoming more and more relevant for the consumer. Digitalization, of course, of everything, of consumer communication, digital sales, and we will see how we have embraced that in 2020.
Of course, this notion of sustainability, not just as a corporate organization, but from a consumer perspective, this notion of build back better, the notion of transparency, of traceability, of buying products that are making less negative impact on the planet. We are seeing consumers being willing to now pay a premium for products that are more sustainable, more traceable, more transparent. What that means for H&H, obviously, we are a science-led and innovation-led organization. We need to be able to talk to consumers about why and how our products are improving their lives and their health. So we have continued those efforts in 2020 in our consumer communication by strengthening our innovation. We have also accelerated digitization with a more data-driven approach, and also increased the total contribution of our digital sales to the total business.
I think a key number that highlights that is the total digital sales at a group level was 23% in 2019. It's gone up to 33% in 2020. A clear acceleration of our e-commerce sales. If we have a look at our performance by territory, as mentioned at the beginning, it's a mixed performance. We have seen a very strong performance in mainland China, which is definitely our core business, accounting for 82.8% of our total sales. 10% growth is a good performance in light of the challenges we have faced last year. We'll come back to the detail of that performance.
Obviously, a much more challenging performance in ANZ identified in the Daigou channel, but also rest of the world, which now accounts for 6.1% of our total sales and is expected to continue to grow as a contribution of our group sales with 2.2% in 2020. As I said, actually a double digit growth if we exclude the Hong Kong SAR region. I will go quickly through the next slide to directly go through our performance in terms of EBITDA. Obviously, again, a mixed performance as we mentioned, as a deleverage of the ANZ region. Our EBITDA margin at the ANC level has been impacted, while we have, on the other end, seen an improvement of our BNC EBITDA margin. Jason will comment more on our EBITDA margin and EBITDA performance in general.
I just want to highlight that despite the pressure we have faced from ANZ, we have done a lot of proactive measures to maintain our profitability. Actually our EBITDA in China, our core market, has been improved in 2020, both in ANC and BNC. I think that's a very important information. Going into the performance by geography. In 2020, in our core Chinese market, again, 10% revenue, 5.5% in BNC, and 25.4% up in ANC with Swisse China as being still a key core growth driver of our growth as a total group. In BNC segment, which still accounts for three quarter of our sales in China, and ANC about one quarter of our sales in China. BNC China is still obviously our biggest business unit, and IMF, infant formula within that, is the largest contributor.
We have been able to come back to growth in the IMF revenue with a reported 2.7% growth for the total year. If you remember in the first half of last year, we had seen pressure as a result of the epidemic in China, and the lack of offline traffic. We have recovered that in the second half, both by expanding our distribution network, but also want to highlight a strong online performance. Really a mix of growing faster and continue to penetrate into more stores in the offline market, but also growing online, as well as an increasing sales contribution from the growth IMF. I already mentioned that our probiotic revenue has also seen double digit growth on the back of very strong first half of last year. Also other pediatric products such as Dodie growing over 21%, which is a good performance.
We will come back to ANC and Swisse in China, obviously very happy with the performance of our Swisse brand in China, which is getting more awareness, and beyond cross-border e-commerce is moving into the normal trade channel. On this page, you've got a snapshot of our performance in terms of infant formula, cow infant formula in China. We have maintained a stable market share at 6.1%. I think what is important is to see that we are growing in the super premium segment. We are number four. We've grown 0.4% market share, and this is a clear focus of the business, to position Biostime as a super premium player, also by combining our probiotic and our infant formula Star Series, reinforcing this immunity message, and making sure that we win in this super premium segment.
We see here that the goat infant nutrition contribution is growing 6.3% on the back of a strong performance from our goat IMF, and also on the back of a strong demand from Chinese consumers for goat infant formula as an alternative to cow infant formula. If we look at our performance per channel, we can actually go to the next slide and see that although in terms of e-commerce, we are still lower than the industry average, but the contribution of e-commerce to our total sales is growing. On the right side of this slide, you can see that our market share online has actually grown significantly during the course of 2020, from 2.2%- 3.4%.
I want to highlight that because we have been talking about growing on e-commerce for some time, last year was a massive competition online as every brand were refocusing their efforts into growing in the fastest-growing segment of the market. We have been able to demonstrate that we are able to grow online, while at the same time keeping an overall healthy business, our ability to continue to grow in this channel is obviously important. Swisse in China. We continue to grow the business. Since the Swisse acquisition in 2015, we have been talking about how to maximize the potential of that Chinese demand for supplement products and continue to grow the brand in that core market. Swisse China already is the largest market for Swisse, accounting for 61.3%, we expect this contribution to continue to grow in this very large VHMS market.
Swisse is still the number one brand online with very strong awareness on CBEC. The next challenge and opportunity for us is to continue to grow in the normal trade channel by launching more products, more Blue Hats, and more in-China products that fits with the needs of the local consumer. We have seen actually a very strong growth of the normal trade e-commerce sales of Swisse in China during the course of 2020, while we have seen more challenges on the offline channel as a result of the low traffic in pharmacies. Overall, strong progress made in the normal trade channel, and we will continue these efforts. Performance of the business in the ANZ region has obviously been challenged, but it's very clearly identified in the Daigou channel. We have spoken about that already.
Border restrictions, lack of tourist traffic, and students buying from the shelves. Obviously, the China-related demand within the Australian market is being challenged. Obviously, we don't see this dynamic changing as we speak. On the other end, the domestic demand has been strong, and Swisse has been able to actually grow share and grow faster than the total category from a domestic perspective. Our team is very clear that they need to refocus their efforts on this domestic demand, and they have made a lot of progress to grow in also more domestic and local consumer-related channels, such as grocery, such as online. We have launched a new range. You can see on the right side, Swisse Nutra+, which is a very premium pharmacy-recommended range, beyond the counter, which has also helped us to move into more local pharmacies.
Over 1,000 new pharmacies opened with the new Swisse Nutra+ range, which is also driving more domestic recognition from the brand and awareness from the brand from domestic consumers. We will continue to grow Swisse as the brand of choice for Australian consumers. In the rest of the world, we are very proud of this performance because, again, the pandemic last year was obviously stronger in the rest of the world, and particularly in Asian countries, in Europe, in the U.S., where we have grown some presence with our brands in the past few years, as you know. I would like just to call out three particular achievements. The first one is in France, and you know that the pandemic in France has been also pretty severe and is still going on as we speak now.
Despite that, we have been able to achieve a number one organic infant formula brand position in French pharmacies. From zero brand awareness four years ago to now being the leader in organic in French pharmacies is a pride for our team. We have now 37% market share, and we are one of the most digitally aware brands from French moms in the French market, which I think is a great performance and will continue to strengthen that position in the French market. The second thing I'd like to highlight is Swisse in Singapore and Italy. Singapore is not a very large market, but it's an important and a strategic market, very mature, premium. Swisse is now ranking in the top five VHMS brands in this market. When we bought the business from PGT several years ago, I think we were only in the top 10.
We are now in the top five and seeing market share increase very significantly. We are very proud of this performance. The second one is Italy. On the back of a very strong pandemic in Italy last year, we have still been able to grow, both offline but also online, with a strengthened position in the beauty from within segment. As we grow these markets, of course, Fei mentioned that at the beginning, it's not just about top-line growth, it's also about starting to build profitability. We are happy to report that some of these markets are already profitable and will continue that path as we speak throughout 2020 and the future. We'll continue to grow the business and aim at profitability. PNC are moving to Pet Nutrition and Care at the end of last year. You're all aware of this move.
I think the capital market really understood what we were trying to achieve. Our teams and all of our stakeholders understand that it makes strategic sense for us to include pets as a key part of the family because of this humanization trend of pets, and that they are actually, from a marketing perspective, from an ingredient perspective, actually synergies between BNC, ANC, and PNC. We are very happy about the performance of the Solid Gold brand in 2020, although we've only consolidated about 20 days of results because we acquired the brand in December. The company has achieved RMB 64.2 million of sales in 2020, which was above what we expected and a significant growth of 49%.
Going forward, of course, for us, for Solid Gold, very clear priorities will be to continue to grow the US market and to expand and scale up in China, where we have a lot of market knowledge and a lot of potential to leverage across these two key markets. Sustainability. For the first time, we as Health and Happiness are reporting our ESG efforts along with our results, and we are going to publish our ESG report at the same time as we report and we publish our annual reports, which is great efforts for our team and really shows for us the willingness to align our business performance with our ESG efforts, because for us, they are one thing together. I think the results speak for themselves.
We have seen an increase in our ESG ratings on the bottom of this page from major index in 2020, which we had set as a KPI, as a target. This is a reflection of efforts that we have kept throughout 2020. We have clearly identified where we want to make an impact in sustainability in four major areas. Good health, the story of good health, which is about how we can make an impact in improving people's life and health, our impact on the environment and how we protect the planet, our impact on social and human fairness as a third pillar, and of course, how we improve our sustainability governance as an organization.
I would not list out all of the achievements, but you can clearly see that we have made very significant progress, and we are now, as a business, coming back to our sustainability strategy, really aligned in terms of mindset of how we should run our business, and that sustainability is not just a must or a requirement that we're putting to ourselves, but it's actually becoming a force for the business to do business in a better way and eventually bringing sustainable business outcomes by putting people's priority and also the broader society and planets and our stakeholders at the core of what we do. Eventually, we create shared value, which will definitely have a positive impact on our business performance going forward.
I feel our teams and our stakeholders are very much aligned on what we're trying to achieve, and we'll carry on these efforts throughout 2020 and beyond. Of course, we have still set, as you know, a 2025 target to become B Corp certified at a group level. We had our first entity certified last year, first brand, and we will continue to have several regions certified in the coming one and two years to go step by step towards this certification. We have made some very concrete commitments for 2021 in terms of environmental impact, reduction in water, in waste to landfill, in using more renewable energies, et cetera. Beyond just, again, environmental impact, it's the broader sustainability that we are looking at and making improvement in all the different areas, including the story of good health, including governance, including diversity, et cetera.
If we move towards our 2021 strategy and outlook, obviously we are still committed to continue to drive profitable and sustainable growth. Going into 2021, we are committed to profitable growth, to continue our revenue growth and to improve our margins in 2021. We are obviously still seeing pressure in the ANZ region, but we are better equipped to anticipate them and to mitigate these impacts. We'll be in a better position to proactively react, and that, as a result, will help us to improve our margins. Mainland China remains our largest market, so obviously we are committed to continue to deliver growth both in BNC and in ANC, while we also start to establish PNC as the third business unit in our China business. As we speak now, our team has really started to activate the marketing and the sales in the China region.
From a BNC perspective, definitely there is competitive and macro pressure with declining birth rate and intensifying competition in IMF, but we are confident that Biostime can continue to grow market share in the IMF segment on the back of an extended distribution network and a very clear product portfolio strategy. For ANC, we'll continue to grow Swisse brand awareness. Again, beyond ANZ, we're seeing big potential for our brand also in the normal trade, not on offline, but also e-commerce. We'll continue to grow the Swisse business in China in this direction. We will continue to, I spoke just briefly about ANZ, definitely have a clear focus on domestic consumers. We are expecting the ANZ market to gradually stabilize. We continue to foresee pressure in the Daigou segments. We'll manage that, as we said, proactively and very clearly focused on driving domestic market share.
In other parts of the world, we'll continue to expand Biostime and Swisse in some key international markets. We will be selective. We'll do that with discipline and also with a very consumer-centric and product innovation mindset in mind. Of course, we will continue to strive for being a best-in-class sustainable organization. Again, we have set very clear targets and KPIs for 2021 to continue to make progress in the field of sustainability and on our journey to become a B Corp certified organization. A last word on our strategy beyond 2021, we definitely have the vision to become a global leader in premium nutrition and wellness through superior products and aspirational brands. As I said at the beginning, we are clear and confident that we now have three pillars of growth with very strong brands in markets where we can drive growth going forward.
Of course, for us, the focus that is needed to win in our core China market, it is our top priority. Growing, continue to grow Biostime in China and Swisse in China, continue to invest in our brand, product innovation and channel expansion, and also gain that domestic leadership for Swisse in the ANZ region. Beyond winning in core, obviously, we still believe as an organization that diversification is strategic and is healthy. We will continue to diversify, again, from a geographical perspective, continue to expand into selected international markets, including the ones that I mentioned earlier, where we think we have a chance to win with a strong brand and product proposition, and expand into the PNC pillar, which we believe will be a growth driver for the business.
We will also continue to invest for the future, to digitalize the business, to try new business models including D2C, and also continue through our leveraging the investment we made through our New H2 fund, into mega trends such as personalization, plant-based, CBD, et cetera, to strengthen the innovation for the total business. We will do that, again, with the right discipline, with a profitable and accelerated growth mindset in mind, very consumer-centric approach, and eventually by really effectively managing our capital to invest where we think there is the highest and the best return for the business. Thank you for your attention. I would now invite our Chief Financial Officer, Jason, to share with you our financial detail, financial profile. Thank you.
Thanks, Laetitia. Good morning, everyone. Now I would like to share with you more financial details from our result announcement. As you can see from the P&L summary page, we maintained the positive revenue growth of the overall business in 2020, with the healthy profitability and cash flow. In particular, we have improved our net profit margin and net profit itself, achieved double-digit growth. If we look at the breakdown of financial items by P&L, cash flow and balance sheet, as you can see in the next page, we show here the gross margin by category. Overall, the group's gross margin was 1.9 percentage points below last year. This is mainly due to the pressure from the product mix and market mix change, which we have highlighted during our interim report and quarterly report announcements.
If we look at the breakdown here for the infant formula, this is mainly due to the higher revenue portion from the slightly lower margin infant formula products of goat milk and domestic series. Overall, the IMF gross margin still stayed at a healthy level of close to 64%. The probiotics has enjoyed the slight improvement of the margin, thanks to the COGS improvement last year. The other pediatric products also see a slight decline of the gross margin, mainly due to the higher portion of revenue contribution from our Dodie-branded diaper range. For ANC side, we have also seen a slight decline of 2.4 percentage points, mainly driven by three factors. The first is the lower revenue portion from the Daigou business. Second is due to the provision made for the supply chain model change in Australia and U.S.
The third is due to the provision and also the discount made for the stock clearing during our China normal trade channel optimization. For 2021, we will continue to see on the BNC side, the continued product mix impact. With the further improved spending ratio, then we shall see a stable EBITDA margin for the overall BNC business. While for ANC side in 2021, then we shall see a stable gross margin going forward. If we look at the next page on the selling and distribution expenses, we are happy to maintain a stable selling and distribution expenses throughout the whole year of 2020. We made a very clear indication one year ago that we will keep the whole overall selling distribution expense within this 40% cap.
In 2020, despite the ANC, ANZ sales decline, which resulted in the slightly higher ANC spending ratio, we managed to neutralize this impact with the strong efforts made in the expense improvement on the BNC side. Therefore, on a total basis, we've maintained this very stable selling distribution expense ratio. Definitely this spending efficiency efforts will continue in 2021. In the next page 34, we also show here the breakdown of S&D expense by existing markets and the new markets and new categories. Again, we fulfilled our indication made one year ago that the investment in the new categories, new markets, should not exceed 10% of the total group's S&D expenses. As you can see, the final result is 9.5%, well within this 10% cap.
This is really thanks to the efforts also made in those new markets, new categories, to improve the efficiency of spending as well. Going forward, we will continue this good approach so as to strike a right balance between the adequate level of resource invested in those new markets and new categories, and the ambition to still keep efficient spending level and healthy profitability. Next page, we look at our admin expense development side. The same spending efficiency improvement efforts also being implemented and made in the admin areas as well. Therefore, despite the challenges we faced last year in many markets and areas due to the COVID-19, we have managed to maintain a stable admin expense ratio on a group total basis. Again, this kind of efficiency improvement efforts just continue in this year.
The next page, we move from P&L to the balance sheet. You can see on the working capital side, on a total basis, we maintained a stable working capital turnover for 2020. On the receivables side, we have improved slightly. Thanks to the efforts to manage our credit risk, especially amid the volatility of COVID-19. On the payable side, even though on the reported basis, the turnover days came down slightly, but this is mainly due to the cut-off differences. There is no material change to our overall payment terms and conditions with our suppliers.
On the inventory turnover side, which was a focus throughout the whole year last year, we are happy that the overall inventory turnover days maintained at a stable level with just a slight increase of 60 days, but this is mainly due to the stock buildup at the end of last year for BNC for the coming Chinese New Year holiday season. For 2019, one year ago, this stock buildup was already consumed at the year-end because, as you may recall, the Chinese New Year in 2020 was in January. Therefore, this season was higher, a lot earlier than this year.
What I want to highlight here is that, as you may recall, in our interim report results announcement for first half of last year, our inventory turnover days went up to over 180 days, mainly due to the need to build up the safety stock for both BNC and ANC in the first half of last year amid the COVID-19. In the second half of last year, we managed to further improve our overall inventory position, along with the gradual relaxation of improvements of the overall COVID-19 situation, especially in China. We managed to improve both the inventory balance and the turnover, especially in the second half of last year, to go down to this overall stable level on the full year basis. We are happy with this positive development and definitely, again, the efforts will continue this year.
Let's move to the next page 37 to look at our overall liquidity status. As Laetitia just mentioned, we have maintained this high cash generation business model. The cash flow generated from operation versus our EBITDA stayed at a very high level. As you may recall, the pre-tax operating cash flow accounted for 97% of our EBITDA one year ago. For 2020, this conversion ratio even went up slightly to over 100%. This really shows a very healthy liquidity status. On the cash balance side, we see the same kind of picture with also the prudent investment in the capital expenditure, which stayed at RMB 106 million, well in line with our indications. We maintained a strong cash balance of RMB 1.8 billion at the end of 2020 on a reported basis.
As you know, we made a payment of RMB 163 million in December 2019 for the Solid Gold acquisition. If we add this amount back on the pro forma base, our ending cash balance was RMB 2.9 billion. This really shows a very healthy liquidity and cash position for the whole group throughout the whole year. Let's move to the next page 38 to look at our leverage status. Also, throughout the whole 2020, we maintained a stable cash, debt position for the group. Even though on a recorded basis, you may notice that on the left-hand side of this slide, our debt balance increased by $75 million U.S. dollars. This is mainly because we completed our refinancing of term loan and the bonds at the end of 2019.
For that new term loan of $66 million-$105 million, within that, the last tranche of $75 million was only drawn down in January 2020, according to the schedule. Therefore, the actual debt remained the same from the beginning to the end of the year at $925 million. Thanks to the successful refinancing of overall debt portfolio at the end of 2019, in 2020, we enjoyed the other full-year benefit of this finance cost saving, with the saving of over RMB 130 million achieved. This saving was slightly higher than our original expectation, thanks to the appreciation of RMB against the U.S. dollars last year. On the leverage side, we maintained a healthy leverage ratio as well. On the net leverage ratio point of view, which is the net debt divided by the EBITDA, we saw a slight increase from 1.64x- 1.94x .
This increase is mainly because of the cash made for the Solid Gold acquisition in December. If we look at on the gross leverage side, without this special effect of cash movement, then you can see our gross leverage remained at also stable level, around 2.8x . Overall, it is a very healthy level, and we have a very sufficient headroom, financial covenant-wise. In summary, we are happy to achieve this positive growth of the revenue for 2020 with the healthy profitability and cash flow status. Also, the stable cash capital structure we showed here can provide us sufficient financial resources to support the continuous profitable growth of our overall business going forward. Now, Laetitia, Fei, and I, we will be happy to answer any questions you may have. Thanks.
Thank you, Jason. We are now ready to take some questions from the audience. As a reminder, you may submit a question by text by clicking the question mark symbol on the left-hand corner of the webcast panel. Kindly submit all questions in English. I will now pass it over to Ms. Joy Tsai, Director of Investor Relations, to commence the Q&A. Thank you.
Hi, everyone. We've got three questions from Bank of America. The first question is about infant formula. How were our sales per store growing for existing point of sales in 2020? How do we plan to further stimulate growth in sales per store going forward, especially as major competitors are also enhancing their product portfolio and investing in offline? The second question is still about the infant formula. For the new distributors we are onboarding, are they exclusive distributors to us, and how are we incentivizing our distributors to switch to us from our competitors? How are we supporting our distributors and retailers to boost sell-through? Is there any implication to cost and profitability? The second question is about our new Pet Nutrition and Care business. On a full year basis, PNC already contributed 3%-4% of our total sales.
Is it fair to assume a similar pace for growth in 2021 versus last year? I.e., is close to around 50% year-on-year? What's the EBITDA margin outlook for PNC?
Hi, Joy. It's Laetitia here. I will try to partially answer the three questions and then invite Jason to give some complementary information from a financial perspective. Of course, Fei, please feel free to jump in at any time. Your first question around the performance per store versus the expansion of our distribution network. Of course, we are aiming at both, which means we are aiming at increasing our distribution network, which we have done definitely materially in the second half of last year. You have seen the number of baby stores that we have covered has grown up to 65,000, which is a dramatic increase, and we've done that through opening new stores and also onboarding more distributors. That has been definitely a focus in the second half of last year. You're right.
At the same time, we need to make sure that those stores are actually delivering and that they are active stores that do actually generate sell-outs. For us, these two metrics go along together. We are actually tracking that our stores and the stores that our teams are opening are not just putting on Biostime products on the shelf, but that they are actually delivering to consumer sales. The way we do so is obviously, to your second question, because they are linked together, working more closely with our distributors, the ones that we already have, since many years for some of them, and the new ones that we have onboarded in 2020, and we continue to onboard, that they need to be part of this effort.
When they help us to develop new stores, they're also here to put on resources along with us to make sure that we carry activities and consumer education activity and new consumer acquisition in the stores. We have made some adjustment to our sales policies and our incentive to distributors during the course of 2020, and as we continue this effort now, to make sure that we amplify the level of resources that they can deploy along with us for this consumer activity. How we support them financially and the financial implication from that from a Health and Happiness perspective, I would like to invite Jason to give more comment on this side.
Definitely, as Laetitia just mentioned, we shall see this growth of the IMF going forward with the contribution from the existing and the new distributors. We have set very clear ambition for the overall team to achieve that. Also on the profitability side, as I just mentioned, in this year, we shall continue to face the gross margin pressure due to the product mix change. Just to share with you, for goat milk IMF, the contribution of our total IMF portfolio in China was 6.4% last year, and domestic series accounted for 2% of total IMF portfolio. This year, the contribution portion of these two categories should even become higher, which then puts the pressure on our gross margin. As you may already seen from the many capital market reports that also there is a kind of increasing trend for certain raw material prices.
We are secured for the first half, thanks to the inventory we built up and also the contract we already in place, there could be a kind of further pressure to place in second half if the raw material price to further increase. Despite this pressure from the gross margin side, we will continue our efforts to further improve our spending efficiency for selling and distribution for PNC in China this year, so that on total basis, we expect a stable EBITDA margin for our overall PNC business.
Thank you, Jason. To finish on your question, I realize that I haven't answered your question around exclusivity of distributors. Most of our distributors are not exclusive. That is, I would say, the role in the industry, including for our peers. Distributors do not have to be exclusive. They have to be, obviously, strategic partners and beyond just being logistic partners, they have to be part of the effort of, again, developing stores and helping for promotion activities, et cetera. It is their role as we have our team together to team up in this effort.
We do not necessarily require exclusivity, but by expanding this distribution network, we're looking at partners who are here to really embrace this idea that we are here not just to expand the channel, but also making sure we create sell-out and new consumer acquisition. On your question around PNC, where is the growth going to come from going forward? Yes, definitely, we're looking at a strong growth in 2021. Jason, I'm not sure whether you want to give more color on the guidance itself, but we will be definitely focusing on U.S. and China as the two core markets. We are expecting the U.S. market to continue to grow in 2021. We are seeing strong demand from particularly the online channel with Amazon and chewy.com, where Solid Gold is well-positioned, as consumers are moving massively online in that part of the world too.
In China, obviously, as we activate the business, as we ramp up the business with our own team, which has already been set up, we are definitely looking at growing the business further in the Chinese market in 2021. Jason, on PNC guidance as well as implications on company's margins, you want to comment more?
Yeah. Basically, for Solid Gold, since for 2020, on the consolidated basis, we only consolidated for the 20 days of December in our group results. Therefore, the contribution is only RMB 26 million. On a stand-alone basis, Solid Gold last year achieved $64 million U.S. revenue, which represents an increase of 49%. Going forward, as Laetitia just mentioned, right, we shall expect the continued growth of Solid Gold business in U.S., China, and also the other markets. Because the size of itself, right, still is relatively small in comparison with the overall group, we expect it will take some time for PNC to make a material tangible contribution to the overall group's revenue and profitability.
Okay. We have the next question from Terrence Liu from CLSA. Terrence's first question is, could you let us know the store expansion plan for 2021 and the year next in terms of store count by channel, please? Do you expect a pharmacy channel to be a more important channel for infant formula sales over the long run? His second question is, what was the sales contribution of organic infant formula brand Healthy Times in 2021? How do we differentiate these products with other organic brands in the market in terms of product positioning, branding, and channel strategy?
Thank you, Joy. Hi, Terrence. Thank you for your questions. Store expansion plan for 2021 and beyond. We have definitely made a big improvement in 2020 in terms of getting into more stores. We will continue this effort in 2021. We are looking at extending into more baby stores. We have a target of increasing to another 10,000 stores at least in 2021. Beyond that, again, we want to make sure that those stores are, to the previous question, are generating sellout. It's not just about the number of stores we are present in, but it's also about how they perform and carry our brand. We'll be looking at both metrics in 2021. Yes, to your question, we have a plan to further extend, not only for domestic series, also for our core IMF, as well as goat.
We also have a plan to extend beyond just baby stores into more pharmacies and more supermarkets, as we have demonstrated in 2020. To the second part of your question around pharmacy channel, is that going to be a driver of growth in 2021 and beyond? Not in IMF because of the restrictions of selling food products in some pharmacies. We do not really see that as a growth channel going forward for IMF. For probiotic, it is different because for probiotic, Biostime probiotic, pharmacies is definitely a destination. We will be looking at having more distribution into more pharmacies for our probiotic product in the course of 2021. To your second question around Healthy Times IMF. Our product is Healthy Times branded under the Biostime brand. It's Biostime branded. Healthy Times is the name of our organic series.
It is part of our total Biostime proposition. It enjoys the same brand positioning around immunity and digestion, along with obviously an organic message. We use the same brand ambassador, same overall branding. It is definitely one of the SKUs that we promote in the super premium end, targeting consumers who are particularly interested into the organic proposition. The performance of Healthy Times in 2020 has been, I would say, in line with the market performance. We are seeing growth in the organic demand. The pace of that growth has slowed down, but it is still a growing category. We have upgraded our packaging in 2020 in the second half of the year with an over cap. Again, that Biostime umbrella brand branding to continue to, again, make a link with our Biostime brand proposition.
We are confident about the development of our organic IMF. We haven't disclosed the contribution of organic in our total IMF. It is definitely one of the drivers of our IMF growth because of the super premium part of the market, which is growing.
Okay, now we have the next question from Tiffany, from Citi. Can you share with us the EBITDA margin outlook in 2021 and for the next few years? Are we still keeping our previous EBITDA targets?
Sure. Jason?
As I just indicated for the PNC, we target for a stable EBITDA margin for 2021. For ANC, we expect the overall margin to improve in 2021, mainly thanks to, first the further improvement of the ANC China's EBITDA margin. Also, for ANC, ANZ EBITDA margin to improve as well, thanks to the full year benefit of the cost optimization efforts made for last year. Therefore, for ANC total, we expect the EBITDA margin to be back to the high teens level in 2021. If we put this together, we expect the overall group's EBITDA margin for 2021 to stay around a level of 20%. This is our outlook for this year. Definitely down the road, we will continue to further improve our efforts to drive for the other profitability improvement.
Also just now, the question was related to the PNC EBITDA margin. As you can understand, we still need to invest in this new business to achieve the growth in those critical existing and new markets. Since PNC contribution in the total group was still relatively small, therefore the dilution effect from this newly included PNC EBITDA will be quite minor to the overall group's profitability.
Okay, we have the next question from Larry Gempler from Credit Suisse. Some say that infant formula industry volume is started to decline due to the declining birth rate. Does H&H also believe that infant formula market in China is likely to decline in volume over the next four to five years?
Well, from a volume perspective, of course, if birth rates stay at the current level or further declines, obviously that means volume-wise, we might see a decline in the total market. I think what is important to highlight is that there are still ways to grow in a market that declines from a volume perspective, because the market is very segmented and the premium and super premium markets, part of the market, is still growing. The super premium part of the market, in 2020 has still increased 27% from a value perspective as consumers are trading up to more premium proposition. As I mentioned, Biostime is really focusing on that part of the market, which is the super premium market.
I haven't mentioned that during the presentation, but we do have an ambition by 2023, to be definitely in the top three player, we are now top four player in that super premium segment and a strong top three player. To continue to strengthen that position, especially with one of our core product, which is called Pi-Star, which is a very innovative and very complete formulation product, which is gaining market share in the market. Even if the total market is definitely from a volume perspective, not expected to grow much in the future, there is this premiumization going on. The second factor is that there is a consumption that is being dragged beyond what we call the one to three years old, in Stage 4 and above.
Beyond just three years of age, beyond that age group, parents continue to give infant formula to their children. Stage 4 and above is seeing strong growth as we speak, which we will also try to capture, and we are capturing as a brand. Of course, the last one is market share gain. We believe, with our strong branding, our now quite complete product portfolio and our channel footprints, we can continue with our cow infant formula, imported, our goat infant formula, organic proposition, and with our domestic IMF series, and also one SKU that we have dedicated for online, Tehua, that we have launched last year.
We have now a good portfolio to be able to address the different parts of the market and the segmentation by price and by functionality, to be able to gain market share in the future.
The next question is from Robin, UOB. For the BNC segment, do you have any market share target for the next few years? As you have the industry data, what was the growth rate for the overall infant formula industry last year and in the premium segment, respectively? What is the compound annual growth for Biostime to achieve that market share target?
The question on whether we have a market share target for the next few years. As mentioned, we have set this ambition to be a strong, top three player in the super premium segment without exact market share guidance. Obviously, in order to do so, we need to grow market share. We need to grow market share by the different drivers that I identified. Again, brand awareness, product portfolio, and channel expansion while continuing to grow our market share online. We have clear targets and roadmap to continue to grow market share in the Chinese market. Industry data on the total market. The IMF market in 2020, according to Nielsen, has grown by 4.8% value-wise. That has been driven obviously, by the premium and super premium segments that are the fastest-growing ones, while mid to low tier are actually in decline.
That's why we really want to focus our efforts in this premium proposition, and continuing to this direction. The implied CAGR growth for Biostime, obviously we are not giving a precise CAGR over year, in terms of BNC. Obviously if we're able to grow market share, in a growing category of the market, that means that our IMF and broader BNC sales should be definitely growing in the future, in following years in China.
The next question is from Paula from Maple-Brown Abbott. Was the improvement in selling SG&A ratio driven more by BNC or our ANC business? How would the ratio be expected to change in the next few years? Her second question is, what would be the potential or target margin for BNC in the long term?
Yeah. Jason, would you like to answer these questions?
Yeah, sure. For BNC, yes, you can see the efforts already been made to drive this improvement of the spending efficiency. Actually for ANC, I want to also share with you is that for China market and also most of other markets, we also saw the same trend of spending efficiency for 2020, with the improvement of the expense ratio. The main challenge we faced in 2020 was in the ANZ market. As you can appreciate, right, when the revenue base declined by 32%, it really makes this ratio quite difficult to manage with this lower revenue base. Actually, the company already made very strong efforts in ANZ last year, especially with the three rounds of major cost optimization made, especially in the second half when the lockdown measures were extended by the government beyond the original expectation.
Going forward then, especially for this year, we should enjoy the full year benefit of those cost optimization measures made, especially from the ANZ market. For this year, we expect is for overall ANC business for China market, for ANZ market, and also other new markets, we shall see the improvement of the spending ratio across all those markets. Therefore, even though on the growth margin side, we expect for ANC this year to stay at a stable level, then with this improvement of spending ratio, this is why just now we give this indication for EBITDA margin of ANC this year should go back to the high teen level for this year. For PNC, as you probably already can see from the acquisition announcement we made in November last year, you can see PNC business during the last three years also improved gradually.
By the time of the acquisition, the EBITDA margin was around low teen level. Going forward, if we look at the mid or long term, say down the road three, five years, definitely we shall see the further improvement from that level. In the near term, as we are speeding up our growth in the existing markets of U.S. and China, plus also the other markets, then we may not see the immediate improvement of the EBITDA margin for PNC given the investments required. Mid or long-term, we shall see the further improvement. Again, since the absolute size of PNC business is still relatively small in comparison with the overall group, the dilution effect to our group EBITDA margin is quite limited from PNC for this year.
Jason, from a mid, long-term perspective, I think we can say that we're looking at a 15%-20% EBITDA margin for that category once we scale up the business and have reached the right investment level, right?
Yeah.
Just long-term indications in the market.
Yes. Definitely will be higher than the level during the acquisition time. This is a more mid to long-term frame in next two or three years.
I have the next question from Jiang Yi from CITIC Securities. His first question is, how should we understand the China expansion of our baby nutrition care business in the China market? I assume that probably is about our further penetration into lower tier cities with local series. Second question is referring to the inventory, whether we are in a healthy status or not, and how can we make sure that our channels are healthy?
Thank you, Jiang Yi . The first question is around domestic versus imported infant formula distribution expansion, definitely during the course of last year when we have expanded to more baby store and other channels, it's a mix of both domestic and imported series. We should not understand that all of these expansions are linked to the fact that we have rolled out our domestic series. As Jason mentioned at the beginning, for our domestic series, the total contribution to the business is still relatively small, below 5%, and he actually mentioned 2%. It is the beginning, as we just launched two new SKUs in the second half of last year.
Our distribution penetration expansion efforts are also, of course, aiming at extending our core ranges, including what we call the Star Series, imported series, and therefore there is not much overlap between the distribution of our domestic and international line. It is important that we carry on these efforts. That channel expansion is really to make sure that our total portfolio is visible and accessible in different regions. You're right, in tier 4, tier 5, and even lower cities, we're more looking at expanding our domestic range versus in higher tier cities, we're more looking at expanding our domestic range. We also have extension for our goat infant formula plans.
It's a total effort, and we do have a very clear portfolio strategy, where we don't want all of our products to go in the same stores, and also giving different stores on different series to avoid competitions between the different retailers. That strategy is aligned, and we'll carry on these efforts in 2021. For your question referring to inventory in the channel, we do as a business track that very carefully. We have the monitoring system which enables us to see how many days of inventory are there at a distributor's level. Obviously, we have team on the ground who are doing store checks to understand how much stock we have in the channel. There is definitely pressure on the short run in the market, very high intensified competition and stock in the channel.
We are monitoring that very carefully and very closely in order to make sure that we keep a healthy market. When we see that there is too much stock in the market, we would definitely try to pull back on sales to make sure we maintain a healthy level. We are doing that and monitoring that very carefully.
We have the next question from Lo Yixing from Huatai. Since we will put more focus on normal trade channel, what's the new product pipeline of ANC for regulation approvals in the following two years?
Yes. Thank you for this question. Definitely you're right. Our ability to expand in normal trade for Swisse, first of all, is very important because if you look at just the e-commerce space, which is really the growing part of the market in 2020, normal trade e-commerce accounts for about 65% of total e-commerce and cross-border only accounts for the remaining 35%. Swisse is extremely strong in cross-border e-commerce, but has been historically weaker in normal trade just because we didn't have the right products. And also because we were really leveraging on the success of CBEC.
Definitely, we are now seeing that as a top priority, and we needed to make sure we have the portfolio that goes along with that, to be able to be more present in the normal trade channel, both offline, and when we say offline, it is actually pharmacies is our number one priority, but also in normal trade online. For pharmacies, it is very clear we need more Blue Hat products, because if you don't have Blue Hats, it is very challenging to be present in pharmacies. We have, through the course of 2020, been having more products approved by SAMR in terms of a Blue Hat approval. To be able to make claims on our products, we've had our iron tablets, we've had our deep-sea fish oil, new protein powder, and probiotic capsules, to name some of them.
We have launched some of these SKUs in the normal trade channel during the second half of this year. To your question, we do have a focus on normal trade. We have the right product pipeline to go with it, and we now have 28 SKUs available in China normal trade. Some of them are Blue Hat, some of them are food-grade products, but that portfolio is being extended every quarter and every year and to enable us to get a bigger footprint into the normal trade channel. The team is really working against that to deploy a broader portfolio.
In the past, we were only focusing on having imported Blue Hat products, and then we have realized that obviously, it is important for us to speed up these normal trade efforts, that Chinese consumers were no longer so focused on just the imported nature of our products, but making sure we have the right branding, the right product efficacy, and these Blue Hats that are so important to be present in the channel and to claim. We have decided from the beginning of last year to allow also some China-made Blue Hat products, because it's easier to get definitely approved, and also because as long as we are able to provide brand consistency with our Swisse message, we think that consumer acceptance is there, and it's actually proved to be like this.
The fact that we now have also some locally made products, of course, with our same quality standards, we are now able to move faster into the normal trade channel.
Okay. Due to time constraints, we are having the last two questions on floor. The first question is from Shen Haonan, Willing Investment. Can you share with us the gross margin level for Swisse China versus ANZ? Does it have the same cost structure as ANZ in terms of the selling and distribution expense ratio?
Sure. Jason, that question is for you.
Yeah. The gross margin level of Swisse China versus the ANZ, the margin for China, gross margin-wise, is higher due to the different price point and product portfolio mix. If you look at the selling distribution expense ratio-wise, also the profile is different. It's because the channel mix also are different. As you can know, in China, close to 90% of the business still is cross-border e-commerce business, which is online, in ANZ market, which is mainly offline-focused. Plus, also in terms of the brand awareness status, as you can see in China, still the Swisse, despite its leading position in the online space, we still have great growth potential to grow offline. Also, the penetrable penetration is still relatively low.
Therefore, it is required to maintain a strong investment in the ANC and also the selling and distribution in order to boost our overall brand awareness and the penetration in the overall China market, both online and offline. If you look at the number by itself, as we also indicated in our results announcement, even though last year the S&D ratio of the ANC business increased by the 5.7 percentage point. This increase was mainly driven due to the operational deleveraging cost of the sharp revenue-based decline in the ANZ market. If we look at the China business itself, actually the spending ratio slightly improved last year. Therefore going forward, the same spending efficiency improvement efforts will continue for both the China and the ANZ business.
Okay, now we have the final question on floor. It's from Chris Lan, Templeton. What kind of sales trends have you observed on the Daigou and local pharmacy channel in ANZ so far this year?
Okay. Hi, Chris. Thank you for the question. We have observed pretty much the same trends as the one we have left you with last time when we reported on our second half results. I think Daigou-wise, the trend is still challenging. That's why we mentioned as an overall outlook for 2021 that the gradual recovery of ANZ as a total because, if we look at last year, actually, COVID impact in Australia and border closure only happened, lockdowns only started to happen in March. We have that first quarter of last year, which is not fully comparable with first quarter of this year. Daigous are definitely not coming back for the Chinese Daigous that wasn't able to return to Australia as well as the Chinese tourists.
We're not seeing any traffic recovering, and I think we are taking the view that this will be pretty much the same for the rest of the year. We're still working strategically with some corporate Daigou that are still in the Australian market, and having those relationships with them. But in terms of trend, we haven't seen a reversing trend. From a local consumption perspective, local pharmacy channel, as you mentioned, but also grocery, also online, which are channels where local consumers are shopping. We are seeing a strong momentum from the Swisse brand, and some market share gains for those channels. The team is launching also quite a bit of innovation, new products to the market. Nutra+ is being ramped up, and as well as some new innovation under the core Swisse brand.
From a domestic perspective, we're seeing same positive momentum that we have started to witness in the second half of last year, and we are pretty confident that this will continue throughout the rest of the year. Team has also launched a new innovation, not just formula innovation, but also moving into gummies, which are new formats that are more appealing to the younger generation and the local consumer. We should definitely be seeing progress on the domestic side and with the clear goal to make Swisse the brand of choice and the leading brand in domestic markets.
Thank you for all the good questions. This ends the Q&A session.
Thank you everyone for joining us this morning. Please stay healthy and safe. I now announce the end of today's presentation and webcast. Thank you.
Thank you, everyone.
Thank you, everyone.
Thank you.