\u3000\u3 Jointo Energy Investment Co.Ltd.Hebei(000600) 729 Chongqing Department Store Co.Ltd(600729) )
Event: the company issued the 2021 annual report. In 2021, the operating revenue will be 21.12 billion yuan / + 0.2%, and the net profit attributable to the parent company will be 980 million yuan / – 6.7%. Among them, 2021q4 achieved an operating revenue of 4.77 billion yuan / – 15.2%, and a net profit attributable to the parent company of 140 million yuan / + 82.4%. At the same time, the company announced the profit distribution plan for 2021, with a cash dividend of 3.79 yuan per share.
Under the continuous adjustment of stores, the operating efficiency of the company continues to improve. On the basis of the operating profit under the new leasing standards, excluding the impact of asset impairment loss (21q4 is – 212 million / 20q4 is – 238 million), financial expenses (21q4 is – 38 million / 20q4 is – 43 million) and investment income, the operating profit of 2021q4 is better than 2020q4, and the base number of 2020q4 supermarket format itself is low. Although competition and consumption decline further affect the company’s operation in 2021q4, the company has improved the company’s operating efficiency in terms of store adjustment, The obvious improvement of expenses has led to the improvement of the overall operating efficiency. Looking back, under the background of the epidemic and the decline of consumption, although the operation of department stores has been affected, the operation toughness of the company’s own high-quality properties is relatively strong, and supermarkets are expected to rise driven by the slowing competition in fresh retail and CPI. With the introduction of Tianjin Wumart and Better Life Commercial Chain Share Co.Ltd(002251) retail, the digital operation ability of the group has been strengthened, and the operation vitality and decision-making efficiency of the enterprise have been improved. The mixed reform will further release the space for the company to build new stores and adjust loss making stores, and the company’s operation is expected to move towards a long upward cycle.
Revenue: ① in terms of business status, in 2021, the actual revenue of shopping malls / supermarkets / electrical appliances / auto trade / others was 2.42 billion yuan / 6.81 billion yuan / 2.41 billion yuan / 7.03 billion yuan / 760 million yuan respectively, with a year-on-year increase of + 9.5% / – 20.4% / + 13.8% / + 8.1% / + 180.6% respectively. Optimize the format of department stores and direct suppliers, and accelerate the replacement and elimination of brands; Supermarkets strengthened the traceability of joint purchase of key categories, increased the proportion of direct purchase of fresh food bases by 2%, promoted the construction of private brands, and the sales of private brands increased by 5%; Electrical appliances implemented strategic brand cooperation, and the sales increased by 17%. ② By region, Chongqing / Sichuan / Guizhou / Hubei achieved revenue of 18.88 billion yuan / 500 million yuan / 100 million yuan / 40 million yuan respectively in 2021, with a year-on-year increase of – 0.3% / – 20.6% / + 0.1% / – 49.1% respectively. During the reporting period, the company actively promoted the launch of digital platforms such as chongbaiyun shopping, electric appliance shopping and commercial car life, with good overall operation effect. Online sales reached 1.8 billion yuan / + 48.4%, accounting for 5.1% / + 1.7pct.
In terms of stores, as of the end of the reporting period, the company had 304 stores, 11 new stores (including 10 supermarkets / auto trade stores / 1 store) and 16 closed stores (including 1 Department Store / supermarket / electrical appliances / auto trade store / 11 stores / 1 store / 3 stores). The company continues to promote the adjustment of stores and continuously improve the operating efficiency.
Expense side: the expense rate of the company during 2021 is 20.40% / -0.09pct. Among them, 1) the sales expense ratio is 14.3% / – 1.1pct, which is mainly due to the adjustment of stores and operations by the company and the impact of the implementation of the new leasing standards; 2) The management fee rate is 5.2% / + 0.1pct, which is mainly due to the increase of intermediary agencies and water and electricity costs; 3) The financial expense ratio is 0.2% / + 0.3pct, which is mainly due to the increase of interest expenses related to lease liabilities due to the implementation of the new lease standards by the company; 4) The R & D expense rate is 0.7% / + 0.7pct, which is mainly due to the increase of relevant information technology expenses invested by e-commerce companies under the company.
The implementation of high dividend scheme is conducive to shareholder return and value discovery. The company announced that it would pay a cash dividend of 3.79 yuan per share of a shares, with a dividend rate of 14.1% calculated according to the closing price on March 25, effectively alleviating the financial pressure of group shareholders and participants in the mixed reform. We believe that the company is expected to maintain a compound growth of more than 15%. At present, PE is only 11 times, and the dividend will not affect the sustainable growth of the company, which is conducive to shareholder return and value discovery.
Investment suggestion: the company introduced Wumart group and Better Life Commercial Chain Share Co.Ltd(002251) group to share advantageous resources and improve its operation efficiency and digital capability. In terms of operation, the supermarket benefited from the upward cycle and continued to improve under the mixed reform. Although the epidemic had a certain impact on the department store format, the department store format with significant geographical advantages was resilient under the epidemic, and the mixed reform brought great growth potential. The supermarket is expected to rise driven by the slowing down of fresh retail competition and CPI. Due to the weak macroeconomic growth and the negative impact of repeated epidemics, we lowered the net profit forecast for 2022 from 1.3 billion yuan to 1.15 billion yuan, increased the net profit forecast for 2023 / 2024 by 1.34/1.52 billion yuan, and maintained the buy rating.
Risk tip: the development of Internet financial business does not meet expectations, regional competition intensifies, and the development of financial and innovative business is uncertain immediately.
