\u3000\u3 Shengda Resources Co.Ltd(000603) 816 Jason Furniture (Hangzhou) Co.Ltd(603816) )
Event: on April 21, Jason Furniture (Hangzhou) Co.Ltd(603816) released the annual report of 2021 and the first quarter report of 2022. In 2021, the company achieved an operating revenue of 18.342 billion yuan, a year-on-year increase of 44.81%; The net profit attributable to the parent company was 1.664 billion yuan, a year-on-year increase of 96.87%, and a year-on-year increase of 25.16% after excluding the impairment of goodwill; The net profit attributable to the parent company after deduction was 1.427 billion yuan, a year-on-year increase of 141.55%, and a year-on-year increase of 32.72% after excluding goodwill impairment. In 2021q4, the company realized an operating revenue of 5.117 billion yuan, a year-on-year increase of 24.16%; The net profit attributable to the parent company was 427 million yuan, a year-on-year increase of 359.61%, and a year-on-year increase of 33.3% after excluding goodwill impairment; The net profit attributable to the parent company after deduction was 314 million yuan, a year-on-year increase of 231.01%, and a year-on-year increase of 27.95% after excluding goodwill impairment. In addition, in the first quarter of 2022, the company achieved an operating revenue of 4.54 billion yuan, a year-on-year increase of 20.05%; The net profit attributable to the parent company was 443 million yuan, a year-on-year increase of 15.11%; The net profit attributable to the parent company after deduction was 382 million yuan, a year-on-year increase of 20.30%.
High potential core categories maintain high growth, and domestic and foreign sales can make concerted efforts to grow
By category, sofa, bed products, integrated products and customization achieved revenue of 92.67/33.38/31.40/660 million yuan respectively in 2021, with a year-on-year increase of 44.51% / 42.75% / 41.13% / 44.80%. The company comprehensively laid out the matrix of high, middle and low-end products and accelerated its expansion with category integration and multi brand development mode. Natuzzi achieved a revenue of 753 million yuan, a year-on-year increase of 51.4%; Lazboy achieved a revenue of 500 million yuan, a year-on-year increase of 61.3%; Tianxi school achieved a revenue of 300 million yuan, a year-on-year increase of 183%.
In terms of sub regions, 1) in 2021, the domestic sales revenue reached 10.712 billion yuan, a year-on-year increase of 40.05%; 22q1 achieved a revenue of 2.736 billion, a year-on-year increase of 15.08%, mainly due to the impact of the epidemic, some orders can not be shipped, and it is expected to delay the confirmation of revenue until Q2. In the past 21 years, the core categories of domestic trade sofas and mattresses increased steadily, with a year-on-year increase of 32.24% and 51.2% respectively; The volume of customized furniture accelerated, with a year-on-year increase of 44.8%; 2) The income from export sales was 6.918 billion yuan, a year-on-year increase of 48.68%; 22q1 achieved revenue of 1.665 billion, a year-on-year increase of 28.02%. The company invested and built a Mexican factory in 21 years, which effectively contributed to the rapid development of foreign trade mattress business.
The diversified store mode has been continuously upgraded, and the construction of refined channels has been steadily promoted
The company adheres to the “1 + N + X” channel strategy, consolidates the advantages of category professional stores, speeds up the integration of large store layout, and continues to explore the X channel. At the end of 2021, the number of physical stores of the company was 6456, a year-on-year decrease of 235, mainly due to the implementation of store optimization and series integration, and the transformation of multiple single stores into large stores and comprehensive stores. The company has built a number of regional retail centers, accurately invested resources according to regional conditions, and endowed the terminal with flexible decision-making power to adjust products and marketing methods. At the same time, the company built an information system for stores, standardized warehousing, logistics and distribution, and improved retail service capacity.
The overall profitability is stable, and the performance of expense control is good
In terms of profitability, the company’s comprehensive gross profit margin in 21 years was 28.87%, a year-on-year decrease of 1.10pct (comparable caliber adjusted according to the restored accounting standards, the same below). After excluding the impact of ocean freight collected and paid by the company, the gross profit margin decreased by 0.68pct. Among them, the gross profit margin of the company’s domestic trade was 34.5%, a year-on-year decrease of 1.21pct, mainly due to the adjustment of freight to operating cost and freight structure in the new accounting standards. In 2022q1, the company’s comprehensive gross profit margin was 29.85%, with a year-on-year increase of 0.65pct.
In terms of period expenses, the expense rate during the 21-year period was 18.57%, with a year-on-year decrease of 0.90pct, and the expense rates of sales / management / R & D / finance were 14.74% / 1.79% / 1.65% / 0.39% respectively, with a year-on-year increase of + 0.29 / – 0.56 / + 0.02 / – 0.65pct respectively. During 2022q1, the expense rate of the company was 18.33%, a year-on-year decrease of 2.97pct. Under the comprehensive influence, the net interest rate of the company in 21 years was 9.27%, with a year-on-year increase of 2.43pct. The net profit margin of 2022q1 company was 10.09%, down 0.07pct year-on-year. With the optimization of product structure and the implementation of price increase policy, the overall profitability of the company is expected to be further improved.
In terms of cash flow, the company realized a net operating cash flow of 2.041 billion yuan in 21 years, a year-on-year decrease of 6.41%. In 2022q1, the net operating cash flow was – 530 million yuan, which was caused by the company relaxing the collection time limit of dealers and reducing contract liabilities under the influence of the Chinese epidemic.
The third stage is the growth of software, and the third stage is the growth of software, the growth of software management team, and the growth of new products. With the optimization of industry structure, the market share is expected to further increase. We estimate that the operating revenue of Jason Furniture (Hangzhou) Co.Ltd(603816) 20222024 will be 22.149, 26.772 and 32.194 billion yuan, with a year-on-year increase of 20.76%, 20.87% and 20.25%; The net profit attributable to the parent company was RMB 2.096 billion, 2.515 billion and 3.053 billion, with a year-on-year increase of 25.93%, 19.98% and 21.39%, corresponding to PE of 18.0x, 15.0x and 12.3x, maintaining the investment rating of buy-a.
Risk warning: the development of new categories and new channels is not as good as expected; Price fluctuation risk of raw materials; Downside risk of real estate sales; Industry competition intensifies risks, etc.
