\u3000\u3 China Vanke Co.Ltd(000002) 327 Shenzhen Fuanna Bedding And Furnishing Co.Ltd(002327) )
The company released its 2021 annual report / first quarterly report. In 2021, it realized revenue and net profit attributable to parent company of RMB 3.18 billion and RMB 550 million, with a year-on-year increase of 10.6% and 5.7%. In 2022q1, the company realized revenue and net profit attributable to the parent company of 670 million and 105 million, with a year-on-year increase of 6.8% and 13.8%. The annual report of the company plans to pay 6 yuan out of 10 to continue to give back to shareholders with high popularity rate.
Online and direct channels grew rapidly, and net stores were opened offline. 1) In terms of channels, the company's online / direct / franchise / group purchase channels achieved revenue of 13.2 / 7.7 / 8.1 / 180 million yuan respectively in 2021, with a year-on-year increase of 16.6% / 10.4% / 5% / - 9.2%. In terms of net opening of stores, the company opened 33 to 470 stores (96 new and 63 closed), and 26 to 1055 franchise stores (136 new and 110 closed). 2) In terms of products, the revenue of kit / quilt core / pillow core / furniture products was 12.6/12.3/2.4/100 million yuan respectively, with a year-on-year increase of 10.1% / 10.5% / 7.8% / 14.6%.
The profitability of e-commerce continues to improve and achieve high-quality development. 1) Gross profit margin: after restoring the adjustment of accounting standards (adjusting "selling expenses freight" to operating costs in 2021), the gross profit margin of the company increased by 1.1pcts to 52.1% year-on-year in 2021, and the gross profit margin of online / direct / franchise channels was 46.2% / 65.3% / 50% respectively, with a year-on-year increase of + 2.3 / - 1.1 / + 1.1pcts. The net profit margin of the channel on the middle line was 17.9%, with a year-on-year increase of 1.4pcts. The profitability maintained a leading position in the industry. The company's e-commerce management team improved its performance from the following aspects, including optimizing commodity structure, deepening flexible supply chain management, optimizing the layout of live broadcast channels, and arranging spring / latex mattress categories. 2) Expense ratio: in 2021, the sales / management / R & D expense ratio was 23.1% / 4.8% / 2.4% respectively, with a year-on-year increase of - 0.6 / 0.5 / - 0.1pcts (the sales expense ratio has been restored to accounting adjustment). We believe that under the influence of multiple external adverse factors such as last year's flood and epidemic situation, the expense control ability is good. 3) Effective tax rate: the year-on-year increase of 3.6pcts to 19.5% in 2021 is mainly due to the one-time impact of Q3's completion of inventory integration construction.
In 2021, the turnover days of inventory and accounts receivable were 186 and 24 days respectively, with a year-on-year decrease of 30 days and 3 days. The net cash flow from operating activities was 780 million, with a year-on-year increase of 16.3%. The operation quality of the company continued to improve. Although 22q1 was affected by the epidemic, the company's online / direct / franchise channels still increased by 8% / 4% / 16% year-on-year, reflecting the growth toughness. We believe that in recent years, the company's brand strength, supply chain and retail efficiency have been continuously improved, and the product design style is distinctive. In addition, the company has accumulated rich operation experience in online channels, which is expected to achieve sustainable and healthy growth in the future.
Profit forecast and investment suggestions
Considering the epidemic situation, according to the annual report and the first quarterly report, we lowered the profit forecast for 22-23 years and predicted that the earnings per share in 20222024 were 0.72, 0.84 and 0.95 yuan respectively (compared with 0.86 and 0.98 yuan in the previous 22-23 years). With reference to comparable companies, we gave the company 13 times PE valuation in 2022, corresponding to the target price of 9.36 yuan, and maintained the "overweight" rating.
Risk tip: the impact of repeated outbreaks on offline retail and the lower than expected growth rate of e-commerce.
