\u3000\u3 Shengda Resources Co.Ltd(000603) 877 Ningbo Peacebird Fashion Co.Ltd(603877) )
2022q1 epidemic and expense side affect performance and maintain the “buy” rating
The company’s 2022q1 revenue of 2.464 billion yuan (- 7.74%) was mainly due to the impact of the epidemic on terminal retail, and the net profit attributable to the parent company was 190 million yuan (- 6.44%), and the deduction of non net profit of 112 million yuan (- 40.24%) was mainly due to the decline of gross profit caused by the decline of revenue & the drag of expense investment, and the higher net profit than the deduction of non net profit was mainly due to the increase of government subsidies on a year-on-year basis. We lowered the profit forecast and predicted that the net profit attributable to the parent company from 2022 to 2024 will be RMB 790 / 9.3 / 1.05 billion (previously RMB 810 / 9.7 / 1.12 billion), the corresponding EPS will be RMB 1.7 / 2.0 / 2.2 respectively, and the current share price will be 11.1 / 9.4 / 8.4 times corresponding to PE respectively. Considering the stabilization of retail, the improvement of the company’s fee control effect is expected to improve the profit and continue to maintain the “buy” rating.
The style adjustment of 2022q1pb men’s wear products has been effective, and the pace of direct store closure and franchise store expansion throughout the year remains unchanged
By brand: 2022q1pb women’s wear / men’s wear / leting / children’s wear / other brands earned RMB 962 / 8.27 / 2.84 / 3.14 / 0.63 billion, a year-on-year increase of – 12.37% / + 4.27% / – 21.75% / – 0.58% / – 22.02%. The growth of men’s wear was mainly due to the effect of the adjustment strategy of product style to fashion and cool. By channel: in 2022q1, the online revenue was 779million yuan (-3.0%), of which the growth rate of tmall declined and the channel of Tiktok was under pressure, accounting for 31.8% of the online revenue, an increase of 1.5pct year-on-year; Offline revenue was 1.671 billion yuan (- 9.55%), of which direct sales and franchise revenue were 1.175 billion yuan (- 12.89%) and 496 million yuan (- 0.51%) respectively. (3) In terms of stores: as of 2022q1, there were 5074 stores, including 1590 Direct stores (26 closed net compared with the end of 2021) and 3484 franchisees (114 closed net compared with the end of 2021). By brand, there are 94 / 30 / 18 Pb women’s clothing / men’s clothing / leting, 2 children’s clothing, and the number of stores of other brands is the same.
2022q1 online gross profit margin increased, expenses dragged down the deduction of non net profit margin, and the operating capacity remained in good condition. Profitability: the overall gross profit margin of 2022q1 was 54.35%, year-on-year -1.7pct. In terms of brands, the gross profit margin of Pb women’s clothing / Pb men’s clothing / leting / children’s clothing was – 3.3 / + 0.1 / – 6.3 / + 1.6pct year-on-year. By channel, the online / offline gross profit margin was + 2.38 / – 3.15pct year-on-year. The increase of online gross profit was mainly due to the increase of supply discount rate, and the direct / franchise gross profit margin was -2.38 / – 3.51pct year-on-year. During the period, the expense rate was 46.11%, with a year-on-year increase of + 1.34pct, and the expense rate of sales / management / R & D / finance was 37.54% / 6.7% / 1.11% / 0.76%, with a year-on-year increase of + 0.5 / + 0.93 / – 0.12 / + 0.33pct. The fee reduction measures in 2022 include closing stores directly and reducing the channel cost of stock stores, optimizing online advertising and commission expenses, and tightening the back office expenses other than R & D; The net interest rate was 7.72%, year-on-year + 0.11pct, deducting non net interest rate of 4.55%, year-on-year -2.49pct. Operating capacity: the inventory of 2022q1 was 2.265 billion yuan, a decrease of 10.8% compared with the end of 2021, and the inventory turnover days were 192 days, an increase of 24 days compared with the end of 2021; Accounts receivable were 480 million yuan, a year-on-year decrease of 24.0% over the end of 2021; The net operating cash flow was – 228 million yuan, mainly due to the decrease in cash income from the sale of goods.
Risk tip: the epidemic repeatedly affects terminal retail; Intensified market competition; The franchise store was not as expected.
