\u3000\u3 Shengda Resources Co.Ltd(000603) 719 Bestore Co.Ltd(603719) )
Event: Bestore Co.Ltd(603719) released the first quarterly report of 2022, and 22q1 achieved an operating revenue of 2.942 billion yuan in a single quarter, a year-on-year increase of + 14.30%; The net profit attributable to the parent company was 93 million yuan, a year-on-year increase of – 8.86%; Deduction of net profit not attributable to the parent company was 62 million yuan, a year-on-year increase of – 31.24%.
Deepen the operation of offline stores and promote the layout of emerging channels. In terms of channels, the revenue of 2022q1 company increased steadily, and the revenue of 22q1 company from online / offline channels was 1.785/1.489 billion yuan respectively, a year-on-year increase of + 19.99% / + 13.01%. 1) Online: the company’s online channels focus on fine operation, optimize business strategies based on the competitive environment of each platform, and achieve steady growth in performance. The proportion of 22q1 online business in the main revenue increased to 54.52% (a year-on-year increase of 1.49pct). 2) Offline: 22q1 franchise / direct retail / group purchase business achieved revenue of 780 / 542 / 166 million yuan respectively, with a year-on-year increase of + 2.86% / 16.28% / 79.72%. The company continued to deepen the business of offline stores, intensively opened stores and improved the scale of offline layout. By the end of 2022q1, the total number of stores of the company was 3007, with a net increase of 204 stores (a net increase of 6 / 27 for franchise stores / Direct stores). In 22q1, the number of signed stores to be opened was 78 (31 / 47 for franchise stores / Direct stores respectively). At the same time, the company also continued to strengthen the layout of emerging channels, and social e-commerce channels achieved rapid growth during the annual goods Festival. In terms of regions, central / East / Southwest / South / North China and Northwest China achieved revenue of 671 / 2.56 / 2.06 / 1.39/50 million yuan respectively, with a year-on-year increase of + 5.89% / + 8.38% / + 21.55% / – 4.88% / + 28.66%.
The adjustment of channel structure superimposes the impact of the epidemic, and the profit side is under short-term pressure. In terms of gross profit, the company’s 22q1 gross profit margin was 26.30%, a year-on-year decrease of 4.86pct, mainly due to: 1) the company continued to increase the investment in e-commerce channel resources, and the proportion of online channels increased, reducing the overall gross profit margin (the 22q1 online channel gross profit margin was 22.01%, lower than the overall gross profit margin level); 2) During the Spring Festival, the proportion of online gift box products with low gross profit increased (22q1 online channel gross profit margin decreased by 4.74pct year-on-year); 3) Under the repeated influence of the epidemic situation in some areas, storage and logistics costs increased. In terms of expenses during the period, the sales expense rate of 22q1 was 18.28%, a year-on-year decrease of 2.82pct, which was mainly due to the slowdown of the company’s expenses under the influence of the epidemic. The management fee rate was 4.60%, with a year-on-year increase of 0.26pct. Overall, the net interest rate of 22q1 was 3.16%, a year-on-year decrease of 0.80pct. We believe that the short-term pressure on the profit side is mainly due to the company’s initiative to adjust the channel structure and promote the omni channel layout. The process of offline store expansion has slowed down due to the impact of the epidemic. Looking forward to the whole year, the company will actively promote the layout of emerging e-commerce platforms online; Based on the store type characteristics of offline stores, we will continue to optimize the resource arrangement of check-out channels and help improve the profitability of single stores. The profitability of the company is expected to recover in 2022.
Profit forecast, valuation and rating: maintain the forecast of net profit attributable to parent company of RMB 362 / 4.40 / 515 million from 2022 to 2024. The corresponding EPS from 2022 to 2024 is 0.90/1.10/1.28 yuan, and the corresponding P / E of the current stock price is 25 / 20 / 17 times respectively. The company continues to promote the layout of all channels and categories, has certain competitive advantages, and maintains the “buy” rating.
Risk tip: the epidemic situation worsened, the cost of raw materials fluctuated, and the growth of subdivided brands did not meet expectations.
