\u3000\u3 China Vanke Co.Ltd(000002) 867 Chow Tai Seng Jewellery Company Limited(002867) )
Event:
Chow Tai Seng Jewellery Company Limited(002867) released the annual report of 2021 & the first quarterly report of 2022: 2021q4, the company achieved a revenue of 2.682 billion yuan / + 54.55%, with a month on month ratio of – 27.21%; The net profit attributable to the parent company was 219 million yuan / – 27.29%, with a month on month ratio of – 44.71%; Deduct the net profit not attributable to the parent company of RMB 229 million / – 18.97%, with a month on month ratio of – 40.04%. The annual revenue was 2029.1 billion yuan / + 2027.1%; Net profit attributable to parent company: 1.225 billion yuan / + 20.85%; Deduct the net profit not attributable to the parent company of RMB 1.193 billion / + 26.16%. In 2022q1, the revenue was 2.754 billion yuan / + 138.15%, with a month on month increase of + 2.70%; The net profit attributable to the parent company was 290 million yuan / + 23.26%, a month on month increase of + 32.44%; Deduct the net profit not attributable to the parent company of RMB 282 million / + 26.29%, with a month on month increase of + 22.68%.
Key investment points:
2022q1 performance exceeded expectations, and the annual performance is expected to increase by 10-20%.
1) in 2021q4, the company achieved a revenue of 2.682 billion yuan / + 54.55%, with a month on month ratio of – 27.21%; The net profit attributable to the parent company was 219 million yuan / – 27.29%, with a month on month ratio of – 44.71%; Deduct the net profit not attributable to the parent company of RMB 229 million / – 18.97%, with a month on month ratio of – 40.04%.
2) in 2021, the revenue reached 9.155 billion yuan / + 80.07%; Net profit attributable to parent company: 1.225 billion yuan / + 20.85%; Deduct the net profit not attributable to the parent company of RMB 1.193 billion / + 26.16%;
3) in 2022q1, the revenue was 2.754 billion yuan / + 138.15%, with a month on month increase of + 2.70%; The net profit attributable to the parent company was 290 million yuan / + 23.26%, a month on month increase of + 32.44%; Deduct the net profit not attributable to the parent company of RMB 282 million / + 26.29%, with a month on month increase of + 22.68%; Among them, the revenue from January to February in 2022 is about 2.319 billion yuan / + 203.11%, and the revenue in March is about 435 million yuan / + 11.10%; The net profit attributable to the parent company from January to February in 2022 was about 218 million yuan / + 36.01%, and the net profit attributable to the parent company in March was 72 million yuan / – 3.84%.
4) guidelines for 2022: the operating revenue is expected to increase by 10-20% year-on-year; Net profit is expected to increase by 10-20% year-on-year.
The high prosperity of gold leads the growth. The income caliber of some gold in the franchise mode has been changed, and the force of Q1 gold online has increased.
1) 2021q4, self operated (offline) revenue of 343 million yuan / + 63.33%; Franchise revenue of 1.878 billion yuan / + 55.72%; Online revenue of 409 million yuan / + 52.04%.
2) in 2021, the revenue of plain gold was 5.565 billion yuan / + 232.22%; Mosaic revenue is 2.229 billion yuan / + 0.90%. Self operated (offline) revenue of 1.26 billion yuan / + 74.97%; Franchise revenue of RMB 6.522 billion / + 103.66%; Online revenue is 1.148 billion yuan / + 18.17%.
3) in 2022q1, the self operated (offline) revenue is 359 million yuan / + 4.33%, of which 37 million yuan / – 26.11%, and the sales revenue of gold products is 310 million yuan / + 12.35%; Franchise revenue is 2.063 billion yuan / + 228.79%, including 140 million yuan / – 28.89%, gold 1.706 billion yuan / + 679.03%; Online revenue of 281 million yuan / + 90.48%, including inlay of 20 million yuan / + 13.56%, gold of 175 million yuan / + 110.2%
Boosted by the high prosperity of gold, the efficiency of single stores increased significantly in 2021. In 2021, the company’s self operated single store revenue was 5.227 million yuan / + 87.31%, including 757200 yuan / + 19.45% inlaid and 4.2483 million yuan / + 116.07% gold; The gross profit of a single store is 1.5815 million yuan / + 35.37%, of which 490200 yuan / + 23.61% is inlaid and 984700 yuan / + 45.77% is gold. The income of a single franchise store is 1614400 yuan / + 90.10%, including 483600 yuan / – 4.49%, 902200 yuan / + 545.34%, brand use fee of 171800 yuan / + 17.08%, franchise management service of 56400 yuan / + 2.21%.
Under the provincial agent model, fully integrate high-quality customer resources and accelerate the expansion of stores.
1) in 2021q4, 298 new stores are opened / + 4.56%, including 289 franchise stores / + 2.12%; 9 self operated stores / + 350%; There are 145 net stores / – 14.20%, including 145 franchise stores / – 15.70% and 0 self operated stores.
2) in 2021, 734 new stores were opened / + 15.96%, including 712 franchise stores / + 14.10%; 22 self operated stores / + 144.44%; There are 313 net stores / + 75.84%, including 324 franchise stores / + 56.52%, and – 11 self operated stores (a net decrease of 29 in 2020).
3) in 2022q1, 74 new stores are opened / – 1.33%, including 71 franchise stores / – 4.05%; 3 self operated stores / + 200%; Net opening of 2 stores / 0%, including 9 franchise stores / + 12.5% and – 7 self operated stores (a net decrease of 6 stores in the same period in 2021).
The proportion of gold increased, the overall gross profit margin declined, and the sales expenses were optimized under the optimization of marketing investment
Under the provincial agent model, part of the brand use fee (gross profit margin 100%) directly paid by franchisees has been transformed into the wholesale sales revenue of gold products, and the overall gross profit margin has decreased. In terms of marketing, the company accelerated the Wuxi Online Offline Communication Information Technology Co.Ltd(300959) integration, innovated marketing methods, and vigorously promoted the precise marketing delivery to effectively improve the marketing efficiency. In 2022, the company will further put forward the upgrading requirements of integration, digitization and new media in terms of marketing, and the sales expenses are expected to be further optimized.
1) 2021q4, the company’s gross profit margin is 22.25% / -12.45pct, with a month on month ratio of + 1.20pct; The net interest rate attributable to the parent company was 8.16% / -9.19pct, with a month on month ratio of -2.58pct; The sales expense rate was 7.19% / -4.31pct, with a chain comparison of + 1.53pct.
2) 2022q1, gross profit margin 20.17% / -20.25pct, mom -2.08pct; The net interest rate attributable to the parent company was 10.52% / -9.81pct, with a month on month increase of + 2.36pct; The sales expense rate was 5.71% / -5.89pct, with a month on month ratio of -1.49pct.
Investment rating: from 2022 to 2024, the company is expected to realize an operating revenue of RMB 10.882/12.527/14.1 billion, with a year-on-year increase of 19% / 15% / 13%; The net profit attributable to the parent company was 1.433/1.640/1.853 billion yuan, with a year-on-year increase of 17% / 14% / 13%; The corresponding valuation is 12.83/11.21/9.92xpe. Maintain the “buy” rating.
Risk tip: the epidemic situation repeatedly affects the recovery rhythm of the industry; Store expansion speed is lower than expected; Industry competition intensifies; The effect of sub brand integration is less than expected; The risk of insufficient store control affecting brand reputation.
