\u3000\u3 Jointo Energy Investment Co.Ltd.Hebei(000600) 859 Wangfujing Group Co.Ltd(600859) )
Event: the company released the first quarterly report of 2022. In 2022q1, the company achieved a revenue of 3.314 billion yuan, a year-on-year decrease of 4.08%, and a net profit attributable to the parent company of 377 million yuan, a year-on-year increase of 19.45%.
Revenue side: the same increase of nearly 4% was achieved from January to February, and the rebound of the epidemic intensified in March, affecting the operation. In 2022q1, the company achieved a revenue of 3.314 billion yuan, a year-on-year decrease of 4.08%. Since the first quarter, the company and its stores have made great efforts to overcome the impact of the epidemic and made full use of the hot spots during the Spring Festival to expand sales and increase efficiency. From January to February, the operating revenue still increased by 3.95% year-on-year. Since March, the rebound of the epidemic has intensified, which has had a great impact on the company’s operation. In March, the operating revenue decreased by 17.69% year-on-year. In terms of business division, department stores / shopping centers / outlets / supermarkets / specialty stores achieved operating revenue of RMB 1.823 billion / 6.09/4.08/138363 billion respectively, with a year-on-year change of – 7.37% / 9.40% / 8.14% / 3.77% / – 15.07% respectively.
Gross profit margin: the company’s gross profit margin in 2022q1 was 40.94%, with a year-on-year increase of 0.94pct and a month on month decrease of 4.08pct. In terms of business division, the gross profit margin of department stores / shopping centers / outlets / supermarkets / specialty stores was 36.04% / 51.83% / 67.37% / 15.51% / 16.10% respectively, with a year-on-year change of -1.05/2.95 / -1.86/0.39/ -5.22pct respectively.
Expense side: the expense rate of the company during 2022q1 was 31.80%, with a year-on-year increase of 7.14pct. Among them, ① the sales expense ratio was 13.18%, with a year-on-year increase of 2.65 PCT; ② The management expense ratio was 15.90%, with a year-on-year increase of 2.94 PCT; ③ The financial expense rate was 2.72%, with a year-on-year increase of 1.55pct. Among them, the financial expenses increased by 122.68% year-on-year, mainly due to the decrease of interest income in the current period.
Profit side: in 2022q1, the company realized a net profit attributable to the parent company of 377 million yuan, a year-on-year increase of 19.45%, a net interest rate attributable to the parent company of 11.37%, a year-on-year increase of 2.24 PCT, and a net profit deducted from non attributable to the parent company of 91 million yuan, a year-on-year decrease of 61.18%. On the one hand, it is mainly due to the phased closure of stores in some areas of the company due to covid-19 epidemic; On the other hand, the company completed the major asset restructuring of absorption and merger of Beijing shoushang Group Co., Ltd. (hereinafter referred to as “shoushang”) in 2021, the adjustment of the accounting method of relevant expenses of the original shoushang and the decline of the company’s interest income in the current period compared with the same period.
Strive to innovate operation, develop in all channels, and continuously strengthen online operation ability. By the end of the first quarter, the company had 74 stores nationwide, with a total area of 4.34 million square meters. In terms of Omni channel and online operation, the company and its stores have accelerated the construction and operation of new traffic channels and products such as member applets and enterprise wechat, and continued to build a variety of self media publicity matrices. In terms of self operated business, Ruijin Shangpin (buyer’s collection store business) overcame the impact of the epidemic and further expanded its business scale. In terms of duty-free business, the company will fully promote the overall development of duty-free business of Wangfujing Group Co.Ltd(600859) group in combination with the opportunity of duty-free policy.
We are still optimistic about the company’s investment and innovation in the short-term market, although we have been actively promoting the integration of tax-free resources in the past 22 years. We predict that the net profit attributable to the parent company in 2022 and 2023 will be RMB 1.4/1.6 billion respectively, corresponding to 18x / 16xpe, maintaining the “buy” rating.
Risk tips: repeated epidemic risk, company operation risk, less than expected channel expansion, etc
