\u3000\u3 China Vanke Co.Ltd(000002) 563 Zhejiang Semir Garment Co.Ltd(002563) )
Key investment points
Event: the company released 22 quarterly reports, with a revenue of 3.309 billion yuan (- 0.03%) and a net profit attributable to the parent company of 209 million yuan (- 40.7%). The intensification of the epidemic in March put pressure on the profit side of Q1
In March, the epidemic affected the progress of retail and delivery, and the flow and revenue were flat and slightly decreased year-on-year.
From the perspective of retail flow, the company's omni-channel flow increased slightly from January to February, but the flow fell by a high number of units under the impact of intensive epidemic in March. Therefore, the omni-channel flow of Q1 company was - 1.3% year-on-year, including online + 10% and offline - 7.3%. In terms of brands, children's wear is still better than casual wear, especially in online channels. Q1 children's wear flows through all channels + 0.5%, with double-digit growth in online high and decline in the number of offline high units; Casual wear all channel flow - 5.2%, of which the number of online low units increased and the number of offline high units decreased.
From the perspective of income statement, the income of 22q1 was 3.309 billion (- 0.3%), and the decline was slightly less than that of retail. Among them, the income of children's wear was + 2% year-on-year and that of leisure wear was - 4% year-on-year; By channel, Q1 online revenue was + 14% year-on-year, and direct / franchise delivery / joint venture revenue was - 6% / - 11% / + 2% respectively.
The profit was under pressure in a single quarter, and the sales in the 21st Winter were lower than expected, resulting in a year-on-year increase in inventory.
On the profit side, the gross profit margin of 22q1 decreased by 1.3pp to 42.7% year-on-year, of which the retail discount rate remained basically stable year-on-year. The decline was mainly due to the slight decline in the fixed rate caused by the rise of raw material costs and the maintenance of the original level of tag price; The decline in gross profit margin, the relative rigidity of direct and joint venture expenses, and the decline in delivery of franchised channels with the highest profit margin were greater than other channels, resulting in a 41% decline in Q1 net profit attributable to the parent company, with an absolute value of 209 million yuan.
In terms of inventory, as of the end of March, the company's inventory scale was 4.05 billion, with a year-on-year increase of 66%, mainly due to the warm winter blow to the industrial strategy of preparing goods in advance in the supply chain in the 21st Winter, and the sold out rate was lower than expected. However, in terms of the proportion of goods and inventory, the proportion of goods within one year can still reach 75% +, which is lower than 80% + units in the 21st Annual Report.
Profit forecast and valuation
The epidemic situation in April is expected to still exert systematic pressure on the retail industry. The company is also focusing on improving its internal efficiency under the adverse external environment through brand upgrading, category branding and lean retail. We expect the net profit attributable to the parent company to be 1.51/17.0/1.88 billion in 22 / 23 / 24, with a year-on-year increase of 2% / 12% / 11%, corresponding to the valuation of 12 / 10 / 9x. As a leader in the industry with low value and high dividend, the company maintains the "buy" rating.
Risk tip: the epidemic worsened beyond expectations and consumer demand changed
