Zhou Dasheng (002867): Operating results in line with expectations Stores continue to expand rapidly
Core point of view: The performance of the first quarter of 19 was in line with expectations. The store continued to expand rapidly. The company released the first quarter report of 2019, and achieved operating income of 10 in the first quarter of 19.
97 ppm, an increase of 17 in ten years.
04%; net profit attributable to mother 1.
0.94 million yuan, an increase of 20 in ten years.
81%; deduct non-net profit 1.
850,000 yuan, an increase of 23 in ten years.
16%, in line with our expectations.
In the first quarter of 19, the number of franchised stores increased by 88 to 3,161, and the number of self-operated stores decreased by 6 to 296. The total number of stores reached 3,457, maintaining the pace of expansion.
Benefited product optimization The gross profit margin continued to increase, driving the net profit rate upward 1Q19 The company’s gross profit margin continued its upward trend and increased by 2.
44pp to 37.
35%, mainly due to the increase in the proportion of franchise and product innovation.
The sales expense ratio decreases by 0 every year.
57pp to 12.
43%; the management expense rate increases by 0 every year.
69pp to 2.
53%, mainly due to the increase in additional incentive fees, the net interest rate increased by 0.
The company’s net operating cash flow during the reporting period was -3.
US $ 300 million, mainly due to the slow return of self-operated stores, increased sales at the marketing headquarters, and increased microcredit.
We are optimistic about the company’s transition from channel dividends to management and brand dividends. Maintaining the previous channel dividends of buy rating companies lies in seizing the first-mover advantage in third- and fourth-tier markets and fully enjoying the third- and fourth-tier city dividends.
At the present stage, the performance of the store combing and franchisees after the survival of the fittest is accelerated, the number of closed stores is reduced, and the speed and quality of store openings are significantly improved.
The company is also continuously strengthening its product and management advantages. The 2018 annual report for the outlook for 2019 directly points to the construction of the operating system and the strengthening of product research and development, including increased investment in advertising marketing, the establishment of product research 深圳丝袜会所 and development centers to increase the proportion of original products, and self-employment informatization.Open up shared inventory, comprehensive upgrade of store image, etc.
We believe that the company has significantly long-term similar enterprises in the output of the franchise system management standards, which will help the company to transition from channel dividends to management and brand dividends in the future.
Under the background of economic stabilization, the prosperity of jewelry terminals gradually picks up, leading companies under the branding bonus have more obvious competitive advantages, and the overlapping companies ‘own store opening speed and quality have entered a new stage. We maintain a forecast of a net increase of 600 franchised stores in 2019.
It is estimated that the net profit attributable to the mother in the year 19-21 is 10.
0 and 15.
9 trillion, corresponding to a growth rate of 29.
We maintain the company’s reasonable value42.
8 yuan / share remains unchanged, corresponding to 20XPE in 19, maintain BUY rating!
Risks suggest that the macroeconomic downturn is inhibiting the release of demand for optional consumption; market competition is intensifying, and brands are accelerating store openings to grab the market; small and medium brands are clearing faster than expected.