Peacebird (603877): Still optimistic about TOC driving improvement in operating efficiency and store efficiency

Peacebird (603877): Still optimistic about TOC driving improvement in operating efficiency and store efficiency

The 2018 performance was lower than expected, and Peacebird’s 2018 operating income was 77.

12 ppm, a ten-year increase of 7.

8%; net profit 5.

7.2 billion, an annual increase of 27.

5%, corresponding to a profit of 1.

19 yuan.

The performance was lower than our expectation because the net non-operating income and expenditure exceeded the decrease.

The company also announced 1Q19 results: revenue fell 4.

5% to 16.

5.9 billion, net profit fell 34.

9% to 86.59 million yuan, due to the high base in 1Q18 and the adjustment of offline channels in 1Q19 (86 closed stores).

Men’s and children’s clothing performed relatively well: PEACEBIRD women’s clothing, PEACEBIRD men’s clothing, Rakucho women’s clothing, Mini Peace children’s clothing and other 2018 revenue were -0.

4%, +12.

3%, + 6.

4%, +21.

9% and +27.

3%, accounting for 35%, 37%, 13%, 11%, 3% of total revenue.

The retail efficiency of offline stores has improved, and the layout of oversized stores has increased: offline revenue increased by 6.

8%, accounting for 73.

5%.

In the initial period, the Group opened a net of 343 stores, with a total of 4,594 stores.

Among them, direct store revenue increased by 14.

4%, accounting for 42%, net opening of 245 stores, single store revenue increased by 4.

8% to 242.

860,000 yuan; franchise income increased 1%, accounting for 31.

6%, with a net opening of 82 stores.

The company continued the development of shopping mall channels, and retail sales in shopping malls increased by 27.

5%, accounting for 20%, with a total of 1,719 stores.

Online retail sales 23.

7 trillion, an annual increase of 10%; income increased by 11.

5%, contributing 26 to overall revenue.

3%.

TOC continues to advance: the company’s sales follow-up accounted for 18%.

The overall gross profit margin increased by 0.

7ppt to 52.

6%, except for PB women’s processing of out-of-season products, which resulted in a decline in gross profit margin1.

The average gross profit margin of other brands except 2ppt increased.

Selling and administrative expenses ratio rose slightly.4ppt to 42.

3%, asset impairment losses increased by 10% compared to the same period last year.

Destocking yielded results, and the original value of inventory decreased by 4 compared to the beginning of the period.

8%, cash flow from operating activities increased by 39%.

Development Trend In 2019, the company plans to achieve 88 ppm of revenue and a net profit of 700 million US dollars, corresponding to a long growth of about 14% and 22%.

We believe that the franchise-like management of direct management and the refining effect of direct sales channels are optimized to optimize the profitability of single stores and the sustainability of revenue 佛山桑拿网 growth.

Earnings forecast According to the company’s latest guidelines, we have lowered our annual profit forecast for 2019 to 12% to 1 in 2020.

43 yuan, 1.

69 yuan, corresponding to an annual increase of 20.

2%, 18.

4%.

It is estimated and suggested that the company currently can sustain 13/11 times P / E of 2019/20.

Maintain the recommendation level and lower the target price by 6 according to the profit forecast adjustment.

5% to 22.

86 yuan, corresponding to a 16 times price-earnings ratio in 2019, compared with current expectations of 20.

7% space.

Multi-risk brand recovery, offline store expansion or inventory de-allocation less than expected