The company's 1H2021 revenue decreased by 1.16% compared with the same period last year, achieving a net profit of 25 million yuan. On August 29, the company released its semi-annual report of 2021: 1H2021 realized operating income of 4.378 billion yuan, a decrease of 1.16% over the same period last year; realized net profit of 25 million yuan, equivalent to 0.03 yuan of fully diluted EPS; and realized deduction of 16 million yuan of non-parent net profit. In a single quarter, 2Q2021 realized operating income of 1.979 billion yuan, down 1.96% from the same period last year; realized net profit of 14 million yuan, equivalent to 0.02 yuan of fully diluted EPS, a decrease of 75.68% over the same period last year; and realized deduction of 14 million yuan of non-return net profit, a decrease of 61.07% over the same period last year.
During the reporting period, the decline in the company's operating income was mainly affected by the decline in supermarket revenue, which was mainly due to two reasons: 1) the sales growth rate of supermarkets affected by the epidemic was relatively high in the same period in 2020. 2) the company optimized the layout of stores and closed 7 stores in East China during the reporting period.
The company's 1H2021 comprehensive gross profit margin rose 3.92 percent, and the expense rate rose 3.05 percent during the period. 1H2021's comprehensive gross profit margin was 29.05 percent, up 3.92 percent from the same period last year. In a single quarter, 2Q2021's comprehensive gross profit margin was 29.39%, up 2.69% from a year earlier.
The expense rate of 1H2021 during the period was 26.57%, an increase of 3.05% over the same period last year, of which the sales / management / financial expense rate was 15.60%, 8.27% and 2.69%, respectively, and the year-on-year change was + 1.73% / + 0.51 percentile 0.80% respectively. The expense rate of 2Q2021 during the period was 26.49%, an increase of 4.56% over the same period last year, of which the sales / management / financial expense rate was 15.66%, 7.62% and 3.21%, respectively, and the year-on-year change was + 3.14% 0.51% / + 0.91%, respectively.
Keep ploughing the construction of intelligent logistics, and the format of supermarkets is in the period of adjustment.
By the end of the reporting period, the company had 83 retail stores with a total operating area of more than 2.3 million square meters, of which the self-owned property area reached more than 800,000 square meters. In terms of logistics system construction, by the end of the reporting period, the company has a total of three modern logistics centers, with a total storage area of more than 400000 square meters and more than 100,000 square meters under construction. The company issued an announcement on July 13, 2020 to adjust the convertible bond-to-equity price, and there is still a difference of 0.58 yuan per share between the company's current stock price and the revised convertible bond price of 7.01 yuan per share.
Downgrade profit forecast and maintain "overweight" rating
The performance of the company was lower than expected, mainly due to: 1) the format of the company's supermarket was impacted by new business type, such as community group buying; 2) the company invested a lot in building a logistics system, and in view of the uncertainty about the profitability of the company's future logistics system, we lowered our forecast for the company's 2021 / 2022 / 2023 EPS 35%, 38%, 41% to 0.15, 0.16, 0.17 yuan. The company actively adjusts the format of the supermarket and continues to strengthen the construction of intelligent logistics, which is conducive to enhance the company's competitive strength and maintain the "overweight" rating.
Risk hint: the adjustment effect of supermarket format is not as expected, the competition in regional retail market intensifies, and the impact of community group buying.
