The company released an interim report of 2022: 2022H1 realized income of 2.537 billion yuan (year-on-year + 0.9%), net profit of 126 million yuan (year-on-year-2.2%), and non-return net profit of 87 million yuan (year-on-year). Single Q2 realized income of 1.224 billion yuan (year-on-year-10.3%), net profit of 67 million yuan (+ 0.7% year-on-year), and non-return net profit of 43 million yuan (year-on-year-35.6%). Non-profit and loss are mainly generated by 38 million yuan of income from disposal of non-current assets and changes in fair value.
The overseas market of 2022H1 is expanding steadily, and the domestic performance is temporarily under pressure under the influence of the epidemic.
The growth of overseas Ekornes is steady, and the Chinese market is under pressure. 2022H1 overseas Ekornes revenue of 1.93 billion yuan (year-on-year + 19.7%, Norwegian dollar + 29.3% year-on-year), net interest rate of 9.5% (year-1.4pct), income growth remained solid against the background of Russia-Ukraine war and US dollar interest rate increase. According to the category, 2022H1 Stressless/IMG/Svane realized income of RMB 1.46 million respectively (compared with the same period last year), which was + 21.0%, 23.0% and 3.7% respectively. The channel penetration of the company's non-comfortable chair products (electric chairs, sofas, dining chairs, dining tables) continues to increase, 2022H1 orders grow by nearly 50% year-on-year, and the Chinese market expands smoothly, with order growth of nearly 40% in the first half of the year, of which single Q1 exceeds 100%. Q2 company mattress products from Europe to the global expansion, and product prices generally increase 6-8% to hedge the impact of raw material prices, growth momentum is expected to remain stable in the second half of the year.
The domestic performance is under pressure, and the innovative business is expanding rapidly. 2022H1's domestic Qumei brand realized 619 million yuan (year-on-year-32.7%) and net interest rate of 1.1% (year-2.9pct). It was repeatedly affected by the domestic epidemic, and the domestic income was under pressure. 1) Distribution channels: the company gives full play to the business advantages of "full category one-stop" business, improves the joint rate and single customer contribution value, and is committed to improving the profitability of new and small businesses. 2) Direct marketing channels: the epidemic situation in Beijing significantly affected the performance of Q2. The company actively promoted the whole assembly business, multi-channel drainage up and down the line, and expanded stores against the trend between epidemics. Under the influence of the city closure of the epidemic in Beijing, the direct operation of 2022H1 achieved a 10% year-on-year growth rate. 3) bulk channels: delayed delivery of real estate projects is a drag on bulk revenue recognition, but the total order volume in the first half of the year increased by nearly 100% compared with the same period last year, and is expected to focus on delivery to contribute bright spots in the second half of the year. In addition, the company has actively optimized its product structure, precise price increases to hedge costs, SKU continued to streamline and optimize, and domestic revenue and profits are expected to usher in an upward inflection point in the second half of the year.
Profits are under short-term pressure, and expenses are significantly lower. 2022Q2's gross profit margin is 32.8% (year-on-year-6.6pct) and homing net profit rate is 5.5% (year-on-year + 0.6pct). The adjustment of freight and service charges and the high price of raw materials lead to pressure on the company's profits. it is expected that the price increase will bring profit improvement in the second half of the year. In terms of cost performance, the expense rate during the single Q2 period is 28.4% (year-4.0pct), sales expense rate is 16.5% (year-on-3.8pct), management expense rate is 8.0% (year-on-year + 1.5pct), financial expense rate is 1.83% (year-on-1.6pct), and R & D expense rate is 2.1% (year-on-0.1pct). The increase in exchange income leads to the decline of financial expenses. It is expected that the debt swap will drive the further optimization of the financial expense rate in the second half of the year.
Cash flow declined slightly and operational efficiency was dragged down by the epidemic. The net operating cash flow of 2022Q2 Company was 183 million yuan (- 20 million yuan compared with the same period last year), mainly due to the increase in procurement expenditure. In terms of operating efficiency, up to the end of Q2, the company's accounts receivable turnover days were 37 days (year-on-year + 4 days), accounts payable turnover days were 42 days (year-on-year-5 days), inventory turnover days were 123 days (year-on-year + 10 days), and delivery was blocked under the epidemic. Company turnover efficiency is reduced.
Profit forecast and valuation: overseas Ekornes brands are scarce with strong product power, high efficiency of retail stores, definite growth and substantial optimization of financial statements. It is estimated that the net profit of homing in 2022-24 is 3.1pm 5.2 / 690 million yuan respectively, corresponding to PE 16.9X/10.0X/7.5X.
Risk hint: recurrent epidemic situation and lower-than-expected real estate recovery