This report is read as follows:
The company was affected by strict policy control and other factors in 2015, the main business income was weak; some stores were closed for rectification, and the rate of sales and management expenses increased significantly, resulting in a net profit loss. The company continues to explore the road of transformation.
Main points of investment:
The performance is in line with market expectations, and the company is actively exploring the road of transformation. ① is affected by the macroeconomic slowdown and strict policy control in recent years, the company's main business income is weak; some stores are closed for rectification, sales and management costs have increased significantly, resulting in net profit losses; ②, relying on the influence of century-old brands, continues to promote chain development, and try cross-border alliance business model; ③ actively explores new e-commerce models and broadens sales channels. Considering that the company's main business is still under pressure in the short term, the cost caused by sales channel expansion has increased, and the EPS in 2016-2017 has been reduced to 0.01max 0.02 yuan (- 0.07 Uniqure 0.06 yuan), maintaining the previous valuation assumption of 7.5xPS, lowering the target price to 8.39 yuan and increasing its holdings.
Performance description: in 2015, the company achieved revenue of 499 million yuan /-8.57%, net profit of-32 million yuan /-386.13%, and earnings per share of-0.06 yuan. The performance is in line with market expectations. The company's main business income was weak in 2015, and the increase in expense rate during the period resulted in a net profit loss. Due to the macroeconomic slowdown in recent years and the influence of policies, ① achieved revenue of 394 million yuan /-12.33% for catering services and 46 million yuan / + 4.12% for food processing (manufacturing) in 2015. ② company closed some stores for rectification, leasing, maintenance and intermediary fees increased significantly, during the expense rate reached 41.92%/+4.15pct, including sales expense rate 32.12%/+3.05pct, management expense rate 8.73%/+2.41pct, resulting in net profit loss.
The company actively promotes chain development and explores new e-commerce models, and senior executives' shareholding shows confidence. ① developed 16 time-honored small chain stores in 2015, and is expected to further promote chain development in the future, relying on the influence of century-old brands; ② four molecular companies to achieve O2O Wechat platform sales, it is expected that in the future will continue to expand sales channels, stimulate retail consumption, and enhance profitability ③ 's planned acquisition of Jiahe Yipin in 2015 was terminated because of the great differences between the two sides on investment projects, but actively exploring the way of transformation through extension expansion is still going on; 10 senior executives of ④ Company increased their holdings of the company's shares in February 2016, demonstrating confidence in the company's future development.
Risk hints: intensified competition in the catering market, food safety risks and chain store management risks