The revenue of 1-3Q2017 company increased by 0.67%, and the net profit of parent company increased by 67.51%.

On the evening of October 20, the company released its quarterly report for 2017: 1-3Q2017 realized revenue of 1.817 billion yuan, an increase of 0.67% over the same period last year; and realized a net profit of 52.34 million yuan, equivalent to 0.19 yuan of fully diluted EPS, an increase of 67.51% over the same period last year. The non-return net profit was 55.99 million yuan, an increase of 4.1% over the same period last year, and the performance was in line with expectations.

In a single quarter, 3Q2017 achieved operating income of 591 million yuan, an increase of 11.61% over the same period last year, while 2Q2017 revenue decreased by 3.37%. Net profit of 17.88 million yuan was achieved, an increase of 167.52% over the same period last year, which was greater than the 26.29% increase of 2Q2017.

The comprehensive gross profit margin decreased by 0.43 percentage points, and the expense rate decreased by 2.38 percentage points.

The comprehensive gross profit margin of 1-3Q2017 was 19.97%, down 0.43% from the same period last year.

The period expense rate of 1-3Q2017 company was 15.13, down 2.38% from the same period last year, of which the sales / management / financial expense rate was 2.18% / 12.91% / 0.03% respectively, with a year-on-year change of 0.37max / 1.79% /-0.96% respectively.

The rate of management expenses has been greatly reduced, and the income side shows signs of warming up.

Due to the decrease in the number of paid departures from the beginning of the year to the third quarter of the year, the company's management expenses decreased significantly compared with the same period last year. At the same time, relying on its own historical status and the influence of Taiyuan Street business circle in the regional market, the company continues to tap endogenous potential, carry out many promotional activities, and the revenue side shows a certain degree of recovery.

Maintain earnings forecasts and "buy" ratings

We maintain our forecast for the company's fully diluted EPS of $0.44 / 047 / 0.50 for 2017-2019, taking into account the company's low market capitalization and maintain a "buy" rating.

Risk hint

The growth rate of household consumption fell short of expectations, and competition in the regional market intensified.