The company's 1Q2018 revenue increased by 1.43% over the same period last year, and its net profit increased by 20.74% compared with the same period last year.
On April 28, the company reported that 1Q2018 realized 1.376 billion yuan in operating income, up 1.43% from the same period last year, while 4Q2017's operating revenue decreased by 5.10%. Realized net profit of 46 million yuan, equivalent to 0.09 yuan of fully diluted EPS, an increase of 20.74% over the same period last year, less than 28.46% of the growth of 4Q2017, and realized deduction of 45 million yuan of non-return net profit, an increase of 12.91% over the same period last year, and the performance was basically in line with expectations. The main reasons for the large increase in 1Q2018's parent net profit are: 1) the gross profit margin increased by 0.17% over the same period last year, and the expense rate decreased by 0.45% over the same period last year; 2) the non-operating expenditure was 29300 yuan, compared with 3.5884 million yuan in the same period last year, mainly due to the closure of Qinghe store to pay lease termination compensation.
The composite gross profit margin increased by 0.17 percentage points, and the expense rate decreased by 0.45 percentage points during the period:
1Q2018's stores remained unchanged, and the company's revenue from merchandise sales was 1.318 billion yuan, an increase of 1.41 percent over the same period last year. 1Q2018's consolidated gross profit margin was 19.54%, up 0.17% from a year earlier. The expense rate of 1Q2018 during the period was 13.77%, down 0.45% from the same period last year, of which the sales / management / financial expense rate was 10.77% / 2.99% / 0.01%, respectively, down 0.32 / 0.04 / 0.09 percentage points from the same period last year. The main reason for the sharp decline in the rate of financial expenses is the reduction of credit card charges.
The main stores have the advantage of location, the proportion of self-owned property is high, and the brand influence is great.
The seven department stores under the company are basically located in the core business district or core community area of Beijing, with good location advantages. The company has its own property construction area of about 194000 square meters, and its own property accounts for 48.22%. The higher proportion of its own property makes the company have a better cost advantage and anti-risk ability. The company has high brand awareness and market influence in Beijing. In 2017, the company won the title of "Beijing Top Ten Commercial Brands Gold Award", and the brand influence continues to be consolidated.
Maintain profit forecast and maintain "overweight" rating
We believe that the current recovery trend of the department store industry is obvious, the company's revenue growth rate becomes positive, and the cost decreases obviously after the closure of loss-making stores. We maintain the company's EPS forecast for 2018-2020, which is 0.30 / 0.33 / 0.36 yuan respectively, maintaining the "overweight" rating.
Risk Tips:
The operating area is more concentrated, and the recovery of middle and high-end consumption falls short of expectations.