Events:
The company announced that as of June 30, 2018, the company reported unaudited results in the first half of 2018, with revenue of HK $4.93 billion during the period, an increase of 6.7% over the same period last year. The net profit of homing is a loss of HK $50.48 million. The loss narrowed compared with the same period last year, with a loss of-HK $0.19 per share and an interim cash dividend of HK22 cents.
Comments:
Earnings were solid and losses narrowed: as of June 30, 2018, the company recorded revenue of HK $4.93 billion in the first half of 2018, up 6.7 per cent from a year earlier. The gross profit margin in the first half of the year was 30.7%, an increase of 0.2pct over the same period last year. Of the classified sales revenue, direct sales were 4.5 billion yuan, an increase of 6.6% over the same period last year, and franchise counter sales revenue was 430 million yuan, an increase of 7.6% over the same period last year. In the sub-regional revenue performance, Hong Kong's sales revenue was 2.2 billion yuan, up 8.1 percent from the same period last year, with a loss of 36.65 million Hong Kong dollars, narrowing compared with the loss of 86.12 million Hong Kong dollars in the same period last year. China's sales revenue was 2.7 billion yuan, up 5.6 percent from the same period last year, with a loss of 13.72 million Hong Kong dollars, compared with a profit of 3 million Hong Kong dollars in the same period last year. The company's inventory procurement cost rate, employee compensation and depreciation expense rate remained basically stable compared with the same period last year, while the expenditure rate of other operations such as distribution administration decreased by 0.5pct compared with the same period last year, which narrowed the loss compared with the same period last year.
Since the second half of 2017, Aeon began to focus on improving profitability, and 2018H1's business in Hong Kong and China has improved. The company's reform mainly includes three directions: 1) different markets establish different business models, such as adding fresh and organic food, and fashionable household products launch characteristic units in line with the characteristics and lifestyle of consumers in each market. 2) the overall transformation of the digital system, including the digitization of the supply chain, the digitization of customer information, and the digitization of the company's internal management. The supply chain strives to reduce procurement levels, increase the proportion of direct mining, and carry out direct cooperation with brands. Terminal water test line online and offline cross drainage, O2O interactive interconnection. 3) Commodity reform, product mix adjustment and optimization, leading the change of consumers' lifestyle, which is very important for retail enterprises. New products, new lifestyle and commodity diversification are the goals that the company continues to pursue. In the future, the company's capital investment will be mainly used to open new stores, renovate old stores and digitally transform them.
Risk tips: 1, macroeconomic fluctuations, government investment expenditure; 2, trade war risk, exchange rate fluctuations, financial property assets fluctuations; 3, changes in consumer income, consumption willingness, employment rate fluctuations, etc.