Revenue increased significantly, net profit of 4S store increased: the company recorded comprehensive income of 12.92 billion yuan in 2019, an increase of 17.9% over the same period last year, gross profit reached 1.39 billion yuan, an increase of 28.8% over the same period last year, comprehensive gross profit of 10.7%, increased 0.9pct, net profit of home was 510 million yuan, down 24.9% over the same period last year, mainly due to the company's adjustment of independent after-sales company and FMC to financial revenue in 2018. If this impact is deducted, the profit of the company's 48 dealer business is 490 million yuan, an increase of 47.4% over the same period last year. The company intends to pay a dividend of HK7.5 cents per share.
New car sales gross profit margin both picked up: in 2019, the company's annual new car sales revenue was 10.91 billion yuan, an increase of 16.7% over the same period last year. New car sales reached 33000, an increase of 21.5% over the same period last year, mainly due to two reasons: first, the company's first and second largest brands BMW and Lexus had strong sales in China. The group BMW sold 26000 vehicles, up 17.4% from the same period last year. Lexus sales reached 3821, an increase of 28%. Second, the growth of the ultra-luxury market is obvious, and the sales volume of Russell and Ferrari has increased significantly. At the same time, the gross profit margin of new car sales improved compared with last year, with a combined gross profit margin of 3%, which increased 0.7pct, mainly because the launch of new BMW models made the overall gross profit margin of BMW rise 0.36pct compared with the same period last year, Rex's gross profit margin remained high at 7.37%, and the company's ultra-luxury brand gross margin increased.
Steady expansion of outlets and improvement of after-sales business: in terms of outlets, as the company refocused on 4S store business, the expansion rate of outlets accelerated. In 2019, the company expanded nine new outlets, and by the end of the year, the number of outlets had increased to 72. In January 2020, the company acquired two ultra-luxury and a Xidi store. The company plans to maintain its network expansion target of more than 15% in 2020. Thanks to the company's refocus on network expansion in 18 years, after-sales business grew rapidly in 19 years, with revenue of 1.69 billion yuan up 31.7% year-on-year, attendance increased significantly to 340000, and after-sales gross profit margin also increased to 43.9% compared with the same period last year.
With the spread of the global epidemic, the demand for luxury cars is better than the big city: the domestic epidemic is gradually under control, the company's 4S store gradually resumed work in late February, and passenger flow returned to normal by the end of March. Under the influence of the epidemic, sales in China's car market are expected to decline by 8% in 2020 compared with the same period last year, but due to the low penetration rate of luxury cars in China, the performance of luxury cars will still be better than that of the overall car market. At the same time, BMW's product cycle remains strong in 2020, with 15 new models expected, including mid-term revamped 5-series and asshole versions, as well as upcoming domestic all-electric SUV IX3 models. The company's overall new car sales are expected to increase by 8% in 2020, and gross profit margins remain stable.
Adjust the target price to HK $4.76, buy rating: due to the impact of the epidemic, after adjusting the key data, the net profit in 2020 is expected to be about 546 million yuan, according to the dealer's average price-to-earnings ratio of 12 times, its market capitalization is about HK $6.55 billion, corresponding to the target price of HK $4.76. a 40 per cent increase over the current price, buy rating.
