Main points of investment
The company announced the third quarterly report of 2022: increased operating pressure under the epidemic, Q3 performance a small loss. The higher growth rate of net profit in the first three quarters of 2022 is mainly due to the loss of assets impairment and investment loss of 34 million yuan in the same period of 21 years, which led to a low base in the same period last year, the revenue in the first three quarters of 2022 was 179 million yuan / yoy+56.1%,. From a quarterly point of view, 22Q1/Q2/Q3 revenue is-1.43% compared with the same period last year, respectively, and the net profit is-9.77% /-53.77% / a small loss compared with the same period last year. The decline of Q3 income side is mainly due to the customer flow of offline stores affected by the epidemic, the net profit is-410000 yuan, and the small loss is mainly caused by gross profit margin year-on-year-4.60pct and period expense rate year-on-year + 13.38pct.
The income of 22H1 mother and baby cotton products has dropped, and the stores have changed to the "experience + service" model. 1) look at the products by product:
22H1 Maternal and Infant Cotton products / Baby clothing / other Maternal and Child products / other income year-on-year-25.16%, 10.47%, 2.70%, 179.18%, 39.20%, 32.99, 21.69, 6.13%, respectively. the decline in income from maternal and infant cotton products in the first half of the year was mainly affected by the epidemic. As the Q3 epidemic is distributed and the impact continues, we judge that Q3 income continues to be under pressure. 2) look at ① by channel: online and offline:
The online / offline revenues of 22H1 are-6.10%, 27.88% and 67.03%, respectively, compared with the same period last year. Online channels are relatively less affected by the epidemic. ② offline endogenous extension: 22H1 direct sales / franchise revenue is 8.64%, 30.39% and 69.61%, respectively, compared with the same period last year. The number of direct sales / franchise stores is 788, which is higher than that of-31 Mobil at the end of 21, and 6.41% compared with the same period last year. The decline in offline channels is mainly due to the company's optimization and adjustment of offline channel strategy and closure of stores with poor performance. As the company adjusts the physical store to the "experience + service" model, and the functional positioning of offline physical stores turns more into experience, distribution and service functions, we expect the Q3 offline channel to decline greatly.
The gross profit margin has dropped sharply, the expense rate has increased greatly, and the profit margin has been seriously damaged after excluding the impact of impairment. 1) Gross profit margin: the gross profit margin in the first three quarters of 22 was-4.59pct to 51.85% compared with the same period last year, mainly due to the company's increased product promotion efforts and the increase in the proportion of low gross margin online channel sales. On a quarterly basis, the gross profit margin of 22Q1/Q2/Q3 is 56.39%, 50.74% and 48.06%, respectively. 2) expense rate: in the first three quarters of 22, the expense rate is from + 3.67pct to 45.50%, of which the sales / management / R & D / financial expense rate is year-on-year + 0.44/+2.78/+0.47/-0.02pct to 25.03%, respectively, 15.65% 0.44/+2.78/+0.47/-0.02pct to 25.03%, 15.65% and 5.76% q3, respectively, due to the rigidity of sales and management fees. 3) homing net interest rate: in the first three quarters of 22, the year-on-year net interest rate was + 2.59pct to 5.76%. Excluding the impact of the impairment and investment loss of 34 million yuan in the same period last year, the net interest rate was year-on-year-13.65pct, mainly due to a sharp decline in gross profit margin and a significant increase in the expense rate during the period. 4) inventory: up to the end of 22Q3 inventory 159 million yuan / yoy-1.04%, inventory turnover days compared with the same period last year + 23 days to 486days. 5) Cash flow: net cash flow of operating activities in the first three quarters-10 million yuan / yoy+24.48%, as of 90 million yuan on 22Q3's account.
Profit forecast and investment rating: the company has been deeply engaged in the mother and child industry for many years. In 2021, the company formulated the strategy of "Mother and Child products + Medical and Beauty Services". Over the past 22 years, the disturbance of the epidemic has led to the pressure on terminal consumption and the quarterly decline of income growth. however, it benefits from the low base effect and high growth rate at the performance end in the same period of 21 years. In 21 years, the company acquired 36% equity of Korean imperial concubine investment, 22H1 Korean imperial concubine investment realized revenue of 175 million yuan, net profit of 1.7403 million yuan, net profit of 3.6939 million yuan, affected by the epidemic, we expect to be difficult to complete the previous gambling agreement (22 years deduction of non-return net profit of not less than 60 million yuan), but in the long run, the company's mother and child main business and medical beauty business consumer group overlap is high, business coordination with the medical beauty business is expected to provide a new driving force for growth.
Taking into account the impact of the epidemic disturbance, we reduced the 22-24 net return of homing from 0.38 million to 0.33 million, respectively, from 0.38 to 0.33 million, EPS 0.04 to 0.09, respectively, and corresponding PE to 174max, 72max, 61x, maintaining a "neutral" rating.
Risk hints: recurrent epidemic situation, weak consumption in maternal and infant industries, and lower-than-expected development of medical and beauty business.
