Event: the company issued a 2023H1 performance announcement. The company's 23H1 realized revenue of 1.415 billion yuan, + 19.8% year-on-year, and net profit of 102 million yuan, + 453.6% compared with the same period last year. The company declares an interim dividend of HK $0.12 per common share, totaling about 263 million yuan, with a corresponding dividend yield of about 3.8% and generous dividends.
Comments:
Net income and profit fell in the median forecast, with a corresponding profit margin of 7.2%, in line with our expectations. As of 23H1, the total number of Zhou's Black Duck stores is 3706, and 23H1 has a net opening of 277 stores, which is mainly due to store optimization in the first half of the year. According to different store types, the number of 23H1 transportation hub / business district / community / other stores is 224max / 2232 / community / other stores respectively, and the net opening of 46pm / 133max / 68max is 30 respectively. The strategy of opening shop in transportation hub and business area increases obviously during the window period. From the single-store point of view, the transportation hub has recovered well and is expected to return to the 21-year level, while the non-transportation hub still has a certain gap compared with that expected at the beginning of the year. Pay attention to the effect of the follow-up single-store boost strategy.
Under the pressure of raw material prices, 23H1 still achieved a gross profit margin of 52.5%. The year-on-year decline in gross profit margin (4.4pct) was mainly due to the impact of changes in raw material prices and store structure. The 23H1 ton price was 88.4 yuan / kg, + 4.7% year-on-year, and the store customer price increased from 59 yuan + 4.9% to 62 yuan. The cost of 23H1 tons is 42.6 yuan / kg, + 15% compared with the same period last year, mainly due to greater pressure on raw materials in the first half of the year. The company expected raw material prices to rise at the beginning of the year, and still achieved a good gross profit margin through supply chain and inventory management as a whole. Since May to June this year, duck sub-raw materials show a gradual decline in the trend, the upstream gradually into the supply upstream cycle, pay attention to 23H2 raw material prices continue to fall.
Profit forecast and investment rating: at present, the industry is mainly subject to the pressure of profit margin recovery and store recovery brought by raw material prices and weak consumption. Zhou's Black Duck's profit performance in the first half of the year is bright, and we expect to achieve the profit target of 200 million in 23 years. We expect 24-year revenue / net profit of 3.45 billion / 400 million, corresponding to the current valuation of 17X, the valuation is low. In the short term, we should pay attention to the profit flexibility brought about by the fall in raw material prices and the effect of individual store boost measures. Long-term Zhou's Black Duck has brand advantages, broad space to open a store, pay attention to the comprehensive running of the community store model, open the store ceiling. We expect earnings per share from 23 to 25 to be 0.09, 0.17 and 0.22 yuan respectively, maintaining a "buy" rating.
Risk factors: fluctuations in raw material prices, downward category cycle, weak consumption, food safety issues?