Event description
In the first half of 2023, the company achieved an income of 1.415 billion yuan, an increase of 19.8% over the same period last year, and a net profit of 102 million yuan, an increase of 453.6% over the same period last year. By the end of June 2023, the company had a total of 3706 stores, including 1542 self-operated stores and 2164 franchised stores, covering 339 cities in 28 provinces, autonomous regions and municipalities directly under the Central Government.
Event comment
The income and profit are in line with expectations, and the diversified product structure is balanced. 2023H1 revenue increased 19.8% year-on-year, sub-model: self-operating growth of 29.3%, franchise growth of 22.2%, online decline of 5.0%. The faster growth of self-owned stores is expected to be related to the relatively high proportion of transportation hub stores. If the average number of stores at the end of 2022 and the end of June 2023 is used as the number of stores in the first half of the year. It is estimated that in the first half of the year, the revenue of individual stores in self-operated stores is about 5027 million yuan / + 12.0%, and that of franchised stores is about 19.69 million yuan /-1.2%. Look at the products:
Duck and duck by-products increased by 19.3%, other products increased by 21.9%, and the proportion of other products increased by about 0.4pct to 20.3% compared with the same period last year, further reflecting the potential of diversified products, of which the terminal tax sales of slightly spicy products were nearly 300 million yuan, and the terminal tax sales of shrimp ball products exceeded 120 million yuan. The total sales of sweet and spicy chicken legs in a series of products with a new price of 9.9 yuan exceeded 960,000 boxes in two months. In the first half of the year, the total sales volume of the company's products increased by 14.5% compared with the same period last year, the average selling price was 884,000 yuan / ton + 4.7%, and the average consumption per purchase order was 62.01 yuan / + 4.9%.
The expansion of stores has been steadily advanced, and the advantages of transportation hubs have been strengthened. By the end of June 2023, according to the number of stores in different models, the number of franchised stores accounted for 58.4% and 28.9% respectively. Look at the number of stores by location, transportation hub 224Universe 46 (including self-operating 157and franchise 67), business district & business body & Shang Chao 2332Universe 133 (including self-supporting 847,638), community 860Universe 68 (including self-supporting 222,638), other 390Universe outlets 30 (including self-supporting 316,74), the company complies with the trend of consumption and has increased the distribution of transportation hubs and high-potential energy business areas this year, with good performance.
Raw material cost is under pressure, income recovery scale effect brings net interest rate to rebound. 2023H1's gross profit margin decreased by about 4.4pct to 52.5% compared with the same period last year, mainly due to the upward impact of raw material costs; sales and distribution expenses accounted for 33.5%/-9.3pct, mainly due to transportation expenses, material consumption expenses and depreciation of right-to-use assets; administrative expenses accounted for 11.3%/-0.1pct The ratio of financial expenses to income, 1.0%/-1.6pct, was mainly due to the redemption of HK $246 million of principal convertible bonds, resulting in a reduction in interest expenses. The overall net interest rate has risen sharply to 7.2%, but there is still room for repair. At present, the cost of raw materials has fallen at a high level, but it is still at an all-time high, and the construction of the company's Chengdu plant in the second half of the year is expected to bring some depreciation.
Profit forecast and investment advice: pay attention to the follow-up pace of store opening and cost changes. It is estimated that the company's return net profit in 2023-2025 will be 2.01,3.42 and 475 million yuan respectively, and the corresponding share price PE will be 31, 18 and 13 times respectively, maintaining the "buy" rating.
Risk hint
1. The risk of slow demand recovery
2. Market competition risk
3. Cost uplink risk.