上半年营收表现稳健，持续推进品牌升级战略。分地区看，24H1 境内/境外市场实现营业收入395.3/2.78 亿元，同比-1.1%/+4.8%。分产品看，2024H1 珠宝首饰/黄金交易/笔类/工艺品销售产品分别实现营收341.96/54.82/1.07/0.15 亿元，同比-4.0%/+26.0%/+9.9%/-78.4%。上半年，公司以“国潮、国风、国韵”为主题，在全国积极布局“藏宝金”主题店；在长三角地区开业运营“凤祥喜事”——“老凤祥喜庆主题店”；5 月，公司在湖北省规模最大、品类最全、最具特色的旗舰店开业运营。截至24Q2，公司营销网点达到6022 家（含境外银楼15 家），较23 年末净增加28 家。Matters:
The company released its 2024 mid-year report. In the first half of the year, the company achieved revenue of 39.96/1.4/1.46 billion yuan in revenue/net profit deducted from mother, -1.0%/+10.3%/+12.9% year-on-year. In the second quarter of a single quarter, the company achieved revenue/net profit attributable to mothers/net profit deducted from mother of 14.33/0.6/0.62 billion yuan, -9.2%/+8.1%/+11.8% year-on-year.
Commentary:
Revenue performance in the first half of the year was steady, and the brand upgrade strategy continued to be promoted. By region, the 24H1 domestic/overseas market achieved revenue of 39.53/0.278 billion yuan, -1.1%/+4.8% year-on-year. By product, 2024H1 jewellery/gold trading/pen/handicraft sales products achieved revenue of 341.96/5.482/0.107/0.015 billion yuan, respectively, -4.0%/+26.0%/+9.9%/-78.4%. In the first half of the year, with the theme of “Guochao, Guofeng, and Guoyun”, the company actively laid out “Treasure Gold” themed stores across the country; opened and operated the “Fengxiang Happy Event” — “Lao Fengxiang Festival Theme Store” in the Yangtze River Delta region; in May, the company opened and operated the largest, most comprehensive and unique flagship store in Hubei Province. As of 24Q2, the company had 6022 marketing outlets (including 15 overseas banks), a net increase of 28 over the end of 23.
The rise in gold prices has led to an increase in gross margin, and the cost ratio is well controlled. 1) At 24H1, the company achieved a gross profit margin of 9.2%, +0.7pcts year-on-year, mainly due to the rise in gold prices. On the cost side, the company achieved a sales/management/finance expense ratio of 1.3%/0.7%/0.2%, -0.1/-0.04 pcts; among them, the decrease in the sales expense ratio was mainly due to a decrease in wages, social security and welfare expenses for the subsidiary Laofengxiang Silver Building. The increase in management expenses was mainly due to an increase in renovation costs for the subsidiary Shanghai Laofengxiang, and the increase in financial expenses was mainly due to an increase in current interest income. Taken together, the company achieved a net interest rate of 3.5% to mother in the first half of the year, +0.4 pcts compared to the previous year. 2) In 24Q2, the company achieved a gross profit margin of 10.7%, +1.6pcts year-on-year. On the expense side, the company achieved a sales/management/finance expense ratio of 1.5%/1.0%/0.1%, +0.1/+0.4/-0.1 pcts year over year; the comprehensive impact on the net profit margin for the second quarter was +0.7 pcts to 4.2% year on year.
Continue to promote internal reforms based on brand, channel and scale advantages. The company is brand-led and market-oriented, and adheres to the “five in one” three-dimensional marketing model of self-operated silver building construction and joint ventures, general distribution, dealers, and specialty stores. Meanwhile, in the first half of the year, the company fully implemented the “Three-Year Action Plan to Fully Promote High-Quality Development (2023-2025)” to promote comprehensive reform and in-depth development of the “Double Hundred” initiative. The selection and recruitment of the second round of professional managers in the second batch of 13 subordinate enterprises has been completed, and the tenure system and contractual management of management members of subordinate enterprises have been further optimized. It is expected to promote the further high-quality development of enterprises.
Investment advice: The company is a domestic gold and jewelry leader. It has a strong brand, perfect channel layout, and is optimistic about optimizing organizational and operating efficiency after the reform. Considering fluctuations in gold prices and pressure on terminal consumption, we lowered our profit forecast. We expect the company's net profit to be 2.38/2.703/2.991 billion yuan for 24-26 (the original value for 24-25 was 2.707/3.094 billion yuan), and the corresponding PE is 11/10/9X. Referring to the relative valuation method and comparable companies, the 24-year valuation was 14X, corresponding to a target price of 63.70 yuan, maintaining a “strong” rating.
Risk warning: market competition increases risk; risk of weakening terminal consumer demand; risk of gold price fluctuations, etc.