The company released a three-quarter report

The company's 24Q3 revenue was 0.21 billion, an increase of 7%; net profit due to mother of 0.01 billion decreased by 63%, and net profit after deducting 0.007 billion to mother increased 48%;

24Q1-3 The company's revenue of 0.7 billion decreased by 4%, net profit due to mother of 0.1 billion was reduced by 18%, and net profit of 0.07 billion after deduction was reduced by 8%;

24Q1-3's gross profit margin was 62.12%, up 2.13pct; net profit margin was 15.13%, down 2.64pct.

Strengthen the collaborative development of Kibushi products and channels

24Q3 Gaibu Shi men's clothing has begun to contribute to the performance, and now the men's and women's clothing performance is within the company's expectations. Currently, the proportion of new autumn clothing developed and designed by the company is relatively small in the product structure, and there is a relatively large inventory of previous seasons purchased from the original authorized dealer.

In the future, the company will enhance the positioning of casual men's and women's clothing on the original basis, increase investment in new products, continue to carry out all-round upgrades in the R&D, design and fabric application of new products, control the price range and positioning of products, upgrade channel quality on the basis of product upgrades, and carry out active brand promotion, so that consumers can feel the value for money.

Deepen brand building and optimize channel layout

The company will continue to focus on brand building next year. For HushPuppies (HushPuppies) men's and women's clothing, we will continue to improve product quality and adjust product structure, improve single-store efficiency, find suitable channels to replicate the single-store profit model, upgrade channel quality, close stores with biased image, and adjust to image stores and flagship stores to meet the strategic direction of brand building.

While upgrading its brand image, the company will also cooperate with brand promotion, thereby further enhancing its brand reputation. As far as the Water Kid brand is concerned, the product upgrade is nearing completion. Next year, the company will invest more in brand promotion to continue strengthening consumer awareness.

High-end children's clothing business is under pressure

Since this year, the company has felt macro-level demand-side pressure, but the biggest impact was BEBELUX, the company's single store and collection store for children's clothing from high-end imported brands. The high-end children's clothing business module showed signs of slow sales to a certain extent compared to the past, and the value of children's clothing from high-end brands is high, and it is usually difficult to quickly clear it out at a low price. The increase in long-term inventory has also had a great impact on asset impairment. In the future, the company will actively adjust this business module to reduce the adverse impact of the high-end children's clothing business on the company's financial situation.

Adjust profit forecasts to maintain “buy” ratings

Based on the 24Q1-3 performance, there is uncertainty about the current macro-consumption environment, and the effects of the company's integration of leisure steps need to be further observed; we adjusted the profit forecast. The company's 24-26 EPS is 1.56 yuan, 1.71 yuan, and 1.88 yuan (the original value was 1.8/2.1 and 2.6 yuan), respectively, and PE is 13X, 12X, and 11X, respectively.

Risk warning: risk of falling inventory prices; decline in online traffic dividends; risk of rising e-commerce return rates.