The company released a three-quarter report

The company's 24Q3 revenue was 0.48 billion, a decrease of 19%; net profit to mother decreased by 47% from 0.06 billion, and net profit of 0.05 billion was reduced by 48%, mainly due to weak terminal demand, channel optimization and adjustment, a decline in sales revenue and an increase in management expenses;

24Q1-3's revenue decreased by 1.61 billion by 13%, of which by brand, DAZZLE revenue of 0.85 billion decreased by 15%, DIAMOND DAZZLE's revenue of 0.089 billion decreased by 14%, D'zzit's revenue of 0.64 billion decreased by 10%, RAZZLE's revenue of 0.026 billion decreased by 5.7%, and revenue of other brands increased by 36% from 0.005 billion; by channel and online e-commerce revenue 0.264 billion decreased by 5%, offline direct sales revenue decreased by 20%, offline distribution revenue of 0.712 billion decreased by 8%, and revenue from other channels increased 36% by 0.005 billion; net profit from 24Q1-3 decreased by 33% from 0.28 billion to mother, and decreased by 32% after deducting 0.24 billion, mainly due to weak terminal demand and channel optimization adjustments, declining sales revenue and rising management expenses; the gross profit margin of the 24Q1-3 company 74.82% increased by 0.01pct, including by brand, DAZZLE gross profit margin 75.79%, DIAMOND DAZZLE gross profit margin 79.56%, D'zzit gross profit margin 72.94%, RAZZLE gross profit margin 78.99%, and other brands gross profit margin 45.16%;

By channel, the gross profit margin of online e-commerce is 76.68%, the gross profit margin of offline direct management is 80.26%, the gross profit margin of offline distribution is 69.49%, and the gross profit margin of other channels is 45.16%;

24Q1-3 The company's net profit margin was 17.29% with a decrease of 5.11pct;

As of 24Q3, the company had a total of 936 stores, of which 261 were directly managed (including 110 DAZZLE, DAZZLE19, D'zzit114, and RAZZLE18) and 675 distributors (including 377 DAZZLE377, DIAMOND DAZZLE5, and d'zzit293).

Omni-channel membership operation and global marketing strategy

The company thoroughly refines omni-channel membership operation projects and actively explores global membership marketing. On the one hand, the company combines online efficiency with offline experience to provide a differentiated shopping experience according to the different demands of members on the basis of opening up omni-channel data and benefits. On the other hand, the company uses the respective characteristics of online and offline to actively experiment with multi-platform traffic operations through online customer development and offline repurchase, effectively divert online traffic to offline stores, expand the store's new customer sources, and explore and experiment with global membership marketing links.

Furthermore, based on the original in-store shopping scenario, the company tried to expand the shopping scene to provide members with the same shopping experience and service without going out.

Adjust profit forecasts to maintain “gain” rating

Based on the 24Q1-3 performance, there is uncertainty about the current macro-consumption environment; we adjusted the profit forecast and expect the company's EPS for 24-26 to be 0.8/0.9 and 1 yuan (original values were 1/1.1 and 1.1 yuan), respectively, and PE was 16X, 14X, and 12X, respectively.

Risk warning: risk of weak consumer environment; increased market competition; risk of damage to brand image.