Event description
The company announced its annual results in 2020, with operating income of 95.5 billion yuan in 2020, an increase of 0.1% over the same period last year, and a net profit of 2.872 billion yuan, an increase of 1.3% over the same period last year, and an EPS of 0.3 yuan.
Event comment
With the intensification of the external competitive environment, the company still shows strong business resilience in 2020. In the second half of 2020, the same store of the company slowed down under the high base effect in the first half of the year, with 1% of the same store for the whole year, while 5.7% of the same store of 2020H1. 2020 added 4 hypermarkets, 3 medium-sized supermarkets, 24 small supermarkets, and closed 3 stores. In the process of the epidemic promoting the transformation of consumers' purchasing behavior, the company's online order performance increased rapidly, and the number of active users of B2C business exceeded 16.5 million at the end of 2020. the overall performance of B2C has increased by more than 60%. The overall performance of B2C has increased by more than 80% over the same period last year. According to the trend, the second half of 2020 will continue to improve: since May 2020, the average daily orders of online stores have exceeded 1000. Although the unit price of 2020H2 customers has dropped from the previous month, it is still 5.7% higher than that of the same period last year, and the unit price of customers excluding tax has reached 66 yuan. Overall, for the whole of 2020, the rapid growth of the company's offline multi-format exhibition stores and online business, to some extent, offset the downward pressure of external rental income and the slowdown of the same store in the second half of the year, but the overall revenue was flat and slightly increased compared with the same period last year. On the profit side, due to the increase in the proportion of fresh business and the pressure on the sublease business with high gross profit margin (the sublease income for the whole year fell by about 14%), the comprehensive gross profit margin for the whole year moved down, and the gross profit decreased by about 1.4 billion yuan compared with the same period last year. Thanks to dual-brand integration and cost control, the total savings of sales and management expenses are about 700 million yuan, with an increase in other income and a reduction in financial expenses. The company's net profit for 2020 was flat and slightly higher than that of the same period last year.
In 2020, in addition to the original B2C online business, the company is still speeding up the pace of format innovation. 1) "Zhong Runfa"
National accelerated exhibition stores: Zhongrun Fat is about 3000-5000 square meters, the number of SKU is about 15000, fresh and daily sales account for about 57%, the business model is basically taking shape, entering the stage of large-scale expansion, focusing on the layout of second-and third-tier cities and fresh supermarkets targeting young consumers. 2) "Xiao Runfa" insists on regional expansion: about 200-500 square meters, with fresh and daily ingredients accounting for more than 70%. Each city constructs a fresh processing center and shares the fast consumer goods pool in the supermarket, focusing on regional intensive expansion. It will enter the accelerated exhibition period in 2021. 3) Community group purchase: in the new format of community group purchase, the company is also accelerating the layout. Feiniu group purchase and post purchase go hand in hand. Feiniu group purchase site has more than 220 stores online, and rookie post station community group purchase business has begun to cooperate in more than 100 stores.
Investment suggestion: after BABA becomes the controlling shareholder of the group, it is expected to inject new impetus into the transformation of the business format for the company. 2021 will be the first year of the launch of the company's new business. Although the investment of new business may affect profitability in stages, it is expected to lay the foundation for future scale growth. It is estimated that the EPS from 2021 to 2023 will be 0.29,0.33 and 0.36 yuan respectively, maintaining the "overweight" rating.
Risk hint
1. Industry competition intensifies
two。 The company's new business training cycle is longer.