According to the company's quarterly report on 2021Q1, the company's 2021Q1 achieved revenue of 54.005 billion yuan, down 6.63% from the same period last year.

2020Q1 realized a net profit of 456 million yuan belonging to shareholders of listed companies, an increase of 182.8% over the same period last year.

Revenue side: the company's 2021Q1 achieved revenue of 54.005 billion yuan, a decrease of 6.63% compared with the same period last year. 2021Q1 accelerates the optimization and adjustment of loss-making business, especially the rapid transformation of express delivery business direction brings about a certain reduction in logistics losses, and will continue to reflect benefits; Internet business pays more attention to the input and output of advertising marketing and the transformation and retention of users, offline business implements the service characteristics of one-stop overall solution, and actively carries out community social management.

Same store: the company's 3C home life stores (excluding superstores) can increase their store sales by 18.91% compared with the same period last year, in part because of the low sales base of the epidemic in the first quarter of last year.

New stores: by the end of March 2021, the company has a total of 2611 self-owned stores and 7526 SUNING retail cloud franchise stores. During the reporting period, the company opened 584 retail cloud franchise stores, closed 195 stores, opened 25 self-owned stores and closed 63 stores.

GMV: the sales volume of online platforms in the first quarter was 49.552 billion yuan, down 18.82% from the same period last year. The main reason is that the company pays more attention to the input and output of advertising marketing and the transformation and retention of users. At the same time, the epidemic goods and homestead goods are sold vigorously, and the company also greatly reduces the subsidy and promotion of sensitive goods that are difficult to make a profit and price competition.

Cost side: the company's 2021Q1 comprehensive gross profit margin of 14.31%, lower 1.38pct than the same period. It is mainly due to the decrease of the company's operating income.

Cost side: the expense rate during the company's 2021Q1 period is 16.71%, which is higher than that of the same period + 0.37pct. ① sales expense rate: 2021Q1 sales expense rate 11.64%, year-on-year-0.69pct; mainly due to the company's role in strengthening cost control. ② management expense rate: 2021Q1 management expense rate is 2.07%, year-on-year + 0.33pct. ③ R & D expense rate: 2021Q1 R & D expense rate is 1.07%, year-on-year-0.26pct; ④ financial expense rate: 2021Q1 financial expense rate is 1.92%, year-on-year + 0.99pct. It mainly brings about an increase in costs for the implementation of the new lease standards.

Profit side: the company's 2021Q1 homing net profit was 456 million yuan, an increase of 182.80% over the same period last year, mainly due to the influence of the company's non-recurrent profit and loss. During the reporting period, the company's non-recurrent profit and loss items affected 1.39 billion yuan, mainly including Zhuhai Puyi Logistics Industry Investment Partnership (limited partnership) acquisition of the company's logistics assets company, 18 SUNING debt second bond repurchase. The impact of the new leasing standards has led to a certain increase in leasing and other related costs.

Regardless of the above factors, the company's return net profit remains basically stable.

Investment advice: the company is a national comprehensive retail leader, offline occupation of the low-line market & the expansion of new channels, online sustained high growth, online and offline integration of all-channel development. After taking over, state-owned assets are expected to improve their financial and governance structure, and look forward to achieving new development goals. Maintain the previous profit forecast, the 21-23 net profit is expected to be 15cm 33 / 4.2 billion, maintain the buy rating.

Risk tips: the impact of the epidemic is higher than expected, the operation of state-owned assets after taking over is not as expected, the macroeconomic decline, and so on.