From January to September, the income increased by 6%, and the net profit decreased by 80%. In January-September 2017, the company achieved a revenue of 193 million yuan, an increase of 6.18%, a deduction of non-net profit of 7.2724 million yuan, an increase of 56.79%, a net profit of 25.6014 million yuan, and a decrease of 80.23%. The growth rate of deducting non-net profit is higher than that of income, mainly due to the increase in gross profit margin and the decrease in expense rate, while the increase in net profit is mainly due to the simultaneous decline of 59.98% in profit and loss in disposal of shops and fixed assets, resulting in a decrease in non-recurrent profit and loss by 62.48%.
The revenue of 16Q1-17Q3 increased by-28.64%,-33.55%,-33.07%,-30.69%,-9.45%, 18.62% and 15.56%, and the net profit of homing increased by 9.78%, 4491.90%,-197.33%,-120.79%,-341.27%,-148.20% and 269.12%.
In recent years, the industry adjustment and the company's performance continue to be under pressure. The recovery of 17Q2-Q3 clothing consumption, the improvement of quality after channel optimization led to the return of income growth, the gross profit margin of 17Q3 increased with 9.64PCT, the rate of sales and management expenses decreased with 3.30PCT and 3.89PCT, and non-operating income increased by 4970.10%. The company's net profit continued to lose money in a single quarter (after 16Q3).
The intensity of promotion has weakened, the adjustment of income structure has promoted the increase of gross profit margin, and the expense rate has significantly decreased from January to September, with the same increase of 1.15PCT to 22.42%, mainly due to the weakening of sales promotion, the control of profits to franchisees and the increase in the proportion of domestic business income with high gross profit margin. The gross profit margin of 16Q1-17Q3 is 28.09% (- 0.67PCT), 16.27% (- 17.22PCT), 16.82% (- 2.27PCT), 16.21% (- 13.66PCT), 18.17% (- 9.92PCT), 22.60% (+ 6.33PCT), 26.47% (+ 9.64PCT). The weakening of 17Q3 promotion and the control of profits to franchisees lead to a sharp rebound in gross profit margin.
During the period from January to September in 17 years, the expense rate was reduced by 7.32PCT to 23.39%, of which the sales expense rate was reduced by 3.66PCT to 16.31%, and the management expense rate was reduced by 3.64PCT to 6.27%. This is mainly due to the collection of taxes in management expenses into taxes and additional accounts according to the new standards, and the financial expense rate is also reduced by 0.02PCT to 0.81%.
Transfer of controlling shares, change of controlling shareholder to cedar travel
On June 13, 2017, the company announced that Guangzhou Cedar Cultural Tourism Investment Co., Ltd., a subsidiary of Junhua Group, signed an agreement with six shareholders including Sinur Group to acquire 200 million Sinur shares (accounting for 62.51% of the total share capital). The purchase price is 21 yuan per share, with a total investment of about 4.2 billion yuan.
Junhua Group is a large comprehensive enterprise group, with industrial layout involved in five major industries: commodity supply chain management, real estate development, petrochemical processing, automobile sales and integrated after-vehicle services, property management and property management. In 2016, Junhua Group achieved an income of 55.111 billion yuan, an increase of 263.12%, and a net profit of 919 million yuan, an increase of 54.45%. On the one hand, the completion of this acquisition will expand the business extension of Sinur Group, promote the diversified business layout of the Group, strengthen the driving force of development and anti-risk ability, and on the other hand, enhance profitability by improving the decision-making efficiency and level of listed companies.
The 17-year net profit is expected to increase by-50% to 0%. The company is expected to have a net profit of 373.43% to 7.4686 million yuan in 2017, with an increase of-50.00% and 0.00%, mainly due to the sale of its own shops, leading to a month-on-month pick-up in net profit growth.
We believe that: 1) the adjustment of the company's clothing business is gradually coming to an end, the income after 17Q2 begins to resume growth, the gross profit margin gradually increases compared with the same period last year, 17Q3 turns losses into profits in a single quarter, and achieves a net profit of 25.6014 million yuan. In the future, the company will comprehensively promote customized business, increase group buying and overseas market development efforts, which is expected to promote the recovery of clothing business revenue. 2) on March 27, 2017, the company announced that no more than 29 shops will be sold / leased at market prices in 2017. in the first three quarters of 2017, the company leased 34 purchased shops, confirmed income of 8.8313 million yuan, sold one store, and the transaction price was 57.38 million yuan. contribute income from the disposal of non-current assets to enhance profitability, but it is lower than that of last year. 3) after the completion of the transfer of controlling shares, the controlling shareholder of the company changed from the bridegroom Sinur Group to Cedar Travel, and the company announced the establishment of a new wholly-owned subsidiary Guangzhou Xichuang Investment Co., Ltd., mainly engaged in project investment, enterprise management services, investment consulting services and so on. 2017.10.26 the company announced that the assets and liabilities related to clothing production will be transferred to Zhucheng Pulanio Men's Wear Co., Ltd., a wholly-owned subsidiary to be set up to optimize the allocation of resources. In the future, the company relies on the advantages of the controlling shareholder group, and the extension layout is worth looking forward to.
Due to the significant decline in the company's non-operating income, we downgraded the EPS for 17-19 to 0.02 EPS 0.02 PE 0.03 yuan, corresponding to 17 years 1664 times UBG, maintaining a "neutral" rating. It is suggested that we should pay attention to the expectation of transformation after the change of control shares.
Risk tips: business transformation progress is not as expected, menswear consumption continues to be weak, and so on.