Baby-friendly room (603214): Endogenous extension and continuous expansion encourage full and steady growth
The baby room announced the 2018 annual report: the company achieved operating income in 201821.
35 ppm, an increase of 18 years.
12%, achieving net profit attributable to shareholders of listed companies.
20 ppm, an increase of 28 in ten years.
23%, budget benefit 1.
28 yuan / share.
Endogenous extensions continued to expand stores.
In 2018, the company opened 45 new stores, closed 11 stores, and opened 34 net stores. At the end of the period, the number of stores was 223 (+18.
0%), the total operating area of the store is 13.
50,000 flats (+21.
6%), steadily expanding, the structure of newly opened stores has been optimized, the proportion of mall stores has gradually increased, and the proportion of street stores has decreased. The newly opened stores are located in the Yangtze River Delta and Fujian.
The store opening will accelerate in 2019, with plans to open 50-60 new direct-operated stores to accelerate the expansion of the South China region.
At the same time, the company actively expanded through outsourcing mergers and acquisitions in different locations. On November 30, 2018, it announced its intention to invest in Chongqing Taicheng, and on March 26, 2019, the transfer and capital increase agreement was settled. The follow-up company will expand to the southwestern region according to the basis.
Strengthening supply chain capacity building and steadily increasing gross profit margin.
Store expansion and consolidation have a high growth rate compared to store revenue (+5.
2%), with an initial income of 21.
2.5 billion (+18.
12%), of which Q4 earns 6.
1.5 billion (+19.
16%), online business has grown rapidly to zero.
4.5 billion (+ 137%), accounting for 2% of overall revenue.
The company actively optimizes its product supply chain, introducing 100 new product brands in 18 years and selling its own brands1.
7.8 billion (+28.
99%), accounting for 8.
The gross profit margin was 28.
36pct), of which the gross sales margin of the store is 25.
The expense ratio increased slightly, and the sales / management expense ratio was 18 respectively.
23pct) / 2.
The increase in sales expense ratio was mainly due to the increase in rental and labor expenses.
In addition, the company has sufficient cash, and its wealth management income increased to 1,527 million (+ 594%), with multiple factors driving a 28% increase in net profit.
33%, with an increase of 18 in the fourth quarter.
The launch of equity incentives demonstrates the company’s confidence.
On February 26, 2019, the company launched an equity incentive plan, granting 2.12 million shares to 55 middle and senior executives, accounting for 2%.
Award price 19.
65 yuan / share (earlier discount of 53 on April 4th.
6%), the three-year assessment period of 2019/2020/2021, the net profit of the assessment will be based on 18 years, which will increase by 20% / 44% / 70% respectively, showing the confidence of consensus and the 南宁桑拿 estimated total cost is 0
Investment suggestion: The company is a scarce target for the mother and infant industry, with endogenous and steady development, and scale expansion to gradually develop barriers to the supply chain.
Estimated 19/20 profit is 1.
8 billion, the current sustainable corresponding PE for 2018/19 is 28.
6 times, maintaining “strongly recommended-A” level.
Risk Warning: The store development is less than expected, and the industry’s prosperity is declining.