Langzi (002612) 2019 Third Quarterly Report Review: Steady Growth in Revenue, Falling Investment Income Affects Net Profit
Revenue continued to increase, investment income decreased and asset impairment losses increased, resulting in a decrease in net profit. The company released its 2019 third quarter report and achieved operating income21.
2.9 billion, with an annual increase of 6.
65%, deducting non-net profit 1.
2.5 billion, downgraded by 25 every year.
80%, net profit attributable to mother 1.
5.7 billion, downgraded by 14.
Under the background of income growth, the growth rate of net profit margin was mainly due to the increase in investment income and increase in asset impairment losses due to the loss of the subsidiary Langzi Hana Asset Management from the end of July 19th.
19Q1-Q3 revenue increased by 11 respectively.
68%, net profit attributable to mothers was -12.
Women’s growth 北京夜网 has been steadily increasing, and medical aesthetics has been growing at a higher rate. In terms of the break-even income of infants and children, 19H1 women’s clothing, infants, medical aesthetics, and asset management income increased by 5 respectively.
37%, of which women’s clothing, infants, medical beauty income accounted for 50%, 26%, 20% respectively.
In the women’s clothing business, only the main brand of Langzi achieved revenue growth (sometimes by 12) in 19H1.
79%), other small brands substitute alternatives.
Looking at the first three quarters, it is estimated that the women’s clothing business will grow in single digits, of which Q3 revenue growth rate is slightly inclined, infants and young children continue the trend of mid-term reporting; the growth rate of medical beauty is still high.
Gross profit margin increased, investment income decreased, and asset impairment losses increased. Gross profit margin increased in the first three quarters of 20192.
65PCT to 59.
29%, mainly women’s clothing with a higher gross profit margin, the proportion of medical beauty business income increased, and the gross margin of medical beauty and infants increased; 19H1 women’s clothing, infants, medical beauty, asset management business gross margins were 59.
60PCT), 100% (+0).
Q3 gross profit margins were doubled +3.
Expense ratio: The increase in expense ratio during the first three quarters decreased by zero.
15PCT to 54.
38%, including sales, management, R & D, and financial expense ratios of 37.
The increase in the sales expense ratio was mainly due to the increase in shopping mall expenses, medical beauty advertising expenses, store custody fees, and employee compensation. The decrease in financial expense ratio was mainly due to the fact that Langzi Hana Asset Management was no longer consolidated and the company repaid the rest in advance.
Other financial indicators: 1) Inventory earlier than early 19-19.
35% to 10.
51 ppm, an increase of 17 over the same period last year.
62%, inventory turnover is 0.
86, compared with 1 in the same period last year.
03 has improved; accounts receivable increased by 12 from the beginning of 19th.
86% to 4.
09 million yuan, accounts receivable turnover rate 5.
53, compared with 4 of the same period last year.
36 speed up.
2) Investment income is reduced by 30 each year.
59% to 1.
50 ppm, a net reduction of 66.16 million yuan, mainly due to the subsidiary Langzi Hana Asset Management no longer holding shares since the end of July, the impact of the decline in shareholding ratio, in addition, L & P performance increased (net profit in 19H1 was 29.03 million yuan, 18H1 was 1.
27 ppm, interest rate 77%), the company confirmed that the reduction in investment income also had an impact.
3) Asset impairment losses increased by 642 in ten years.
13% to 20.78 million yuan, mainly due to the increase in the decline in inventory of women’s clothing business.
4) Net cash flow from operating activities increased significantly to 6.
3.3 billion, a net increase of 5.
USD 8.9 billion was mainly due to the repayment of corporate loans by Langzi Hana Asset Management.
Business structure adjustment, shrinking asset management business, women’s clothing and medical beauty continued to acquire May 2019, the company completed the mid-to-high-end well-known women’s clothing brand “Zibaomi (m.
The Zibaomi brand was born in Japan and has a history of more than 20 years. The brand image is simple, clean, and has both design and practicality.
After the company’s introduction, it plans to turn it into a domestic “leading brand of daily fashion aesthetics” and a “multi-platform innovative brand” within the group.
The overall scale of the brand is relatively small. At the end of June 19, it had two directly-operated stores, which contributed a consolidated income of 2.25 million yuan in the first half of the year.
The company announced in June 2019 that it would issue shares to the controlling shareholder and actual controller, Mr. Shen Dongri, to purchase Langzi Medical 41.
19% equity, set the shareholding ratio to 100%, the completion on August 5, 19, the new issue of shares on August 20, 3507.
07 million shares were listed.
In July 2019, the company changed its 42% stake in subsidiary Langzi Hana Asset Management to 6.
RMB 9.6 billion was transferred to Wuhu Dezhen, and the industrial and commercial change was completed on July 22. The company expects to hold 34% of its shares instead of consolidating consolidated statements.
The company announced in August 2019 that it had invested 63 million yuan to acquire a 60% stake in Xi’an Meicube, and it had been consolidated since October 2019.
Xi’an Beauty Cube is a high-end general hospital in the medical and beauty industry. Its main business is plastic surgery including plastic surgery, minimally invasive surgery, dermatology and hair transplantation. It has been operating since 2013 and has more and more brand influence in Xi’an.
The target’s 2018 revenue was 33.75 million yuan, net profit was 14.90 million yuan, 19H1 revenue was 45.96 million yuan, and net profit was -3.24 million yuan.
Factors such as the decrease in investment income in 19 years have affected profit. The reasons for the improvement in business structure are: 1) The main business of women’s wear has grown steadily. In terms of revenue performance in the first half of the year, Langzi’s main brand has grown steadily.The speed of medical beauty business development, the company’s acquisition of the US cubic hospital and increasing the average shareholding ratio of Langzi Medical show the key development strategies of the business; the infant and child flat increase slightly; the asset management business shrinks, confirming the decrease in investment income.
2) The company will no longer consolidate the management of Langzi Hana Asset Management, which will affect 19 years of net profit, reduce investment income, and reduce restructuring financial costs accordingly.
In addition, the performance of L & P companies increased in 19, and the investment income recognized by the company will also decrease.
3) In terms of consolidation, the women’s clothing brand Baozi has been consolidated since May 19th, and the US Cube in the medical beauty business has been consolidated since October 19th, due to its relatively small scale and limited increase in revenue.
Considering that investment income accounts for a higher proportion of the company’s profits, the proportion of shares in Langzi Hana Asset Management declined in 19 years, no longer holding, and the increase in investment income of cosmetics L & P, the impact on the profit of consolidated statements, down 19?
The 21-year EPS is 0.
55 yuan, 20 times PE in 19, maintaining the “overweight” level.
Risk warning: weak terminal consumption; improper integration of mergers and acquisitions; fluctuations in asset management business, L & P investment, etc., causing changes in investment income to exceed expectations.