Semir Apparel (002563) 2019 First Quarterly Report Review: Endogenous Extensions Promote Continuously High Revenue Growth Supply Chain Upgrade Promotes Profitability

Investment Highlights: Event: The company disclosed the 2019 first quarter report, and the company realized 深圳桑拿网 operating income of 41.

180,000 yuan, an increase of 63 in ten years.

90%, net profit attributable to shareholders of listed companies.

47 ppm, an increase of 11 years.

06%.

Performance growth was in line with expectations.

KIDILIZ’s consolidated income increased rapidly, excluding the endogenous growth factor of the consolidated factor, the growth rate was close to 30%.

In the first quarter, the company’s overall growth rate was the fastest, and the company still maintained rapid growth.

The company’s endogenous growth in the first quarter is based on categories: children’s wear has maintained rapid growth, with a growth rate exceeding 27%; adult casual wear has maintained steady growth, with a growth rate of 20% -25%.

In terms of channels: offline, the company’s new store openings in 2018 will be reduced, and it will start to contribute revenue growth in the first quarter of 2019; on the online side, online growth in the first quarter is still booming, with an expected growth rate of over 30%.

Looking into the future, the incremental increase of new stores and the deterministic replacement of high increase in online channels and high revenue growth.

The speed of opening stores is maintained, and overseas markets can be expected.

The company opened new stores in 2018 for the time being, and there will be digestion time in 2019. It is expected that the new stores will be slightly distorted earlier than 2018, but it is expected that there will be more than 200 new stores each for children’s and casual wear (the number of stores will increase by 5%)the above).

In addition to the extension of store openings, the internal store-same store, benefiting from the company’s internal reforms in the past few years, especially the upgrade of the supply chain, the company’s store efficiency will continue to improve.

At the same time, the company is expected to aim at the development of overseas markets. The overseas business online and offline are making great efforts to contribute more increments in 2019. The offline stores of the company are mainly directly operated stores. The refined management will help the sustainable development of overseas business.On the online front, the company cooperates with Ali’s cross-border e-commerce “AliExpress” to launch cross-border business and penetrate the global market.

Global supply chain integration is expected to further improve the company’s efficiency, help Kidiliz reduce losses, and improve overall profitability.

The company’s gross profit margin for Q1 2019 was 41.

68%, an increase of 2 per year.

59 pct, mainly because Kidiliz’s gross profit is higher than domestic business, and consolidated the overall gross profit level.

In terms of expense ratio, the company’s expense ratio for the period of 2019Q1 increased by 7.

7pct, is mainly a consolidation factor.

Endogenously, the company’s original business profit growth in the first quarter was about 20%, which was slightly lower than the revenue growth mainly due to the company’s rapid business development and increased expenses.

In terms of consolidation, Kidiliz overall is still in the shortening period, and consolidation factors will drag down the accumulated net interest rate level.

However, the company has now reached a relatively high level of supply chain integration capabilities, and the efficiency of the company will increase with the effective use of global suppliers.
Profit forecast and investment rating: We believe that the company has gained a number of mature brand operation experience. In the future, multi-brand development can be expected, and the company can enjoy a higher profit premium.

We raised the company’s profit forecast 北京夜网 and expect the company to achieve operating income of 214 in 2019-2021.

1.2 billion, 244.

5 billion, 279.

920,000 yuan, an increase of 36 in ten years.

22%, 14.

19% and 14.

49%; realized net profit 19.

8.4 billion, 23.

93 ppm and 28.

07 million yuan, an increase of 17 years.

97%, 20.

65%, 17.

31%.Give 20X estimate, target price 14.

8 yuan, with 31% space.

Maintain the “Highly Recommended” rating.

Risk warnings: 1. Terminal consumption expectations continue to be sluggish; 2. New store development is less than expected