Zhou Dasheng (002867): 19H1 Profit Exceeds Expectations, Continues Recommending Jewelry Leaders to Benefit Gold Price Up

Zhou Dasheng (002867): 19H1 Profit Exceeds Expectations, Continues Recommending Jewelry Leaders to Benefit Gold Price Up

On August 23rd, Zhou Dasheng released the semi-annual report for 2019.

2019H1 company achieved revenue of 23.

90 ppm, an increase of 12 in ten years.

51%; net profit attributable to mother 4.

750,000 yuan, an increase of 34 in ten years.

63%; net profit after deduction to mother 4.

430,000 yuan, an increase of 32 in ten years.

13%.

Among them, the revenue in 2019Q2 was 12.

92 ppm, a ten-year increase of 8.

92%; net profit attributable to mother 2.

810,000 yuan, an increase of 46 in ten years.

16%; net profit after returning to the mother 2.

580,000 yuan, an increase of 39 in ten years.

40%.

Brief comments on the rapid expansion of channels, profit optimization of prime products, and total 19H1 profit exceeding expectations. In the first half of 2019, the company established a brand foundation, strengthened core competitiveness such as “channels, products, and supply chain management”, and focused on creating “deep integration,”Efficient and coordinated” operating ecosystem, operating performance continued to grow steadily.

2019H1 company realized operating income23.

90 ppm, an increase of 12 in ten years.

51%; net profit attributable to mother 4.

750,000 yuan, an increase of 34 in ten years.

63%.

By business, 2019H1 franchise business operating income13.

8.4 billion, an increase of 8 over the same period last year.

72%; operating income from proprietary offline business 6.

61 ppm, an increase of 8 over the same period last year.

17%; self-operated online (e-commerce) business realized operating income2.

2.2 billion, an increase of 34 over the same period last year.

71%; Baotong’s supply chain service business revenue was 3,185.

380,000 yuan, an increase of 43 over the same period last year.

42%; Baotong’s small loan financial business is fully launched, and operating income in 2019H1 is 1,228.

910,000 yuan.

In terms of products, 2019H1 prime gold products business income7.

50,000 苏州桑拿网 yuan, operating income of specific products12.

9.6 billion, accounting for 29 of the total operating income.

49%, 54.

At 25%, prime products have increased their revenue share and gross margins have also increased3.

80pct to 22.

90%, the proportion of product revenue in the designated category slightly decreases every year, but the gross profit margin also slightly increases. The company’s channels continued to expand at a rapid pace.

As of June 30, 2019, the company has 295 self-operated stores and 3,304 franchised stores across the country, reaching a total of 3,599 stores; of which in 2019H1, a net increase of 224 stores, a net increase of 231 franchised stores, and a net decrease of 7 Family.

The company’s chain channel network industry leads, the brand influence and visibility continue to increase, and the transformation effect and resource integration advantages are further strengthened.

The profitability has increased significantly. In terms of expenses to maintain a stable profitability, the gross profit margin of the company in 2019H1 is 37.

73%, an increase of 3 per year.

15pct, mainly due to the high gross profit franchise fee brought by channel expansion and the gross profit margin increase of prime gold products3.

80pct; net sales margin is 19.

88%, an increase of 3 per year.

33 points.

In terms of period expenses, 2019H1 company period expenses13.

66%, a decrease of 0 every year.

22 points.

The sales expense ratio decreases by 0 every year.

41 points to 10.

82%, the management expense rate increased by 0 in ten years.

12pct to 2.

40%, the financial expense ratio is flat for ten years, is 0.

19%.

Investment suggestion: We expect the company’s operating income for 2019-2020 to be 54.

80, 64.

23 ppm, an increase of 12 each year.

52%, 17.

21%; net profit attributable to mothers is 10 respectively.

42, 12.

7.4 billion, an increase of 29 each year.

31%, 22.

18%, EPS is 1.

43,1.

74 yuan / share, the corresponding PE is 15 respectively.

1x, 12.

4x, maintain “Buy” rating.

Risk factors: optional consumption growth is lower than expected; channel expansion is lower than expected.