Seven Wolves Wholesale Retail Challenge Is Also An Opportunity.

< p > Guoxin Securities issued a report on seven wolves (14, -1.45, -9.39%) (002029) in April 3rd. It said that in 2012, seven wolves realized operating income of 3 billion 477 million yuan, an increase of 19.05% over the same period last year, and realized net profit of 561 million yuan, an increase of 36.09% over the previous year, which was equivalent to EPS1.11 yuan.

In the quarterly view, the fourth quarter income increased by 17.37% over the same period, and the net profit of the parent company increased by 28.59% over the same period last year.

In 2012, the allocation plan was pferred 10 to 5 yuan and 1 yuan.

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< p > 2012, the net cash flow of the company's business activities improved substantially compared with the previous year, an increase of 73.7% to 438 million yuan compared with the previous year, and the profit quality has been improved.

The company's inventory dropped 12% to 566 million yuan over the same period last year. The company has increased 7 Factory discount stores, and the electricity supplier's handling of inventory products through large-scale sales activities, helping the channel to inventory.

At the same time, due to the company's support for credit policy, the accounts receivable increased significantly by 79% to 612 million yuan.

The gross profit margin in 12 years increased by 4.3 percentage points to 45.5%, mainly due to the continuous optimization of the supply chain, the decrease of raw material prices and the structural adjustment.

At the same time, the cost rate has been effectively controlled, and the sales cost rate and management cost rate have decreased year by year.

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< p > 2012, the speed of company expansion slowed down obviously, and the number of stores increased from 31 to 4007. But the area of single store increased significantly, the sales area increased by 30 thousand square meters, and the average area has reached 120 square meters.

Through many years of development, the company has become the leading menswear enterprise in China. 13 years is a challenge and an opportunity. In the long run, it is facing the pformation of development mode, wholesale to retail, and upgrading of retail management capabilities, so as to enhance the pformation of store efficiency through simple extension and expansion. In the short term, it is necessary to assist channels to inventory, enhance terminal profitability and restore confidence in the channel.

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< p > because the company takes the order as the main mode, the financial statements reflect the lagging performance of the terminal. Taking into account the opportunities and challenges faced by the company in the past 13 years, the 13-14 year EPS forecast is reduced to 1.32/1.56 yuan (originally 1.40/1.75 yuan), giving a forecast of 1.78 yuan for 15 years, corresponding to PE 12/10/9 times, and downgrading the company's rating to prudent recommendation.

This year, we need to track the sale of terminals and pay close attention to the rebound opportunities after the adjustment of the valuation depth. If the terminal is stable, the valuation of the company will have room for repair and has greater flexibility.

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