Women'S Shoes Business Is Growing At A Low Speed, And Sales Of Sports Goods Are Good.

The company's medium-term sales increased by 10.9% to 18 billion 600 million yuan (6.1195, -0.0032, -0.05%). Profit attributable to shareholders increased by 7.6% to 2 billion 80 million yuan over the same period last year. The interim dividend is 0.15 yuan per share, plus a special dividend of 0.25 yuan per share, with a median dividend yield of 160%. We believe that the adjustment of the supply chain (the first time in advance) and the increase of the dividend payout rate (from 30% to 60% earlier) are the short-term highlights of the company, but there is no sign of improvement in the fundamentals of women's shoes. The latest sales in 9 and October are still not ideal. Our target price of HK $12 (7.7546, 0.0022, 0.03%) was 13 times earnings in fiscal year 15 and 12 times earnings in fiscal year 16, which was lower than that of the previous day.

　　 Metaphase Sale The amount increased by 10.9% over the same period, and net profit increased by 7.6% over the same period last year.

The company's medium-term sales increased by 10.9% to 18 billion 600 million yuan. Gross profit margin increased 0.6 percentage points to 56.3% year-on-year. Profit attributable to shareholders increased by 7.6% to 2 billion 80 million yuan over the same period last year. The interim dividend is 0.15 yuan per share, plus a special dividend of 0.25 yuan per share, with a median dividend yield of 160%.

　 　 Women's Shoes Business is growing at a low speed, and sales of sports goods are good.

In the one or two quarter, the same store growth rate of women's shoes was -1.8% and -2.8% respectively. The sales situation was worse than that of the same industry. If the effect of SKAP was eliminated, the sales growth of women's shoes was 4%. However, the sales situation in the latest 9 and October is still not ideal. We expect that the operating profit margin of women's shoes in 22% will be difficult to maintain in the second half of the year. The sales situation of sports goods is better, mainly based on inventory digestion in the previous two years, and the increasing demand for sports apparel by consumers. We expect that the whole year's sports business can still maintain double-digit growth.

　　 Adjustment of first order Order-placing meeting To improve the operation efficiency of goods by loading time.

In the past, the company's first order would go too short on the shelves of local goods, resulting in inadequate preparation of production links, affecting the quality of products. At the same time, it was also based on the consideration of high labor mobility and shorter working hours, and the company would advance the order time of the first order, thereby improving the operation efficiency of the supply chain. We believe that this adjustment will help to improve the efficiency of production, but on the other hand, there is still a look at the readjustment of raw materials and the coordination of the volume adjustment and the first adjustment.

Raising dividend payout rate to protect shareholders' interests and considering spanformation of capital structure

As the company has entered a slow growth period from high speed growth, in order to protect the interests of shareholders, the company decided to raise the dividend payout rate from 30% to 60%. On the other hand, the company will also consider changing the capital structure. If there is a larger acquisition project in the future, it will consider the financing plan.

Target price HK $9, maintain hold Grade

We believe that the adjustment of the supply chain and the increase of dividend payout rate are the short-term highlights of the company, but there is no sign of improvement in women's shoes. The contribution of online sales is still small. Last year's online sales were 1 billion yuan, and 30%-40% growth is expected this year. Our target price of HK $12 was HK $13 times in fiscal year 15 and 12 times earnings in fiscal year 16, which was HK $8.2% lower than the previous day's closing price.