Giordano Will Accelerate The Pace Of Opening Stores In The Future

If you are a fan of Buffett, you may remember that as early as 1972, Berkshire bought $25 million of hi candy through its blue chip stamp company, and then increased investment to achieve hi Shi candy holdings.

At that time, many people could not understand this investment. Why did Buffett value the growth of the enterprise?

Buffett's explanation is, "the reason for buying hi poem candy is quite simple. This is a company that will not bother us too much. I hope I can find fifty more similar companies."

In fact, what Buffett values is not the growth potential of hi poetry candy, but his ability to create stable cash flow. Buffett uses the cash supply of hi poetry candy to realize wealth increment.

Then, are there any enterprises like Hong Shi candy in the Hong Kong stock market? Let's take a look at "no bother" as a prerequisite.

International (00709) is like a candy company.

Business is simple and easy to understand.

First of all, Giordano and Hei Shi candy are similar in business, both are consumer goods enterprises.

The difference is that hi candy produces candy, and Giordano is an international company.

Retailer.

According to the world clothing and shoe net, Giordano currently has many.

It includes proprietary Giordano and Giordano Junior, Giordano Ladies, BSX, and other smaller brands and authorized non proprietary third party brands.

At present, Giordano's products have been widely exported to mainland China, Hongkong, Macao, Taiwan, the Asia Pacific region and the Middle East.

As of September 30, 2017, Giordano had 2370 sales outlets all over the world, including more than 900 outlets and franchises in mainland China.

At the same time, Giordano also has online sales channels.

This not only provides convenience for consumers to buy goods, but also provides convenience for investors to evaluate their products.

Rebound in performance, with ample cash flow

Of course, we should not only evaluate a company from the product level, but also judge it from a financial point of view.

Judging from the performance of Giordano over the past years, the scale of the company's business in recent years has shown a gradual decline. Until the mid 2017, the company achieved 2 billion 618 million yuan sales, an increase of 3.4% over the same period last year, operating profit of 331 million yuan, an increase of 24% compared to the same period last year, and finally stopped the decline of the performance.

However, revenue is not the highlight of Giordano's earnings. The company's biggest bright spot is Buffett's financial index, a cash flow.

It is worth noting that Giordano has a very strong ability to create cash flow. In recent years, the net cash generated by the company's business activities has doubled over the net profit.

In addition, cash and cash equivalents on Giordano account have been rising in recent years. In the middle of 2017, cash and cash equivalents reached HK $1 billion 531 million (if not stated below), accounting for 59.55% of current assets and 37.21% of total assets.

It is worth mentioning that as of June 30, 2017, the total liabilities of the company were only 1 billion 202 million yuan, with a debt ratio of 28.22%, that is to say, the company had strong solvency and low financial risk.

From this we can see that Giordano is a company with strong profitability and sound operation.

High dividend payback shareholders

Then, how do companies deal with the money lying on Giordano account? Of course, it is a return to shareholders.

It is noted that the high proportion of dividends paid to shareholders is a consistent practice of Giordano. From 2006 to 2016, Giordano accumulated a net profit of 5 billion 121 million yuan, including 4 billion 577 million yuan for dividends and a dividend payout rate of 89.38%.

Such a high dividend payout rate is attractive to investors who want to pay dividends.

Actively repurchase shares "red envelopes"

However, with a thousand and one words, investors are most worried about stock prices.

Giordano's stock price has gained a lot of attention this year. From February to October, the stock price rose more than 1 times in 8 months.

Source: Fu Road Securities

The reason is that in addition to the strong growth of profitability, there is also a very important point that the company actively repurchases its own shares.

Noting that from June 22nd to December 1st this year, Giordano opened the buyback mode. During the period, the Company repurchased 7 million 274 thousand shares of its own shares, accounting for 0.46% of the total share capital, and the total cost was 31 million 758 thousand and 300 yuan.

Stock repurchase, a good stimulus to the company's stock price rise, is another kind of shareholder return.

The future will accelerate the pace of opening stores.

As for Giordano's future growth, Giordano also has its own plan.

It is understood that Giordano chairman and chief executive Liu Guoquan has said that in Greater China, Future Ltd will focus on accelerating the pace of opening up in the mainland of China, and will focus on franchisees to open stores in the three or four tier cities. If there is still room for profit in the second tier cities, they will not be closed.

In Hongkong market companies will also expand the size of the store, and are expected to put 50 million to 100 million yuan to refurbish the old store renovation costs.

In the overseas market, the company has more than 30 stores in Vietnam. In July 1st this year, it also signed relevant documents to confirm that the company accounted for 60% of Vietnam's shops. It will speed up the process of Vietnam's opening up in the future. In addition, Giordano opened a new store in Mongolia in September this year.

In the European market, the company also signed a franchise in France and opened in the outskirts of Paris at the latest.

On the whole, at the operational level, Giordano is a company that will not let investors worry too much at the operational level. Can such a company enter your "legal eye"?

More interesting reports, please pay attention to the world clothing shoes and hats net.