Net Profit Doubled, And Cash Flow Is Negative.

In February 23rd, the newsbirds released the 2018 performance bulletin. In 2018, the total revenue of the newsbirds reached 3 billion 120 million yuan, an increase of 19.76% over the same period last year. The operating profit was 124 million yuan, an increase of 196.11% over the same period last year; the total profit reached 130 million yuan, a 255.93% increase over the same period last year; net profit attributable to shareholders of listed companies was 52 million 450 thousand yuan, 102.3% more than that of the same period last year; the same basic earnings per share were 0.04 yuan, a 100% increase over the same period last year; the weighted average net assets yield was 0.04, an increase of 102.3% percentage points over the same period last year.

In terms of assets, as of December 30, 2018, the total assets of the wedding birds were 4 billion 180 million yuan, a decrease of 1.69% over the same period last year. The owners' equity of the shareholders belonging to the listed companies was 2 billion 720 million yuan, a decrease of 10.48% over the same period last year, and net assets per share attributable to shareholders of listed companies were 216 million yuan, a decrease of 10.77% over the same period last year.

Cash flow is negative in 2018.

In order to promote sales growth, the company reported that during the reporting period, in order to promote sales growth, the company continued to increase market development and market maintenance, increase the brand outlets, increase the affiliate buying system (the delivery is to confirm revenue, and allow a certain proportion of returns to be replaced). The proportion of cooperation models, such as news birds, HAZZYS (Haggis), and Kay Mitch, increased sales, while labor cost and terminal cost input increased further. Secondly, the company received government subsidies increased from the same period last year, and reduced donations from operating expenses; third, the provision for impairment of assets was made; fourth, the termination of the implementation of the restricted stock incentive plan in 2017 led to the accelerated confirmation of the related share payment costs during the reporting period.

In 2018, the net profit of the newsbird achieved a substantial increase, but the company's earnings bulletin did not disclose the cash flow situation.

In the three quarter report of 2018, extra finance learned that in the first three quarters of 2018, the net cash flow generated by operating birds was 14 million 50 thousand yuan, a decrease of 79.44% over the same period last year.

In fact, during the same period, the company's operating income and net profit after deduction were 24.59% and 186.62% respectively.

It can be seen that when the operating income and net profit growth of the wedding bird rose, the cash flow generated by the company's business activities did not respond to a substantial increase.

We are trying to find some reasons from the cash flow statement of the company's three quarter report in 2018.

In the first three quarters of 2018, the net cash flow generated by the business activities of the newspaper birds was 14 million 50 thousand yuan, down 79.5% from 68 million 370 thousand yuan in the same period of the previous year. The net cash flow generated by the investment activities was -150 million yuan, and the net cash flow generated by the fund-raising activities was -9290 yuan.

In the first three quarters of 2018, cash flow of business activities of reported birds declined significantly, and net cash flows from investment activities and fund-raising activities were negative. Therefore, it is more likely that the company will have a negative cash flow in 2018.

In fact, the bird said in a notice that the termination of the implementation of the restricted stock incentive plan in 2017 led to the accelerated confirmation of the relevant share payment during the reporting period.

In the company's three quarter report of 2018, extra finance found the cost impact on cash flow.

As of September 30, 2018, the cash received from the company was 8 million yuan, 96.68% lower than the beginning of the year, and the net cash flow generated by fund-raising activities was -9290 million, a decrease of 219.07% over the beginning of the year.

The above two reasons were mainly caused by the restricted stock subscription paid by the company in 2017.

Gross margin growth stable

The 2018 China Daily reported that the company mainly engaged in research and development, production and sales of brand clothing. Its products cover all kinds of men's clothing, such as suits, trousers, shirts, jackets, sweaters, casual pants and so on. The operation brands include wedding birds, HAZZYS (Haggis), Kay Mitch, Lafuma (Le Feiye), Don Bollini, cloud wing intelligence, and treasure birds. The products can meet the clothing needs of the middle class under different occasions.

According to the product, in the first half of 2018, the business income of the wedding birds from the tops was 306 million yuan, which accounted for 21.63% of the business revenue, and the revenue from the trousers was 249 million yuan, accounting for 17.6% of the total business income; the income from T-shirts was 175 million yuan, accounting for 12.36% of the total revenue; the operating income from the shirts was 265 million yuan, accounting for 18.73% of the total operating income; the income from windbreaker was 152 million yuan, accounting for 10.78% of the operating income.

In the first half of 2018, the gross profit margin of the wedding bird jacket was 61.13%, 1.1 percentage points lower than that of the same period last year; the gross profit margin of trousers was 63.94%, which was 1.42 percentage points lower than that of the same period last year; the gross profit margin of T-shirts was 73.97%, an increase of 2.84 percentage points over the same period last year; the gross profit margin from shirts was 69.02%, an increase of 1.45 percentage points over the same period last year; the gross profit margin from windbreaker was 91.54%, an increase of 1.31 percentage points over the same period last year.

The gross profit margin of textile and apparel was 64.94%, an increase of 2.53% over the same period last year.

Since the beginning of 2019, the share price of news bird has increased by 8.25%, while the market share rose by 19.5%.