Hai Lan'S Radical Store Expansion Strategy Has Reached A Critical Point And Revenue Has Almost Stopped Growing.

600398.SS released a year-round net profit growth of 3.78% on Friday.

In 2018, the profit of Hai Lan home increased from 3 billion 328 million 900 thousand yuan a year to 3 billion 454 million 800 thousand yuan. After deducting the non profit, it reduced from 3 billion 288 million 400 thousand yuan to 3 billion 267 million 800 thousand yuan, slightly down 0.63%. The company's annual income increased by only 4.89%, from 18 billion 200 million 100 thousand yuan to 19 billion 89 million 700 thousand yuan, of which the clothing business income was 18 billion 738 million 700 thousand yuan, which was only 1.74% increase.

The above performance continues to depend on the aggressive expansion of stores, which is very gloomy. For the men's group, which has the highest market share, its previous strategy may officially enter a turning point.

In 2018, the number of stores in Hai Lan home increased by 15.2%, from 5792 to 6673.

During the reporting period, there were 1181 new stores and 300 outlets, with a net increase of 881.

According to the brand, by the end of 2018, there were 5097 brand stores in Hai Lan's home, 1281 brand stores in other places, and 295 stores in other brands.

Although the business is dominated by men's clothing, haerang's home has been investing in other categories in recent years. Its investment matrix includes clothing business agency operators, Shanghai international trade (Limited by Share Ltd), children's clothing brand YEEHOO Ying Shi, boys and girls, Cowboy brand ABLE JEANS.

As for the fast fashion brand, which is invested and held in 2017, 19% of the shares of fast moving fashion (Guangzhou) Co., Ltd., Urban Revivo parent company, are pferred to Sequoia China subsidiary, Beijing Sequoia Ming Tak equity investment center (limited partnership) and FLASH BUSINESS Ltd., of which the former purchase 14% is still fashion equity.

In the paction of Urban Revivo, the home of Hai Lan benefited 70 million yuan.

At the beginning of last year, Hai Lan's home was allied with Tencent Holdings Ltd. (0700.HK) Tencent holdings, the founder Zhou Jianping family, sold 5.31% of the shares to Tencent, with a total paction price of 2 billion 500 million yuan.

At the same time, the two sides set up 10 billion yuan industrial investment fund.

The direct business doubled and the gross profit margin of the core business increased significantly. In 2018, haolangjia's gross profit margin increased by 192 basis points to 41.55%, of which the gross profit margin of the direct business increased by 60.71% on an annual basis by 64 basis points, and the gross margin of franchise and other businesses increased by 175 basis points to 39.72%.

During the reporting period, Hai Lan's home sales increased by 9.25% to 1 billion 151 million 100 thousand yuan, and the overall growth rate of the industry also increased significantly.