After More Than 2000 Stores, The Sales Volume Increased By 9 Times, And Net Profit Fell By 536.01%.

Recently, the annual report of the domestic sports brand "bird of honor" received the inquiry letter from the Shanghai Stock Exchange. Due to the 2018 annual earnings report, 2294 stores were closed in 2018, but the related revenue increased 9 times, increasing by 1 billion yuan. For the first time in five years, the profit loss has reached 686 million yuan, down 536.01% from the same period last year.

Radical adjustment of franchise outlets ratio

Do not know from when, brand crazy expansion period of the fragrant steamed bun store, has become a brand in mind not good management, hinder the development of brand important factor. In 2018, many brands were strengthening direct sales outlets with high gross margins and reducing the wholesale mode of distributors. The birds were no exception. The results showed that in 2018, there were 1437 new stores and 2294 franchised stores, some of which were converted from original franchisees.

According to the 2018 annual financial report, the expensive birds claim that because of the rising social financing costs in 2018, interest expense diluted company profits, the decline of market risk preference, and the decrease of some dealers' own funds utilization rate, the upgrading of the terminal stores of the birds slowed down, and the turnover rate of goods declined, which affected the implementation of our company's brand business policy. Some dealers also offered the company the decision to transfer channels or join other brand businesses.

Therefore, the channel resources of distributors in 14 provincial level regions, such as Fujian, Guangdong, Hunan, Zhejiang and Liaoning, have been recovered, and some of the distributors' merchandise has been recovered, and subsidies for distributors in other regions have been supported in various ways to ensure the sustainability of brand development.

By the end of December 31, 2018, the number of retail outlets of the brand reached 2873. The marketing network has covered 31 provinces, autonomous regions and municipalities directly under the central government. The total retail area is 234578 square meters. According to the urban classification, there are 399 retail outlets in the first tier cities, 657 outlets in the second tier cities, 1246 retail outlets in three cities, and 571 retail outlets in four cities.

Shutting down 2294 stores but increasing revenues

14 yuan in the provincial level, 128 million yuan in the distribution channel resources transactions were included in the current sales expenses, plus 122 million yuan in the sales rebates added to the dealers, resulting in a total consumption of 2018 yuan in the 2018 year, an increase of 81.06% over the same period last year. Meanwhile, about 372 million of the resale commodities were not sold abroad in the year.

It is worth noting that the surge in the number of outlets has only increased the revenue of the company's outlets by less than 20%. On the other hand, the net closes up 2294 stores' stores, but the revenue has not been reduced. The revenue has increased from 120 million yuan in 2017 to 1 billion 201 million yuan in 2018, an increase of over 9 times. After shutting down 2294 franchised stores, the related revenue of the precious birds increased from 120 million yuan in 2017 to 1 billion 201 million yuan in 2018, an increase of over 9 times.

Later, in reply to the Shanghai Stock Exchange's enquiry letter, the precious bird replied that the franchise revenue realized by the franchisee in 2018 increased the wholesale income of the brand, and the sales revenue of franchised stores in the past year did not include wholesale income. The statistical caliber of income has changed a lot compared with the previous year, so the operating income has increased significantly, resulting in a significant reduction in the number of retailers joining the brand.

You also announced the two annual revenue and operating costs listed on the same statistical caliber. The revenue of the updated company in 2018 was 865 million yuan, 725 million yuan in 2017, an increase of 19.31% over the same period last year, and the sales revenue of the franchised store in 2018 was 1 billion 201 million yuan, while that in 2017 was 1 billion 910 million yuan, a decrease of 36.9% over the same period last year.

Loss selling subsidiary plus debt repayment deficit 660 million

In 2014, the Landrace landed at the Shanghai Stock Exchange, becoming the first and only sports brand in the A share market, with a market value exceeding XTEP and 361 degrees. Subsequently, Lin Tianfu, founder of 2015 noble birds, surpassed the founder of Anta, special, Heng An and other companies in the same city, and ascended the richest man in Quanzhou by 19 billion.

But after the listing, the birds are unwilling to become a sports brand only. They want to create a sports industrialization group with various sports industry forms and coordinated development. It even wants to change the name of the company to "all-round sports". However, the so-called "diversified development" and the acquisition of investment in return are few, but because of blind expansion of the potential decline.

According to the end of 2018 earnings report, the main loss was due to the loss of the sale of subsidiaries, and a large number of closed stores, resulting in a backlog of inventory backlog and subsidy costs. From the open data, the one-time loss is relatively high. The company also says that the goal of 2019 is to turn losses into profits.

The main brand of "bird of honor" lays emphasis on the layout of the three or four tier city market, and the company believes that consumers in the market are more inclined to domestic brands. At the same time, we plan to acquire high-end sports brand AND1 and PRINCE to attack the second and second tier markets, while increasing R & D efforts and sinking IP marketing. This is also taking the mainstream mode of the current sports market. It is reported that the total cost of R & D in the reporting period was 80 million 817 thousand and 100 yuan, an increase of 39.12% over the same period. Is there any chance to return to the main business?