Lining 2019 Medium Term Net Profit Rose 196%, Revenue Growth 33%

In the early morning of August 14, 2019, Lining released the interim results in 2019: January 2019 to June, Lining's revenue grew by 33%, reaching 6 billion 255 million yuan, net profit of shareholders rose 196% to 795 million, net interest rate increased from 5.7% to 12.7%, gross margin increased 1 percentage points to 49.7%, operating cash flow increased 107% to 1 billion 366 million. The basic earnings per share is 32.88 cents, not paying dividends.

Among them, the net profit rose by about 200% of the reason is that the group has an investment income - Shanghai red double happiness Limited by Share Ltd holding a piece of land was bought and sold by the government, Lining group to share the related one-time income of about 270 million yuan. After deducting disposable profits and losses which are not related to business, Lining's net profit increased by 109% to 561 million yuan, with a net interest rate of 9%.

By effectively integrating the Chinese elements with their own "sports genes", the recognition of Lining brand has increased significantly, and the incomes of all channels have recorded higher growth. Among them, (a) with the increase of the confidence of the franchisee in the brand of Lining, and considering the optimization of the overall channel structure of the group, the group will transfer some of the original self owned shops to the distributors, and allow the distributors to set up big stores and fashion shops to increase the revenue of the franchisee in the 40% quarter. (b) by the influence of the transfer of some shops, the sales revenue growth has slowed down slightly, but the growth rate of the sales revenue has also been increased by more than 10%. (c) the e-commerce channel has developed rapidly in recent years, and the income share has been rising continuously, with a strong growth rate and a 30% high growth rate. Li Ning Co said that the main reason for the sharp rise in revenues was mainly While earning a high income growth, the company will continue to pay attention to the change of channel inventory and keep it at a reasonable and healthy level.

During the period, the overall retail sales (including online and offline) achieved low 20%-30% growth. Channel library sales ratio continued to improve, the same store sales in the first half of 2019 recorded 10%-20% growth. Under the new line, the retail sales volume increased by 10%-20%, the discount rate of new products improved by more than 1 percentage points, and the sales rate increased by more than 2 percentage points.

Among them, footwear business and clothing business grew quite fast, respectively, above 33%, footwear business increased to 2 billion 922 million yuan, clothing business increased to 3 billion 60 million yuan, accounting for basically unchanged, accounting for 46.7% and 48.9% respectively.

Channels, direct sales accounted for 5.1 percentage points lower than the same period last year, the franchisee channel grew 4.2 percentage points to 48.6%, e-commerce business accounted for 21.7%, an increase of 0.9 percentage points over the same period. International market sales increased by 32.4% to 97 million 500 thousand yuan, accounting for 1.6%.

In the Chinese market, the growth rate in the South and Southern China was the strongest, with a growth rate of 43% and 44.3% respectively. The northern market grew by 24.1%, earning 3 billion 191 million. It is still the most concentrated area of Lining's business, accounting for 51%.

In terms of expenditure, staff cost accounted for 11.6, advertising and marketing expenses accounted for 8.9%, 1.6 percentage points lower than last year, and R & D expenditure accounted for 2.1%, an increase of 0.8 percentage points over the same period last year.

In terms of asset operation efficiency, the average stock turnover period increased from 85 days to 74 days, and the average turnover period of trading volume was 24 days, which also decreased by 18 days compared with that of the previous year. The average daily turnover of gross profit payable decreased by 16 days for 66 days. These data have been improved to the leading level in the industry.

As of June 30, 2019, the total number of Lining outlets in China (excluding Lining YOUNG) totaled 6422, representing a net increase of 112 over the previous quarter, and a net increase of 78 so far this year. In the net sales of 78 outlets, the retail business decreased by 127, and the wholesale business increased by 205. As of June 30, 2019, the number of Lining YOUNG outlets in China totaled 872, a 57 increase from the end of last quarter, and a net increase of 79 so far this year.