Taiping Bird, Who Wants To Be China'S ZARA, Sold 5 Billion Of Its Sales In The First Three Quarters.

Ningbo Taiping bird fashion apparel Limited by Share Ltd (hereinafter referred to as "Taiping bird") recently released the three quarterly bulletin in 2019. During the reporting period, the company achieved operating income of 5 billion 3 million yuan, and the net profit attributable to shareholders of listed companies was 207 million yuan.


During the reporting period, there were 346 New Direct stores and 572 franchise stores in Taiping bird store, 237 closed Direct stores, 827 franchise stores and 10 affiliated stores, and - 156 net stores. By the end of the reporting period, the number of offline stores of the company was 4438, including 1625 Direct stores, 2807 franchise stores and 6 affiliated stores.


Thanks to the growth of sales growth and the strengthening of inventory management, the net inventory of Taiping bird stock was 2 billion 124 million yuan at the end of the three quarter of 2019, down 3.09% from the end of the three quarter of last year.


Taiping bird said that this year, the company continued to enhance product design and development capabilities, do a good job in commodity planning, in the cross-border joint name of continuous improvement, the launch of the "Lok Ting X white rabbit" joint name, Harry Potter and Taiping bird series of cooperation in the market continues to sell well. In addition, the company continues to increase its brand building efforts, constantly exploring the fusion direction of Chinese culture and innovative design through brand show, and strengthening the fashion expression of "Chinese design" on the international stage under the "national tide". The MiniPeace children's clothing of Taiping bird landed in Beijing fashion week in August. Women's clothing and men's wear brands also appeared in New York fashion week and Paris fashion week in September.


Taiping bird said that the company will continue to optimize the "new four-wheel drive" channel layout, and promote the rapid development of online business, explore the whole network retail at the same time, increase shopping centers, Oteri J and other channels to expand efforts to continuously improve the overall quality of offline stores.


Financial reports show that during the reporting period, the revenue of Taiping bird clothing business increased 10.5% to 1 billion 860 million compared with the same period last year. The growth rate increased by 11.7pct compared with the first half of the year, and the gross profit margin fell by 1.0pct to 51% over the same period.


Sub brands, the three quarter of PB women's wear and MP children's clothing revenue increased performance, PB men's wear and music department's income growth is stable but gross margin pressure; among them, PB women's wear, PB men's clothing, Lok Chi, MP children's clothing revenue grew by 7.7%, 7.1%, 9.5%, 25.3%, respectively, during the same period, gross profit margin decreased by 3.0pct, 0.1pct, 2.4pct, growth 4.6pct respectively.


During the reporting period, the sales discount rate of PB menswear direct sales decreased and increased the intensity of old goods handling, resulting in profit bearing pressure. MP children's clothing sales discount rate and product multiplying rate increased to support gross margin improvement.


From the point of view of the channel, the growth of the direct channel is better, but the profit is under pressure. The adjustment of the franchising channel is continuous, but the quality of the store is expected to be optimized. At the level of expansion, there were 156 outlets in the first three quarters, 109 outlets, 255 franchises, and 10 affiliated stores. Among them, 11 stores opened in the three quarter. At the operational level, the revenue of direct line and online channels under the Q3 line is +9.5% and +30.8% compared to the same period. The gross profit margin of the same period is -2.1pct and -2.4pct respectively. It is estimated that the proportion of old goods handling in the direct channel is increased. The three quarter joining channel revenue is +3.3% compared with the same period last year, and the number of franchising stores has decreased by 200 over the same period last year.


Changjiang Securities analyst Yu Xuhui believes that the first three quarters of the financial report shows that the performance of Taiping birds is improved but its profits are under pressure. Taking into account the optimization of stock sales and the acceleration of online sales, the company's revenue in 2019 is expected to grow 4.4% to 8 billion 50 million compared to the same period last year, and the net profit margin of the parent company increased by 10.4% to 630 million over the same period last year.


There are Taiping bird executives previously revealed that over the years, the first quarter and the four quarter accounted for a relatively high income, the two or three quarter is the off-season, the three quarter slightly better than the two quarter, the fourth quarter accounted for the largest proportion (profits accounted for about half of the year). The above executives believe that the clothing industry is characterized by high price of autumn winter clothing, but the cost of personnel rents is relatively fixed, so the profit will be higher in the four quarter. In addition to the seasonality of the industry, the Taiping bird policy has a quarterly impact on performance. Generally speaking, the provision for goods in winter is filled up in the first half of third years. For example, in 2017, the winter market entered the drop in area in the 19 quarter of the one or two quarter, the highest proportion was reported, affecting the first half profit. The fixed cost cost was relatively high, and efforts were being made to optimize the control fee, supply chain, channel, personnel cost and so on.


The industry believes that since the first half of the year, although the performance of Taiping bird has dropped, but its offline channel optimization (Shopping Center shops instead of inefficient department stores and street shops), online product mix improvement (new product share improvement) and over the quarter inventory clearance are expected to drive the company's performance recovery. The first three quarters also showed that the online business of Taiping bird realized 1 billion 286 million yuan in the first three quarters, an increase of 14.28% over the previous year.