Semir Apparel Released 2019 Performance Bulletin: The Main Business Is Steady.

In February 28, 2020, Zhejiang Semir dress Limited by Share Ltd (hereinafter referred to as Semir dress) released the 2019 performance bulletin. In 2019, the company realized total business income, operating profit, net profit to mother, net profit of 193.59 yuan, 21.58, 15.46 yuan and 1 billion 485 million yuan, representing an increase of 23.15%, 3.74%, -8.72% and 11.29% over the same period last year. 2019Q4's revenue and operating profit increased by 2.39% and 28.33% respectively.

Fangyi Textile Group Feng Yi team analysis of domestic business is stable, overseas business is still adjusting period.

(1) Revenue: revenue growth is driven by the combined factors and domestic business growth.

(1) the whole situation: 2019 all year round: in 2019, because of the steady business of children's clothing, the rapid development of online channels, and the continued growth of SafizaSAS (2018 and Q42019 only), we expect that the growth rate of domestic companies will contribute to 60% and 40% of the revenue growth respectively. Semir's main business revenue is expected to maintain about 10% growth (2019 online revenue growth is expected to maintain 25-30%. ), K company revenue has declined over the same period, and 2019 revenue is about 3 billion. 2019Q4: expects domestic main business revenue to grow low single digit growth year by year, of which children's clothing, leisure year-on-year 10%+ and single digit declines are expected.

Second, the main industry split: casual wear, 2019Q3 single season product transformation adjustment affects the growth rate, the whole year's revenue is basically the same level, it is expected that the online growth of about two digits, a slight decline under the line. In terms of children's clothing, Balabala's brand growth slowed down in the second half of last year due to the high base and delivery frequency of the same period last year. Compared with the growth rate of about 30% in the first half of 2019, the growth rate of the brand was about 20%, and the online and offline sales reached about 30% or about 10% respectively. The growth rate of the brand was 2019. In addition, the minibala brand reached 8 hundred million in 2019, with a growth rate of about 68%, and the overall retail sales of marcard brand reached 6 hundred million, with an increase of about 46%. In 2019,

(2) profit: the main business is stable, and the loss of the company's overseas business has declined.

2019 due to overseas business clearance, brand and business adjustment and other factors, the loss amounts to around 300 million yuan. If we eliminate the influence of overseas business, the domestic main industry's 2019 profit will be about 1 billion 850 million yuan, which is about one digit higher than that of the same period last year. (a net profit of 1 billion 690 million yuan in the same period last year, excluding about 180 million of the negative earnings arising from goodwill and about 330 million of the fixed assets and investment real estate impairment losses), the net profit of main industry in 2018 was about 1 billion 800 million yuan. )

(3) channels: (1) domestic: it is expected that Barbara stores will continue to grow rapidly in 2019, which is expected to increase by 400-500. The number of Semir brand adult stores is still expected to grow by dozens. However, due to the impact of some other brands, adult stores are expected to decrease. Overseas: the French business stores are in a net decrease and adjustment stage, and 2020 of the trend is expected to continue and decrease. History: as of the end of the third quarter of 2019, the total number of stores in the company (except Sofiza's Kidiliz) amounted to 9582 (459 more than that at the beginning of the year, +4.8%), including 5682 children's wear, an increase of 389, an increase of 3900 in adult wear, and an increase of 70. The number of Direct stores is about 10%, that is, about 958 (net increase of 195, +25.6%); the number of franchised stores is 8624 (with a net increase of 264, +3.16%).

(4) inventories: in 2019, the company prepared 648 million yuan for the depreciation of various inventories, which was 658 million yuan for the sale of the sold inventory and the 10 million yuan for the overall inventory depreciation reserve compared with 2018. The total profit brought by the company in 2019 was positively affected by 1 million 378 thousand yuan, and the net profit from the parent company was positively affected by 1 million 33 thousand and 500 yuan. And inventory is mainly one-year inventory, less than 2 years inventory. Inventories are expected to remain flat throughout the same period last year.

In terms of investment, Fang Yi Fang Feng Yi team recommended that the net profit of the company in the 2019/2020/2021 is 15.46/15.89/17.93 billion yuan, the growth rate is -8.72%/2.76%/12.89% over the same period. The corresponding EPS is 0.57/0.59/0.66 yuan / share, corresponding to P/E is 14/13/12, giving the "recommended" rating.

In terms of risk, Fangyi textile team Feng Yi team gave hints: (1) the macroeconomic downturn, consumption growth rate further slowed down. (2) two main business development of children's wear and leisure is lower than expected. (3) the acquisition of new brands is not as good as expected.