Earth Reserves 2 Billion 800 Million Cash To Deal With Risks, But Also To Hit 200 Million Repo To Motivate Employees.

In the evening of May 12th, the middle and high end women's clothing group, Limited by Share Ltd, the world's high-end clothing brand group, announced that the company would buy back the company's shares with a centralized bid. The total amount of the buyback would be no less than 100 million yuan, not more than 200 million yuan. The repurchase price does not exceed 31.62 yuan / share. The period of repurchase shall be 12 months from the date of the consideration and adoption of the repurchase scheme by the board of directors, that is, from April 29, 2020 to April 28, 2021.

Di Su said that this repurchase aims at the confidence of the company's future development prospects and the recognition of the company's internal investment value, and further improves the long-term incentive and restraint mechanism of the company's management team and core employee stock ownership, so as to ensure the long-term business objectives of the company.

According to public information, Dazzle was founded in 2002. As a well-known high-end fashion brand group in China, it has four brands, including the main brand, the high-end clothing, the D 'zzit (the young brand, the high-end female dress), the DiamondDazzle (high-end women's wear) and the Razzle (middle and high-end men's wear). 。 The chairman of the company takes the lead in research and development, and the free and open design atmosphere gives designers more room for development. Therefore, its brand and product style have stronger fashion and trend factors than the similar domestic dress brands, and higher recognition.

According to the financial report, in 2020, a quarterly report showed that the operating income of Di Su fashion was 408 million yuan, down 30.14% compared to the same period last year. The net profit attributable to shareholders of listed companies was 122 million yuan, down 37.44% compared with the same period last year. Basic earnings per share of 0.3 yuan.

Sub brands, DA brand contributed 228 million yuan in business revenue, down 32.12% from the same period last year. As of the end of the reporting period, there were 606 stores, including 187 direct outlets and 419 distributors, representing a net increase of 1 over the end of 19.

DZ brand contributed 140 million yuan, down 27.97% compared with the same period last year, with 438 stores at the end of the reporting period, including 146 outlets and 292 dealers, a net increase of 3 over the end of 2019.

DM brand contributed 38 million yuan, down 22.01% compared with the same period last year. It has 33 stores as of the end of the reporting period, of which 33 are direct stores, 2 less than those at the end of 2019.

From the point of view of the channel, the operating income of the direct store decreased 28.87% to 181 million yuan, and the distributor's business income dropped 46.57% to 137 million yuan compared with the same period last year.

Affected by the epidemic, di Su fashion actively layout electricity providers, expand the new retail business, make full use of Taobao live and micro mall live broadcast, while the offline flow to the online drainage, electricity supplier income grew 24.69% to 88 million 450 thousand yuan, is expected to sell new products, gross margin of 1.3PCTs to 75%.

During the epidemic period, di Su fashion strengthened its support for franchisee stock, and temporarily raised the proportion of returnable goods. The turnover days of inventory increased by 166 days to 367 days compared with the same period last year. According to the industry, the structure of "Di Su style" library is healthy, most of the products are new products in one year, and the net cash in the fashion business activities is 150 million yuan, down 21.6% compared with the same period last year, which is less than the net profit falling from the parent company. The cash in the account is abundant, reaching 2 billion 890 million yuan, which has the ability to resist risks.

The industry has said that the fashion design ability is outstanding, brand building is strong, product fashion has considerable influence in the industry, but the terminal store performance is lower than the peer level. Take Dazzle as an example, the growth rate of single store in the same store in 2015-2017 years is low, and the store effect is about 2 million 500 thousand / year, much lower than that of Vigna S, George, and so on.

China Merchants Securities analyst Liu Li believes that in the first quarter, although the fashion is affected by the impact of the epidemic, retail sales are down, but the overall discount rate of the company is relatively good. The overall gross profit margin has increased from 0.92pct to 74.76%, showing strong brand influence. The expenses are fixed, and the revenue declines will lead to a cost increase of 6.74pct to 41.73%, of which the sales fee rate will increase from 7.77pct to 36.98%.

As of the end of the reporting period, the scale of the vogue fashion inventory increased by 13.97% to 293 million yuan compared with the previous year, and the scale of accounts receivable decreased by 9.94% to 48 million yuan over the same period. Net cash flow from operating activities decreased by 21.56% to 145 million yuan over the same period last year. The whole is still in good condition.

In Liu Li's view, land based fashion is the leading industry in terms of profitability and operational efficiency through unique product design, efficient supply chain system, refined channel management and discount control capabilities. Although the epidemic has led to short-term pressure on 20Q1 performance, but in recent years, the reform of the retail service capability of the direct system has been remarkably effective, and the growth of endogenous growth has been strengthened. After the elimination of the epidemic situation, the fashion of Di Su will continue to enhance the efficiency of single store and the quality of business, while the stores will steadily expand to achieve steady growth in performance.

Local fashion has also said that in 2020, it will take advantage of the Internet tools, combined with the popular way of dissemination and promotion, to carry out marketing plans for streaming media and other aspects, and achieve commercial realisation through fans' value.