Antarctic Electricity Supplier: Steady Growth In Performance And Upgrading Of Industrial Chain

Event: in 2019, the company authorized the sale of brand products to 30 billion 559 million yuan, up 48.9% over the same period last year, and realized operating income of 3 billion 907 million yuan, up +16.5% compared to the same period. The net profit attributable to the parent company was 1 billion 206 million yuan, up from +36%. The company's operating income was 1 billion 397 million yuan, up +34.7%, and its net profit to the parent company was 2 billion 508 million yuan, up from +8.3%. New fast industrial chain service providers, leading advantages highlighted.

　　 In 2019, the company authorized the brand GMV to reach 30 billion 559 million yuan, an increase of 48.9% over the same period, the number of online shops reached 5800, and authorized suppliers / distributors to reach 1113/4513. The main brand of the south pole is the leading consumer goods brand based on the business channel. In 2019, GMV was 27 billion 138 million yuan, an increase of 52.86% over the same period last year. The Antarctic electricity supplier has accumulated abundant shop resources, and the scale of the sales side has been continuously released: (1) the conversion rate is relatively high: in 2019, it sold 335 million items in the Ali channel, paid more than 288 million people; the monthly conversion rate of underwear category in Ali was 20.28%; (2) the expansion and marketing advantages of the big shop were obvious: in 2019, the SKU of the official flagship store in the southern region reached 6500, an increase of 35.42% over the same period. GMV grew by 107.02% compared to the same period last year, and the direct promotion fee accounted for about 0.87% of the total GMV. Compared to the same period last year, the proportion of direct promotion fee was about 1.04%, which was 16.35% lower than that of the same period last year. (3) the market share of the dominant category continued to increase: "women's underwear / men's underwear / home clothes" Ali GMV was 6 billion 495 million yuan, up to + 39.47%, and the market share was 8.42%, up 1.73% over the same period last year; "bedding" GMV was 3 billion 503 million yuan, up to +59.59%; The market share was 8.03%, an increase of 2.16% over the same period last year; the two category sales ranked first in the industry; (4) the sales scale increased rapidly: in 2019, the GMV of ALI / Jingdong / spit / vip.com channel was 203.17/46.82/39.65/14.45 billion yuan, up by 39.13%/31.50%/124.89%/200.35% over the same period, leading to the growth of the platform in all channels. At the end of the supply chain, the Antarctic electricity supplier made accurate production and optimized inventory through the data in the power plant, and achieved higher turnover. In 2019, the company investigated 320 factories and established strategic cooperation with 13 third party quality inspection institutions to continuously optimize the quality control video. Antarctic electricity supplier to build industrial chain service providers to help supply chain partners to upgrade the industry, is the main beneficiary of C2M.

Brand authorized income is growing steadily and business efficiency is optimized.

In 2019, the company achieved operating income of 3 billion 907 million yuan, an increase of 16.5% over the same period last year. The company's revenue was 1 billion 397 million yuan, an increase of 34.7% over the same period, the monetization rate of the Ministry was 4.6%, and the authorized service revenue of the brand was 1 billion 306 million yuan, an increase of 39.9% over the same period, and the monetization rate was 4.3%, and the downward trend was slowing down. Mobile internet marketing business revenue of 2 billion 508 million yuan, an increase of 8.3% over the same period. In 2019, the gross profit margin of modern service industry reached 92.69%, down 0.69% compared with the same period last year, and the gross profit margin of mobile Internet business was 8.33%, down 0.04% compared to the same period. From the expense point of view, sales / management / R & D expenses increased by 6.54%/41.62%/14.56% compared to the same period last year; sales rate was 3%, year-on-year optimization of 0.3%; management fee rate was 2.1%, an increase of 0.4% over the same period last year, mainly in terms of business expansion, personnel increase in corresponding remuneration, office building leasing and property water and electricity charges; R & D rates were 1.1%, unchanged from the same period last year. Scale effect promotes business efficiency to improve steadily.

Profits continued to improve and cash flow improved significantly.

In 2019, the company achieved a net profit of 1 billion 206 million yuan, an increase of 36% over the same period last year, and a net profit of 1 billion 148 million yuan after deducting non recurring gains and losses attributable to shareholders of listed companies, an increase of 36.5% over the same period last year. The company's net profit of 1 billion 95 million yuan, an increase of 44.4% over the same period; 2016-2019 years, the company's net interest rates were 57.8%/68.0%/73.2%/78.4%, profitability continued to improve steadily, the advantages of the industrial chain service providers have been recognized. The time interconnection achieved a net profit of 111 million yuan in 2019, less than the performance promise of 132 million yuan in the year, and the accumulated profit of 420 million yuan in the 2016-2019 years. The performance commitment of the merger and acquisition has been realized, and there is no need to make up for the loss of goodwill in connection with time. In 2019, the company reduced the scale of factoring business and strengthened the management of accounts receivable. Factoring accounts receivable decreased by 85.45% compared to the same period last year. The net cash flow of the company amounted to 1 billion 255 million yuan, up 127.59% from the same period last year, of which the cash flow of the Ministry was 1 billion 78 million yuan, an increase of 86.18% over the same period last year, and the interconnection time was 177 million yuan.

　 Investment recommendations: brand licensing, stable growth of performance, and promote the upgrading of the industrial chain.

The Antarctic electricity supplier is mainly based on the business channel. The core revenue and the profit growth of the brand authorized core business are steady and play a key role in the upgrading of the C2M industry chain. In 2019, the company continued to consolidate its competitive advantage in terms of traffic optimization, channel development, data empowerment, quality control and so on, and the market share of the dominant categories such as underwear and bedding was further improved. In 2020, the company will gradually launch new products, comply with the live broadcast of e-commerce, actively develop store broadcasting, expand network red broking business, etc. It is estimated that in the 2020-2022 year, the Antarctic electricity supplier will achieve 46.86/57.25/69.12 billion yuan, corresponding growth rate of 19.95%/22.16%/20.74%, and achieve net profit of 12.65/14.83/17.25 billion yuan, an increase of 4.89%/17.22%/16.31% over the same period last year.

Risk warning: (1) layout brand / category matrix resistance, brand influence declined, service rate and revenue decline; (2) factoring business risk control capacity is insufficient, a large number of bad debts, cash flow deterioration; (3) channel development is not smooth, too dependent on Ali platform, authorized product GMV growth slowed sharply.