Jiajiayue (603708): Supply chain construction with performance in line with expectations has been steadily advancing
The event company announced its 2018 annual report: the company achieved revenue of 127 in 2018.
3 billion, an annual increase of 12.
36%; net profit attributable to mothers4.
300,000 yuan, an increase of 38 in ten years.
35%; the company plans to distribute a cash dividend of 5 per 10 shares.
6 yuan (including tax), a total distribution of dividends 2.
6.2 billion yuan, with a dividend payout ratio of 60.
96%. At the same time, it intends to transfer capital reserves to all shareholders and increase the share capital by 3 shares per 10 shares.
The company plans to invest 5.
US $ 700 million was invested to establish the Jiajiayue Zhangjiakou Comprehensive Industrial Park project in Zhangjiakou, with a project land area of 13.
320,000 square meters, with a construction area of about 110,000 square meters.
The results of the brief evaluation were in line with expectations, and they were fresh and beautiful. The area outside Jiaodong continued to expand. In 2018, the company’s revenue increased by 12%.
6% to 127.
300 million, net profit attributable to mother increased by 38.
35% to 4.
300 million, in line with our expectations.
By category: Fresh products performed the most beautifully: The company’s fresh income increased by 14 in 2018.
44% to 51.
7.5 billion, an increase of 0% in revenue.
74 pct to 40.
65%, fresh income accounted for more than 40% for the first time; fresh gross profit margin increased by 0.
45 pct to 15.
Food washing and department stores have steadily increased: In 2018, the company’s food washing and department store revenues increased by 9 respectively.
32% / 16.
19% to 55.
6 billion / 10.
8.7 billion, accounting for -1 of the proportion of revenue.
21 pct / +0.
28 pct to 43.
68% / 8.
54, gross profit margins are +0.
29pct / -1.
45 pct to 18.
29% / 20.
In terms of different regions, the increase in operating income in other regions of Shandong was higher than the company’s average level, and areas outside Jiaodong continued to expand.
In 2018, the company’s Jiaodong area revenue was +11 for ten years.8% to 104.
3.7 billion, gross margin +0 per second.
19 pct to 17.
42%; revenue from other regions outside Shandong +10 for ten years.
6% to 13.
8.5 billion, gross profit margin +0 for ten years.
2 pct to 17.
36% of other regions outside Shandong accounted for two years of +0 revenue.
21 pct to 10.
In terms of same-store growth, the company opened in 2018 for more than two years, which is comparable to the same-store growth rate2.
72%, of which hypermarkets / comprehensive supermarket same-store growth rates were 2 respectively.
9% / 2.
84%, under the background of the pressure of the consumption environment, the company ‘s same-store sales in the major formats maintained a growth of nearly 3%, reflecting the company’s excellent operating capabilities and leading industry advantages.
The store continues to expand. It is estimated that the company will open 57 stores in 2019, including 17 hypermarkets, 19 general supermarkets, 10 convenience stores, and 11 specialty stores. There are 40 stores in Jiaodong area and 40 stores in Jiaodong area.17 stores opened.
As of the end of 2018, the company’s total number of stores was 732 (105 hypermarkets, 542 general supermarkets, 56 specialty stores such as Baby Yue, 12 department stores, and 17 convenience stores), with a total store area of 1.75 million square meters.
It is expected that in 2019, 100 new stores will be opened and hypermarkets, and the proportion of stores outside Jiaodong will improve.
The gross margin and expense ratio increased the most, and the profitability has increased. In 2018, the company’s gross margin increased by 0.
19 pct to 21.
77%, mainly driven by the increase in raw fresh gross profit margin, and the gross profit margin of the Jiaodong area / outside the Jiaodong area increased simultaneously.
We believe that the company’s own-brand sales share can be further increased (the share in 18 years also increased by zero.
83 pct to 9.
83%), the adjustment of the product structure and the increase in scale advantages will further increase the company’s gross profit margin.
In 2018, the company’s expense ratio was maximized by 0.
21 pct to 17.
84%, of which the sales expense ratio drops 0 every year.
07 pct to 15.
94%, the management expense rate goes up every year.
2 pct to 2.
37%, the financial expense rate increases by 0 every year.
09 pct to -0.
The increase in management expense ratio and financial expense ratio is mainly affected by the consolidation of wikis. At present, the integration of Qingdao wiki is still continuing. It is expected that the integration of the company headquarters and Qingdao wiki will be completed in the future. In particular, the management synergy effect of this department on Qingdao wiki will increase.Expense rates will decline.
In addition, the company confirmed the asset disposal income of 39.27 million yuan for the compensation for demolition. The previous subsidiary can be repeatedly replaced until the equivalent tax rate (revenue / profit margin) decreases by 7.
18 pct to 16.
95%, the above factors drive the company’s net interest rate to increase by 0.
6 pct to 3.
Cash flow was plentiful, and inventory turnover accelerated. In 2018, the company’s operating cash flow decreased by 21.
45% to 6.1.3 billion, which was mainly affected by the increase in accounts receivable and prepayments, which remained healthy and overall.
Inventory turnover days decreased by 5 per year in 2018.
73 days to 45.
In 97 days, the speed of inventory turnover increased significantly; the number of days of account turnover decreased by one.
98 days to 57.
Maintaining a high dividend payout ratio, and actively giving back to shareholders in 2018 the company plans to distribute a cash dividend of 5 per 10 shares.
6 yuan (including tax), a total distribution of dividends 2.
62 trillion, dividend payout ratio of 60.
96%, and plans to transfer capital reserve to share capital for all shareholders, 3 shares for every 10 shares.
The company has paid dividends for more than 60% for three consecutive years from 2016 to 2018, and its business has expanded steadily while paying dividends to shareholders.
The number of members has grown rapidly, and the stickiness of customers has continued to increase. Until the end of 2018, the number of members of the company increased by 30.
08% to 603.
490,000, member points increased by 14% to 37,200,000 yuan in ten years, member customer unit price increased by 5 in ten years.
17%, members contribute 75% to store sales.
The company’s overall offline membership and online WeChat membership system have been fully connected, using accurate portraits of big data, strengthening member consumption analysis to enhance member value, improving overall marketing effectiveness, and increasing the membership experience and stickiness.
Increased supply chain construction and cross-regional speedup The company has established logistics centers in Weihai, Yantai, Laiwu, Jinan, Qingdao, and Wendeng Songcun, with a total storage area of about 160,000 square meters and about 590 distribution vehicles, of which about 480 are cold chain transportation vehicles unit.
At present, the company is actively promoting the Yantai Integrated Logistics Industrial Park project (building area of about 100,000 square meters) and Jinan Laiwu fresh processing logistics center project (new construction area of about 3).
420,000 square meters), part of which is expected to be temporarily put into use in 2019.
In March 2018, the company consolidated Qingdao WIKI. In the second half of 2018, the company visited Qingdao WIKI Logistics Center (building area is about 2).
(930,000 Ping) started standardization transformation, which is expected to be completed in June 2019, which will help improve the efficiency of the supply chain in Qingdao.
In 2018, the company completed the acquisition of Zhangjiakou Fuyuexiang Supermarket, and it is expected to change to the company’s consolidated statement scope from 2019.
The plan starts with 5.
The US $ 700 million investment in Zhangjiakou’s Zhangjiakou Comprehensive Industrial Park project (building area of about 110,000 square meters) will greatly increase the company’s fresh produce supply chain capacity in Zhangjiakou, and help the company’s steady implementation of its cross-regional expansion strategy.
We expect that this project can support the development of about 500 stores in the future and meet the strategic development needs of Zhangjiakou in the next 3-5 years.
Advancement of omni-channel integration and further upgrade of organizational structure In 2018, the company has cooperated with Meituan to increase online business on a pilot basis in more than 10 stores and explore an omni-channel marketing model.
It is expected that in 2019 the company will base its stores on the advantages of being close to the community and increase its home business. At the same time, it will carry out external cooperation and supply chain output services through the brand + supply chain + technology + capital model to create an open platform.
In terms of organizational structure, the company’s internal theater structure has been further improved. In 2018, 56 new stores were added for the pilot of the partnership mechanism. At present, the total number of pilot stores of the partnership mechanism is 89, and the sales of the pilot stores exceeded the average increase of comparable stores.
Investment suggestion: The company has obvious advantages in leading the Jiaodong area, and the province’s expansion is steadily advancing.
The integration of Qingdao Wiki is smooth, and it is expected that it will turn a profit into a profit in 2018, and it will become a profit center in 2019.
The company deeply cultivates the fresh supply chain and has strong logistics capabilities. At present, the construction of multiple logistics centers has been steadily progressing, and the advantages of supply chain competition barriers have been strengthened.
The company’s internal management mechanism, store structure continued to be upgraded, external exhibition stores accelerated, cross-region expansion steadily advanced, and omni-channel integration brought about business increase.
We estimate that the company’s net profit attributable to the parent for 2019-2021 will be 4 respectively.
700 million, corresponding to PE 24X, 21X, 18X, maintaining the “Buy” level.
Risk factors: Marginal consumer consumption trend declines; industry competition intensifies; cross-region, omni-channel business development is less than expected