The Decline Of Revenue Birds Will Actively Carry Out The Whole Category Custom Business.

The 2014 China Daily EPS was 0.11 yuan, and its performance fell 18% compared with the same period last year, lower than expected.

In the first half of 2014, the company's operating income was 999 million yuan, down 3.7% compared with the same period last year. The net profit attributable to shareholders of listed companies was 67 million 100 thousand yuan, down 18% compared with the same period last year. The net profit was -165 million yuan, down 103.2% compared with the same period last year, and EPS was 0.11 yuan.

Among them, the two quarter business income of 374 million yuan, a year-on-year decline of 23%, attributable to shareholders of listed companies net profit of 12 million 970 thousand yuan, down 57.6%, EPS 0.02 yuan.

Main brand in the first half year

Stable performance, hazzys, flangton and treasure bird income declined.

The reason for lower earnings is mainly the company's 5-6 quarter retail sales performance is lower than expected.

The non recurring gains and losses amounted to 68 million 750 thousand yuan, including 36 million 820 thousand yuan in real estate income and 2 million 570 thousand yuan in risk to franchisees.

In the company's report, it is estimated that the net profit change range from 1 to September is 0-20%.

In the first half of the year, the gross profit margin dropped by 2.2 percentage points, the sales cost rate rose and the asset quality improved.

The gross profit margin of the company dropped by 2.2 percentage points to 59.2%, which was mainly affected by the decline in the unit price of the bird (group buying) business.

In the first half of the year, the marketing investment of the brand retail business was increased, which increased the sales cost rate by 5.3 percentage points to 35.1%, and the management cost dropped 1.3 percentage points to 13%.

The quality of the company's assets has improved. Accounts receivable decreased by 89 million yuan to 440 million yuan compared with the beginning of the year, and inventories decreased by 31 million yuan to 1 billion 100 million yuan compared with the beginning of the year.

The net cash flow of operating activities was -2500 yuan, but increased by 275 million yuan compared with the same period last year, mainly due to the increase in the withdrawal of loans and the reduction of taxes.

The company takes a different route to strive to build "expert in formal dress", "the most cost-effective Western clothing expert" and "the two or three line market's custom dress expert".

Continue to promote "more"

"Multi series" strategy.

The company took the route of differentiation, and launched the whole category volume customization business in the first half of the year. It was appointed by the CCTV financial channel host to designate clothing, and opened the first full volume volume customization shop.

In the first half of the year, the company continued to push forward the strategy of "multi brand and multi series": the high-end brand Euclid increased the business of Electronic Commerce (revenue grew by 5.2% over the same period).

In the middle and high-end brands, the birds reported a steady performance (+2 outlets to 905 outlets, income fell by 1% over the same period), hazzys increased the proportion of localization (+4 outlets to 180 outlets, revenue fell 7%), flangston fell more (-19 outlets to 113 outlets, revenue fell by 11% compared with the same).

Young fashion brand San tre & amp; Trafford improved the channel efficiency (-13 outlets to 164 outlets, and revenue grew 96% over the same period last year).

In addition, the unit price of Bao bird declined somewhat (income fell 3.4% compared with the same period last year).

The company increased its capital in Shanghai in July, making it a wholly-owned subsidiary. Its brand "Kai Mitch" products are cost-effective.

Medium and high grade in the first half of the year

The performance of the brand is generally not good, and the company's performance in the two quarter is lower than expected. It is expected that the downward trend of the performance in the second half of the year is still difficult to reverse.

The company takes a differentiated route and actively develops the whole category customization business, which will become a new growth point of the company's performance in the future and maintain its overweight rating.

We lowered the forecast of EPS for 14-16 years to 0.35/0.46/0.51 yuan (13 years April forecast 14-16 years EPS 0.8/0.87/0.9), corresponding to PE for 20/15/14 times, maintain overweight rating.