Listing Is Less Than Two Years. Why Is It That Half Day Profits Are Halving?

In 2018, the daily fashion revenue increased by about 6% over the same period last year, but net profit fell sharply, down 50% to 65% compared to the same period last year.

A few days ago, Sunday sowing fashion announced 2018 annual performance pre reduction announcement, which is expected to increase about 6% year-on-year in 2018, of which the core brand "broadcast sowing" developed steadily, operating income increased by about 7% year on year, but the net profit of the same period has fallen sharply, which is expected to decrease by 41 million 500 thousand to 54 million yuan, 50% to 65% from the same period. After deducting non recurrent profit and loss, the net profit of the shareholders of the listed company is expected to decrease by 45 million to 56 million yuan, 60% to 75% on the same period from the same period.

The reason for the sharp decline in net profit is that the fashion of the day will be attributed to channel investment, R & D investment and new brand development.

It is reported that because of the reopening period of new shops, the sales of fashion and fashion sales increased by 22.5% over the same period last year, and the company increased its R & D investment in clothing and fabrics, and carried out functional renovation, purchase of new equipment, increase staff training and remuneration for the quality control center and R & D center of the company.

In 2018, two new brands were launched to the market in the fashion of the day. The early investment is large, and the output benefit will take some time.

In addition, coupled with the impact of the macroeconomic environment in 2018, the boom of the apparel industry has been under pressure. The overall performance of the daily fashion sales terminal market has not reached the expected level. Meanwhile, the inventory has increased, and the company's inventory depreciation has been prepared accordingly.

From the recent performance, the growth of the daily fashion continues to be weak.

From 2013 to 2017, the daily profits were 929 million, 911 million, 898 million, 949 million and 1 billion 73 million respectively, and the net profits were 112 million, 82 million 473 thousand and 400, 75 million 119 thousand, 75 million 624 thousand and 600 and 83 million 635 thousand and 700 respectively.

According to the rough calculation of the announcement, the business income in 2018 is about 1 billion 150 million, and the net profit will reach 38 million 630 thousand yuan.

This also means that the highest performance decline in the recent five years has been 66%, while the annual performance in 2018 was only about 1/3 that of five years ago.

It can be seen that in recent years, the fashion of broadcasting has focused on store expansion, but sales performance is not as good as expected. This has greatly affected the company's performance gains and profits.

It is understood that in 2016, the number of direct broadcast stores increased by 18, with 82 stores and 141 stores.

In 2017, there were 68 direct outlets, 24 joint stores and 11 outlets. As of December 31, 2017, the total number of shops owned by the day was 989, of which 247 were direct stores, 106 were joint stores, and 636 were distributors.

In 2018, there were 117 new outlets.

Roughly estimated, in the past three years, the number of new outlets has increased to 203, with an average of 5 stores per day.

Correspondingly, from 2016 to the first three quarters of 2018, the selling expenses of daily fashion sales were 307 million, 349 million and 310 million, up 6.5%, 13.6% and 23%, respectively, over the same period of revenue and net profit growth.

The corresponding sales expense rates were 32.3%, 32.5% and 39% respectively.

Up to the end of the three quarter of last year, the average selling cost of A shares of 8 women's clothing companies was around 35.46%, and that of the same day was also higher than that of comparable industries.

In this regard, the daily fashion shows that the introduction of new brands requires a process of cognition from the market and consumers. The input of early stage marketing, R & D investment and investment in channel development are relatively large, and the output benefit needs a certain time.

At the same time, because sales efficiency is less than expected, resulting in the backlog of inventory commodities increased.

From the end of the first three quarters of 2016 to the end of each reporting period, the balance of daily fashion inventories was 218 million, 278 million and 360 million respectively, accounting for 48.3%, 33.8% and 43.7% of the company's current assets at the end of the year, respectively.

It is reported that the fashion of 2019 will slow down shop opening and control expenses.

On the day of fashion trends, the company's performance will be improved with the adjustment of the company strategy and the gradual improvement of the new direct stores and new brands.