Peacebird (603877): TOC effect initially shows steady business growth

Peacebird (603877): TOC effect initially shows steady business growth

Core points: 1.

The event company released its 2018 annual report. From January to December 2018, the company achieved revenue of 77.

12 ppm, a ten-year increase of 7.

78%; net profit attributable to parent company5.

72 ppm, an increase of 27 in ten years.

51%; net profit deduction for non-attributed mothers3.

95 ppm, an increase of 12 in ten years.


18 years to achieve an EPS of 1.

20 yuan.

A cash dividend of 10 yuan (including tax) is proposed for every 10 shares, with a dividend yield of 3.

45% (2019/3/29).

Among them, 2018Q1-Q4 operating income increased by 14 respectively.

49% / 9.

99% / 14.

51% /-0.

38%; net profit attributable to parent company increased by 131, respectively.

88% / 87.

51% / 13.

93% / 2.



Our Analysis and Judgment (I) Men’s wear and children’s wear are growing fast, and offline channel structure continues to be optimized. From the perspective of various disaggregated data on income: 1) Men’s wear and children’s wear are growing faster by brand: main brands PB women’s clothing, PBMen’s clothing revenues increased by -0 respectively.

37% / 12.

29%, accounting for 34% of income.

68% / 36.

69%, the growth rate of men’s clothing income reached a new high; the revenue of small brands Leping and Mini Peace children’s clothing increased by 6.

35% / 21.

85%, accounting for 13.

07% / 11.

20%, although the growth of children’s clothing revenue has improved, it is still in the process of rapid growth. The company launched a new brand “Beitian Children’s Clothing” in 18 years.Power; total revenue of other brands increased 27.

32%, including MATERIAL GIRL women’s clothing, Betty’s children’s clothing, Peacebird’s Nest; 2) Online growth slowed: 18 years of online income growth11.

55%, accounting for 26.

29%, the proportion has further increased, and the growth rate of revenue has slowed down, mainly due to the high base in 17 years and the reduction of e-commerce promotional activities; 3) the rapid growth of shopping malls: offline retail sales accounted for 78 in 18 years

9%, of which direct sales accounted for 36.

2%, joining (including associates) accounted for 42.


Specifically, department stores, shopping malls, street stores, and outlets account for 30.94% / 30.

11% / 15.

19% / 2.

69%, an increase of -2 each year.

41% / 17.

41% /-7.

54% / 70% / 9.


Among them, the rapid growth of shopping malls drove overall offline growth: the total number of shopping mall stores exceeded 1,700, a net increase of 343 in 18 years, and retail sales increased by 20%; 4) the number of offline stores grew steadily: the company’s total number of stores was 4,594, Opened 1,111 佛山桑拿网 new stores, closed 768 inefficient stores, a net increase of 343, and subsequently set a net increase of 600 targets.

By brand, PB women’s clothing, PB men’s clothing, Rakucho, Mini Peace, MATERIAL GIRL women’s clothing, Betty’s children’s clothing, and Taiping Bird’s Nest stores increased by 25/96/25/106/2/37/6, respectively.Men’s and children’s clothing corresponded to a net increase in stores.

By channel type, direct management, franchise, and associates have 1,532 (net increase of 261) / 3,062 (net increase of 82) / 16 (net increase of 16).Peitian children’s clothing.

In 18 years, the company accelerated the adjustment of offline channels, and the strength index of franchised stores closing.

(2) The company’s overall gross profit margin increased and increased for 18 years.

48PCT to 53.


Specifically, in terms of brands, PB women’s clothing, PB men’s clothing, Rakucho, Mini Peace children’s clothing, and other gross profit margins were 53.

11% / 57.

37% / 49.

88% / 52.

73% / 48.

57%, respectively changed by -1.






The decrease in the gross profit margin of PB women’s clothing was mainly due to the cut-out of the inventory, the out-of-season inventory of the franchisees, and the increase in discount sales of the Ole Store; the increase in the gross profit margin of Rakucho was mainly due to the substantial increase in offline stores (a net increase of 53), which closed lowEffective franchise stores (net reduction of 28); by channel, direct sales, franchise, affiliate, and online gross profit margins were 64.

51% / 48.

11% /-1.

3% / 44.

88%, the increase in the number of direct-operated stores, the increase in the proportion of direct-operated revenue, driving up the company’s overall gross profit margin; quarterly, 18-year Q1-Q4 gross profit margins were 55.

20% / 56.

47% / 51.

73% / 51.

83%, respectively changed by 0.

80 / -1.

74 / -3.



Because the company controlled the discount in the traditional autumn and winter sales season, the gross profit margin increased in the fourth quarter. (3) The TOC effect is remarkable. The growth rate of net profit attributable to mothers is far faster than the income growth rate. The TOC effect is significant. The overall size of the inventory is stable and the age structure of the warehouse is significantly improved.

As of the end of 2018, the scale of inventory decreased by 0.

12% to 18.

USD 3.6 billion, the inventory turnover days decreased by 1 day to 184 days, and the company’s inventory management effect was significant. Taking the summer of 2018 as an example, the retail discount rate increased by 2%, the sales rate increased by 6%, and the quarterly commodity inventory decreased by 12The storage age structure of 18 years has improved markedly. Within 1 year, 1-2 years, 2-3 years, and the proportion of inventory over 3 years is 50.

78% / 26.

46% / 7.

39% / 15.

At 37%, the amount and proportion of long-term Kuling’s inventory decreased significantly; the loss from the decline in inventory value decreased by 0.

97% to 1.

7.3 billion.

The scale of accounts receivable has increased, and operating cash flow has improved significantly.

The size of accounts receivable increases by 21 every year.

04% to 5.

9 billion U.S. dollars, accounts receivable turnover days increased by 3 to 25 days, mainly due to the company’s sales scale and channel expansion, account receivables such as department stores and direct sales channels and dealers increased payment;At the same time as the subsidy increased, new bank acceptance bills were added as a purchase settlement tool, so the net operating cash flow increased by 38.

57% to 8.

5.3 billion.

As of the end of 2018, the company’s asset-liability ratio was 46.

86%, increasing by 0 every year.

69%, basically unchanged from the previous year.

During the period of January to December, the expense ratio is maximized to 0.

81% to 42.

57%, of which, selling expenses, management expenses, and selling expenses were 34.

58% / 7.

72% / 0.

27%, changing 0 every year.

84% / 1.

12% /-10.


Sales expenses and income increased at the same rate, mainly due to the expansion of direct sales channels, direct store employees’ salaries, leasing fees, decoration costs and mall store costs increased; e-commerce platform sales expanded, sales commissions increased;Logistics expenses also increased; the decrease in financial expenses was mainly due to the return of some completed logistics construction project liabilities.

Other gains increase by 200 per year.

20% to 1.

2 trillion, mainly due to the increase in government subsidies in 18 years; investment income increased by 163.

28% to 0.

33 ppm was mainly due to the increase in investment income from wealth management products.

The stock incentive plan announced in July 2017 was unlocked under the conditions that the net profit attributable to the mother for 2017-2019 should not be less than 4 respectively.



500 million US dollars, the 17-year unlocking conditions have been completed, but the 18-year unlocking conditions have been replaced.


The investment proposal considers that the company’s brand covers women’s wear, men’s wear, children’s wear, and home furnishings, and has both growth potential. The TOC operation effect has already begun to bear fruit.The company’s negative factors have been reflected in the current estimates, and the overall estimation error, we believe that the current overlap corresponds to a PE of 16 in 2019-2021.



52 times, the expected revenue for 2019-2021 is 85.



59 trillion, a ten-year growth rate of 11.

29% / 9.

47% / 9.

19%, net profit attributable to mother is 589.



88 trillion, EPS is 1.



50 RMB.

For the first time, we give a “recommended” rating.


Risks indicate the uncertainty of the terminal consumption environment, the risk of breakthrough in the proportion of inventory and its price drop, the risk of shareholders’ reduction of holdings, and the risk of inadequate disclosure of information leading to the investigation by the CSRC.