subject: Suning: Household Appliance Market Economy Affect Downstream Performance [print this page] industry boom down, slightly less than expected interim results as a whole:
08 in the first half realized main business income of 25.1 billion yuan, up 39.4%; to achieve the owner's net profit attributable to parent company 1.1 billion, up 70.4%. Fully diluted EPS was 0.736 yuan. Distribution increase by transferring 10 shares for every 10 shares for every 1 per 10 shares distributed in cash. Involved in the industry boom down and occasional factors, performance was slightly lower than expected.
Industry is rapidly shrinking, after deducting price factors, the actual growth rate fell significantly. Real estate market downturn, people's actual income growth under
Down and earthquakes is the major cause incidental factors. In the short term, the industry boom of the fall for
Home Appliances The negative impact of chain objective. The long term, home appliance market is still developing rapidly, urbanization and improving living standards rising demand for the release of a long-term stable trend. At the same time may enhance the downstream industries sector economy integration, thereby enhancing the average gross margin level.
overall business situation is good, better than major competitors:
1. Gross margin levels to increase substantially offset the cost of increased rate of adverse effects; 2. Inventory turnover rate to further improve, widen and the National US-lead; 3. Costs of the rate of inflation well under control, up 1.5 percentage points to 10.17%, but still less than 1 percentage point the U.S. State shows the company's operating efficiency still significantly better than the competition. Financing after the completion of the company's overall cash flow than sufficient to increase the advances and receivables suppliers to get more discounts and benefits, thus reducing the operating cash flow.
Same-store growth has slowed somewhat warmer in the second half, sales structural changes of concern:
Core indicators - same store growth in 2007 from 16.5% to 0.02%, mainly due to the company level include: 1. Last year, growth in same store base too much, resulting in lower growth rates this year. 2. The same city new store new stores accounted for two-thirds of the cost savings in the scale and might divert the existing store sales, leading to the same store slowdown.
In the second half rebound in same-store growth of 7-August has reached 3-5% sales growth in the second half of the overall more optimistic. Taking into account the impact of the first half of the year at 1.5% -3%, but the side of the industry is also worthy of the continued weakness in key concern.
Sales contribution of structural changes of concern. After 1 January 2007 the new stores contributed 90% of new sales in the first half, if the formation of future sales growth depends on the pattern of new stores, the company's sustainable growth will be challenged.
temporarily maintain the profit forecast and buy investment grade
08-10 annual sales growth of 44.9%, respectively, 33.6% and 23.7%. Net profit growth in 75.5%, 47.3% and 25.4%, corresponding to EPS were 1.72 yuan, 2.53 yuan and 3.17 yuan. PE of 35 times to maintain in 2008 and buy rating, 6-month target price of 60 yuan.
