DS(SH:600694) Xin Lang Cai Jing·2025-04-29 02:35Core Viewpoint - The company reported lower-than-expected performance for 2024 and Q1 2025, with a decline in revenue but an increase in net profit for the full year 2024 [1] Group 1: Financial Performance - In 2024, the company achieved revenue of 6.949 billion, a year-on-year decrease of 5.20%, while net profit attributable to shareholders was 586 million, an increase of 16.05% [1] - In Q4 2024, the company reported revenue of 1.661 billion, a year-on-year increase of 0.34%, and net profit of 55 million, a year-on-year increase of 0.13% [1] - In Q1 2025, the company achieved revenue of 1.925 billion, a year-on-year decrease of 8.04%, and net profit of 265 million, a year-on-year increase of 0.7% [1] Group 2: Business Strategy and Operations - The company is optimizing its multi-format operations, with department stores, supermarkets, and electronics contributing 32.71%, 34.22%, and 21.58% to total revenue, respectively [2] - In 2024, the company plans to introduce over 2,000 new brands in department stores and enhance the shopping experience by increasing the share of experiential formats [2] - The company is focusing on direct sourcing for fresh produce and optimizing logistics to enhance its private label offerings, aiming for a private label sales share of over 20% [2] Group 3: Store Structure and Online Channels - The company operates 63 department stores, 19 supermarkets, and 9 electronics stores, with a net reduction of 5, 8, and 3 stores, respectively [3] - The online channel, based on "Tian Gou Wang," generated a GMV of 148 million, with sales reaching 93.05 million [3] - The new management team aims to revamp 20 key stores and open 12 franchise stores in lower-tier cities to drive growth [3] Group 4: Profitability and Cost Control - The company has improved profitability through better supplier collaboration and an increased sales share of high-margin products, achieving gross margins of 39.61% in 2024 and 44.80% in Q1 2025 [4] - The company has effectively managed operating and marketing expenses, with a period expense ratio of 23.68% in 2024 and 22.0% in Q1 2025, both showing a year-on-year decline [4] - The sales, management, and financial expense ratios have shown mixed results, with some categories experiencing slight increases while others decreased [4] Group 5: Investment Outlook - The company maintains a "buy" rating, supported by its strong regional presence and the new chairman's extensive experience in commercial real estate [5] - The company has adjusted its net profit forecasts for 2025-2026 to 672 million and 759 million, respectively, while introducing a new forecast of 821 million for 2027 [5] - The company is expected to maintain a stable dividend payout, with a dividend rate exceeding 50% for 2023-2024 [5]