Juewei Food (SH:603517) Huaxin Securities·2024-08-31 10:07Investment Rating - The report maintains a "Buy" investment rating for the company [2][5]. Core Views - The company has optimized store quality, leading to a stabilization in average store revenue contribution despite a decrease in the total number of stores [3][5]. - The company reported a revenue of 3.34 billion yuan for the first half of 2024, reflecting a year-on-year decrease of 9.73%, with a total of 14,969 stores, a net decrease of 1,193 stores or 7.38% [3]. - The average revenue contribution per store is 223,100 yuan, showing a year-on-year increase of 2.54% [3]. - The gross profit margin for the first half of 2024 reached 30.29%, an increase of 6.13 percentage points year-on-year, while the net profit margin was 8.51%, up by 1.94 percentage points [3]. - The net profit attributable to shareholders was 296 million yuan, representing a year-on-year increase of 22.20% [3]. Revenue and Profitability - In Q2 2024, the company achieved a revenue of 1.644 billion yuan, down 12.35% year-on-year, but the gross profit margin improved to 30.55%, up 4.78 percentage points [4]. - The net profit for Q2 2024 was 131 million yuan, reflecting a year-on-year increase of 25.08%, with the non-recurring net profit at 125 million yuan, up 36.63% year-on-year [4]. - The report anticipates that the company's operational performance will return to a positive trajectory due to improved store quality and management, although it has adjusted future earnings forecasts downward due to weak terminal demand [5]. Earnings Forecast - The earnings per share (EPS) for 2024-2026 are projected to be 1.00 yuan, 1.19 yuan, and 1.41 yuan respectively, with corresponding price-to-earnings (PE) ratios of 13, 11, and 9 times [5].