Fuanna(SZ:002327) Guoxin Securities·2025-10-28 01:49Investment Rating - The investment rating for the company is "Outperform the Market" [5][20][21] Core Views - The company experienced a narrowing decline in revenue in the third quarter, with a year-on-year decrease of 7.6% to 535 million yuan, compared to a 15.3% decline in the second quarter [1][2] - Gross margin decreased by 2.1 percentage points to 53.4%, primarily due to inventory clearance [1] - The overall expense ratio stabilized, with a year-on-year decrease of 0.7 percentage points, while sales and management expense ratios changed by +1.0 and -1.3 percentage points respectively [1] - The company’s net profit attributable to shareholders fell by 28.7% to 54 million yuan, with a net profit margin decrease of 3.0 percentage points to 10.0% [1] - Inventory turnover days increased by 31 days to 285 days, indicating a proactive approach to assist franchisees with returns and exchanges [1] - The company’s operating cash flow significantly improved, maintaining a high net cash ratio of 2.07 [1] Summary by Sections Financial Performance - For the first three quarters, the company achieved a total revenue of 1.627 billion yuan, a year-on-year decline of 13.8%, and a net profit of 160 million yuan, down 45.5% [2][20] - The decline in revenue was mainly attributed to high inventory levels in the franchise channel due to strong stocking last year, while the direct sales channel was affected by reduced foot traffic [2] - The e-commerce channel remained relatively stable, with expected improvements in growth rates across all channels in the third quarter compared to the first half of the year [2] Future Outlook - The company is expected to stabilize its performance next year as inventory improves and franchisee orders return to normal [20] - Long-term, the company has demonstrated operational resilience and has maintained a high dividend payout ratio of over 90% in the past three years [20] - Profit forecasts for 2025 to 2027 are estimated at 390 million, 410 million, and 430 million yuan respectively, with a projected year-on-year change of -28.5%, +5.2%, and +5.1% [20][21] Valuation Metrics - The company’s projected earnings per share (EPS) for 2025 is 0.46 yuan, with a price-to-earnings (P/E) ratio of 15.5 [21] - The estimated gross margin for 2025 is 55%, with a return on equity (ROE) of 9.9% [21] - The company’s market capitalization is approximately 6.019 billion yuan, with a closing price of 7.18 yuan [5][21]