Semir(SZ:002563)2024-04-01 16:00Investment Rating - The report maintains an "Outperform" rating for the company [4][17]. Core Views - The company reported its 2023 annual results, which met expectations, showing a revenue of 13.7 billion yuan, a year-on-year increase of 2.5%, and a net profit attributable to shareholders of 1.12 billion yuan, up 76.1% year-on-year [4]. - The company plans to distribute a cash dividend of 0.3 yuan per share, with a payout ratio of approximately 72%, corresponding to a current dividend yield of about 5% [4]. - The company is focusing on optimizing its business and implementing a new retail model, which has improved operational quality, with a gross margin increase of 2.7 percentage points to 44.0% in 2023 [5]. Summary by Sections Financial Performance - In Q4 2023, the company recorded a revenue of 4.76 billion yuan, an 8.5% year-on-year increase, but a net profit of 290 million yuan, down 20.8% year-on-year due to impairment provisions for investment properties [4]. - The company’s inventory situation improved significantly, with year-end inventory at 2.75 billion yuan, a decrease of 29% from the beginning of the year [5]. Business Segments - The children's clothing segment showed resilience, with revenue of 9.37 billion yuan, a 4.9% year-on-year increase, and a gross margin improvement of 4.9 percentage points to 46.8% [17]. - The offline channel has seen recovery, with revenue from direct and franchise channels growing by 19.2% and 9.7% respectively [17]. Future Outlook - The company plans to continue cash dividends over the next three years, distributing no less than 10% of the annual distributable profit each year, and a cumulative distribution of at least 30% of the average annual distributable profit over three years [4]. - The company expects to achieve net profits of 1.35 billion, 1.64 billion, and 1.89 billion yuan for 2024, 2025, and 2026 respectively, with corresponding P/E ratios of 11, 9, and 8 times [17].