Yixintang (002727): The practising pharmacist temporarily affects the performance growth temporarily and will gradually recover in the second half of the year

Mar 18, 2020 夜生活

Yixintang (002727): The practising pharmacist temporarily affects the performance growth temporarily and will gradually recover in the second half of the year

Yixintang (002727): The practising pharmacist temporarily affects the performance growth temporarily and will gradually recover in the second half of the year

Event: On August 21, the company released its 2019 Interim Report: the company achieved revenue of 50 in the first half of the year.

6 billion, an increase of 17 in ten years.

90%; net profit attributable to mother 3.

3.7 billion, an increase of 15 in ten years.

31%; deduct non-net profit 3.

35 billion, an increase of 15.

09%; net operating cash flow 3.

01 billion, previously increased by 570.

70%; EPS0.

59 yuan / share.

  Comments: 1.

The practising pharmacist temporarily affects the growth rate of the performance temporarily. In the second half of the year, it will gradually resume the quarterly view of the first half of the year. The revenue in Q1 and Q2 will be 25 respectively.

8.8 billion (+18.

77%), 24.

7.2 billion (+17.

00%); net profit attributable to mother 1.

7.5 billion (+33.

51%), 1.

6.2 billion (+0.

48%); deduct non-net profit1.

72 billion (+30.

50%), 1.

6.2 billion (+2.

25%).

18H1-19H1 companies have basically no acquisitions, and 19H1 only acquired 28 stores in Qujingkangqiao in March, so the first half of the results basically reflected the endogenous growth rate.

The company’s Q2 grew rapidly in the quarter. The analysis is mainly related to the strict practice of remote practising pharmacists in the first half of the year, which has an impact on both endogenous and extended growth rates. The number of practising pharmacists in the southwestern region has decreased. Take Yunnan as an example.There are 20,462 pharmacies, but there are only 7,800 licensed pharmacists registered in retail pharmacies in the province, with a deployment rate of 38.

1%, equipped with licensed pharmacists in some regions to become a hard target for drugstore acquisitions, to a 北京夜生活网 certain extent limit the company’s new store opening + acquisition speed.

The Q1 / Q2 companies opened 275/182 new stores and a net increase of 247/124.

  At the same time, the company is located in Yunnan, Guizhou, and Chongqing (the pilot was launched on August 5, 19). Hainan, Henan, Shanxi, Shanghai and other regions have not implemented remote trials or trials in the first half of the year. According to the pharmacy classification management method, there are no licensed pharmacists.Pharmacies prevent the sale of prescription drugs and decoction pieces, which has an impact on store traffic and sales patterns.

In the first half of the year, in order to attract passenger flow, the company increased its discount promotion efforts, which continued to impact on gross profit margin and net profit.

Q1-Q2 gross profit margin is 38.

12%, 39.

49%, a decline of 2 per year.

7%, 3.

36%; net interest rate 6.

79%, 6.

53%, a year-on-year decrease in the second quarter.

09%.  Looking into the second half of the year, Yunnan has already allowed remote review on July 3. The second half of the year will increase the speed of new construction. In the long run, the performance of pharmacy operation doors will increase, and the cost advantage of one-heartedness will be more obvious.

  2.

The market structure is optimized, and the results of the expansion outside the province are the core driving factor. As of June 30, 2019, the number of Yixintang stores reached 6,129, including 457 newly opened stores, 59 relocated stores, and 27 closed stores, mainly due toFactors such as urban transformation and strategic location adjustment.

Q1 and Q2 were 247 net increase stores and 124, and 371 net increase stores gradually.

In the second half of the year, the company will increase store development efforts.

The company has gradually formed three key breakthrough areas outside Sichuan: Sichuan, Chongqing, Guiqiong, and Shanxi. In the future, the company will expand within the above-mentioned areas and continue to optimize the store layout and product structure, thereby enhancing the local brand influence of Yixintang stores, and finally achieveIncrease in sales and profitability.

  From the perspective of the operation of various provincial regions, the performance of Southwest, North and South China is outstanding, and the revenue growth in the Southwest is 18.

58%, North China regional revenue growth was 32.

70%, South China regional revenue increased by 10.

76%; revenue growth in the Southwest and North China regions is higher than the company’s consolidated caliber of 17.

90% growth rate.

  3.

The overall performance has been improved, and the growth rate of old stores still can be cut from the expansion area. The company’s proportion outside the province is constantly increasing. Sichuan, Chongqing, Guizhou, Guangxi, Hainan and other places have shown scale.The expansion model (concentrated store opening in the early stage, refined management in the middle stage, and encrypted layout in the later stage) was successfully replicated outside the province, and the initial display gradually entered the harvest period, and regional bargaining and profitability continued to improve.

  Profit forecast: The company ‘s high-density, low-area layout strategy and self-built main expansion model value will be realized in performance improvement. It is estimated that the net profit in 19-21 will be 6 respectively.

15 billion, 7.

40 billion, 8.

9.1 billion, corresponding to PE 25 / 20/17 times, maintain “Buy” rating.

  Risk warning: store expansion speed and later integration, profitability exceeds expectations.