Suning.Com Expects Net Profit Of 2 Billion In The First Half Of The Year, Which Is Expected To Be Profitable From 2023.

The suning.com group Limited by Share Ltd (hereinafter referred to as suning.com) released its performance forecast in the first half of July 11th this evening. It expects net profit of 2 billion 100 million yuan to 2 billion 300 million yuan in the first half of this year, down 61.69% to 65.02% compared with the same period last year.

Suning.com said that the net profit of the Company attributable to shareholders of the listed company was 870 million yuan to 1 billion 70 million yuan if the net profit of the sunning shop was first increased in the first half of the year and the net profit from equity transfer was deducted.

For the main reason for the year-on-year decline in net profit, suning.com explained:

In the first half of the year, the external environment of enterprise development is still weak. The company continues to promote the retail development of the whole scene, speed up the development of the community and rural market, further enhance the specialized operation ability of non electrical products, and speed up the construction of logistics infrastructure and the improvement of user experience. After a year of rapid expansion, Suning store has entered the stage of operation optimization and mode optimization, but it is still in the stage of stage loss. During the reporting period, the company completed the transfer of Su Ningxiao shop equity to SuningSmartLifeHoldingLimited at the end of 6 at the end of 2019. This transaction increased the net profit of the company by about 3 billion 428 million yuan.

Overall, suning.com expects to achieve net profit of 2 billion 100 million yuan to 2 billion 300 million yuan in the first half of the year. If deducting the operating losses of Suning shop in the first half of the year and the increase in net profit brought by equity transfer, it is estimated that the net profit attributable to shareholders of listed companies is 870 million yuan -10.7 billion yuan. Due to the sale of some Alibaba shares during the same period last year, the net profit of RMB 5 billion 601 million yuan was affected. During the reporting period, the net profit of the Company attributable to shareholders of listed companies changed -65.02% - -61.69% over the same period.

In the view of Tang Chuan, an analyst of state securities, Suning has always been a company based on chain retailing. Suning's assets under the nurturing line in the past 20 years should not and should not be belittled. Traversing any domestic electricity supplier or Internet giant can find that despite the attempts of countless stores, the giants are still unable to tear down the breakthrough line by building their own stores. This is the fundamental reason why Suning is proud and hard to shake. It is also because the basic dishes on the line have gone through enough long time to precipitate, so Suning can get tickets to enter the online business.

Tang Chuan believes that under the mainstream view of Su Ningxin's retail imagination and new or online or O2O businesses as investment value labels, Suning's core asset value should still be focused on the offline chain businesses that accompany us all the way. Therefore, sunning's scale and expansion of offline chain businesses and positioning of online businesses will be the first element to judge the short-term value of the company. For a long time, Suning's upstream relationship and the performance of free cash flow will also affect Suning's long-term investment value.

Tang Chuan said that the business logic of Suning's strong and fast layout in recent years, as well as the diversification scenario strategy, is to enhance the scale of transactions by increasing the frequency of consumption, the coverage of scenarios and the coverage of consumer groups. Through the gradual coverage of categories to enhance the frequency of consumption, through the coverage of e-commerce and store types to enhance the coverage of the scene, through large-scale open shop to increase consumption.

From the online point of view, in recent years, Suning's online business, besides suning.com's self operated electric business, business open platform and Suning live broadcast, sunning's purchase, Suning Yun Chao, sunning help customer repair and many other O2O businesses are taking root. At the same time, by changing the stock with ALI, we can realize our cooperation with Tmall. According to the caliber of the state securities, Suning's suning.com flagship store, which opened in Tmall, contributed nearly $35 billion to Suning in 2018. It is expected that the contribution of GMV in the first half of 2019 will exceed 18 billion yuan, and the best sellers will include mobile phones, refrigerators, washing machines and 3C digital products. GMV

Peng Yi, a researcher at Zhongtai securities, said that in the first quarter, the net profit of Suning was obviously under pressure due to the loss of small business. It is expected that the daily sales and gross profit margin of small stores will be improved with the accumulation of fresh and fast supply commodity supply chain capabilities and the gradual opening up of new stores. The scale effect of the future is expected to optimize the operating cost rate of rents, staff and hydropower, and the scale of losses will be narrowed gradually, and eventually the profits will be realized. Refer to the current gross margin level (28%+) of convenience stores such as Hongqi chain and 7-11, and the gross margin level of third generation stores in Suning store (increasing the proportion of high gross profit commodities such as fresh fruit, box lunch, bar hot food and gross profit margin to 25%+). If the store can achieve the expected effect, it is expected to achieve positive profits from 2023.

According to the results, by the end of 2018, the total number of stores in suning.com has reached 11064, including 8881 self owned stores, 2071 retail cloud stores, and 112 daily convenience stores, including 3C, mother and baby, supermarkets and convenience stores.

By the end of 2018, suning.com owned its own property area of 209 thousand and 100 square meters. Through the innovative assets operation mode and the cooperation with the large real estate developers, the property area of 852 thousand and 700 square meters and the social lease area of 5 million 600 thousand and 300 square meters were obtained.