On the evening of April 19, Jiajiayue Group Co., Ltd. (SH: 603708, hereinafter referred to as "Jiajiayue") released its 2023 annual report. In 2023, the company achieved revenue of 17.76 billion yuan, a year-on-year decrease of 2.3%, and net profit attributable to the parent company of 136 million yuan, a year-on-year increase of 127%. However, some research institutions believe that Jiajiayue's net profit attributable to the parent company in 2023 is less than expected, and they have lowered their performance forecasts for 2024.
Net profit in 2023 fell short of Wind's consensus estimatesIn 2023, Jiajiayue Group Co., Ltd. has achieved remarkable results in the retail industry. In the face of fierce market competition and a volatile economic environment, Jiajiayue has achieved double growth in operating income and net profit through a series of strategic measures, demonstrating the overall health and sustainable development momentum of its operating conditions.
In terms of key financial indicators, Jiajiayue will achieve a total operating income of 17.763 billion yuan in 2023, a year-on-year decrease of 2.31%.
Jiajiayue said that the reason for the year-on-year change in operating income is that "while the company steadily promotes the layout of the existing regional network and enhances the advantages of regional density and scale, it decisively closes stores that continue to lose money and are difficult to change in accordance with the principle of 'superior advance and inferior retreat', so as to reduce the subsequent profit pressure." ”
At the same time as the operating income is declining, Jiajiayue's operating costs are also decreasing, and the operating costs in 2023 will decrease by 3% year-on-year. Both selling expenses and finance expenses decreased year-on-year. Among them, the change in selling expenses was mainly due to the decrease in labor costs and rents. Comparing the 2023 and 2022 annual reports, the New Yellow River Big Fish financial reporter found that the number of employees in Jiajiayue decreased from 24,032 to 21,775, a decrease of 2,257 employees in a year.
Jiajiayue's net profit attributable to shareholders of listed companies in 2023 will reach 136 million yuan, a significant increase of 127% year-on-year. The profit growth benefited from the basic management of Jiajiayue's stores, promoting the transformation and upgrading of stores, strengthening the ability of commodity management, better empowering stores through the improvement of supply chain efficiency, strengthening the refined management of all links, and continuously improving operating efficiency and profitability.
In terms of store management and operation, Jiajiayue takes customer value as the center, pays close attention to the improvement of store quality and connotation, and realizes a significant improvement in the quality of store operation through the strengthening of basic management such as display, service and logo. At the same time, Jiajiayue also accelerated the transformation of stores and the upgrading of business formats, and decisively took measures to close stores that were not operating well, further optimized the store structure, and enhanced the overall profitability and market competitiveness.
In terms of supply chain management, Jiajiayue has strengthened the logistics system and commodity power through the construction of Huaibei and Shanghe Logistics Parks, and improved the distribution efficiency and satisfaction rate. Jiajiayue has also strengthened the direct procurement and source development capabilities of fresh food bases, and improved the R&D and market competitiveness of its own brand products, making the proportion of its own brand and customized products reach 13.5%.
In addition, Jiajiayue has also actively promoted network layout and business synergy, and launched new business formats such as Yue Ji Snack Store and Haohuixing Discount Store, enhancing the three-dimensional layout of multiple formats and regions. In terms of innovation and transformation, the company continued to optimize its information system, improve operational efficiency and consumer experience, increased online sales by 23.9%, and continued to enhance its omni-channel operation capabilities.
Jiajiayue also continued to promote organizational reform, strengthened cost control through refined management, and improved profitability and development quality. The company has implemented the first phase of the equity incentive project, which has stimulated the enthusiasm and creativity of employees and provided talent guarantee for the sustainable and healthy development of the company.
In terms of the use of the raised funds, Jiajiayue will continue to use the funds raised from the issuance of convertible corporate bonds and the issuance of shares to specific targets for projects such as supermarket chain renovation and logistics reconstruction and expansion, which will further promote the company's long-term development.
Overall, Jiajiayue's performance in 2023 has not only achieved growth in financial data, but also achieved remarkable results in operation management, store optimization, supply chain improvement, business innovation, digital transformation and organizational reform. These achievements are the result of Jiajiayue's adherence to the high-quality development strategy, continuous innovation and enhancement of competitiveness, and also lay a solid foundation for the company's future development.
For Jiajiayue's overall performance in 2023, Lin Huanyu, chief analyst of Huatai Securities' home appliances and trade retail, believes that Jiajiayue's net profit of 136 million yuan in 2023 is lower than Wind's consensus expectation of 230 million yuan.
In 2023, 57 directly-operated stores will be closedJiajiayue's main business is supermarket chain operation, with comprehensive supermarkets, community fresh food supermarkets and rural supermarkets as the main formats, focusing on the development of Shandong and surrounding markets in Inner Mongolia, Beijing, Hebei, northern Anhui and northern Jiangsu. Supermarkets account for more than 90% of Jiajiayue's main business income. In 2023, Jiajiayue will open 110 new stores, including 37 supermarkets, 56 snack stores, 7 Haohuixing discount stores and 10 stores in other formats.
In terms of the adjustment of directly operated stores, Jiajiayue closed 57 stores, and the total number of directly operated stores reached 991. By the end of 2023, the total number of Jiajiayue stores will reach 1,049, including 991 directly operated stores and 58 franchised stores. There are 259 comprehensive supermarkets, 408 community fresh food supermarkets, 228 rural supermarkets, 53 snack shops, 7 Haohuixing discount stores, and 94 convenience stores.
The vast majority of Jiajiayue's stores are concentrated in Shandong. In 2023, Jiajiayue will open 67 new directly-operated stores in Shandong Province, and only 14 outside the province. As of the end of 2023, Jiajiayue has 859 directly-operated stores in Shandong and 132 directly-operated stores outside the province.
From the analysis of the format of directly operated stores that have been open for more than two years, the revenue of department stores decreased by 26% year-on-year, the revenue of community fresh food supermarkets decreased by 5.8% year-on-year, and the revenue of comprehensive supermarkets decreased by 0.24% year-on-year. However, the community fresh food supermarket still ranks first with a ping effect of 1,195 yuan/square meter/month, which is higher than that of rural supermarkets and comprehensive supermarkets.
Among the top 10 directly-operated stores in terms of operating income, they are basically located in Weihai, Qingdao and Yantai.
Jiajiayue said that in 2024, it will continue to implement the strategy of "regional intensive and multi-format development", deepen the existing regional market, and accelerate the development of new business formats such as Haohuixing discount store and Yue Ji snack store through the combination of self-operation and franchise, so as to form a strong regional competitiveness. At the same time, Jiajiayue will strengthen the integration of online and offline to enhance the consumer experience.
In terms of product strength, Jiajiayue plans to subdivide channels to study customer needs, optimize category adjustment, enhance source development capabilities, and cooperate with suppliers to accurately select products to create competitive products. The company will strengthen the fresh supply chain system and improve the quality and characteristics of cooked food, pasta and other processed fresh food to meet consumer demand. At the same time, Jiajiayue also reminded investors of the risks. Factors such as the complex and severe international situation, macroeconomic trends, and the downturn of the world economy, as well as the lack of growth momentum in the retail industry and weak consumption expectations, may have an impact on the retail industry and the company's operating performance.
In terms of the development of the expansion area and the new business format, it will take a certain amount of time to improve the performance of Jiajiayue's external expansion and optimize and develop the business model of the new business format, and at the same time, it is necessary to gradually strengthen the market coverage of each region, and there is uncertainty about the impact of the early development on the business performance of Jiajiayue.
Tang Jiarui, head of the consumer group of Everbright Securities Research Institute, believes that Jiajiayue's performance is lower than previously expected, "mainly due to the company's relatively large investment in launching new formats of snacks and discount stores." In view of the fact that the company will continue to invest in the future, and the competition in the above formats is fierce. "Everbright Securities lowered its forecast for the company's net profit attributable to the parent company in 2024 and 2025 by 44% and 45% to 124 million yuan and 137 million yuan, and added a forecast of 148 million yuan for the company's net profit attributable to the parent company in 2026.
According to the report for the first quarter of 2024 released on April 19, Jiajiayue's operating income in the first quarter was 5.189 billion yuan, a year-on-year increase of 5.73%, and the net profit attributable to the parent company was 147 million yuan, a year-on-year increase of 7.1%. In the first quarter, Jiajiayue opened 12 new directly-operated stores and added 8 new franchise stores. In the secondary market, as of the close of trading on April 19, Jiajiayue closed at 10.02 yuan, with a total market value of 6.396 billion yuan. Since the beginning of this year, Jiajiayue's stock price has fallen by 23%.
Reporter: Du Lin Editor: Lv Bing Proofreader: Gao Xin