In the past few years when the epidemic has led to a comprehensive setback for the large home furnishing industry, upholstered furniture has almost become the "hope of the whole village" and has maintained a high growth rate. And in 2023 after the epidemic, what is the overall performance of the upholstered furniture category? Today's Home Furnishing 2023 annual financial report analysis series, this issue focuses on the four leading brands of finished product/upholstered furniture - Gujia Home, Xilinmen, Dream Lily, and Mousse Shares, through a comprehensive interpretation of the data, take a look at the opportunities and challenges of the software track!
- Revenue, gross profit, net profit, number of stores, which one is stronger?
1. In the horizontal comparison of revenue in 2023, Gujia is far ahead
Gujia Home's revenue in 2023 will be 19.210 billion yuan, a year-on-year increase of 6.67%. Among them, the domestic business increased by 6.12%, and the overseas business increased by 6.84%.
Gu Jia summed up the past 2023 with "chasing efficient and stable growth". If we see the "impact" from Oppai's financial report, then the Gu family's financial report reveals more "dormant". In terms of effectiveness, Gujia's revenue growth rate in 2023 will outperform Oppai.
Xilinmen's revenue in 2023 will be 8.678 billion yuan, a year-on-year increase of 10.71%, and its growth channels are bulk business and online sales, which have brought a total revenue growth rate of 18.5%.
Dream Lily's revenue in 2023 will be 7.976 billion yuan, a slight decrease of 0.52% year-on-year. About 80% of the company's revenue comes from overseas, and in 2023, Dreamlily will still actively promote the transformation of overseas business from ODM to OBM, and overseas revenue will decrease by 6.88% year-on-year.
Mousse's 2023 annual revenue will be 5.579 billion yuan, a year-on-year decrease of 4.03%, mainly due to the interruption of Mousse's direct supply business with Opai Home.
2. Net profit attributable to the parent company, Gujia and Mousse performed well
The bar height in the chart above reflects how much money each company made to shareholders of the parent company in 2023.
The net profit of Gujia and Mousse continued to grow steadily, increasing by 10.7% and 13.25% respectively in 2023.
Based on the low net profit base in 2022, the year-on-year net profit growth rates of Xilinmen and Dream Lily in 2023 are as high as 80.54% and 157.74%.
In 2023, the net profit attributable to the parent company of Gujia Home Furnishing will be 2.006 billion yuan.
Mousse with an income of 802 million yuan far exceeded Xilinmen (429 million yuan) and Dream Lily (107 million yuan),
3. Compared with revenue and market value, Dream Lily is underestimated?
As of May 9, 2024, the market value of the four companies is: Gujia Home Furnishing 29.42 billion yuan, Xilinmen 7.311 billion yuan, Dream Lily 4.941 billion yuan, and Mousse shares 14.220 billion yuan.
Dream Lily's revenue reached 7.976 billion yuan, while the market value was only 4.9 billion, making it the most "underestimated" of the four. Xilinmen also has a revenue of nearly 8.7 billion, but its market value is only 7.3 billion. This also shows that the capital market is not optimistic about the valuation of the two major brands and is relatively conservative about the future.
Mousse's revenue is 29% of Gujia's, its net profit is 40% of Gujia's, and its market value is close to half of Gujia's, which shows that investors are more optimistic about the future development of Mousse.
4. ROE, Gujia surpasses Oppai
ROE (ROE) (i.e., the profitability of an investor's net worth) is particularly important from an investment return perspective.
With a return on net assets of 21.87%, Gujia Home Furnishing exceeded the custom leader Opai Home Furnishing by 4.32 percentage points, which may also be an important indicator of Yingfeng Group's premium acquisition of Gujia.
See also Huge amount of information! A comprehensive and detailed analysis of the five major indicators of Oppai's 2023 annual report!
The ROE of Gujia, Mousse and Xilinmen in 2023 is much higher than the bank deposit rate in the same period, and if the ROE of the enterprise is lower than the bank deposit rate for a long time, then there is no point in investing.
5. Comparison of subdivided categories: Gujia's customized gross profit declined, and the gross profit of Mousse and Dream Lily increased significantly
Image source: Gujia Home Furnishing Annual Report 2023
From the perspective of various products of Gujia Home, sofa and bed products are the advantages of Gujia, and the revenue & gross profit margin will both increase in 2023.
The revenue of the Gujia customized category increased by 15.57% year-on-year, while the gross profit margin decreased by as much as 5.59 percentage points, which was due to the increase in the cost of raw materials in the customized category by 25.91% year-on-year. The average gross profit margin of listed enterprises is 33.67%, and Gujia needs to strengthen the cost control of customized categories in order to achieve the goal of "strengthening the transformation of the whole family and overtaking in the curve after precipitation".
Image source: Xilinmen 2023 Annual Report
In 2023, Xilinmen actively promoted cooperation with hotels and online sales business, resulting in a year-on-year increase of 23.94% in the revenue of the mattress category. At the same time, Xilinmen has also increased the gross profit margin of various categories.
Image source: Dream Lily 2023 Annual Report
In the past two years, the cost control of Dream Lily has been effective, with a year-on-year increase of 7.38% in gross profit margin in 2022 and a year-on-year increase of 38.16% in 2023. Relying on the transformation of overseas ODM to OBM business, the gross profit margin of Dreamlily's household products is expected to exceed the peak of 39.54% in 2019 in 2024.
Image source: Mousse 2023 annual report
In 2023, after Mousse interrupted the low-margin business of direct supply to Oppai, the overall gross profit margin increased by 3.74 percentage points to 49.81%.
The brand premium can be seen from the gross profit margin, for example, the gross profit margin of Kweichow Moutai is 91.96%, and the gross profit margin of Wuliangye is 75.79%. Through the gross profit margin, you can also judge what products are good to make money.
The above figure shows the gross profit margin of the four companies in the past 5 years, which can be seen through the data:
- Selling mattresses is more profitable than selling furniture;
- The premium of the Mousse brand is high.
Gross profit minus expenses and taxes to obtain net profit, through the net interest rate index to see the management ability of the enterprise. Gujia's gross profit margin ranked fourth, and its net profit margin surpassed that of Xilinmen and Dream Lily, and narrowed the gap with Mousse, indicating that Gujia's ability to control various expenses was stronger than that of the other three. Dream Lily's net profit margin is only 1.52%.
Second, the number of stores, the average store delivery volume indicators
In 2023, the number of stores of Gujia Home Furnishing will be 6,946, an increase of 203 over the previous year. Among them, there were 6,813 dealerships, an increase of 213 over the previous year; There were 133 directly-operated stores, a decrease of 10 from the previous year.
In 2023, the number of Xilinmen stores will be 5,633, an increase of 380 over the previous year. Among them, there were 3,551 Xilinmen stores, an increase of 271 over the previous year; 1,612 Ximian stores, an increase of 190 over the previous year; There were 490 M&D stores (including Xiatu), a decrease of 81 from the previous year.
In 2023, the number of Dream Lily stores will be 1,276, a decrease of 177 from the previous year. Among them, the total number of dealer stores was 971, a decrease of 200 over the previous year; There were 305 directly-operated stores, an increase of 23 over the previous year.
The number of stores in Mousse's 2023 annual report was not disclosed, but through the data of its announced prospectus and 2023 semi-annual report, it is estimated that Mousse's stores in 2023 may be expanding rapidly.
The store pick-up volume of the four major brands is indicated
In 2023, the average pick-up value of Gujia Home's own brand stores will be 3.1071 million yuan, a slight increase from 2022, and the average pick-up value of stores of other brands will be 1.4291 million yuan, a decrease from 2022.
In 2023, the average store pick-up volume of Xilinmen dealer stores will be 652,000 yuan, a decrease of 4.84% from 2022 and a decrease of 25.92% from 2021.
In 2023, the average store pick-up volume of Dream Lily direct stores will be 7.2698 million yuan, a decrease of 18.47% compared with 2022; The average pick-up value of dealerships was MOP 398,200, an increase of 54.1% over 2022.
Mousse data is for reference only.
3. Interpretation of capital chain data
1. The number of inventory turnover days is the highest in Dream Lily
Recently, the head brand of custom furniture, Ou Suo Zhishang, has launched multi-layer board packages to replace particle boards. The innovation of raw materials and the elimination of old models will lead to a decline in the price of inventory assets.
Today's home furnishing through a horizontal comparison of the inventory turnover days of the four companies, sorting the inventory turnover days of the four companies, from large to small, are Dream Lily> Xilinmen> Gujia Home Furnishing> Mousse shares.
Looking at the data of various enterprises in the past three years, in 2023, Gujia, Xilinmen, and Mousse will all improve their inventory control.
2. Accounts receivable turnover, Gujia is the lowest, and Dream Lily is the highest
The importance of receivables to business operations is well known. The larger the amount of the receivable and the longer the account period, the greater the likelihood of bad debts. Furniture manufacturing enterprises are closely related to real estate enterprises, and in recent years, they have a deep understanding of the losses caused by bad debts.
The turnover days of receivables and transfers of the four companies in 2023 are: 22.37 days for Gujia Home, 37.72 days for Xilinmen, 65.15 days for Dream Lily, and 7.56 days for Mousse shares.
The capital risks brought by the four companies due to the receivables factor are also Dream Lily> Xilinmen> Gujia Home Furnishing> Mousse shares.
The ratio of receivables to net profit is interesting. If the data value reaches 100%, it means that the money earned in a year is still in other people's pockets.
In 2023, the proportion of receivables to net profit attributable to the parent company of the four enterprises is: Gujia Home Furnishing 67.4%, Xilinmen 220.12%, Dream Lily 1443.93%, and Mousse 5.25%.
3. Current ratio > quick ratio
The current ratio and quick ratio are very important indicators to analyze the risk of a company's capital chain.
The current ratio is the ratio of current assets to current liabilities, which is used to measure the ability of a company to use it to repay its liabilities before short-term debt matures. Current liabilities need to be repaid in cash, and current assets include inventories, and it is generally considered that a current ratio greater than 2 is safe.
The quick ratio is the ratio of liquid assets to current liabilities. Liquid assets are assets that can be quickly repaid after deducting inventory. It is generally accepted that the quick ratio should be greater than 1.
Sort 4 companies with quick ratios, Dream Lily> Xilinmen> Gujia Home Furnishing> Mousse shares.
4. Net cash flow from operating activities
There are many ways for a business to obtain capital, but it is essential to obtain cash from continuing operations.
In 2023, the net cash flow generated by operating activities will be 2.443 billion yuan for Gujia Home, 1.253 billion yuan for Xilinmen, 917 million yuan for Dream Lily, and 1.935 billion yuan for Mousse shares. Mousse's total revenue is 29% of Gujia's total revenue, while the net cash flow from operating activities is 79% of Gujia's.
Mousse is indeed excellent in terms of management and goodwill, so investors are willing to give Mousse a higher stock market value.
The net cash flow generated by the operating activities of Dream Lily is growing rapidly and continuously, and as mentioned above, the gross profit margin of Dream Lily is expected to hit a record high this year, and it is expected that these good signs can make Dream Lily grow healthily.
In 2024, many small factories will go bankrupt, and many listed companies have also reported quarterly losses. Perhaps the most important thing is to focus on business management.