Boss Electric (002508) 2018 Annual Report and 19th Quarterly Report Comments: The first quarter revenue growth rate to improve the fundamentals is about to usher in an inflection point

Boss Electric (002508) 2018 Annual Report and 19th Quarterly Report Comments: The first quarter revenue growth rate to improve the fundamentals is about to usher in an inflection point
Key points of investment: The performance of the annual report in the first quarter is in line with expectations: 1) The company achieved operating income of 74 in 2018.25 ppm, a five-year increase of 5.81%, net profit attributable to mother 14.740,000 yuan, an increase of 0 in ten years.85%, net profit of non-return to mother 13.28 ppm, a decrease of 5 per year.56%, corresponding to the basic income1.55 yuan / share; the company plans to distribute a cash dividend of 8 yuan (including tax) to shareholders for every 10 shares, with a dividend rate of 51.52%, corresponding to an index rate of 2.67%.2) The company’s operating income for the first quarter of 201916.60 ppm, a ten-year increase4.30%, net profit attributable to mother 3.20 ppm, an increase of 5 in ten years.84%, net of non-attributed net profit2.75 ppm, a ten-year increase of 8.55%, basically 0 benefits.34 yuan / share, an annual increase of 6.25%. Fundamentals are about to usher in an inflection point, and annual revenue is expected to increase by 5% -10%.Since the fourth quarter of 2017, the company’s revenue growth rate has shifted significantly, reducing the reduction of land area and inhibiting the release of new demand for kitchen appliances, and causing the online growth dividend to also decline.In terms of stable growth, the company increased its channel splitting efforts. In 2018, the number of city companies increased from 98 to 155, and the number of specialty stores increased by 9% each year, bringing the “boss” main brand up by 4%.Judging from the results of the first quarter of 2019, the company’s revenue growth rate has improved from the previous quarter. It is expected that the rebound of first- and second-line transactions will support the company’s performance in the second half of the year. Product profitability remained stable, and dealers were highly motivated to make payments.Looking at the future of 2018, the company’s gross profit margin will remain basically stable, and the gross profit margin in Q1 2019 will increase by 0.67 pcs reached 54.79%, the market risk of the kitchen appliance industry price war.The company’s 18-year sales expense ratio increased by 1.75 to 25.72%, the sales expense ratio in the first quarter further increased to 30%, indicating that the company’s expansion and expansion of power to promote growth decisions; management expense ratio (including research and development) increased by 0.75 to 7.62%, of which R & D expenses increased by 25.87%, 杭州夜生活网 accounting for nearly 4% of income (+0.62pct), which confirms the company’s expansion of new product development.Overall, the company’s net interest rate fell by 0.98 to 19.85%. Category innovation + channel sinking, two-pronged approach to drive future growth.The company is currently in the overlapping process of category and channel driving force conversion: 1) In terms of category, the company first tried to establish a single category business unit-steamer business unit, and first acquired Jindi to achieve category expansion-integrated stove, dishwasher 19 Initially from OEM2) In terms of channels, the company’s engineering channels are currently growing at a rapid rate of over 40%, accounting for 9% of the company’s revenue; the growth rate of e-commerce channels has basically fallen below 10%, accounting for 31% of the company’s revenue. Profit forecast and investment rating.The company’s second-phase agent holding costs 39.81 yuan / share, the cost of employee share price is 35.94 yuan / share, the current sustainable safety margin is still high.We revise down the company’s net profit forecast for mothers for 2019-2020 to 16.06 billion and 17.6.9 billion (previous value was 16.67 ppm and 18.660,000 yuan), plus the net profit forecast for mothers in 2021 is 19.79 trillion, an increase of 9 each year.0%, 10.2% and 11.9%, corresponding to dynamic P / E ratios of 18, 16 and 14 times.Considering that real estate completion data is expected to rebound in 2019, the sales of first- and second-tier real estate will pick up first in the follow-up period. As the leading kitchen appliance company, the company has expanded its competition and continued to maintain its “Buy” investment rating.