Po Laiya (603605) 19Q1 financial report comments: The construction of all categories and multi-brands is making good progress and the net profit has increased by 30.

4% meet expectations

Po Laiya (603605) 19Q1 financial report comments: The construction of all categories and multi-brands is making good progress and the net profit has increased by 30.

4% meet expectations

Event: The company released the first quarter of 2019 financial report on 4/19.

At the core of the report, the company achieved operating income6.

4.2 billion yuan, an increase of 深圳桑拿网 27 over the same period last year.

59%, achieve net return to mother 0.

91 trillion, an increase of 30 in ten years.


The growth momentum of make-up is strong, and the matrix layout of the entire category appears.

The company continuously strives to build a product matrix, from single-brand single-category to multi-brand full-category development.

(1) Skincare: Revenue continues to increase rapidly (26.

83%), the low-priced mask products opened up sales space and resulted in an average attenuation of 23.

99 yuan / piece (-19.

A 71% year-on-year increase).

The overall skin care products still maintained a relatively high growth rate, and the revenue share declined slightly.

73pct to 89.


(2) Beauty: Income 0.

1.8 billion (295.

A year-on-year increase of 72%), an average of 24.

76% (1.

52% YoY).

Complementing consumers’ expectations for pre-makeups, the company’s new cutting-edge beauty brands have received good market response, with huge potential space.

As an important part of building a category matrix, make-up has become the main force of the company’s high-growth categories. This year’s revenue share is expected to be from the current 1.

2% to 5%, forming the prototype of a multi-category layout.

(3) Cleansing category: income 0.

400 million (10.

7% over the same period last year).

96 yuan / piece (5.

15% year-on-year).

Platformization supports ecological development, and a brand incubation mechanism has taken shape.

Under the multi-brand strategy, the company builds an ecological platform to share internal resources such as research and development, production, and marketing, and shares in many external service companies such as content strategy, content promotion, and influencer operation.

The platform approach can support the operation of mature brands while determining the efficient incubation of new brands and new categories to form a benign operating model.

The company’s brand construction is progressing smoothly. The main brand Po Laiya’s marine biotechnology image is constantly solidified. Second-tier brands such as Inca Baha and YNM achieve complementary complementarity in the direction of youth. International brands Korean makeup YNM and Japanese IKAMThe localization operation is good, and the multi-brand layout is expected to progress smoothly.

The decline in the cost of sales ratio led to a slight increase in gross profit margin. During the period, expense control effectively helped the net profit margin.

The rapid development of high-margin e-commerce channels has boosted the company’s comprehensive gross profit margin.

73pct to 63.

83%, always staying high.In terms of expenses, the selling expense ratio decreased by 0.

51pct to 35.

61%, the management expense ratio rose by 0.

39 points to 9.

03%, the amortization of equity incentives and the increase in R & D expenses resulted in a small benign rise in management expenses.

Net sales margin increased slightly.

2 points to 14.

10%, long-term profitability does not change.

Profit forecast and investment grade: The company is expected to achieve operating income of 29 in 2019-2021.

4.5 billion, 37.

1.6 billion and 47.

56 ppm; net profit is 3.

8.5 billion, 4.

80 ppm and 5.

94 ppm; EPS is 1.

91 yuan, 2.

38 yuan and 2.

95 yuan, corresponding to the current sustainable PE is 32.

86x, 26.

37x and 21.

30 times.

Give the company a “Highly Recommended” rating.

Risk warning: Brand incubation is less than expected, single-brand store expansion is worse than expected, etc.