AfterthemarketclosedonMarch25,MeibangApparelannouncedits2021semi-annualreport.DatashowthatMeibangApparelachievedoperatingincomeof1.377billionyuaninthefirsthalfoftheyear,ayear-on-yeardecreaseof14.06%;anetprofitlossof38.9269millionyuan,ayear-on-yearincreaseof91.85%,andthelossnarrowed.
Close30%ofdirectly-operatedstores
Atpresent,MeibangApparel’sThereareMetersbonwe,MECITY,Moomoo,MECITYKIDS,CH’INQiandotherbrands,andthemen’s and women’s clothing categories contribute more than 80% of the operating income. In the first half of the year, the operating income of both men’s and women’s clothing decreased. Among them, men’s clothing achieved operating income of 764 million yuan, a year-on-year decrease of 13%; women’s clothing achieved operating income of 470 million yuan, a year-on-year decrease of 16.95%.
In the past, Meibang Clothing’s direct-operated stores and franchised store marketing networks spread across the country. In the first half of the year, Meibang Clothing’s store closing speed continued unabated, with 73 direct-operated stores closed and 176 existing ones, and 292 franchise stores closed and 1,605 existing stores. Compared with the 237 directly operated stores at the end of 2020, about 30% has been reduced.
In this regard, Meibang Apparel said that due to the impact of the new crown epidemic and declining passenger flow, the company has closed some directly operated stores in major business districts in cities that continue to have poor profitability. Franchisees Then they chose to close franchise stores that were difficult to sustain profitability.
Among the three major channels of online sales, direct sales, and franchise sales, franchise sales achieved the only growth in operating income. It can be seen from the semi-annual report that franchise sales achieved operating income of 561 million yuan in the first half of the year, an increase of 70.3339 million yuan year-on-year; direct sales achieved operating income of 418 million yuan, a year-on-year decrease of 139 million yuan; online sales achieved operating income of 375 million yuan, a year-on-year increase of 375 million yuan. A decrease of 157 million yuan.
Two sales of assets
Since the beginning of this year, Meibang Apparel has sold off its “property” twice.
In March, Meibang Apparel and its holding subsidiaries sold 100% of the shares of Shanghai Mold Industry Co., Ltd. (hereinafter referred to as Shanghai Mold Industry) jointly held by Bacchus Wine Industry. The total sale amount is 448 million yuan; in June, it planned to sell 10.10% of its shares in Huarui Bank, and the remaining 4.9% shares after the transaction were also intended to be sold. At present, the plan has been reviewed and approved by the extraordinary shareholders’ meeting.
Behind the frequent liquidation of assets is the continued decline in performance of Meibang Apparel.
It can be seen from the financial reports over the years that since Meibang Apparel suffered losses in 2015, its net profit has been swinging between “meager profits” and “significant losses”. The long-awaited profit of 122 million yuan in the first quarter of this year is related to cost control and the sale of Shanghai Mold Co., Ltd.
Meibang Clothing’s net profit in the reporting period
100% benefited from the sale of Shanghai Model Equity and Huarui Bank equity methods recognize investment income. In the first half of the year, Meibang Apparel’s investment income totaled 301 million yuan, accounting for 795.54% of total profits. Among them, a total investment income of 290 million yuan and non-recurring gains and losses of 290 million yuan were recognized from the disposal of Shanghai Model.
But “selling, selling, selling” can only be a delaying tactic. In the long run, if Meibang Apparel cannot open up new profit growth points in the second half of the year and continues to suffer losses, it will face ST risks. According to exchange regulations, if a company operates at a loss for two consecutive years, it will be subject to special treatment (ST).
The 2020 annual report shows that Meibang Apparel achieved operating income of 3.819 billion yuan and a net profit loss of 859 million yuan. As of August 25, the company’s total market value was 6.683 billion yuan. </p
