Antarctic E-commerce (002127): Main business profit + 39% GMV + 59% Accounts receivable Improve financial quality

The performance of the first three quarters of the core business revenue increased by 38%.

Antarctic e-commerce achieved revenue of 26 in the first three quarters of 2019.

Year-on-year increase of 47ppm / + 29%, net profit attributed to mother 6.

02 CPI / + 34% YOY, of which Antarctica’s main business realized revenue 6.

8 billion / + 30% year-on-year, attributed to net profit of mother 5.

11 ppm / + 39% year-on-year, Antarctic core business brand service fee achieved revenue6.

1.4 billion / + 38% per year, and other Antarctic businesses achieve zero revenue.

A year-on-year increase of 6.6 billion / -14%.

Accounts receivable improved significantly. Accounts receivable decreased in factoring business, operating cash flow was good, and financial quality improved.

As of the end of the third quarter of 2019, the net receivables of Antarctic core business brand service business was 4.

50,000 yuan / + 24% year-on-year, which is less than the 38% revenue growth rate of this business, and the net receivables of factoring business is 3.

12 ppm / -31% year-on-year, the net receivables of the time interconnection business was 2.

4.7 billion / -10% per year.

In the first three quarters of 2019, the net operating cash flow of Antarctica was +2.

92% / + 43% year-on-year, of which the net operating cash flow of Time Connect was 杭州桑拿 +0.

15 ppm / year ago was -1.

30,000 yuan.

In the first three quarters of 2019, the total GMV of Antarctic e-commerce platforms reached 168.

100 million / + 59% year-on-year.

In 2018, the company’s GMV volume exceeded 200 billion yuan, and the first three quarters of 2019 still achieved 59% growth, reflecting the company’s brand power in the e-commerce model of the head siphon effect.

In terms of brands, the growth of the Antarctic brand is strong: the first three quarters of Antarctic / Cartier Le Crocodile / Classic Teddy / Other achieved 145 respectively.

2/20.

1/1.

5/1.

300 million GMV, with an annual growth rate of 65.

0% / 37.

1% / 54.

4% /-27.

6%, respectively accounting for 86.

4% / 11.

9% / 0.

9% / 0.

8%, +2 per year.

9pct / -2.

0pct / 0.

0 points / -0.

9 points.

① The value of Antarctic people’s superior categories is prominent, and the city’s share has further increased; ② Following the e-commerce channel flow rules and introducing big store strategies, the effect is significant. In terms of platforms, Ali maintains a high growth rate, and social e-commerce and Vipshop will rise strongly.

Ali / Jingdong / Social E-commerce / Vipshop will achieve 111 respectively.

4/26.

6/21.

5/7.

500 million GMV, the previous growth rate was 50.

9% / 36.

5% / 131.

8% / 198.

9%, respectively 66.

3% / 15.

8% / 12.

8% / 4.

4%.

-3 per night.

7pct / -2.

7pct / + 4.

0 points / + 2.

1pct.

Investment recommendations We expect that the Antarctic e-commerce GMV composite material will exceed 35% in the next 2-3 years. It is estimated that the company’s net profit attributable to the parent will be 12 in 2019-2021.

2/16.

3/20.

0 billion, corresponding to PE of 23/17 / 14x, maintain BUY rating, target price of 15 yuan.

Risk reminders: e-commerce growth profit; platform policy risks; lifting of ban risks; category expansion risks.