La Natsu Bell, the leader of women's clothing, was in deep mire of loss.
La Natsu Bell went public from the scenery to the mire of loss, which took less than two years.
H shares issued in 2019 semi annual report, once again pushed La Natsu Bell into the heart of the quagmire.
According to the semi annual report, La Natsu Bell's total revenue in the first half of 2019 was 3 billion 951 million yuan, down 23.2% compared to the same period last year. Net profit was -5.65 billion yuan, down 333.9% from the same period last year. Even after adjustment, the net profit attributable to shareholders of listed companies is still -4.98 billion, down 311.2% compared with the same period last year.
The data is unsightly and the performance of the stock market is not satisfactory. At the beginning of the listing, La Natsu Bell's stock price was 8.41 yuan, and its market value reached 12 billion yuan at its peak. However, as of October 9th, the closing price was only 4.91 yuan, and its market value dropped to 2 billion 689 million yuan, which was less than 1/4 of the A share market. Obviously, the word "waist cut" could not be applied to the market value of U La Natsu Bell's fall.
However, La Natsu Bell also had a bright future. After listing in Hong Kong in 2014, he was listed on the Shanghai Stock Exchange in September 2017 and became the first "A+H" listed clothing company in China.
Only this kind of scenery day did not last long. After second years of A share listing, La Natsu Bell began to speed up on the road of loss.
By comparing the previous data, we can clearly feel the decline of La Natsu Bell. In 2014 and 2015, when La Natsu Bell was just listed in Hong Kong, the net profit was 500 million yuan and 615 million yuan respectively, the growth rates were 21.36% and 28.7% respectively.
In 2016 and 2017, La Natsu Bell's net profit growth continued to maintain steady growth, and finally reached the peak in the first quarter of 2018. In this quarter, La Natsu Bell's net profit growth rate reached 26.17%, but then began to decline.
According to the semi annual report in 2018, La Natsu Bell's net profit fell by 20.20%, but in the third quarter, it continued to slide to 36.10%. According to the annual report in 2018, La Natsu Bell's net profit in 2018 was -1.60 yuan, down 132% from the same period last year.
The first quarter of 2019 continued to be sluggish last year. La Natsu Bell's losses continued to expand, and net profit fell by 99.63% again.
La Natsu Bell was caught in the night of the rain and lost in the mire. Before he could catch his breath, he was in trouble again.
On the evening of August 6th, La Natsu Bell announced that he had received a notice from Xing Jiaxing, the controlling shareholder and the real controller, and was informed that the 141 million 600 thousand shares (all A shares) of the company's limited sale conditions to its Haitong Securities were lower than the minimum performance guarantee ratio.
In fact, Xing Jiaxing has pledged several times. Since November 2017, Xing Jiaxing has made 6 equity pledge. As of now, Xing Xing Xing holds 142 million shares of La Natsu Bell directly, accounting for 25.91% of the total share capital of the company, but its total pledged shares are 141 million 600 thousand shares, accounting for 99.81% of the share of the company directly holding shares.
In the evening of August 17th, La Natsu Bell announced again that he had received the decision of the Shanghai regulatory authority of the China Securities Regulatory Commission on the adoption of the warning letter issued by the Limited by Share Ltd of the Limited by Share Ltd in Shanghai.
The warning letter shows that there is a big difference between the net profit disclosed in La Natsu Bell's January 31, 2019 earnings forecast and the actual performance, and there is no sufficient risk indication for the performance from profit to loss. The information disclosure is inaccurate, incomplete and incomplete. The act violates the relevant provisions. The Shanghai regulatory authority of the China Securities Regulatory Commission has decided to adopt the administrative supervision measures for La Natsu Bell to issue a warning letter.
From the hot pursuit of the capital market, to half a loss of 5 hundred million, then to the pledge of stock rights default, the exchange issued a warning letter, women's clothing leading enterprise La Natsu Bell exactly how?
Are all the disasters caused by crazy expansion?
In May 1998, Xing Jiaxing, a businessman in Fujian, founded "La Natsu Bell", the main consumer market, and determined to make La Xia Bei to become a "Chinese version of Zara".
"A developing company can't stop. The domestic consumer market is growing by more than 20% every year. If we do not open a new store, it will mean retrogression." Xing Jiaxing, who was born in the clothing sales, has always adhered to the concept of "scale expansion" at the beginning of founding La Natsu Bell, and advocated the formation of multi brand matrix based on direct camp mode.
In early 2011, La Natsu Bell had only three women's clothing brands, and then gradually expanded the brand. Now, the number of La Natsu Bell's sub brands is as high as nearly 20, which covers women's wear, men's wear, children's wear and so on.
Also in 2011, Pes La Natsu Bell's number of stores under the line was 1841, then continued to expand rapidly, and reached its peak in 2017. A total of 9448 stores were opened, almost all over the country's major shopping malls.
By the first half of 2018, this figure has shrunk slightly to 9269, but the speed of expansion is still alarming. By contrast, at the same time, the international fast wear giant Zara has fewer than 7000 outlets in the world.
La Natsu Bell's number of stores not only surpassed Zara, but also the largest number of stores in the same kind of domestic competitive enterprises in China. The number of stores in La Natsu Bell is the largest. According to public data, the number of stores in Hai Lan home and Semir clothing in 2017 was 5792 and 8000, which were lower than those of La Natsu Bell's 9448.
For La Natsu Bell, who is the main consumer market, the number of offline stores means to a large extent whether the vitality is tenacious.
In 2014, La Natsu Bell went to Hong Kong to go public. After 3 years, he landed smoothly at the Shanghai Stock Exchange. La Natsu Bell raised almost all of the two listed funds for the expansion of the retail network, so as to maintain the rapid expansion of the offline stores.
Although it has an unparalleled number of stores, it does not seem to be directly proportional to La Natsu Bell's total revenue.
According to the 2018 annual report, La Natsu Bell's total operating income in 2018 was RMB 10 billion 176 million yuan, a decrease of 269 million yuan over the same period last year, down 2.58% from the same period last year. Net profit attributable to shareholders of listed companies was 160 million yuan, down 654 million yuan from the same period last year, down 132% from the same period last year.
La Natsu Bell's revenue channel consists of three sections, namely, counters, stores and online e-commerce platforms.
According to the 2019 semi annual report, the counter created 1 billion 684 million yuan for La Natsu Bell, a decrease of 32.8%, accounting for 42.6% of the total revenue, and 1 billion 645 million yuan in sales revenue, a decrease of 12.9% over the same period last year, accounting for 41.6% of the total revenue. The earning capacity of the online e-commerce platform was the worst, only 527 million yuan, up 0.5% over the previous year, accounting for 13.4% of total revenue.
Through the enumeration of data, a problem can be clearly seen, that is, the more La Natsu Bell stores, the total revenue is declining.
The frenzy of opening shop gradually made La Natsu Bell suffer, and reckless expansion eventually led to a surge in inventories.
A clothing enterprise problems often appear in the inventory. Because the fashion industry is affected by the trend of popularity, once the unsalable sales, clothing enterprises usually give a larger discount to deal with the inventory, so as to quickly return the funds.
Unlike liquor, metals, real estate and other industries, inventory has the ability to maintain and increase value. The clothing industry's inventory is a black hole to embezzle profit margins. Backlog will not only reduce the value of the brand, but also substantially increase the operating cost of the company.
From 2014 to 2018, La Natsu Bell's inventory rose rapidly from 1 billion 327 million yuan to 2 billion 534 million yuan, while the share of current stock in current assets rose from 26.42% to 48.58%, an increase of nearly 1 billion 200 million yuan.
In addition to the inventory pressure brought by inventory, La Natsu Bell's inventory turnover days remain high.
According to the research results of Orient Securities, most of the garment enterprises have more than 150 days' stock days. Only a handful of enterprises can control the stock days in less than 100 days.
In 2018, La Natsu Bell's inventory turnover reached 285 days. Although it improved slightly in the first quarter of 2019, it also exceeded 250 days, while the second quarter increased nearly 70 days to 313.1 days, much higher than the industry average.
In contrast, the days of inventory turnover of Taiping bird and Semir clothing were 183 days and 129 days respectively, which means that La Natsu Bell's turnover efficiency of inventory is lower than that of Semir.
Low turnover efficiency will eventually be reflected in gross margin. According to the 2019 semi annual report, La Natsu Bell's gross profit margin has dropped from 65.33% at the end of last year to 60.88%, while the average gross profit margin of other listed garment enterprises is 73.84%.
La Natsu Bell is facing a tough test to support nearly 10000 outlets.
La Natsu Bell broke his arm to survive.
The loss in 2018 was 160 million yuan, which sounded the alarm for La Natsu Bell.
Faced with the current bad situation, La Natsu Bell decided to change. In the second half of 2018, La Natsu Bell implemented the business mode of joint operation and franchise based on the original direct mode.
The advantage of the direct camp mode lies in the control of the channel, but the assets are heavy and investment is large and suitable for enterprises with sufficient capital. La Natsu Bell also realizes that he is not such an enterprise.
In the first half of 2019, La Natsu Bell switched off more than 2400 stores, averting more than 13 stores a day, and actively implemented a strategic shrinkage strategy from top to bottom, closing down the direct and inefficient retail outlets to reduce the ineffective investment of resources. As of the end of June 2019, there were only 6799 remaining outlets under La Natsu Bell.
In fact, it is not only La Natsu Bell, closing stores, closing down, discounts, which seems to be the curse of the global fast fashion brands.
In the evening of September 29th, the US fast fashion brand Forever21 filed for bankruptcy in the United States. At its height, Forever21 has nearly 800 stores in 48 countries and employs more than 40 thousand people worldwide.
According to reports in the US media, 178 US stores and 350 overseas stores owned by Forever21 will be closed soon.
The problems facing Forever21 are almost the same as those of La Natsu Bell. The prosperity of the Internet has allowed some online shopping malls and shopping App to seize the living space of many offline stores.
Fast fashion encounter severe attacks, in addition to the reasons for the rise of e-commerce platform, more can no longer attract younger generation of consumers. But in the face of the crisis, what did Forever 21 do?
It is puzzling that Forever21 has not worked hard on meticulous management. Instead, it has chosen to continue expanding its offline stores, trying to form a scale effect and reverse the trend of decline.
Therefore, after a long period of time, the expansion of stores has become the only focus of work for Forever21.
Regardless of the blind expansion of the situation, Forever21 finally became more and more difficult to bear the pressure of operating costs, and finally ended in bankruptcy.
Compared with Forever21, La Natsu Bell was able to recognize the situation before falling off the cliff. Facing the same crisis, La Natsu Bell resolutely decided to actively change and attract young consumer groups. In order to enhance the brand vitality, La Natsu Bell worked with cross border cooperation with famous illustrators such as fashion illustrators, street graffiti artists, writers and artists, dance studios, and other famous IP.
Cross boundary cooperation has achieved some success, especially in member marketing. By the end of June 2019, the number of effective members of La Natsu Bell was over 11 million. In the first half of the year, the number of newly recruited members exceeded that of 2018, and the proportion of member sales accounted for over 40% of total sales, representing an increase of 30% over the same period last year.
However, La Natsu Bell's road of self salvation has just begun. At present, when there are strong enemies eyeing, and when the internal operation strategy changes, how to quickly adjust the operational plan, and strive for more market share and more profits is particularly critical. After all, if we can not win, we will be inferior.
Source: Bullet financial writer: Yin Taibai