Wangfujing(600859) 国盛证券·2024-11-07 12:48Investment Rating - The report maintains a "Buy" rating for Wangfujing (600859.SH) [3] Core Views - Wangfujing's performance in Q3 2024 shows resilience in its outlet business, with certain subcategories performing well despite overall revenue decline [1] - The company is actively developing its duty-free business, which began operations in January 2023, contributing to its long-term growth strategy [1] - Adjustments to revenue and profit forecasts for 2024-2026 reflect ongoing challenges in offline consumption, with projected revenues of 113.3 billion, 119.2 billion, and 125.9 billion yuan respectively [1] Summary by Sections Financial Performance - For the first three quarters of 2024, Wangfujing reported revenues of 8.499 billion yuan, a year-on-year decrease of 8.27%, and a net profit of 427 million yuan, down 34.13% [1] - Q3 2024 alone saw revenues of 2.464 billion yuan, a decline of 14.61%, while net profit increased by 2.53% to 134 million yuan [1] - The company's gross margin in Q3 2024 was 38.29%, down 1.09 percentage points year-on-year, attributed to declining revenue and newly opened stores [1] Business Segments - The outlet segment showed a sales increase of 15.08% in Q3 2024, while department stores and shopping centers experienced declines of 19.66% and 4.86% respectively [1] - Digital product sales grew nearly 28%, and categories like outdoor sports and trendy fashion showed strong market performance [1] Cost and Profitability - The overall expense ratio increased by 2.63 percentage points to 31.57% in Q3 2024, with sales and management expenses rising [1] - Non-recurring gains significantly impacted profitability, with non-operating income of 950 million yuan in Q3 2024 compared to a loss of 10,000 yuan in the same period last year [1] Future Projections - The report projects a gradual recovery in revenue and profit, with net profits expected to reach 5.18 billion, 5.73 billion, and 6.38 billion yuan for 2024-2026 [1] - The current stock price corresponds to price-to-earnings ratios of 34.5, 31.2, and 28.0 for the respective years [1]