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新鲜 便宜 舒适 便利. . .Fresh Inexpensive Comfortable Convenient. . .
Stock code: 6808
Financial Results Announcement
Six Months ended 30 September 2021
Financial Results Announcement
Six Months ended 30 September 2021
Speakers
Strategy Progress
Operating Environment
Financial Review
Q&A
Expansion Status
Financial Results Announcement
Six Months ended 30 September 2021
新鲜 便宜 舒适 便利 Fresh Inexpensive Comfortable Convenient. . . . . .
Financial Results Announcement
Six Months ended 30 September 2021
Kevin Lin Desory Wan
Chief Financial Officer
Chief Executive Officer
and
Executive Director
Xiaobei Gu
Head of
Investor Relations
3
Financial Results Announcement
Six Months ended 30 September 2021
新鲜 便宜 舒适 便利 Fresh Inexpensive Comfortable Convenient. . . . . .
4
OPERATING
ENVIRONMENT
Financial Results Announcement
Six Months ended 30 September 2021Operating Environment
8.2%
-20.5%
4.6%
34.2%
2.5%
25.8%
3.0%
25.2%
11.7% 7.3%
30.6%
5.1%
-30%
-20%
-10%
0%
10%
20%
30%
40%
1-2 3 4 5 6 7 8 9 10 11 12 1-2 3 4 5 6 7 8 9 10 11 12 1-2 3 4 5 6 7 8 9
2019 (by month) 2020 (by month) 2021 (by month)
TTL Retail Sales Growth % Online Physical Products Sales Growth %
Growth of Total Retail Sales of Consumer Goods & Online Physical Products Consumer Confidence Index (CCI)
123.7
126
124.1123.4
125.9
122.4
126.6
118.9
122.2
116.4
112.6
117.2
116.4
124
122.1
127
121.5
122.8
117.8
117.5
110
114
118
122
126
130
1 2 3 4 5 6 7 8 9 10 11 12 1 2 3 4 5 6 7 8 9 10 11 12 1 2 3 4 5 6 7 8
2019 (by month) 2020 (by month) 2021 (by month)
CCI
Growth Rate of Consumer Price Index (CPI) Sales Growth Rate of China Top 100 Key Retailers
101.3
97
135.2
-46.9
21.9
-5.2
0.7
-10
-5
0
5
10
15
20
25
-50
0
50
100
150
1 2 3 4 5 6 7 8 9 10 11 12 1 2 3 4 5 6 7 8 9 10 11 12 1 2 3 4 5 6 7 8 9
2019 (by month) 2020 (by month) 2021 (by month)
Pork CPI Food CPI CPI
-32.8%
-12.4%
-15.2%
-7.0%
-4.2%-1.8%
7.1%
0.7%
2.6%
30.7%
7.4% 8%
3.3%
-6.8%
-0.8%
-40%
-20%
0%
20%
40%
1-4 5 6 7 8 9 10 11 12 1-4 5 6 7 8 9
2020 (by month) 2021 (by month)
Sales Growth Rate of China Top 100 Key Retailers
Source: (1), (2), (3) from National Bureau of Statistics of China. (4), (5) from the China National Commercial Information Center (CNCIC).
5
(1) (2)
(3) (4)
(5)
4.4%
10.1%
Financial Results Announcement
Six Months ended 30 September 2021
新鲜 便宜 舒适 便利 Fresh Inexpensive Comfortable Convenient. . . . . .
6
EXPANSION
STATUS
Financial Results Announcement
Six Months ended 30 September 2021
新鲜 便宜 舒适 便利 Fresh Inexpensive Comfortable Convenient. . . . . .
7Expansion Status
Covering 236 cities cross 29 provinces, autonomous regions
and municipalities. Secured 26 sites and 16 sites to open
hypermarkets and superstores respectively, of which 23
hypermarkets and 9 superstores were under construction.
During the six months ended 30 September 2021, the Group has
opened 3 hypermarkets and 37 mini stores, and closed 2 hypermarkets.
As of 30 September 2021, the Group had 491 hypermarkets, 6
superstores and 68 mini stores.
Xinjiang Uygur
Autonomous Region
Sichuan
GansuShaanxi
Hubei
Ningxia
Autonomous Region
Guangdong
Fujian
Zhejiang
JiangsuHenan
Shanxi
Inner Mongolia
Autonomous Region
(west)
Inner Mongolia
Autonomous
Region
(north)
Liaoning
Taiwan
Qinghai
Tibet
Yunnan
Hunan
Anhui
Jiangxi
Heilongjiang
Hebei
BeijingTianjin
Shandong
Jilin
Chongqing
Guizhou
Hainan
Shanghai
Guangxi
Zhuang
Autonomous
Region
RegionNo. of stores GFA (sqm)
(as of 30 September 2021) (as of 30 September 2021)
Hyper-
market
Super-
store
Mini
StoreTotal Hypermarket Superstore
Mini
StoreTotal
Eastern
China186 4 54 244 5,470,660 51,895 13,745 5,536,300
Northern
China52 1 0 53 1,358,286 10,283 0 1,368,569
N-Eastern
China53 1 0 54 1,675,664 5,850 0 1,681,514
Southern
China98 0 0 98 2,422,061 0 0 2,422,061
Central
China76 0 14 90 1,975,635 0 4,934 1,980,569
Western
China26 0 0 26 691,724 0 0 691,724
Total 491 6 68 565 13,594,030 68,028 18,679 13,680,737
Store no. breakdownGFA breakdown
Owned, 32.6%
Leased, 67.4% Owned,
23.3%Leased, 76.7%
Financial Results Announcement
Six Months ended 30 September 2021
STRATEGY
PROGRESS
新鲜 便宜 舒适 便利 Fresh Inexpensive Comfortable Convenient. . . . . .
8
Financial Results Announcement
Six Months ended 30 September 2021
• Create incentives for customers to shop offline and become offline experience centers:
Focus on categories that cannot be substituted online. Highlight the display such as seafood tank, poultry stall, meat
stall.
Focus on shopping experience that cannot be substituted online by creating hustle-and-bustle shopping
atmosphere, and selling products through associated display.
Adjust tenant mix and turn gallery into traffic inlet. At present, the tenants with traffic inflow accounts for
approximately 40% of total.
• Upgrade store warehouses, establish warehouse-based stores, and become logistics
fulfillment centers of online business:
Despite the impact from community group buying (“CGB”) business and intensified peer competition, the online
order keeps a continuous growth of more than 25%.
Enhance fulfillment capability of Tmall Inventory Sharing half-day-delivery (“猫超半日达”) business by sharing quick-
picking warehouses and conveyor-belt system in more stores.
Become the core supply chain service provider of Alibaba Group’s CGB business.
• The multi-format and omini-channel development:
Cautious expansion of RT-Super and accelerated expansion of RT-Mini.
The revenue of RT-Mini reached expectations and its loss narrowed.
By leveraging the supply chain scale advantage of hypermarkets, RT-Super will form a individual supply chain
system and provide support to hypermarkets afterwards.
Accelerate to establish supply chain capability of fresh product, facilitate direct sourcing from farm bases, and
deploy processing centers.
Strategy Progress 9
Financial Results Announcement
Six Months ended 30 September 2021Strategy Progress
Adhere to the established strategy, focus on capability building and create customer
value in the second half of the fiscal year.
• Improve supply chain capability of fresh products
Accelerate to construct processing centers of fresh products, with a coverage of approximately half
of the hypermarkets.
Fruits and vegetables will gradually adopt direct sourcing from the far-fields and near-fields.
Establish farm-based procurement system.
• Enhance customer operating capability
Digitization of the membership system.
Establishment of the marketing and content system.
• Continue to explore business model of multi-formats
Upgrade remodeling of hypermarket to version 2.0.
Pilot RT-Super and RT-Mini in specific cities.
10
Financial Results Announcement
Six Months ended 30 September 2021
新鲜 便宜 舒适 便利 Fresh Inexpensive Comfortable Convenient. . . . . .
11
FINANCIAL
REVIEW
Financial Results Announcement
Six Months ended 30 September 2021
新鲜 便宜 舒适 便利 Fresh Inexpensive Comfortable Convenient. . . . . .
12Financial Highlights
For the six months ended 30 September 2021
RMB in million 2021 2020 Change
Revenue (1)41,534 43,706 -5.0%
Gross Profit 10,933 11,748 -6.9%
Gross Profit Margin 26.3% 26.9% - 0.6ppt
EBIT 560 1,631 -65.7%
EBIT Margin 1.3% 3.7% - 2.4ppt
Profit for the period 112 905 -87.6%
Net Profit Margin 0.3% 2.1% - 1.8ppt
Profit attributable to equity shareholders 117 833 -86.0%
Earnings per share
-Basic and diluted (RMB) (2) 0.01 0.09
Note: The Group has initially applied HKFRS 16 at 1 January 2019.
(1) In our electronic appliance department, the business model was changed from self-operation to consignment from August 2018. Since then, only consignment fees received have been recognized in
revenue instead of gross sales.
(2) The calculation of basic and diluted EPS is based on the weighted average number of 9,539,704,700 ordinary shares in issue during the period.
Financial Results Announcement
Six Months ended 30 September 2021
2015 2016 2017 2018 2019 2020 PreviousPeriod
ReportingPeriod
3,144 3,345 3,545 3,808 4,078 3,502 1,711 1,773
93,270 97,096 98,775 95,551 91,279 91,984
41,995 39,761
Rental Income Sales of Goods
2015 2016 2017 2018 2019 2020 PreviousPeriod
ReportingPeriod
22,463 23,981 24,674 25,119 25,731 24,343
11,748 10,933
Gross Profit
23.3%23.9% 24.1%
25.3%
27.0%
25.5%
26.9%26.3%
GP Margin
13
Revenue Gross Profit and Margin
RMB (million) RMB (million)
Note:
(1) In our electronic appliance department, the business model was changed from self-operation to consignment from August
2018. Since then, only consignment fees received have been recognized in revenue instead of gross sales.
(2) Previous Period: the six months ended 30 September 2020, hereinafter the same.
(3) Reporting Period: the six months ended 30 September 2021, hereinafter the same.
96,414100,441
102,32099,359
95,357 95,486
43,706
41,534
Financial Highlights
(2) (3)
(1)(1)
(2) (3)
Financial Results Announcement
Six Months ended 30 September 2021
4.2%4.4%
4.9%4.7%
5.1%4.9%
3.7%
1.3%
EBIT Margin
14
Operating Profit Net Profit and Margin
RMB (million) RMB (million)
2015 2016 2017 2018 2019 2020 PreviousPeriod
ReportingPeriod
4,012 4,413
5,003 4,698 4,890 4,664
1,631
560
EBIT
2015 2016 2017 2018 2019 2020 PreviousPeriod
ReportingPeriod
2,328 2,500 2,934
2,700 3,045 3,046
905
112
Net Profit
2.4% 2.5%
2.9%2.7%
3.2% 3.2%
2.1%
0.3%
Net Profit Margin
Financial Highlights
Note: The Group has initially applied HKFRS 16 at 1 January 2019 using the full retrospective approach. Under this approach, figures in the 4 years earlier than 2019 (i.e. since 2015) are restated
retrospectively.
(1) Showing profit for the period, i.e. including the non-controlling interests.
(2) In our electronic appliance department, the business model was changed from self-operation to consignment from August 2018. Since then, only consignment fees received have been recognized
in revenue instead of gross sales.
(1)
(2)
(2)
Financial Results Announcement
Six Months ended 30 September 2021
1.2%1.1% 1.1% 1.2% 1.2%
1.3% 1.3%
1.1%
Operating Lease Rental as % of Revenue
8.5%9.0% 9.2%
10.1%10.8%
10.3%10.9%
11.9%
Staff Cost as % of Revenue
2015 2016 2017 2018 2019 2020 PreviousPeriod
ReportingPeriod
2,633 2,876 2,895 2,847 2,807 2,480 1,209 1,175
16,565 17,565 18,406 19,317 19,523
19,118
9,524 9,887
Administrative Expense Selling and marketing expenses
19.9%20.5% 20.8%
22.3%23.4%
22.6%
24.6%
26.6%
Total Opex as % of Revenue
15
Expenses Operating Lease Charges
RMB (million) RMB (million)
2015 2016 2017 2018 2019 2020 PreviousPeriod
ReportingPeriod
1,114 1,089 1,142 1,158 1,120 1,225
551 458
Operating Lease Rental
Staff CostRMB (million)
2015 2016 2017 2018 2019 2020 PreviousPeriod
ReportingPeriod
8,163 8,999 9,421 10,016 10,297 9,856
4,740 4,927
Staff Cost
Note: The Group has initially applied HKFRS 16 at 1 January 2019 using the full retrospective approach. Under this approach, figures in the 4 years earlier than 2019 (i.e. since 2015) are restated retrospectively.
(1) In our electronic appliance department, the business model was changed from self-operation to consignment from August 2018. Since then, only consignment fees received have been recognized in revenue
instead of gross sales.
(1)
(1)
Financial Highlights
20,441
19,198
21,301
22,164 22,330
21,598
10,733
11,062
(1)
Financial Results Announcement
Six Months ended 30 September 2021Balance Sheet 16
Working Capital Days Net Cash Position
2015 2016 2017 2018 2019 2020 2021/9/30
5,978
8,110
10,492
13,483 13,267
17,476
20,144
Net Cash
(1) (2)
(3) (4)
Note:(1) The inventory turnover days and trade payable turnover days are calculated on average balances of inventory and trade payable, together with the cost of inventory during past 12 months.
Data has been restated since 2015.
(2) The balance of net cash position is calculated as the sum of cash and cash equivalents, financial assets measured at FVPL and time deposits minus bank loans.
(3) For the six months ended 30 September 2020 (“Previous Period”), the inventory turnover days and trade payable turnover days are calculated on average balances of inventory and trade
payable, together with the cost of inventory during past 6 months.
(4) For the six months ended 30 September 2021 (“Reporting Period”), the inventory turnover days and trade payable turnover days are calculated on average balances of inventory and trade
payable, together with the cost of inventory during past 6 months.
RMB (million)
2015 2016 2017 2018 2019 2020 PreviousPeriod
ReportingPeriod
49 53 55 57
65 65 60 59
81 84 85
88 87
78 82 81
Inventory Turnover Days Trade Payable Turnover Days
Financial Results Announcement
Six Months ended 30 September 2021Investment Return 17
CAPEX ROE
RMB (million)
Note:
(1) ROE is calculated by dividing net profit for the period by total equity amounts as at the end of the period.
(2) The Group has initially applied HKFRS 16 at 1 January 2019 using the full retrospective approach. Under this approach, figures in the 4 years earlier than 2019 (i.e. since
2015) are restated retrospectively.
(1) (2)
2015 2016 2017 2018 2019 2020 ReportingPeriod
4,624
3,744
2,141
2,590
1,871 2,044
840
CAPEX
2015 2016 2017 2018 2019 2020 2021/9/30
11.4% 11.6%
13.2%
11.4%12.0%
11.2%
0.4%
ROE