1H2012 results
Revenue rose 33%, but recurrent net profit grew by 8%, due to gross margin decline, higher expenses and a higher effective tax rate.
SSSG for self-owned stores rose by 17% in 1H12. Thoughhealthy, such growth is a slow-down from FY2011’s 18.2%.
We estimate SSSG were 11.9% in 1H11 and 24.5% in 2H11.
Steady store additions in 1H12. The company added threestores including Mianyang (greenfield, Dec 2011), Lanzhou (acquisition, Nov 2011) and Channel 1 in Shanghai(acquisition, Nov 2011).
Operating margin (over GSP) eroded to 6.5%. Concessionaire rate dropped 0.2% YoY, and 0.6% HoH, while direct sales margin fell 0.8% YoY and 1.7% HoH. Operating expenses (including salaries, leasing, depreciation, other) as % of GSP increased by 0.2ppt YoY. Operating margin was 7.8% in 1H11 and 12.0% in 2H11.