"Heilan House, a man's wardrobe", this highly directional advertising slogan has allowed Heilan House to quickly gain popularity and compete in the fiercely competitive men's clothing market. It is reported that its 2019 annual general meeting of shareholders will be held on May 20. Before that, let's take a look at its transcript.
Net profit fell by more than 70% in the first quarter
Public information shows that Heilan Home (full name "Heilan Home Co., Ltd.") was established in 1997 and is part of the Heilan Group. Its subsidiaries were listed on the Shanghai Stock Exchange in 2014. It owns brands such as men's clothing, women's clothing, children's clothing, professional clothing and lifestyle home furnishings, including Heilan Home, Sancano, Heilan Preferred Lifestyle Store, OVV, Black Whale, Boys and Girls, and Ying's. The main business model is the chain business model.
In the first quarter of 2020, operating income was 3.848 billion yuan, compared with 6.089 billion yuan in the same period last year, a year-on-year decrease of 36.80%; net profit attributable to shareholders of listed companies was 295 million yuan, compared with 1.21 billion yuan in the same period last year. yuan, a year-on-year decrease of 75.59%.
The reasons for both revenue and net profit decline are expected.
Heilan House stated in its first quarter report of 2020 that the new crown epidemic was the main reason.
Before the text of the 2019 annual report, Zhou Lichen, vice chairman of Heilan House, published a "Letter to Shareholders". He stated in the letter: "Although I feel stressed in the face of the new situation in 2020, Our confidence remains unchanged. We face the poor performance in the first quarter due to the impact of the epidemic. We believe that challenges will always exist, and the epidemic is just a magnifying glass to test whether our past accumulation is solid."
"Young Marshal" The road to succession is uneven
Public information shows that Zhou Lichen is the son of Zhou Jianping, chairman and general manager of Heilan Group and chairman of Heilan House. He was born in 1988 and graduated from Tsinghua University in 2010. He joined Heilan Group in 2015 and successively took over the advertising department, product center, information center and e-commerce departments. He has been the vice president of Heilan Group since 2014, and the vice chairman of Heilan House since March 2015. In 2017, he In February of that year, he was appointed as the president of Heilan Group.
In its early days, Heilan House left consumers with a stereotype of being rustic and old-fashioned, so it was nicknamed the "old man's wardrobe". The rise of the top academic "Young Marshal" has accelerated the transformation of Hailan House.
In order to capture the young consumer market, Heilan House has implemented a series of major actions. For example, it has contracted the exclusive clothing brand sponsorship of "Running Brothers" and "The Biggest Brain" for three consecutive seasons, and subsequently sponsored "Mars Intelligence Agency" and "If You Are the One", using popular niche actors Chen Xiao and Lin Gengxin as spokespersons, and cooperated with the animated classic IP "Havoc in Heaven" 》Jointly launch a series of products...
Today, Heilan House’s business has expanded to women’s clothing, children’s clothing, and even started selling wardrobes.
In the three years since this "young commander" took office, what is the specific performance of Heilan House?
In 2017, operating income was 18.2 billion yuan, a year-on-year increase of 7.06%; net profit attributable to shareholders of listed companies was 3.329 billion yuan, a year-on-year increase of 6.60%.
In 2018, operating income was 19.09 billion yuan, a year-on-year increase of 4.89%; net profit attributable to shareholders of listed companies was 3.455 billion yuan, a year-on-year increase of 3.78%.
In 2019, operating income was 21.97 billion yuan, a year-on-year increase of 15.09%; net profit attributable to shareholders of listed companies was 3.211 billion yuan, a year-on-year decrease of 7.07%.
To sum up, it can be seen that the growth rate of revenue and net profit declined in the first two years. In the third year, the growth rate of revenue increased, but the net profit declined year-on-year. The road after Zhou Lichen took over was not smooth.
“Falling in love” with Alibaba and JD.com and “marrying” with Tencent
Heilan House, which mainly focuses on offline, has made efforts online in recent years and has settled in Tmall, JD.com and Weibo. Platforms such as Pinhui and WeChat mini programs have "fallen in love" with Alibaba, JD.com, and Tencent, and finally "married" Tencent.
On August 13, 2017, Jack Ma personally visited Heilan Group, accompanied by father and son Zhou Jianping and Zhou Lichen.
It is reported that Jack Ma visited Heilan Home e-commerce, smart warehousing, Heilan headquarters independent brand store and Heilan Horse Culture Museum, and also watched Heilan dressage equestrian performance.
On August 30, 2017, under the witness of Alibaba Group CEO Zhang Yong and Heilan House Chairman Zhou Jianping***, Heilan House signed a contract with Alibaba’s Tmall. Based on Tmall With the new retail solutions provided, the two parties will conduct in-depth cooperation in new retail aspects such as new product launches, brand building, channel management, product innovation, big data empowerment, consumer operations, and online and offline omni-channel integration.
On January 17, 2018, Liu Qiangdong posted: "The two most important things for Chinese men in 2018: go to JD.com and buy Heilan; being a man is very simple! I am the spokesperson for Heilan House!" announced He became the spokesperson of the Heilan Home flagship store on JD.com.
On the evening of February 2, 2018, Heilan House issued an announcement stating that Rongji International Co., Ltd. (hereinafter referred to as "Rongji"), the company's controlling shareholder acting in concert, and Shenzhen Tencent Puhe Co., Ltd. The partnership (hereinafter referred to as "Tencent Puhe") signed the "Share Transfer Agreement". After negotiation, Rongji plans to transfer 238,549,618 shares of the company to Tencent Puhe at a price of 10.48 yuan per share. The total share transfer price is RMB 2.5 billion. The shares transferred this time account for 5.31% of the company's current total share capital.
On the same day, Jiangyin Heilan Home Investment Co., Ltd., a wholly-owned subsidiary of Heilan Home, signed the "About ***" with Linzhi Tencent Technology Co., Ltd. and Ningbo Zhixin Investment Management Partnership in Shenzhen. Framework Agreement on the Establishment of Industrial Investment Funds. The investment direction and purpose of the industrial investment fund established by all parties is: to invest in clothing-related industrial chains, excellent clothing and apparel brands, clothing manufacturing and other companies based on the strategic development policy of Heilan House. The target size of the industrial investment fund is set at RMB 10 billion.
Learn from and challenge "Qianlang" Uniqlo
In addition to being a competitor of Heilan House, Uniqlo can also be regarded as the latter's "master".
In early 2002, Zhou Jianping, the founder of Heilan House, went to Japan for an inspection. One of the companies he inspected was UNIQLO. He was deeply moved by its business model of "buying clothes in bulk" and secretly made up his mind to turn it into a business model. Bring the "UNIQLO model" back to China. In September of that year, Heilan Home’s first mass-market store, Nanjing Zhongshan North Road store, opened.
On September 3, 2014, Zhou Jianping made a high-profile announcement that Heilan House would compete with Uniqlo!
The "apprentice" challenges the "master", and the "back wave" challenges the "front wave". What will happen next?
On Double 11 in 2017, Heilan House successfully won the first place in Tmall men’s clothing industry with a turnover of over 400 million yuan, surpassing Uniqlo in one fell swoop.
In April 2019, Heilan House opened its first store in Japan. Previously, Heilan Home has opened 27 overseas branches in Malaysia, Singapore, Thailand and Vietnam.
However, there is still a big gap between Heilan House and Uniqlo.
The first quarter financial report of fiscal year 2020 released by Uniqlo parent company Fast Retailing Group showed that in the three months ended November 30, 2019, its sales were 623.4 billion yen (approximately RMB 39.4 billion yuan).
The 2019 annual report of Heilan House shows that the operating income in the fourth quarter of 2019 was 7.281 billion yuan.