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Casual clothing "mid-term examination" : performance collective decline, transformation far water difficult to solve near thirst

Jul. 28, 2022

As of July 26, Semir, MetersBonwe, Peacebird and other casual apparel enterprises have been disclosed half-year performance forecast, a number of brand performance decline. Among them, Semir, Peacebird, Lancy shares net profit fell more than 60%; MetersBonwe, continuous loss. In fact, according to the data of previous financial statements, traditional casual clothing enterprises, mainly based on offline channels and large-scale development, are experiencing a period of transformation pain.

Results the landslide

According to financial information, in the first half of 2022, MetersBonwe apparel, Soyute respectively showed losses. Among them, MetersBonwe clothing is expected to lose 620 million - 680 million yuan, the amount of loss has expanded. Soyute expects a loss of 500 million yuan to 700 million yuan, 62.56% to 47.58% lower than a year earlier.

In view of the performance loss, Soyute, MetersBonwe clothing attributed to the impact of the epidemic. MetersBonwe said in its earnings forecast that due to the impact of the epidemic, the company's logistics headquarters in Pudong, Shanghai, could not deliver goods to offline stores and online shopping in China for about two months, resulting in a decline in the company's operating revenue and operating profit. At the same time, during the epidemic period, some franchisees had poor performance, overdue repayment and the aging of receivables became longer, and the company incurred credit impairment losses, which had a great impact on the net profit of the first half of the year.

Soyute affected by the pandemic and the company money is tight, liquidity shortage, lead to the company and the subsidiary more financial institutions loans overdue default, many financial institutions have already filed a lawsuit or arbitration, and apply for property preservation, the company and the subsidiary part of the bank account by the people's court freezes, more land property and equity investment and other assets seized by a people's court, The company's credit damage, financing difficulties, customer and supplier loss, have a great impact on the company's business development.

In addition to the above two losses, with children's wear business against the trend of growth of Semir clothing, light transformation more successful Peacebird, cross-border medical beauty Lancy shares have also fallen sharply.

Semir Apparel's first-half net profit is expected to decrease by 80.46% to 86.47%. PeaceBird net profit is expected to fall about 68 percent. Lancy shares net profit is expected to fall 87.14% to 91.43%.

In addition to the impact of the epidemic on sales, Semir Apparel increased procurement costs due to the rise in raw material prices in the supply chain, and increased sales promotion efforts, resulting in a decline in gross profit margin. Fixed expenses such as rent and employee salary of Peace Bird's direct stores are relatively large, and the decline in retail performance leads to a significant decline in the company's non-net profit.

Lancy shares in the performance forecast said that in 2021, the new opening of a number of women's clothing stores and the new opening of a number of medical beauty institutions, resulting in the current period of selling and administrative expenses increased year-on-year by a large margin.

"The overall decline of the casual apparel industry, in addition to the overall contraction of offline channels and poor sales caused by the epidemic, is also due to the impact of a number of low-cost popular brands rising online, which makes the development of large-scale production brands such as Semir and Peace Bird not good." Added Weixiong Cheng, an independent apparel industry analyst.

On the decline in performance related questions, Beijing Business Daily reporters to Peace Bird, Semir interview, but did not receive a response to the press release.

The transformation of the rescue

In fact, due to the impact of the epidemic and the pressure on performance, all enterprises are constantly transforming themselves.

In Cheng Weixiong's opinion, both Semir's focus on children's clothing and Peace Bird's development toward younger generation are on the right track. Such a transformation means more segmentation and precision, and the corresponding consumer groups are also more precise. For Semir apparel, Peace Bird and other enterprises, there is also a certain amount of capital to promote the development of transformation for a long time. As long as you can persist, the transformation effect will be reflected, but it is difficult to reflect in a short time.

In the opinion of insiders, casual clothing has been in a development bottleneck in the past two years. Domestic casual clothing brands are far from enough in terms of new speed, product innovation and research and development, and were once squeezed by foreign fast fashion. Nowadays, although various brands are constantly seeking for transformation, but the transformation needs a long period of time, for the current casual clothing brands, perhaps far water cannot quench the thirst.

Source: Beijing Business Daily

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