< p > Lining released the annual performance report for 2013. In the 2013 fiscal year, its income was RMB 5 billion 820 million yuan, gross profit was 2 billion 594 million yuan, up 3.2% compared with the same period last year.

Although the net loss of RMB was 390 million yuan in 2013, it had narrowed considerably compared to 2012.

Li Ning Co said that the change plan has been carried out halfway, the business revival is almost completed, and the investment of a target= "_blank" href= "//m.pmae.cn/" > clothing > /a > retail operation platform has shown positive results.

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Lining, who is at the stage of deep reform, said that the first stage of his pformation plan has achieved many desirable results, such as direct retail accounts for about 1/3 of Lining's brand sales; the proportion of new products in channel inventory has risen to the level of 2011; and the number of new products sold in the second half of 2013 has increased by the number of units per year.

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< p > Haitong international has interpreted Lining's change from multiple business data. It is believed that the effectiveness of Lining's pformation has begun to emerge. In 2014, it will maintain its buying rating by taking profits as the key.

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< p > Haitong international pointed out that, thanks to the increase of gross profit margin of Lining brand and red double happiness, the gross gross profit margin was significantly improved to 44.5% compared with 37.7% in 2012, of which the main brand Lining gross margin rose from 38.7% to 45.3%, mainly from the provision of inventory returns and the increase in self occupied stores with higher profit margins.

The improvement of administrative expenses mainly came from the provision of accounts receivable and no asset impairment. However, the proportion of distribution fees increased by 6.8 percentage points to 45.9%, mainly due to the increase in sponsorship of basketball projects and the signing with NBA star Wade.

By the end of 2013, 519 shops were closed to Lining, and the number of shops had been reduced to 6434 from 2012 at the end of 2012. Among them, the clearance of stores in the second half of 2013 was significantly slower than that in the first half of the year.

Taking into account the cost of CBA sponsorship in 2014, the decline in TV advertising expenses and the significant reduction in stores, Haitong International believes that Lining's operating expenses will decline in 2014, and gross margin will also be further improved due to the decrease in old stocks and the increase of new products.

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< p > pformation to fast fashion retail direct sales mode.

Haitong international pointed out that, < a href= "//m.pmae.cn/news/index_c.asp" > Lining < /a >, the company has changed from 100% wholesale / futures mode to the current direct sales account for more than 30%.

Since 2013, the company has adopted the "ordering + quick replenishment + quick response" order mode to shorten the time of replenishment, thus improving the stock structure and optimizing the store network. The order volume has been warmer.

Benefiting from the acceleration of refund and supplement, the number of accounts receivable decreased by 9 days to 89 days in 2013, and the turnover days increased by 15 days to 104 days, mainly due to an increase in self employment.

The cash flow has basically reached balance of payments and net cash is about 230 million yuan (850 million yuan net liabilities in 12 years).

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< p > sales of new products are strong and inventory structure is improved.

In the second half of 2013, the sales volume of self run shops in the same store recorded a high growth rate, and the proportion of revenue contribution increased to more than 30%, and the terminal discount rate improved to 7-8. Among them, the discount rate of the products has reached the normal level and the sales rate has been around 40%.

The Li Ning Co management target will further improve the selling rate to more than 50% in 2014.

The company's Treasury sales ratio improved to less than 7 months, of which the old product inventory ratio decreased to 50%, and its Treasury sales ratio also dropped to 4 months.

The continuous improvement of distribution channels and optimization of inventory structure will further improve store efficiency and profitability.

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< p > change has achieved initial success and profit turning point has emerged.

Haitong International believes that since 2012, Li Ning Co's investment in the recovery plan will gradually generate positive returns, which will be reflected in the improvement of financial performance and cash flow. In 2014, it will pay attention to < a href= "//m.pmae.cn/news/index_cj.asp" > profit < /a > and cash flow promotion.

Thanks to the recovery of performance and profit margins, Haitong International believes that Li Ning Co's net profit in 2014 will be about 110 million yuan.

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