Youngor's net profit fell by more than 30% last year will return to the apparel industry

"Troika" has sighed with regret for 2011. Not only real estate investors and the majority of investors, Youngor's major businesses in finance and real estate are listed in the main business.

In fact, Youngor’s chairman, Li Rucheng, has been mentally prepared. He was openly public to the media last year. 2011 was a very difficult year for Youngor, and two of the “troikas” were trapped. Sure enough, the Younger's 2011 annual report announced today showed that total operating revenue, operating profit, total profit, and net profit attributable to shareholders of listed companies decreased by 20.49%, 28.29%, 28.40%, and 34.03% over the same period last year.

Right now, returning to the main business of clothing has become an unavoidable task.

Sixty percent of the financial investment net profit fell by one-third of the stock index, and it was unavoidable for Younger, who had a large gold production, to make a major hit.

In 2011, Youngor's financial investment business realized a net profit of 48,698,200 yuan, a decrease of 75,843,700 yuan over the previous year, 1,245.4129 million yuan, a decrease of 60.90%.

At the same time, the main method of Youngor's intervention in equity investment is still to participate in the private placement of listed companies. Youngor has invested 272497.70 million yuan to participate in the wide 100 shares, Hisun Pharmaceutical, Haili De, Xing Rong Investment, Sheng Yi Technology, Jinggong Technology, Yuntianhua, Shengnong Development, Oriental Zirconium, Xinjiang Zhonghe, gold , Huaxin Cement and Shanxi Coal International and other 13 listed companies issued additional shares.

Youngor reported in the third quarter of 2011 that 70% of its operating profit of 1.8 billion yuan was due to the return on equity investment.

Affected real estate regulation has incorporated real estate business into listed companies for nearly a decade. In 2009, Youngor's real estate business accounted for 42% of the company's total revenue. In 2010, Youngor's industry contributed 47% of its total revenue, accounting for nearly half of the total revenue.

But good times are no longer there. Affected by “the most severe real estate regulation in history” in 2011, Youngor’s real estate delivery due to cyclical factors decreased by RMB 3.234 billion, revenue and operating profit decreased by 46.94% and 32.12% year-on-year; cash recovery slowed, and the inflow decreased by 25.26 over the previous year. Billion, while the payment of land, construction funds, and taxes and fees increased by 2.304 billion yuan over the previous year.

According to incomplete statistics, the transaction volume of commercial housing in the main urban areas of these four cities fell by 15%, 23%, 53% and 24% respectively in 2011. During the reporting period, the company’s real estate tourism development business realized a business income of 3636.3046 million yuan, a decrease of 46.94% over the same period of the previous year, and a net profit of 571.5227 million yuan, a decrease of 15.86% over the same period of last year.

Li Rucheng said earlier that the performance of Youngor's real estate business in 2011 only accounted for one-third of the expected value.

Back to the apparel business real estate sluggish, the stock market back a decade ago. Returning to the main business of clothing became an inevitable choice for Youngor.

According to the annual report, Youngor sold the equity of Xinma Apparel last year to further reduce the export contracting business with lower gross profit margin. At the same time, the company took the wholly-owned subsidiary Xinma Garment International Co., Ltd. as the main entity, and acquired 25% of the 14 controlled subsidiaries of the main clothing production and marketing with the audited net assets at the end of 2010 at 753.7578 million yuan. After the acquisition was completed, the 14 companies became Youngor's wholly-owned subsidiary.

As of the end of last year, Youngor had a total of 2,302 retail outlets, an increase of 157 from the beginning of the year. In addition, group purchase, as a supplement to sales channels, accounts for 11% of domestic sales.

At the same time, Youngor has entered the transition from a production-oriented enterprise to a brand-operating enterprise. At present, the company has formed a pattern of YOUNGOR as the core, Mayor, Hart Schaffner Marx, GY and Hanma family of five brands diversified development.

However, can returning clothes allow Youngor to re-enter the growth channel?

Market analyst Ma Gang believes that Younger's return strategy is expected to have little effect in the short term. As a whole, the garment industry itself belongs to a slow-moving industry. The pattern of the garment industry is facing tremendous changes. The men's clothing market itself is sluggish, and the rent for shops is relatively low. The main problems such as high homogeneity and serious homogeneity have been plaguing the development of Chinese men's wear brands. In addition, due to factors such as the intensification of international competition and the obstruction of foreign trade, it is necessary to rely on the return to the main clothing industry to reverse Youngor’s current situation in a short period of time. The trend is still more difficult.

On the other hand, Youngor Garments, as the leading force in China's clothing brands, has its own advantages. This is mainly reflected in the control of the industrial chain, forming an industry from the upstream cotton, yarn, textile and other industries to downstream marketing and retailing. The vertical industry chain operated by branded clothing. In order to reverse the situation, Magang believes that Youngor's focus is to start with product design and tap into something with Chinese characteristics instead of blindly mimicking foreign brands.