361 DEGREES INT. (01361) 1Q2022 retail sales growth of e-commerce products accelerated June 15, 2022 145

PSR Recommendation: ACCUMULATE Status: Initiation
Target Price: HKD4.43

2021 results beat consensus
During 2021FY, 361 Degrees International Limited (361 Degrees) recorded a revenue of
RMB5,933.5mn (2020: RMB5,127mn), increasing 15.7% YoY, slightly below our estimates of
RMB6,040mn but roughly in line with consensus estimates RMB5,922mn. Profit attributable
to the equity shareholders of the Company was RMB601.7 million, increase of 45% and
39.2% by compared with 2020 and 2019 respectively, above our and consensus estimates of
RMB507.4mn and RMB549.0mn respectively. Net margin was up by 2ppt YoY to 10.1%.
The revenue of footwear products and clothing products were RMB2,532mn (accounting for
42.7% of the overall revenue) and RMB2,147mn (accounting for 36.2% of the overall
revenue), an increase of 21.7% and 7.3% YoY. By adjusted the upgrade of product mix by
launching a variety of new products with a higher average wholesale price (AWP) and drove
the revenue growth from the e-commerce business, the AWP of footwear and apparel
products are back to pre-epidemic levels, increased by 4.4% and 2.3% YoY. In addition, the
sales volume of footwear and apparel products increased by 16.6% and 4.8% YoY,
respectively. This was mainly due to the recovery in the market and continuous brand image
enhancement as well as introducing high-quality new products. The sales volume of the
accessories edged down by 0.8% YoY but the AWP of the accessories increased by 31.2% YoY
which led to a YoY increase of 30.3% in the revenue to RMB69mn from the sales of
accessories. Also benefited from the recovery of the market, the revenue from 361 Degrees
Kids for the year continued to grow, recording a YoY increase of 18.7% to RMB1,107mn, and
accounted for approximately 18.7% of the total revenue during the year. The growth was
attributable to a YoY increase of 18.4% in the sale volume of products and a YoY increase of
0.2% in AWP.

About the author

Profile photo of Eric Li

Eric Li

李浩然先生(Eric Li) 高級分析師 現任現為輝立証券持牌高級分析師,曾任職股票基金、家族辦公室及證券公司等,擁有多年的證券研究部門從業及投資經驗,並先後於香港最暢銷的財經媒體撰寫投資專欄。畢業於香港理工大學電子計算系。 Eric is currently a licensed research analyst at Phillip Securities. Prior to joining Phillip Securities, he has years of equity research and investment experiences in asset management company, family office and securities company. Meanwhile, he has written investment columns in Hong Kong`s best-selling financial media for years. He holds Bachelor of Arts in Computing from The Hong Kong Polytechnic University.

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