Meituan 22Q1 income 46.27 billion yuan / + 25.0% yoy, operating income-5.58 billion yuan, after the aggravation of the epidemic, the market is more worried about the financial impact of short-term shocks, the company's actual performance shows resilience.Under the influence of the epidemic, although the two core businesses of takeout and arrival are inevitably affected, in terms of the trend, as long as the control of the epidemic is slightly improved, the business recovery will be flexible.
Flash purchase and other innovative business demand release growth is strong, although the overall pace of community group purchase business has slowed down, but the competition pattern has been obviously conducive to the head, matching the strategic significance of improving user ecology and cutting into e-commerce business.
Under this epidemic, Meituan further strengthened the minds of users, and at the same time showed the social value of the platform at a critical moment to the public to the government, which is of significant long-term significance.
Looking forward to Q2, the impact of the epidemic has been formed. Under the contraction of both supply and demand, the growth rate of takeout and arrival business is expected to be suppressed, among which the drag on arrival business is more obvious. On the profit side, the company focuses on high-quality growth, low subsidy rates and continuous optimization of operations in the context of the epidemic will push up phased profitability.
We believe that the company's operational resilience will promote the market to consolidate the recognition of its value, the marginal improvement of the superimposed policy is expected to continue to ferment, and the value bottom is formed.
CymbalTakeout is limited affected by the epidemic, with high-quality growth at the profit end.
The average daily volume of 22Q1 takeout business is 37.35 million orders / + 15.8% yoy, with revenue of 24.16 billion yuan / + 17.4% yoy, in line with expectations. Although affected by the escalation of epidemic prevention and control, and the company actively responded to the phased relief policies of the service industry and helped small and medium-sized businesses with operational difficulties in the epidemic areas, takeout business volume, income and profitability showed resilience. From a structural point of view, the company's delivery business distribution / commission income + 11.0% Universe 24.0% yoy, online marketing revenue + 20.4% yoy, single average advertising revenue (0.79 yuan) healthy growth.
At the profit end, the adjusted operating income of 22Q1 takeout business is 1.58 billion yuan / + 41.3% yoy, corresponding to 0.47 yuan per order, Adj OPM 6.5%, close to the upper limit of market expectations.
It is inferred that all 22Q1 takeout orders are subsidized to maintain a low level (estimated to be about 1.10 yuan per unit), mainly aimed at medium and high frequency users, and the takeout ATU/ATU frequency is + 10% and 15% compared with the same period last year. Thanks to the abundant supply of riders and the improvement of operational efficiency during the Spring Festival, the average distribution cost of 22Q1 is 7.8 yuan, down 0.20 yuan from the same period last year. Looking forward to 22Q2, since April, some areas with Shanghai as the core static management of external transport capacity has caused restrictions, merchants can not operate normally due to control policies, resulting in supply contraction, while the continuing impact of the epidemic on consumers' basic income and purchasing power is also facing a long-term impact, and the growth of takeout volume has been affected.
However, the consumption characteristics of rigid demand for takeout are obvious and the local impact is controllable. A trend of improvement has been observed since mid-May. With the resumption of offline commerce in Shanghai in June, supply and demand are expected to pick up together, and the unit volume of 22Q2 takeout business is expected to level off and increase slightly.
On the profit side, considering that the supply contraction of long-tail merchants is more obvious in the context of the epidemic, the decline in the proportion of low-customer unit price orders will further boost AOV levels, and the superimposed company strategy focuses on high-quality growth, continuous tightening subsidies and optimizing operations, which is expected to effectively hedge against the increase in one-time rider costs and merchant support expenses brought about by the epidemic, and OPM is expected to continue to improve year-on-year.
There is a significant differentiation in the arrival business before and after March, and the recovery period may be relatively longer than that in 2020.
22Q1 to the store, wine and travel income of 7.62 billion yuan / + 15.8% yoy; adjusted operating income of 3.47 billion yuan, Adj OPM 45.6% / + 3.9pcts yoy, continuing to hit a record high. Among them, the growth rate of arrival business from January to February was remarkable, and GTV increased by more than 30% year-on-year driven by holiday consumption, but after March, due to the strengthening of epidemic control, offline activities shrank sharply, merchants' CPC advertising budgets tightened, and store-arrival business suffered a significant impact.
The wine and travel business was also divided in March. The night volume between hotels increased by about 15% year-on-year, boosted by local consumption during the Spring Festival from January to February, but cross-regional mobility decreased significantly under the influence of the epidemic, and the overall single-digit volume among 22Q1 hotels declined. Among them, the proportion of night volume among Gaoxing hotels reached an all-time high of 17.4%.
Looking forward to Q2, the arrival business is still mainly subject to the rhythm of the complete recovery of offline commercial activities under the epidemic control policy, and the recovery trend has been basically established. However, offline merchants, especially small and medium-sized merchants, face greater pressure on their cash flow during the closure period, and it is judged that the period of return to normal growth channel or the comparable period after the epidemic in Wuhan in 2020 is longer than that after the epidemic in 2020, which still needs dynamic observation and further judgment combined with the time period of epidemic control.
At present, it is relatively clear that once the control of the epidemic is relaxed, the resilience of the wine and travel business will be reflected. In 22Q2, which is expected to be the most affected by the epidemic, the revenue of wine and travel business in hotels has dropped by more than 20% compared with the same period last year. OPM maintains about 40%, and is expected to continue to recover, but the strength and cycle of recovery depend on the pace of the development of the epidemic.
CymbalInvestment in new business is targeted, Meituan chooses UE for continuous improvement
22Q1's new business income is 14.49 billion yuan / + 47.0%, and the adjusted operating loss is 9.02 billion yuan, which is less than expected. We have always believed that under the background of logical verification of core business profits and continuous improvement of cash flow, the company has the ability to concentrate resources and funds into the excavation of more local life service demand scenarios, continue to expand the ecological value and network effect of the platform.
The company's retail business maintained a strong release of demand. 22Q1 Meituan flash orders / GTV increased by 70% / 80% compared with the same period last year, and the average daily order is expected to exceed 3.9 million, leading the industry in market share and UE level. Although there are still losses due to the expansion of the business office and the high subsidy rate, the high growth reflects that the demand has entered a period of rapid release.
Meituan's grocery shopping business actively participated in the guarantee and supply work, making every effort to ensure the implementation of the contract in the epidemic area, the order volume / GTV compared with the same period last year + 85% AOV 110%, the demand for hoarding drove up AOV and led to continuous improvement of UE.
Community group buying business, combined with grass-roots research feedback, we infer that its GMV in a single quarter is about 33.5 billion yuan, market share and Duoduo Buy vegetables are tied for the first echelon, with a loss of about 6 billion yuan per quarter. The loss rate continues to narrow from the previous quarter and is expected to remain. In the context of high-quality growth strategy, based on the dynamic evaluation of the efficiency of some large positions, the company decisively shut down provincial businesses that have little growth potential and are difficult to make profits in the long run. The overall volume of these weak areas is relatively low, and the impact on the overall scale is limited, but the adjustment will help the company to focus and expand the market share of the existing advantageous areas.
The focus of the company on Meituan's preferred business has been relatively clear on continuing to precipitate, explore and improve the business model and improve the UE level. We believe that the significance of the preferred business to Meituan has never changed, and in the long run, the business is expected to activate a new demand scenario in low-line cities, promote a jump in user activity and transaction frequency, and realize the network effect of "1 restaurant takeout and local life business", which is very important to the extension of platform scene, the depth of industry and the path of e-commerce.
"risk factors:
The epidemic spread again, the serious situation exceeded expectations; Internet policy risks; platform subsidies, increased competition led to lower-than-expected performance release and so on.
"Investment advice:
With its strong operating performance, the company shows the market the resilience and rigid demand characteristics of its core business in the face of the challenge of the epidemic. Several experiences have proved that the impact of the epidemic on external sales and arrival business is short-term. Once the edge of epidemic control is relaxed, demand rebounds and feedback is strong, and we judge that the company is still expected to continue revenue growth of about 20% this year. At the same time, the company continues to strengthen operational efficiency, optimize the allocation of resources, and promote the long-term improvement of core business profitability.
The user level of platform trading has improved beyond expectations regardless of quantity or quality. Meituan, as a representative enterprise that consumers yearn for a better life, is continuing to show its potential under regulatory norms and maintenance. Considering the epidemic control and suppressing the growth rate of takeout and arrival business, the new business will maintain strategic high investment in stages, and the net profit in 2022-24 is expected to be-150.9pp56.7 / 27.31 billion yuan (the original forecast did not take into account the impact of the epidemic in Shanghai and other places-141.2pm 80.8 / 29.05 billion yuan), corresponding to the adjusted net profit forecast of-82.8max 112.8 / 33.67 billion yuan in 2022-24.
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