Cross Border Langzi'S "Beauty" Business: 20 Medical And American Institutions Outline The Whole Story Of 10 Times Myth

From a low of 6.88 yuan / share on April 30, 2020 to a high of 71.60 yuan / share on June 1, 2021.

In just one year, the share price of RANTZ (002612. SZ) has risen 10 times.

When the "cross-border" A-share market is generally covered with chicken feathers, langzi shares seems to show another logic.

Established in November 2006, landsie shares landed in Shenzhen stock exchange with the halo of "the first stock of A-share high-end women's wear" in August 2011, mainly engaged in women's fashion business.

By the end of 2020, langzi has two high-end comprehensive medical and beauty brands "Milan Boyu" and "gaoyisheng", as well as the light medical beauty chain brand "Jingfu Yimei", with 20 medical beauty institutions in hand (including 4 medical beauty hospitals and 16 medical beauty clinics or outpatient institutions).

Taking the revenue in 2020 as an example, the fashion women's clothing business contributed 1.329 billion yuan in revenue, accounting for nearly 50% (the annual revenue of 2020 was 2.876 billion yuan), still accounting for the majority; The revenue of medical beauty business was 814 million yuan, accounting for about 28%; The revenue of green infant and child business was 733 million yuan, accounting for 25% of the total revenue, which was equivalent to the revenue scale of medical beauty business.

On the other hand, the company's 28% revenue accounted for 68.8679 million yuan of net profit attributable to the parent company, accounting for 48% (the net profit in 2020 was 142 million yuan); Women's clothing business realized a net profit of 29.3877 million yuan, accounting for only 21%; However, the green infant and child business suffered a large loss, and the net profit attributable to the mother was only - 1.9023 million yuan.

Compared with the net profit peak of 231-233 million yuan in 2012-2013, there is still a gap between the net profit of 142 million yuan in 2020. Can the "beauty economy" with medical cosmetology as the core continue to develop?

"Beauty of clothes" to "beauty of appearance"

In 2016, the company's tentacles began to extend to the medical cosmetology business. It not only invested in the Korean orthopedic management organization "dream Medical Group Co., Ltd" and "dream plastic surgery", but also announced to enter the domestic medical and aesthetic market.

As a cross track transition "player", landsie, which mainly deals in women's fashion business, claims to be "the first listed company to enter the medical beauty business in China's A-share market".

Or because of fear of "cross-border", langzi's strategy is frequently packaged as "Yimei" and "Yanmei".

A word of "beauty" seems to have deliberately weakened the deep gap between the two industries.

In September 2016, landsie announced that it had completed the acquisition of 63.49% equity of Sichuan Milan, 70% of Shenzhen Milan, 70% of Sichuan Jingfu, 70% of Xi'an Jingfu, 70% of Changsha Jingfu and 70% of Chongqing Jingfu with its own funds of 327.2 million yuan, thus including two domestic medical and American brands of "miranboyu" and "Jingfu Yimei".

As a regional well-known medical institution, Milan Boyu was invited to become the "chief sponsor and exclusive beauty support agency" of China's first plastic film "cosmetic diary" (directed by Lin Aihua, supervised by Chen Kexin, starred by Bai Baihe and Zheng Zhongji).

Jingfu medical beauty focuses on the market segmentation of rejuvenation, positioning itself as a chain brand of "medical rejuvenation". It mainly provides laser beauty, injection beauty, anti-aging, spa anti-aging beauty and other services.

In the 2016 annual report, landsie said that in order to promote the "Pan fashion industry ecosystem" strategy, it has completed the layout of the four major fashion industries of "women's wear, baby children, medical beauty and cosmetics".

"The company will deeply tap the fashion demand and consumption potential of female customers, accelerate the mutual introduction of women's clothing business users and medical beauty business customers... At the same time, the company will build a medical beauty service network in the first tier cities and other key cities where the company's women's clothing business customers are concentrated."

In 2017, by investing its own funds and combining with the pilot and promotion of the incentive mechanism of the partnership system, langzi Co., Ltd. added 3 "Jingfu medical beauty" brand clinics, two in Chengdu and one in Xi'an.

In January 2018, Lanzi Medical Management Co., Ltd. (hereinafter referred to as "langzi medical") acquired Shaanxi gaoshengyi medical cosmetology hospital Co., Ltd. with a total of 267 million yuan. It owns 100% equity of Xi'an famous medical and aesthetic plastic brand "gaoshengyimei". Gaoyisheng mainly consists of cosmetic surgery, micro plastic surgery, cosmetology and dermatology It has 26 years history in Xi'an.

In 2020, the company completed the acquisition of all the remaining minority shares of the initial six medical and American institutions with its own funds, realizing 100% control of the six institutions.

By the end of 2020, Lanzi has formed a three-dimensional development pattern of high-end (Milan Boyu), technology (high life) and light medical and beauty multi store chain (Jingfu Yimei) through three major medical and beauty brands. It has 20 medical beauty institutions (including 1 joint-stock and entrusted management organization), including 4 hospitals, 16 outpatient or clinics, mainly distributed in Chengdu, Xi'an, Chongqing, Shenzhen, Changsha, and so on Baoji and Xianyang.

Langzi said that in 2020, Chengdu and Xi'an have initially achieved the stage goal of regional head medical beauty brand, and radiated to the southwest region, and striding forward to the strategic territory of the development of national medical beauty.

Langzi shares said that it hopes to take the two listed companies of China and South Korea as the resource integration platform, adopt the development idea of "industrial cooperation between China and South Korea and linkage of multiple brands", and plan to create a multi regional and multi-level three-dimensional medical and aesthetic service brand system.

28% revenue supports 48% net profit

In the acquisition of six medical and American companies, including Milan, Sichuan, the original shareholders promised that the non net profit deducted by the target company from 2016 to 2018 would not be less than 25 million yuan, 30 million yuan and 36 million yuan respectively.

Sichuan Milan and other six companies, as well as gaoshengyimeimei, which was acquired in 2017, have fulfilled the corresponding promised net profit.

Overall, over the years, the proportion of medical cosmetology business of langzi has been increasing.

The 21st century economic reporter combed the data and found that the proportion of its medical and American business revenue increased from 10.86% in 2017, 18.01% in 2018, 20.90% in 2019 and 28.25% in 2020.

In particular, in the third quarter of 2020, the medical and American layout of langzi has ushered in an important turning point.

In the first three quarters of 2020, the revenue of medical and American business of langzi only accounted for nearly 30% of the total revenue, but contributed 94% of the net profit.

By the end of 2020, the medical and American business of langzi Co., Ltd. has been stable in half: among the 142 million yuan of net profit, the contribution of medical beauty business to the parent's net profit was 68.8679 million yuan, accounting for 48%, an increase of 31.43% over the same period of last year; Women's clothing business contributed 29.3877 million yuan to the mother's net profit, accounting for 21%.

In contrast, the revenue share of the fashion women's clothing business, which was originally the main business of RANTZ, increased briefly from 47.17% in 2017 to 51.84% in 2018, and then further decreased to 50.28% in 2019 and 45.99% in 2020.

At present, among the three medical beauty brands held by landsie, the young brand mainly focusing on laser and micro plastic surgery, and "Jingfu medical beauty" with non-surgical business as the main business, has the fastest expansion speed. By 2020, "Jingfu medical beauty" has 13 institutions; "Milan Baiyu", which takes the high-end route, has four institutions; In addition, gaoshengsheng has two institutions, one hospital and one outpatient department in Xi'an and Baoji.

In terms of revenue share, "milanboyu" accounted for the highest proportion of revenue of Longzi, accounting for about 65% in 2020“ "Jingfu Yimei" accounts for about 20%. The remaining shares are "Gao Yisheng", which has been included in the consolidated statement of langz shares in 2018.

In addition, from the perspective of profit contribution, as most of the organizations under "Jingfu Yimei" are still in the growth and climbing period, and the profits are mainly contributed by "Milan Baiyu" and "gaoyisheng". In 2020, the net profit of Longzi medical beauty attributable to shareholders of listed companies was 68.86 million yuan, of which Sichuan Miran Boyu contributed 60.41 million yuan, more than 87%.

In addition, "Milan Boyu", "jingfuyimei" and "gaoyisheng" brands have gross profit margins of more than 50%.

It is worth mentioning that, similar to langzi shares, the large-scale medical and American listed companies are also "dominating" in different regions of China.

For example, Ruili medical (02135. HK) mainly focuses on Shanghai and Zhejiang; The cosmetic hospitals of Huahan plastic surgery (430335. OC) are mainly located in Nanjing, Qingdao, Changsha and Sichuan. More than half of the sales revenue comes from Jiangsu Province; Cosmetology (02138. HK) is mainly located in Hong Kong.

"The regional characteristics of the layout of many medical and aesthetic institutions are obvious, mainly because consumers definitely seek medical and aesthetic institutions nearby, and it is convenient for them to continue to receive services in the future; From an institutional point of view, even if Shanghai and Hangzhou are close to each other, the transportation of many medical and aesthetic instruments and equipment is not convenient. It is better to cultivate local services and open more, "the head of a medical beauty clinic in Hangzhou told the 21st century economic report on June 2.

In the opinion of the person in charge, with the gradual acceptance of medical and aesthetic consumption by the market, the "compliance" requirements from products to services will increasingly become the industry threshold.

Recently, Luo Ying, investment manager of HSBC Jinxin fund, also pointed out to the reporter of 21st century economic report that "medical beauty has both medical attributes and consumption attributes. When investing in the medical and aesthetic industry, we will pay attention to the medical examination and approval barriers and the marketing barriers in the consumer market. The examination and approval barrier mainly lies in who can accurately discover the unmet medical and aesthetic needs of the terminal market, quickly find the corresponding products and complete their listing and registration in China. Marketing barriers lie in the fact that enterprises need to build new product promotion programs with downstream organizations and train downstream doctors. Therefore, it can be seen that most of the excellent medical and American enterprises in China not only have strong R & D capabilities, but also have a strong ability to accurately occupy the needs of consumers, and have the compound barrier of "medicine + marketing"

Investment income half sky?

What can't be ignored is that another source of profit side of langzi shares is its investment income.

In 2020, the investment income of Landsat will reach 99.2872 million yuan, accounting for 72.11% of the total profit. In this regard, the explanation of langzi shares is "investing in dividend and financial management, and selling part of the equity of L & P".

Prior to that, from 2018 to 2019, the investment income of RANTZ was up to 301 million yuan and 160 million yuan respectively, accounting for 132.37% and 113.10% of the total profit respectively.

Among them, Lanzi's participation targets include ruoyushen (003010. SZ), a listed company of a shares, which holds 12.33% of its shares by the end of 2020; Beijing langzi Hanya Asset Management Co., Ltd. (hereinafter referred to as "langzi Hanya asset management", formerly known as "langzi asset management") was established in 2016 and Korea L & P Cosmetics Co., Ltd. invested in 2015.

Langzi Hanya asset management was established in May 2016, jointly invested and established by RANTZ shares and Hanya Bank Co., Ltd., a wholly-owned subsidiary of Hanya financial group, a top financial group in South Korea. In September of that year, landsie shares and Hana Bank increased the capital of langzi asset management. After the completion of the capital increase, landsie shares hold 75% of the equity of lucz asset management, and Hana Bank holds 25% of the equity of lucz asset management.

Langzi said that the company's asset management business started in June 2017, mainly through the provision of professional consulting services to collect service fees. At the same time, it participated in the establishment of fashion industry partnership enterprises for industrial investment, and finally recovered the investment by the income distribution of the partnership, so as to promote the company's "Pan fashion industry interconnected ecosystem" strategy.

From 2017 to 2018, ranzi Hanya asset management performed well, contributing 75.7052 million yuan of net profit to listed companies and 92.7052 million yuan of net profit, accounting for 40% (187.6 million yuan) and 44% (210.5 million yuan) of the net profit of the year.

Until October 2019.

"In order to concentrate advantageous resources, focus on fashion business such as fashion women's wear, medical cosmetology and other fashion businesses" and "move out of the asset management sector which is highly dependent on capital", landsie plans to transfer 42% of the equity of landsie Hanya asset management to Wuhu Dezhen Ruiyuan investment partnership (limited partnership) at 695.9 million yuan, and the receiving party is Shen Dongri, the actual controller of the listed company. After the completion of the transaction, the shareholding ratio of the listed companies in ranzi Hanya asset management has changed from 76% to 34%, which is no longer included in the consolidated statement.

By the end of 2019, due to the capital increase of Hana Bank, the shareholding ratio of RANTZ shares in RANTZ Hanya asset management further reduced to 30.76%.

However, it can be seen from the annual report that the performance of ranzi Hanya asset management is still excellent: at the end of 2019 and the end of 2020, the net profit data of ranzi Hanya asset management are 108 million yuan and 154 million yuan respectively.

In this regard, on June 3, 21st century economic news reporter, as an investor, called the Securities Affairs Department of ranzi shares to inquire about the operation of ranzi Hanya asset management. The other side only said that "at present, the company's equity participation in the nature of langzi Hanya asset management" and did not comment on its specific operation.

However, the divestiture of ranzi Hanya asset management means that the listed companies completely leave the investment business?

The answer is clearly no.

In December 2020, Landsea will again hand out 200 million yuan in cash to establish a new partnership, Wuhu bochen No.5 equity investment partnership (limited partnership), with landsie Hanya asset management, to "increase the scale" of medical and American industry investment.

Coincidentally, in February 2021, langzi plans to establish Wuhu bochen No.8 equity investment partnership (limited partnership) with its own capital of 125 million yuan.

According to the announcement, bochen No.5 and bochen No.8 are two medical and beauty industry funds with a total scale of 652 million yuan. By the end of 2020, bochen No. 5 has not been invested, and langzi shares as LP accounted for 49.875%; Bochen No. 8 has not been invested, and langzi shares as LP accounted for 49.8008%.