Insufficient Provision For Sanfo'S Outdoor Depreciation Reserve

The reporter found that in the case of inventory ratio far higher than peers, Sanfo's outdoor inventory turnover rate is far less than that of comparable listed companies, and the company's inventory depreciation allowance is also obviously insufficient.

In the context of cold business, slow revenue growth and declining net asset yields, Sanfo's outdoor profitability is worrying.

Sanfo outdoor is an outdoor product company which sells outdoor products and sells outdoor retail chain products.

The company specializes in outdoor outdoor products, outdoor products, outdoor clothing, outdoor shoes and socks and outdoor equipment. The main products are mainly professional outdoor products and public outdoor products. The three main categories are outdoor clothing, outdoor footwear and outdoor equipment.

In Sanfo's outdoors balance sheet, the company's inventory is particularly noticeable.

Prospectus shows that in 2011-2014 years, the total assets of Sanfo outdoors were 161 million yuan, 208 million yuan, 231 million yuan and 252 million yuan respectively.

In the same period, the amount of goods stored in the company was 105 million yuan, 115 million yuan, 132 million yuan and 132 million yuan respectively, accounting for 65.19%, 55.42%, 57.12% and 52.38% of total assets respectively.

In the A-share market, Pathfinder (300005.SZ) is more similar to Sanfo outdoor than A.

Data show that, in the past 2011-2013 years, the total assets of the Pathfinder were 845 million yuan, 1 billion 86 million yuan and 1 billion 489 million yuan respectively, while the merchandise inventory value of the same period was 180 million yuan, 164 million yuan and 291 million yuan respectively, and the inventory accounted for 21.05%, 15.06% and 19.57% respectively, much lower than that of Sanfo outdoor.

Although Sanfo explains outdoors, the company is a channel retailer for outdoor products.

Most of the property used is leased, so the amount of illiquid assets of the company is smaller than that of the Pathfinder.

However, after excluding illiquid assets, the inventories of 2011-2013 years' inventories accounted for 30.84%, 20.15% and 25.05% of current assets respectively, still lower than Sanfo outdoor.

More Than This,

The turnover rate of inventory is also far from that of the Pathfinder.

Prospectus shows that in 2011-2013 years, Sanfo's outdoors inventory turnover rate was 1.47, 1.30 and 1.37 times, while the same period Pathfinder's inventory turnover rate was 2.96, 3.18 and 3.17 times respectively.

In addition, the reporter also found that Sanfo outdoor inventory inventory preparation is obviously insufficient.

Prospectus shows, 2011-2013 years, Sanfo outdoor

The amount of preparation was 35 thousand yuan, 1 million 77 thousand and 800 yuan and 1 million 471 thousand and 800 yuan respectively, the proportion was 0.03%, 0.93% and 1.4% respectively, while the amount of allowance for inventory depreciation in the same period was 24 million 939 thousand and 500 yuan, 24 million 113 thousand and 700 yuan and 42 million 32 thousand and 100 yuan respectively, and the ratios were 12.3%, 12.84% and 12.84% respectively.

At the same time, the storage age of Sanfo's outdoor merchandise shows that as of December 31, 2014, the merchandise value of Sanfo's outdoor warehouse aged more than 3 years was 19 million 260 thousand and 200 yuan, accounting for 14.54%; the merchandise value of 2-3 years was 29 million 965 thousand and 300 yuan, accounting for 22.63%; 1-2 years, the commodity value of the warehouse age was 30 million 104 thousand and 700 yuan, accounting for 22.73%;

As a result, the inventory reduction preparation for Sanfo outdoors should be over 10 million yuan, in accordance with the proportion of the explorer's inventory fall.

Sanfo's outdoors explanation is that the products of the company over 3 years old are mainly outdoor equipment products. Most of these products are durable and professional outdoor products. The age of the products has little effect on the net realizable value of the products. The sales volume of some products in the company's sales is stable throughout the year. Winter goods such as down garments can not only be used for daily cold protection, but also can be used in mountains, snowy mountains and extremely cold areas. Therefore, such goods still have large sales volume in spring and summer, and the prices will not be reduced. Therefore, there is no over season of such goods.

And summer commodities (such as spring and summer T-shirts, shorts, sandals, etc.), because their own low prices, the proportion of the company's stock is smaller, and the next year can still be sold, so there is generally no price decline.