New Classic (603096): Steady Growth of Main Business, Children’s Books Become New Motive Force for Growth

New Classic (603096): Steady Growth of Main Business, Children’s Books Become New Motive Force for Growth

Event: The company achieved revenue 4 in 2019H1.

74 ppm, an increase of 6 per year.

64%, net profit attributable to mothers1.

1.9 billion, an annual increase of 8.


The general book business has developed well, especially the revenue of children’s own copyright books increased by 21.

69%, achieving rapid growth; book retail and digital book business both grew faster, but because of their small size, they had limited effect on overall performance.

The company achieved revenue 2 in Q2 2019.

53 ppm, an increase of 7 per year.

62%; net profit attributable to mother is 0.

63 ppm, an increase of 16 per year.


The main business has grown steadily, and the number of children’s and literature-owned books has increased.

On the revenue side, revenue was achieved in the first half of 20194.

74 ppm, a ten-year increase6.


The revenue from the planning and distribution of children’s own copyright books increased by 21%.

Promote performance growth; Expansion, although the number of new classic digital book business has decreased, it achieved 27.

27% higher growth.

In terms of business, the general book distribution business has seen healthy growth, and digital book and book retail business revenues have grown rapidly, further decentralizing the distribution business.

Looking at the profit side, the gross profit margin of the main business in the first half of 2019 was 0.

3 averages, the net profit margin increased slightly by 0.

53 units.

The main reason for the decline in gross profit margin was the book retail business, and the operating costs of the digital book business rose significantly.

Seize 杭州桑拿网 the potential of the industry to develop children’s books and promote new growth in performance.

Opening book information shows that the overall book retail market in the first half of 2019 increased by 10% year-on-year.

82%, the children’s category is the largest segment in the retail market.

New classics continue to make efforts in the field of children’s books, and 2019H1 revenue will grow even longer21.


Both the sales of classic works have continued to increase, and the original children’s literature market has been actively explored, and the works of several domestic children’s literature writers have been launched.

Moderately divest Pageone bookstore business, reduce financial risks, and seek the possibility of Pageone development.

The company completed the acquisition of Pageone Bookstore in October 2017. Due to the early expenditures of Pageone Bookstore, high operating costs, and long capital recovery cycles, it brought pressure on the company’s funds and operating risks, and appropriately reduced its business and helped reduce its capitalExpenses and financial risks.

At the same time, in order to improve the brand influence and market competitiveness of Pageone Bookstore, appropriately reducing the share proportion will be helpful to improve its financing environment and will be beneficial to the further development of Pageone Bookstore.

Risk reminder: New book sales are lower than expected, children and non-fiction books are less than expected, competition in the book market is intensified, and the cost of paper and costs is rising.