Xinjing News (Reporter Guo Tie) October 28, Xinjiang dairy products and chain baking brand Macquare issued a semi-annual report for 2018 showed that its January-June revenue was 297 million yuan, an increase of 13.21%; net profit of 125.642 million yuan, an increase of 10.63%.

However, Macquare's net profit after deducting non-profit fell by 55.39% and its operating cash flow decreased by 89.44%. Macquare explained that during the reporting period, more sales activities were done to stabilize the market, with raw material prices and labor costs rising, resulting in a 7.07% decrease in gross margin and a 10.3264 million yuan decrease in operating profit compared with the same period last year.

As far as the main business is concerned, except for the increase of 43.83% in dairy products, the sales of bakery and festival food decreased by 3.14% and 34.28% respectively. Macquare explained that the increase in dairy income was mainly due to the opening up of the student milk market in South Xinjiang in 2018, followed by a 16.95% increase in the market outside Xinjiang (Zhejiang) over the same period last year. The decrease in festive food revenues is mainly influenced by external environmental factors in Xinjiang.

It is noteworthy that since 2011, Macquare has extended its baking business to the whole country by setting up subsidiaries and acquiring assets. The number of stores has increased from 39 at the beginning of the listing to 242 in 2017. However, behind the massive expansion, it is the increasing cost of stores, resulting in Macquare's net profit in the last two years has fallen sharply. Recently, the Shenzhen Stock Exchange inquired about McQueen's announcement that it would pay a high premium of 616.22%.

The analysis shows that Handle E-commerce is a typical "capital fattening horse enclosure" company, and does not focus on quality and brand maintenance. As bakery outlets gradually hit the net, the advantages of online cake brands are becoming less obvious, and these risks could be passed on to Macquare. In response to this, McQueen said that the acquisition can be achieved depends on the performance of Palmer in 2018, there are still uncertainties.

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