\u3000\u3 Guocheng Mining Co.Ltd(000688) 363 Bloomage Biotechnology Corporation Limited(688363) )
Event: the company released its 2021 annual report. During the reporting period, the company achieved revenue of 4.948 billion yuan, an increase of 87.93%, the net profit attributable to the parent company of the company and the line was 882 million yuan, an increase of 21.13%, and the net profit deducted from non attributable to the parent company was 663 million yuan, an increase of 16.74% and EPS was 1.63 yuan. The company’s performance met expectations and its business maintained rapid expansion. 21q4 company realized a revenue / net profit attributable to the parent company of RMB 1.936227 billion, an increase of 86.77% / 9.01% at the same time. The increase of sales expense rate led to a relatively low growth rate of net profit.
Comments:
Four wheel drive has made steady progress and various businesses have grown rapidly. By business: 1) in 2021, the revenue of functional skin care products business was 3.319 billion yuan, an increase of 146.57%, accounting for 67.08% of the revenue. The four major brands have passed the initial growth period of the brand, entered the stage of large-scale, and their revenue has maintained rapid growth. 2) In 2021, the revenue of medical terminal business was 700 million yuan, an increase of 21.54% and accounting for 82.05%, of which the revenue of skin products was 504 million yuan, an increase of 15.88%, mainly because the company focused on building “micro crosslinking” products, with obvious market differentiation advantages, comprehensively improving the market share of medical and American products and driving the rapid expansion of medical terminal business; Benefiting from the company’s continuous promotion of National Orthopaedic academic exchanges and the deepening of hospital channel sales coverage, the orthopaedic business revenue was 123 million yuan, an increase of 37.98% at the same time. 3) In terms of raw material business, the company achieved a revenue of 905 million yuan in 2021, an increase of 28.62% at the same time, accounting for 18.29% of the revenue. Among them, the revenue of pharmaceutical grade / cosmetic grade / food grade raw material products was 252 / 391 / 107 million yuan, an increase of 15.82% / 15.98% / 36.85%. The company created the advantages of fermentation technology, product quality, qualification certification and production scale, and the hyaluronic acid raw material business achieved steady growth. The functional food business has made a good start, focusing on products, channels and marketing, and the pattern of three major brands has been initially opened.
The diversified layout of the four skin care brands will further open the ceiling of future growth. 1) run the 100 billion yen to fight the wisdom of the recipe concept, implement the concept of science and technology skin care, while implementing diversified channels, global marketing strategy, such as vibrant voice, and other new channels accounted for a significant increase, tiktok shops opened steadily, 21 years to achieve 1 billion 229 million yuan, an increase of 117.42%. 2) in 2021, in 2021, the contribution of revenue was 979 million yuan, increased by 150.19%. The brand was located in the hard core anti aging function. The main products were frozen age, anti old and old markets. The core product sub throwing series and the CT50 series were combined with the advanced technology and technology to become the tangible carrier of the brand. 3) starting point for BM muscle activity is young group, focusing on two dimensional R & D tiktok and large single product creation, gradually forming product lines, deep operation Tmall, jitter, distribution and three channels, promoting product development layout, 21 years, contributed 435 million yuan, increased 286.21%. 4) In 2021, mibel achieved an income of 420 million yuan, an increase of 111.12% at the same time. The high income growth is mainly due to the fact that it has created an exclusive sensitive muscle repair brand in Z era through customized skin products such as “skin micro ecology”, “pH electrolyte stability maintenance”, “repair conditioning” and “strength newborn” technologies. Overall, the four brands have diversified layout in terms of channels, focused on building star large single products in terms of product strategy, shared resources and reused sales ability in terms of organizational structure, so as to jointly help the brands achieve large-scale expansion.
Freight and other items affect the gross profit margin, increase the sales expense rate and expand the brand voice. In 2021, the company’s comprehensive gross profit margin was 78.08%, down by 3.34 PCT, mainly due to the adjustment of freight and other cost items to operating costs (the freight included in operating costs in 21 years was 128 million yuan). In 21 years, the company’s sales rate was 49.24%, with an increase of 7.48 PCT, mainly due to the same increase of 9.02 PCT in the rate of online promotion services, and the new share payment fee was 38.94 million yuan, accounting for 1.6% of the revenue. Benefiting from the scale effect, the management expense rate of the company in 21 years was 6.14%, with a decrease of 0.02pct. On the whole, the net profit margin of the company decreased by 8.83pct to 15.67% in 2021. 2021 is the second year of the company’s functional cosmetics brand construction and the first year of yimeirunzhi brand construction. In the short term, it has an impact on the net profit margin in the process of rapid development of multi business and multi brand. With the maturity of the brand, the net profit margin is expected to increase in the future.
The business structure continues to be optimized and upgraded, new production capacity and new platform consolidate long-term competitive advantage. 1) In terms of R & D, the company adheres to the long-term principle and focuses on the field of synthetic biology technology. In 2021, the “synthetic biotechnology international innovation Shenzhen New Industries Biomedical Engineering Co.Ltd(300832) base” was successfully settled in Beijing. The four technology platforms were built and put into use at the end of the year. The R & D strength was comprehensively improved to enable the realization of high achievement conversion rate. 2) In terms of brand building, the company will adhere to the industrial development logic of science technology product brand, promote differentiated market positioning of many sub brands, and continuously improve market awareness. 3) The company plans production capacity in a forward-looking way. The Tianjin plant will increase the production capacity of 300 tons of hyaluronic acid, and 30 pilot production lines will further expand the production and sales scale, so as to realize the efficient transformation of the company from R & D to industry. 4) The company adheres to the middle office strategy, through upgrading the organizational structure, improving intelligent management, further strengthening the front, middle and back office strategy, improving organizational efficiency, building industry 4.0 and building a large operation system.
Profit forecast and investment rating: the high outlook of the industry continues to be superimposed on the continuous improvement of the company’s brand and product power in the future and the steady progress of the four major businesses. We predict that the EPS in 202223 will be 2.15/2.86 yuan (the original value is 2.36/3.04 yuan), and the EPS in 2024 will be 3.71 yuan. The current share price corresponds to 53 times PE in 22 years, We have long been optimistic about the company’s focus on R & D and innovation. Relying on the six technical platforms of microbial fermentation technology, we continue to launch active substances, enrich and optimize product structure, and with strong achievement transformation ability, we help the rapid development of business in the four sectors, consolidate our dominant position, expand market share and maintain the “buy” rating.
Risk factors: covid-19 epidemic rebound, new product market acceptance is lower than expected, industry competition intensifies, etc
