By-Health Co.Ltd(300146) (300146)
Event: on January 3, 2022, By-Health Co.Ltd(300146) released the annual performance forecast for 2021. It is expected that the net profit attributable to the parent company will be RMB 1.60-1.91 billion in 2021, with a year-on-year increase of 5% – 25%. The forecast performance is basically in line with the expectation. The performance is in line with expectations, and there is no goodwill impairment risk in 21 years.
According to the forecast, 1) from the revenue side, the growth rate of domestic offline business in 21 years is lower than expected; The domestic online business revenue has achieved rapid growth. During the double 11, the company’s whole brand and whole network sales exceeded 600 million yuan, with a year-on-year increase of 38.3%. It has won the double champion of tmall and JD double 11 for three consecutive years; Overseas LSG revenue increased to a certain extent. 2) From the profit side, 21q4 company expects to realize a net profit attributable to the parent company of -62-242 million yuan, with a median value of 90 million yuan, corresponding to a single quarter growth rate of 56.7%. The amount of non recurring profit and loss of the company in 21 years is expected to be RMB 200-220 million, down from RMB 380 million in 20 years. The non recurring profit and loss mainly comes from government subsidies, profit and loss from changes in fair value of financial assets and investment income. According to the company’s preliminary goodwill impairment test, it is estimated that there is no goodwill impairment risk in 2021.
In July 2021, the company started the transformation of offline sales and Wuxi Online Offline Communication Information Technology Co.Ltd(300959) integration, which is specifically reflected in building a digital system of full marketing link and strengthening brand and market management. As the reform needs to break the current situation and make new attempts, which will bring certain pressure on the company’s performance in the short term, the company expects the reform to continue until the first half of 2022. Expand brand influence and boost revenue growth with the help of the Winter Olympic Games.
In December 2021, the sports equipment center of the General Administration of sports of the people’s Republic of China awarded By-Health Co.Ltd(300146) as a supplier of sports food and nutrition for Team China’s national team, and By-Health Co.Ltd(300146) will provide sports food, nutrition and professional nutrition preparation programs for athletes of more than 70 teams of the national team. This cooperation is the national team’s recognition of By-Health Co.Ltd(300146) brand and product quality. With the holding of the Winter Olympic Games, the brand influence of By-Health Co.Ltd(300146) is expected to expand and boost revenue growth.
Numerous R & D and innovation results highlight R & D strength.
In December 2021, the company released a number of R & D achievements, including the discovery of breakthrough anti-aging substance PCC1 in authoritative scientific journals in cooperation with research institutions such as the Chinese Academy of Sciences. This research achievement is expected to be used to delay aging and control aging related diseases in the future; At the “definition of nutrition wisdom” press conference in December, the company took the lead in launching the first personalized customized vitamin concept product. Each capsule can realize more than 50 million nutrient combinations, making efforts to “precision nutrition”. The company attaches importance to R & D innovation and provides inexhaustible power for the launch of new products. Profit forecast, valuation and rating: we maintain the company’s net profit attributable to the parent company from 2021 to 2023 to be RMB 1.745/22.53/2771 billion respectively, equivalent to EPS of RMB 1.03/1.33/1.63 from 2021 to 2023 respectively. The current share price corresponds to PE of 26x / 20x / 17x from 2021 to 2023 respectively, maintaining the rating of “overweight”.
Risk tips: the pressure of economic slowdown increases, the risk of goodwill impairment, and food safety issues
