\u3000\u3 Jointo Energy Investment Co.Ltd.Hebei(000600) 315 Shanghai Jahwa United Co.Ltd(600315) )
Core view
In 2021, the company achieved an operating revenue of 7.646 billion, a year-on-year increase of 8.73%, and a net profit of 649 million, a year-on-year increase of 50.92%; Q4 net interest rate increased significantly to 12.6% (sales expense rate and effective tax rate decreased), driving the annual performance to exceed expectations.
After the adjustment in 2020, the skin care category has recovered rapidly, driving revenue growth. Jiaan and mayborn have declined due to external factors. 1. By category, skincare / gehujiaqing / mother and baby / cooperative brands achieved revenue of 2.7 billion yuan / 2.41 billion yuan / 2.16 billion yuan / 370 million yuan respectively, with a year-on-year increase of 22% / 0.4% / 4.2% / 6.5%. 2. In terms of brands, baicaoji / Yuze / Diancui / Goff / meijiajing / Shuangmei of skin care category increased by 30% + / 20% + / 35% + / 15% + / 10% / 15% + respectively, Liushen / Jiaan in gehujiaqing category achieved a high single digit increase of / – 13%. The decline of Jiaan was mainly affected by the adjustment of special channel, and the growth of Qichu and mayborn of mother and baby category increased by 20% + / – 1.7% year-on-year. The decline of mayborn was mainly affected by 21h2 international supply chain.
The online share was flat (mainly affected by the decline of Tequ), and the offline new retail business grew rapidly. 1. Online business: accounting for 42% of the overall revenue, which was flat year-on-year. In terms of splitting, the e-commerce channel increased by + 20%, and the special channel decreased by 10%, which was mainly caused by the decline of group purchase business caused by the reform of Ping An Life Insurance. 2. Offline business: supermarket / department store channel / CS channel increased by 40% / 35% year-on-year respectively. The company actively expanded new retail business and promoted online offline business through various forms, with a year-on-year increase of 100% + in 2021. In addition, the department store channel continued to be strategically closed and downsized. In 2021, a total of 111 low yield counters and stores were closed. At the same time, through the online business of four seasons spa, it successfully turned losses into profits; Improve CS profitability through Watson’s channel reconstruction.
In the adverse external environment, the business quality continues to improve. In 2021, the company overcame the impact of short-term adverse factors on the special channel business and overseas business, and achieved good performance growth. At the same time, the operation quality was also significantly improved. Among them, the number of inventory turnover days decreased by 11 days year-on-year, the number of accounts receivable turnover days decreased by 3 days year-on-year, and the company realized an operating cash flow of 993 million yuan, a year-on-year increase of 54.34%.
We believe that in the future, the company will continue to implement a rich and differentiated multi brand strategy, improve operational efficiency by focusing on high-profit beauty and skin care tracks, mining head product SKUs and optimizing channel efficiency. We look forward to more sustainable profit growth in the future
Profit forecast and investment suggestions
According to the annual report, we lowered the forecast of the company’s revenue, gross profit margin and selling expense ratio. It is estimated that the company’s earnings per share in 20222024 will be 1.17 yuan, 1.44 yuan and 1.74 yuan (the original forecast of earnings per share in 20222023 will be 1.05 yuan and 1.37 yuan), and the DCF target valuation will be 42.78 yuan to maintain the “overweight” rating of the company.
Risk tips: impact of abnormal weather on sales, fluctuation of e-commerce and special channel sales, etc.
