\u3000\u3 Shengda Resources Co.Ltd(000603) 288 Foshan Haitian Flavouring And Food Company Ltd(603288) )
The company released its 2021 annual report, with annual revenue of 25 billion yuan, a year-on-year increase of + 9.7%; The net profit attributable to the parent company was 6.67 billion yuan, a year-on-year increase of + 4.2%; Deduct non net profit of RMB 6.43 billion, a year-on-year increase of + 4.1%. Among them, 4q21 achieved a revenue of 7.01 billion yuan, a year-on-year increase of + 22.9%; The net profit attributable to the parent company was 1.96 billion yuan, a year-on-year increase of + 7.2%; Deduct non net profit of RMB 1.85 billion, a year-on-year increase of + 4.0%.
Key points supporting rating
The company raised the price of 4q, and the dealers concentrated on purchasing goods and prepared goods in advance during the Spring Festival. 4q increased significantly in a single quarter. (1) In 2021, the revenue of main business (excluding other products) was + 9% (1q / 2q / 3Q / 4q + 22% / – 9% / + 1% / + 21% respectively), and 4q increased significantly in a single quarter. We judge that it is related to the price increase of the company’s products, the centralized purchase of dealers and the early preparation of goods in 2022 Spring Festival. (2) By category, soy sauce / seasoning sauce / oyster sauce were + 9% / + 6% / + 10% (4q + 21% / + 14% / + 21%) respectively in 2021, and the core categories grew steadily. In addition, the revenue of other categories reached 2.21 billion, a year-on-year increase of + 14%. Among them, vinegar, cooking wine and other products have begun to take shape. The accelerated development of new categories will further expand the company’s competition and leading advantage and maintain strong development momentum and vitality. (3) In terms of subregions, the East / South / middle / North / West will be + 8% / + 8% / + 14% / + 7% / + 9% respectively in 2021, and the central and Western markets will continue to maintain a leading growth rate. (4) In terms of the number of dealers, the company continued to promote the sinking and fission of channels, and the number of dealers maintained an upward trend, with a net increase of 379 to 7430 dealers throughout the year. (5) In terms of sub channels, while ensuring the stable development of offline channels, the company accelerated the layout of online business to meet the rapid iterative market demand and consumption scenarios, with a year-on-year increase of + 85% / + 8% online / offline.
Affected by the rising cost of raw materials, the annual gross profit margin was -3.5pct and the net profit margin was -1.4pct. (1) In 2021, the gross profit margin was 38.7%, – 3.5pct, and the gross profit margin of single 4q was 38.1%, – 3.7pct, which was mainly caused by the impact of income standards and cost side pressure in the same period of last year. (2) In 2021, the four expense rates totaled -1.2pct, of which the sales expense rate was -0.6pct, which was 5.4%. Under the cost pressure, the company contracted the expenses; Financial expense rate -0.6pct; The rate of R & D and administrative expenses was flat. (3) Under the combined effect, the net profit margin of sales in 2021 was 26.7% (- 1.4pct), and the net profit margin decreased slightly under the rise of the prices of soybeans, packaging materials and pet.
The 22-year target will return to double-digit growth, and the profit margin will be improved in the second half of the year. The company’s 22-year target revenue and profit growth rate were 12%, returning to the double-digit track of performance growth. Haitian announced the price increase in October of 21, and after increasing the cost at the beginning of the year, the terminal mobile sales accelerated. According to the previous rounds of price increase and resumption, the cost rate will increase for 1-2 quarters after the price increase. It is expected that the main theme of the first half of 22 will be inventory clearing + investment cost, and the cost rate will return to normal after 3q, which will usher in the improvement of profit margin.
Valuation
We expect EPS to be 1.79/2.08/2.35 yuan in 22-24 years, with a year-on-year increase of + 13.2% / + 15.9% / + 13.0%. Maintain the overweight rating.
Main risks of rating
The increase of raw material cost exceeded expectations; The impact of repeated epidemic on catering business; The output of the project is less than expected; Food safety risks; Goodwill impairment risk.
