\u3000\u3 Jointo Energy Investment Co.Ltd.Hebei(000600) 882 Shanghai Milkground Food Tech Co.Ltd(600882) )
Event: the company disclosed its 2021 annual report. In 2021, it realized operating revenue / net profit attributable to parent company / net profit not attributable to parent company deducted by RMB 4.478154/122 billion, with a year-on-year increase of 57.31% / 160.6% / 173.72%. Among them, 21q4 achieved operating revenue / net profit attributable to parent company / deduction of net profit not attributable to parent company of RMB 13.33/0.11 / – 21 million, with a year-on-year increase of 37.45% / 72.68% / – 507.43%. The net profit is at the central level of the previous forecast.
The proportion of cheese increased steadily, and the cheese stick and catering series performed well: according to categories, the cheese / liquid milk / trade revenue increased by 60.8% / 4% / 96.9% year-on-year respectively in 2021. The company actively promoted innovation, strengthened channel development and promotion, and maintained a high growth rate of cheese. The trade business was all the trade of raw and auxiliary materials related to the company’s production, which had a good synergistic effect with the core business. The company insisted on focusing on cheese. The proportion of liquid milk decreased steadily, and the proportion of cheese increased rapidly. In 2021, the proportion of cheese reached 74.6%, with a year-on-year increase of + 1.7pct. In the fourth quarter alone, the proportion of cheese was 79.2%, with a year-on-year increase of + 3.8pct. Further subdivide the cheese category. In 2021, the ready to eat nutrition series / family table series / catering industry series increased by 70.8% / 6.3% / 72.7% respectively year-on-year. The high growth of ready to eat nutrition series is mainly due to the continuous iterative upgrading of the company’s low-temperature cheese sticks and the accelerated distribution of normal temperature cheese sticks. The growth rate of family dining table series has slowed down due to the high base, and the catering industry series has achieved good growth with the recovery of downstream catering and the development of new customers.
The gross profit margin increased steadily, the expense rate increased in the short term, and the profitability did not change: the gross profit margin in 2021 was 38.21%, with a year-on-year increase of + 2.3pct, of which the gross profit margin of cheese / trade / liquid milk business was 48.51% / 3.9% / 13.73% respectively, with a year-on-year increase of + 3.14 / + 1.92 / – 4.19pct. The category structure of cheese and trade business was continuously optimized, such as the introduction of gold cheese stick and 0 added cheese stick, which drove the company’s gross profit margin to continue to increase. From the perspective of expense rate, the sales expense rate in 2021 was 25.87%, with a year-on-year increase of + 0.92pct, mainly due to the increased investment in advertising and promotion expenses and channel expenses in the peak season of the Spring Festival (the sales expense rate in 2021q4 was 29.35%, with a year-on-year increase of + 9.63pct). In 2021, the management expense ratio was 7.67%, with a year-on-year increase of + 2.74pct, mainly due to the amortization of equity incentive expenses. In 2021, the net interest rate was 3.45%, with a year-on-year increase of + 1.37%. If excluding the impact of equity incentive fees, the net profit in 2021 was + 364.49% year-on-year and the net interest rate was + 4.09pct year-on-year. The profitability maintained a good trend with the upgrading of product structure, the strengthening of scale effect and the improvement of cost-effectiveness ratio.
Accelerate the strategy of “refining at low temperature and broadening at normal temperature”, and gradually release the escort of production capacity: since the introduction of normal temperature cheese stick in mid September 2021, the company has flexibly adjusted its strategy, merged the normal and low temperature business division, separated the north and South regions, accelerated the development of normal temperature channels and strengthened the refined management of channels. By the end of 2021, the number of dealers of the company had reached 5363, an increase of 2737 year-on-year and 1137 month on month, covering about Shanghai Pudong Development Bank Co.Ltd(600000) retail terminals, An increase of about 310000 over the same period last year. The normal temperature channel has a strong momentum, the low-temperature products have been continuously upgraded, the production capacity construction has been accelerated, and the brand construction has been continuously overweight. The market share has steadily increased to 36%, further consolidating the leading position of cheese.
Investment suggestion: it is estimated that the company’s EPS in 2022, 2023 and 2024 will be 0.84, 1.46 and 2.38 respectively, and the six-month target price will be 51.1 yuan, corresponding to 35xpe in 2023.
Risk warning: industry competition intensifies; The promotion of normal temperature was not as expected
