\u3000\u3 Jointo Energy Investment Co.Ltd.Hebei(000600) 882 Shanghai Milkground Food Tech Co.Ltd(600882) )
Event:
On March 24, the company released its annual report for 2021, with annual revenue of 4.478 billion yuan, a year-on-year increase of + 57.31%; The net profit attributable to the parent company was 1.544 billion yuan, a year-on-year increase of + 160.60%; The net profit deducted from non parent company was 1.220 billion yuan, a year-on-year increase of + 173.72%; The basic EPS is 0.33 yuan. The performance is in line with the previous forecast.
Comments:
Q4 pushes new normal temperature cheese stick to boost revenue
The company’s revenue continued to increase, and the revenue of single Q4 was 1.333 billion yuan, a year-on-year increase of + 37.42%, which was mainly caused by the company’s introduction of normal temperature cheese sticks in September and the increase of sales collection. By category, the annual cheese / liquid milk / trade revenue was 3.335/4.3/704 billion yuan, a year-on-year increase of + 61% / 4% / 97%. The cheese sector continued to maintain a high growth rate. Among the cheese sub categories, the revenue of instant / family / Catering was RMB 2.51/3.5/470 billion, with a year-on-year increase of + 71% / 6% / 73%. The performance of instant medium and low temperature iteration + normal temperature promotion was driven by high growth. On the channel side, the company Wuxi Online Offline Communication Information Technology Co.Ltd(300959) made synchronous efforts, realizing an annual online revenue of 448 million yuan. At the end of 2021, there were 5363 offline distributors, a year-on-year increase of + 104%, covering Shanghai Pudong Development Bank Co.Ltd(600000) retail terminals, covering more than 96% of prefecture level cities and more than 85% of county-level cities.
Category upgrading drives the increase of gross profit margin, and the increase of expense rate inhibits profit growth in the short term
The gross profit margin of the company in 2021 was 38.1%, with a year-on-year increase of + 2.2 percentage points, and the gross profit margin of cheese business was + 3.1 percentage points, of which instant food / Catering were + 2.2 / 5.1 percentage points respectively, mainly driven by the high-end products. On the expense side, the sales / management expense ratio was + 0.9/2.74 percentage points respectively, which was mainly due to the increase of advertising and amortization of equity incentive expenses caused by the promotion of new products such as normal temperature.
From cheese industry to snack food industry
In the short term, the company launched normal temperature cheese sticks to open up incremental space. At the same time, the company launched normal temperature gift box products before the Spring Festival to explore the consumption scene of spring festival gifts. Recently, the company has successively launched a number of new products to further enrich the product matrix. In the long run, after the company launched the normal temperature cheese stick, it will gradually promote its products to the offline market and enhance its brand influence. It is expected to develop from a cheese company to a snack food company in the future.
Profit forecast
We continue to be optimistic about the company’s continued expansion share in the cheese industry. It is expected that the short-term cost investment is still relatively high, giving the company eps0.5% from 2022 to 202488 / 1.59/2.14 yuan; Corresponding to the current share price, PE is 41 / 23 / 17 times. The company is still in a period of rapid growth. The compound growth rate of net profit attributable to the parent company in the next three years is 56%. According to the company’s valuation of PEG 1 in 2022, the target price is 49.28 yuan, maintaining the “buy” rating.
Risk tips
Risks of rising prices of raw materials and packaging materials, new products at room temperature falling short of expectations and capacity release falling short of expectations
