\u3000\u3 Guocheng Mining Co.Ltd(000688) 169 Beijing Roborock Technology Co.Ltd(688169) )
Performance summary: the company released the annual report of 2021 and the first quarterly report of 2022. In 2021, the company achieved a revenue of 5.84 billion yuan, a year-on-year increase of 28.8%; The net profit attributable to the parent company was 1.4 billion yuan, a year-on-year increase of 2.4%; The net profit attributable to the parent company after non deduction was 1.19 billion yuan, a year-on-year decrease of 1.5%. Non recurring profits and losses mainly included the investment income of 250 million yuan obtained from the company’s trading financial assets. In Q4, the company achieved a revenue of 2.01 billion yuan in a single quarter, a year-on-year increase of 29.6%; The net profit attributable to the parent company was 390 million yuan, a year-on-year decrease of 17.8%. In 2022q1, the company achieved a revenue of 1.36 billion yuan, a year-on-year increase of 22.3%; The net profit attributable to the parent company was 340 million yuan, a year-on-year increase of 8.8%. In addition, the company plans to distribute a cash dividend of 2.1 yuan per share, a total of 140 million yuan, with a dividend rate of 10%.
China’s market share has increased rapidly. According to GfK data, the market scale of China’s floor sweeping Siasun Robot&Automation Co.Ltd(300024) in 2021 was about 11 billion yuan, with a year-on-year increase of 21.7%, and the industry continued its high boom. In 2021, the company launched two t7s series sweepers and one G10 sweeper with good market response, which led to the rapid increase of the company’s market share. According to AVC data, in December 2021, the company’s online retail volume share / retail volume share of China’s sweeper market reached 17.3% / 13.4% respectively, with a year-on-year increase of 7.2pp/6.6pp respectively. China’s market boom continued, the company’s market share was further optimized, and China’s revenue grew rapidly. In the overseas market, under the repeated epidemic, the global transportation capacity is tight, and the growth rate of the company’s overseas sales has slowed down. With the release of the company’s overseas new products and the mitigation of superimposed shipping, the company’s overseas revenue is expected to grow rapidly.
Profitability is under pressure in 2021. In 2021, the company’s comprehensive gross profit margin was 48.1%, a year-on-year decrease of 3.2pp. The decline of the company’s gross profit margin is mainly due to the adjustment of accounting standards and the continuous rise of raw material prices. If the impact of changes in accounting standards is excluded, the company’s annual gross profit margin will decline by 1.8pp. In terms of expenses, the company’s sales expense rate / management expense rate / R & D expense rate were 16.1% / 2% / 7.6% respectively, with a year-on-year increase of 2.4pp/0.2pp/1.8pp respectively. The reason for the increase in sales expense rate is that the company launched high-end new products in the Chinese market and matched with active marketing publicity; The reason for the increase of R & D expense rate is that the company continues to strengthen R & D expense investment in order to further consolidate the industry competitiveness. Overall, the company’s net profit margin was 24%, a year-on-year decrease of 6.2pp, and its profitability was under pressure.
Q1 revenue continued to increase, and profits improved month on month. In the first quarter, G10 sweeper continued to make efforts. G10 won the monthly sales champion of sweeper category in January and February. At the same time, the company launched the annual new T8 and g10s Series in March. We speculate that the gradual volume of new products has also driven the high growth of Q1 revenue of the company. In terms of profitability, the gross profit margin of 2022q1 company was 47.5%, a year-on-year decrease of 2.2pp and a month on month increase of 2.8pp. In terms of expense rate, the sales expense rate was 13.4%, with a year-on-year increase of 3.6pp, mainly due to the company’s increasing marketing investment and actively seizing market share; The management expense ratio / financial expense ratio was 2.2% / – 1.2% respectively, with a year-on-year decrease of 0.4pp/0.3pp respectively; The R & D expense rate was flat year-on-year. Overall, the net profit margin of the company was 25.2%, down 3.1pp year-on-year, up 6PP month on month, and the profitability showed an improvement trend month on month.
The equity incentive plan demonstrates confidence. The company launched the equity incentive plan in April 2022 and plans to grant 248000 stock options to 479 management, technical and business backbones at the price of 50 yuan / share, accounting for 0.37% of the total share capital of the company. The assessment conditions are based on the company’s revenue in 2021. It is required that the revenue growth in 2022, 2023, 2024 and 2025 shall not be less than 10% / 14% / 18% / 22% respectively. Based on the company’s revenue of 5.84 billion yuan in 2021, the corresponding revenue from 2022 to 2025 is 64.2/66.6/68.9/7.12 billion yuan respectively. The equity incentive plan aims at steady revenue growth and demonstrates the confidence of the company in long-term development.
Profit forecast and investment suggestions. It is estimated that the company’s EPS from 2022 to 2024 will be 26.93/33.86/40.9 yuan respectively, and the net profit attributable to the parent company will maintain a compound growth rate of 24.9% in the next three years. Considering the continuous prosperity of clean appliances, the company, as one of the leading enterprises, has strong product competitiveness, continuously improved terminal share, steadily improved profit performance and maintained the “buy” rating.
Risk tip: the risk of sharp fluctuations in raw material prices, the risk of sharp fluctuations in RMB exchange rate, and the risk of terminal sales falling short of expectations.
