\u3000\u3 Shengda Resources Co.Ltd(000603) 610 Keeson Technology Corporation Limited(603610) )
Core view:
On April 18, 2022 Keeson Technology Corporation Limited(603610) disclosed the annual report of the company. The annual report shows that in 2021, the company achieved an operating revenue of 2.967 billion yuan, a year-on-year increase of 31.28%; The net profit attributable to the shareholders of the listed company was 357 million yuan, an increase of 30.61% year-on-year. Among them, in the fourth quarter, the company achieved an operating revenue of 789 million yuan, a year-on-year increase of 14.64%; The net profit attributable to the parent company reached 106 million yuan, a year-on-year increase of 27.13%. Due to the low base in the first three quarters, the growth rate slowed down in the fourth quarter.
At the industry level, according to the 2021bedding market quarter issued by ISPA, the sales volume of intelligent electric beds in the United States accounted for about 13.87% of the sales volume of all bed types (i.e. the total sales volume of fixed beds and intelligent electric beds) in 2021, an increase of 0.4 percentage points over 2020, and the penetration rate still maintained a steady increase. In 2021, the performance of the company’s key customer tapur Silian increased rapidly, and the annual operating revenue increased by more than 30%. Driven by this, the company’s operating revenue rose to 2.967 billion yuan, a year-on-year increase of 31.28%.
In terms of profit level, affected by the rise in shipping prices and raw material prices, the company’s gross profit margin fell to 35.47% in 2021, a year-on-year decrease of 2.54 percentage points. With the continuous strengthening of expense control, the company’s net profit margin remained relatively stable. The net profit margin of the company was 11.94%, a year-on-year decrease of 0.04 percentage points, basically flat. The net profit in 2021 reached 354 million yuan, a year-on-year increase of 30.86%.
Looking ahead, considering that the demand of the North American market may decline in the post epidemic era and the orders of major customers are relatively stable, we expect that the growth rate of the company’s operating revenue in 2022 may be weaker than that in 2021, but it will still maintain a relatively rapid growth rate. Considering the great uncertainty of geopolitics and epidemic situation, the price of raw materials may remain high, and there may still be pressure on the cost side. Overall, the net profit of the company is expected to maintain a steady growth trend in 2022.
On April 18, 2022 Keeson Technology Corporation Limited(603610) disclosed the annual report of the company. The annual report shows that in 2021, the company achieved an operating revenue of 2.967 billion yuan, a year-on-year increase of 31.28%; The net profit attributable to the shareholders of the listed company was 357 million yuan, an increase of 30.61% year-on-year. Among them, in the fourth quarter, the company achieved an operating revenue of 789 million yuan, a year-on-year increase of 14.64%; The net profit attributable to the parent company reached 106 million yuan, a year-on-year increase of 27.13%. Due to the low base in the first three quarters of 2020, the growth rate slowed down in the fourth quarter.
I. The relationship between overseas key customers continues to be consolidated, and the Chinese market still needs to be continuously cultivated
At the industry level, according to the 2021bedding market quarter issued by ISPA, the sales volume of intelligent electric bed in the United States accounted for about 13.87% of the sales volume of all bed types (i.e. the total sales volume of fixed bed and intelligent electric bed) in 2021, an increase of 0.4 percentage points compared with 2020. The permeability of intelligent electric bed still continued to improve steadily.
In 2021, the performance of the company’s key customer tepulslian increased rapidly, the annual operating revenue increased by more than 30%, and acquired dreamuk, a well-known British mattress brand. In the same year, the company renewed the three-year electric bed product manufacturing and supply agreement with tempurworld, LLC (tepur International), and the close relationship between the company and key customers was further consolidated. The sales scale of the top five customers reached 2.242 billion yuan, a year-on-year increase of 28.14%. Driven by this, the company’s operating revenue rose to 2.967 billion yuan, a year-on-year increase of 31.28%. However, it is worth noting that the company’s dependence on a single major customer continues to increase. From 2019 to 2021, the company’s sales to the largest customer accounted for 41.78%, 47.16% and 49.66% respectively, accounting for nearly half.
In the Chinese market, as the only supplier of smart electric beds for the 2022 Beijing Winter Olympic Games and winter Paralympic Games, Keeson Technology Corporation Limited(603610) has provided more than 6000 smart electric beds and 20 sleep experience warehouses for the Winter Olympic Village and venues. Through the sharing of American athletes’ experience of smart electric bed on social media, “Winter Olympic smart bed” quickly boarded the hot search of major short video platforms in a short time, and was successively reported by Chinese and foreign media. The cumulative exposure exceeded 10 billion, and Chinese consumers’ cognition of smart electric bed has been improved to a certain extent. The company also joined hands with Greentown to lay the company’s intelligent electric bed in various life scenes of Greentown users, and provide them with health management services of intelligent electric bed. In 2021, the company’s revenue in the Chinese market also reached 127 million yuan, with a year-on-year increase of 9.33%. The Chinese market is still in the cultivation period.
II. Cost control continued to be strengthened and the net profit margin remained stable
In terms of profit level, affected by the rise of shipping prices and raw material prices, the company’s gross profit margin fell to 35.47% in 2021, a year-on-year decrease of 2.54 percentage points, and the gross profit margin fell for two consecutive years. The expense rate during the period was 22.47%, a year-on-year decrease of 2.64 percentage points. Among them, the sales expense rate was 9.09%, down 0.53 percentage points year-on-year. With the continuous operation of new factories, the control of labor cost has been optimized, and the management expense rate has decreased to 12.22%, down 1.04 percentage points year-on-year; Affected by the decline in exchange gains and losses, the financial expense ratio fell to 1.16%, down 1.07 percentage points year-on-year. With the continuous strengthening of expense control, the company’s net profit margin remained relatively stable. The net profit margin of the company was 11.94%, a year-on-year decrease of 0.04 percentage points, basically flat. The net profit in 2021 reached 354 million yuan, a year-on-year increase of 30.86%.
The company’s net cash flow from operating activities reached 149 million yuan, a significant increase from 53 million yuan in the same period in 2020, and the cash flow improved. With the increase of raw materials and the slowdown of international logistics, the inventory increased to 786 million yuan, a year-on-year increase of 70.93%. This also led to the company’s inventory turnover days increased to 117.18 days, an increase of 19.05 days compared with 2020.
Looking ahead, considering that the demand of the North American market may decline in the post epidemic era and the orders of major customers are relatively stable, we expect that the growth rate of the company’s operating revenue in 2022 may be weaker than that in 2021, but it will still maintain a relatively rapid growth rate. Considering the great uncertainty of geopolitics and epidemic situation, the price of raw materials may remain high, and there may still be pressure on the cost side. Overall, the net profit of the company is expected to maintain a steady growth trend in 2022.
