\u3000\u30 Beijing Zznode Technologies Co.Ltd(003007) 61 Jiangsu Lihua Animal Husbandry Co.Ltd(300761) )
The event company issued the annual report of 2021 and the first quarter report of 2022.
In the year of 21, the company’s contribution to the performance of yellow chicken was steady, and factors such as pig business dragged down the performance. In 2021, the company achieved a revenue of 11.132 billion yuan, a year-on-year increase of + 29.12%; Among them, chickens, pigs and geese contributed 9.996 billion yuan, 1.020 billion yuan and 100 million yuan respectively, with a year-on-year increase of + 34.71%, + 18.93% and + 37.77%. The net profit attributable to the parent company was -396 million yuan, a year-on-year increase of – 255.70%; The net profit attributable to the parent company after deducting non-profit was -473 million yuan, a year-on-year increase of -338.76%. The company’s expense rate during the period was 6.8%, with a year-on-year increase of + 0.47pct; The comprehensive gross profit margin was 7.89%, with a year-on-year increase of -0.69pct. The decline of the company’s performance was mainly dragged down by the pig breeding business, the increase of expenses during the period and the impairment loss of assets of 592 million yuan. 22q1 revenue was 2.711 billion yuan, a year-on-year increase of -0.91%; The net profit attributable to the parent company was -178 million yuan, a month on month increase of -161.63%. The gross profit margin of sales was 8.52%, with a year-on-year increase of -8.95pct; The expense rate during the period was 8.19%, with a year-on-year increase of + 1.62pct.
The sales volume of yellow chicken increased significantly in the past 21 years, and the regional expansion will continue in the future. In 2021, the company sold 370 million commercial broilers, with a year-on-year increase of 14.68%, and the market share reached 9.15% (year-on-year + 1.86pct); The sales revenue of commercial chickens reached 9.582 billion yuan, a year-on-year increase of + 30.71%; The average sales price was 12.88 yuan / kg, up 11.6% year-on-year. The number of cooperative farmers of the company’s yellow feather chicken business was 6605, a year-on-year increase of + 2.8%. Benefiting from the expansion of the company’s yellow feather chicken production capacity, the slaughter volume has increased more than expected. At the same time, the relationship between market supply and demand has improved compared with 2020, and the rise of sales price is good for the profit of yellow chicken. In 2022q1, the company sold 856005 million commercial chickens, with a sales revenue of 2.471 billion yuan. The average sales price of wool chicken was 13.81 yuan / kg, with month on month changes of – 11.79%, – 9.29%, + 1.69% respectively, and year-on-year changes of + 5.51%, + 7.02% and – 3.49% respectively. The company’s chicken industry has steadily promoted the regional expansion strategy and continued to strengthen the development of major consumer markets such as southwest, South China and central China. In addition, the company continues to promote the yellow chicken slaughtering business and plans to form a fresh poultry processing capacity accounting for about 50% of the total slaughter volume in the next five years.
The number of cooperative farmers in pig breeding business was 213, with a year-on-year increase of + 36.54%; Changzhou and Wujin building pig raising projects were completed and put into operation. In 21 years, the company sold 412500 commercial pigs, a year-on-year increase of + 123.94%; The average sales price was 17.89 yuan / kg, a year-on-year increase of – 44.51%; The sales revenue was 806 million yuan, a year-on-year increase of + 20.43%. At the end of Q1, the company’s fixed assets, construction in progress and productive biological assets were 4.441 billion yuan, 1.125 billion yuan and 426million yuan respectively, up from +5.94%, +3.59% and -1.39% month on month at the end of 21. As the time point of pig cycle reversal approaches, the pig breeding industry may usher in an upward cycle. With the increase of the company’s pig breeding scale, its profit contribution will be significantly improved.
The investment suggestion company is the second largest yellow feather chicken breeding enterprise in China. The company continues to promote the production capacity expansion of yellow feather chicken and pig, superimposed with the reversal of pig cycle and the expectation of yellow feather chicken price rise, and the overall performance of the company can be expected. Considering the relatively high price of yellow chicken in 22 years, the potential upward trend of pig price in the second half of the year and the gradual return of breeding costs, the company’s sales gross profit margin is better (estimated at 11.43% / 16.11% in 22 / 23 years), the relatively stable change of superimposed expense rate and the reduction of asset impairment loss, the overall performance of the company is significantly improved (estimated net profit of 349 million yuan / 1534 million yuan in 22 / 23 years, year-on-year + 188.32% / + 339.14%). We predict that the EPS from 2022 to 2023 will be 0.87 yuan and 3.8 yuan respectively, corresponding to 37 and 8 times of PE.
Risk tips
1. Risk of animal epidemic and natural diseases;
2. Risk of raw material supply and price fluctuation;
3. Risk of price fluctuation of yellow feather chicken and pig;
4. Risk of policy change;
5. Risk of product quality, etc.
