\u3000\u3 Jointo Energy Investment Co.Ltd.Hebei(000600) 305 Jiangsu Hengshun Vinegar-Industry Co.Ltd(600305) )
Event: Jiangsu Hengshun Vinegar-Industry Co.Ltd(600305) released the annual report of 2021 and the first quarterly report of 2022. In 2021, it achieved a revenue of 1.89 billion yuan, a year-on-year – 6.5% (adjusted caliber), and a net profit attributable to the parent company of 120 million yuan, a year-on-year – 62.3% (adjusted caliber), close to the lower limit of previous performance forecast; In 2022q1, the revenue was 570 million yuan, a year-on-year increase of + 10.4%, and the net profit attributable to the parent company was 80 million yuan, a year-on-year increase of – 0.8%.
The effectiveness of marketing reform was reflected, and the growth rate of revenue hit the bottom and rebounded. 1) In terms of products, vinegar / cooking wine was – 10.3% / + 1.2% year-on-year in 2021, and + 6.6% / 17.5% year-on-year in 2022q1. On the whole, the seasoning business revenue in 2022q1 was + 14.1% year-on-year. Under the disturbance of the epidemic in March, the main seasoning business still maintained rapid growth, which was reflected in the competitiveness of brands, channels and products; 2) In terms of sub regions, East China / Central China / South China / West / North China performed well in 2021 with a year-on-year ratio of – 4.0% / – 5.6% / – 9.7% / – 8.6% / + 1.9%, and 2022q1 with a year-on-year ratio of + 10.1% / + 13.5% / + 18.3% / + 33.0% / + 14.7%; 3) At the end of 2021, there were 1820 dealers, an increase of 381 compared with the end of 2020. The prefecture level market coverage rate reached 89.7% and the county-level market coverage rate was 50.1%.
The high price of packaging materials and the increased investment in promotion and marketing outside the province dragged down short-term profits. The gross profit margin of 2021q4 was 33.4%, with a year-on-year decrease of – 6.4pct, which was due to the upward price of packaging materials and promotion outside the province. The sales / management / R & D / financial expense rate was 23.2% / 6.7% / 3.5% / 0.2%, with a year-on-year increase of + 10.3 / + 0.6 / + 1.1 / + 0.0pct. Q4 increased marketing investment and reached in-depth strategic cooperation with Jiangsu Radio and television headquarters, with a net profit rate of – 2.9%, with a year-on-year increase of – 17.8pct; In 2022q1, the gross profit margin was 37.9%, year-on-year -1.5pct, the sales / management / R & D / financial expense rate was 12.1% / 5.3% / 3.8% / 0.2%, year-on-year -0.4 / – 0.2pct, and the net profit margin was 13.0%, year-on-year -2.4pct.
The annual target setting is conservative and optimistic about the revenue exceeding the expected performance. 1) In the short term, the impact of the epidemic on the company’s logistics delivery is still continuing, but the channel inventory in the main epidemic areas has been significantly removed. If the control is liberalized in May, Q2 revenue is expected to continue to grow rapidly; 2) Throughout the year, in 2022, the company will continue to focus on vinegar, wine and sauce strategy, continue to promote marketing reform and accelerate the development of channels outside the province. With the implementation of the reform results, the revenue scale is expected to enter a new level in the next two years; In 2022, the revenue of the main condiment industry will increase by more than 10% and deduct the growth rate of non net profit by 5%. Under the disturbance of the epidemic, the target setting is conservative, and the expected revenue will exceed the expected performance.
Investment suggestion: we adjusted the previous profit forecast according to the annual report and the first quarterly report, and introduced the profit forecast for 2024. It is estimated that the company’s operating revenue from 202 to 2024 will be 2.13/24.0/2.67 billion yuan (2.23/2.53 billion yuan before 20222023), a year-on-year increase of + 12.7% / 12.2% / 11.7%; The net profit attributable to the parent company is RMB 130 / 2.2 / 310 million (the value before 20222023 is RMB 270 / 350 million), a year-on-year increase of + 11.8% / + 66.3% / 38.0%, corresponding to PE times 75 / 45 / 33x, maintaining the “buy” rating.
Risk tip: the industry demand is lower than expected, the epidemic situation is repeated, and the cost is higher than expected.
