\u3000\u3 Guocheng Mining Co.Ltd(000688) 363 Bloomage Biotechnology Corporation Limited(688363) )
Event:
The company released the first quarter report of 2022.
Comments:
High revenue growth and improved profit growth
In the first quarter of 2022, the company realized an operating revenue of 1.255 billion yuan, a year-on-year increase of 61.57%; The gross profit margin was 77.13%, a year-on-year decrease of 1.57pct, and the sales expenses / administrative expenses / R & D expenses / financial expenses were 45.12% / 6.25% / 6.49% / – 0.25% respectively; The net profit attributable to the parent company was 200 million yuan, a year-on-year increase of 31.07%, and the net profit margin attributable to the parent company was 15.92%, a year-on-year decrease of 3.84 percentage points and a month on month increase of 1.55 percentage points. In the first quarter, the company continued to make strategic investment and accrued share based payment expenses of about 35 million. In terms of new business, the functional new food sector and functional skin care product innovation business suffered losses.
High growth in cosmetics business and better than expected performance in muscle activity
By business, the raw material business grew by nearly 30% year-on-year in the first quarter; The revenue of medical terminals remained stable year-on-year, and the overall business was in the adjustment period; Functional skin care products achieved more than 90% growth and achieved better than expected performance. In terms of sub brands, runbaiyan increased by more than 40% year-on-year in the first quarter, kwadi increased by more than 70% year-on-year, mibeier increased by more than 70% year-on-year, and muscle activity increased by about 5 times year-on-year driven by hot brown rice water, which exceeded expectations.
Layout collagen, continue to build upstream ingredients and raw material barriers, and enable downstream applications
Recently, the company officially signed the property right transaction contract with China coal geological group to acquire 51% equity of “Yierkang biology” for 233 million yuan and enter the collagen industry. Collagen will become Bloomage Biotechnology Corporation Limited(688363) another core substance, enrich the company’s bioactive product pipeline and strongly support the sustainable development of the company’s future business. The hospital admission products such as collagen sponge and artificial bone mainly produced by Yierkang biology can further enrich the company’s existing medical terminal product pipeline, form a good medical terminal product matrix and multi department layout.
Investment advice and profit forecast
With hyaluronic acid as the core, supplemented by a variety of bioactive substances, the company has gradually become China’s leading platform company for the whole industrial chain of bioactive substances, and jointly drives the business development with four sectors: bioactive raw materials, pharmaceutical terminals, functional skin care products and functional food. We expect the company to achieve eps2.0 from 2022 to 202416 / 2.82/3.60, pe54 / 41 / 32x, maintaining the “buy” rating
Risk tips
Brand incubation is less than expected, industry competition intensifies, and policy supervision risks
