\u3000\u30 China High-Speed Railway Technology Co.Ltd(000008) 95 Henan Shuanghui Investment & Development Co.Ltd(000895) )
Event: the company disclosed that in the first quarterly report of 2022, 22q1 achieved operating income / net profit attributable to parent company / net profit attributable to parent company / fee deduction of RMB 13.762/14.60/1.369 billion, a year-on-year increase of - 24.73% / + 1.34% / + 5.69%.
Affected by the epidemic, the sales volume of meat products decreased slightly, and the profit of 22q1 tons reached a new high. In terms of meat products, the revenue of 22q1 was 6.8 billion yuan, a year-on-year increase of - 4.9%, of which the sales volume was about 385000 tons, a year-on-year increase of - 2.5%, mainly due to the impact of epidemic control in some regions on logistics, resulting in a decline in sales volume. The profit per ton exceeded 4500 yuan, with a year-on-year increase of about 25%, a record high, mainly due to: 1) the cost of meat products continued to decline month on month (21q4), 2) the adjustment of product structure during the Spring Festival and the increase of sales volume of high-profit products. According to the company's communication, the pig price is expected to be low before and high after 2022, the cost of meat products is expected to remain low, and the annual ton profit is expected to be close to 21q4, about 4000 yuan. Looking forward to 2022, the meat products business is expected to achieve rapid growth under the promotion of low base, low cost and new products.
The revenue growth of slaughtering business is dragged down by low pig prices, and the profit is expected to improve quarter by quarter. In terms of slaughtering business, the revenue of 22q1 was 6.88 billion yuan, with a year-on-year increase of - 37.1%, including 6.02 billion yuan in foreign transactions and 860 million yuan in inter segment transactions, with a year-on-year increase of - 38.8% / - 21.7% respectively, mainly because the average price of 22q1 pigs was only 13.4 yuan / kg, with a year-on-year decrease of - 58%. The sales volume reached 355000 tons, a year-on-year increase of + 6.6%, and the sales volume of meat produced in China increased by about 30% year-on-year. Slaughtering profit was 134 million yuan, with a year-on-year increase of - 52.8%, of which the profit of fresh products increased significantly, the profit of frozen products decreased significantly due to the high base number, and the loss of some frozen raw materials in 21q4 was reflected in 22q1 due to accounting recognition. 22q1 slaughtered 3.44 million heads, a year-on-year increase of + 84.6%. We expect that the annual slaughtering volume may be close to the level in 2018. The impairment of 22q1 is about 61 million yuan, which is significantly lower than that of 1.3 billion yuan at the end of 2021. The significant provision for impairment of 21q2 / Q3 brings a lower base. We expect that the profit of slaughtering business is expected to improve quarter by quarter and the profit elasticity is expected to be released.
Adhere to "two adjustments and one control", and the promotion of new products is steadily improving. The meat industry will continue to adhere to the policy of "two adjustments and one control", promote new products, adjust the structure, control costs and stabilize prices. At present, they are all progressing smoothly. In terms of new product promotion, the annual sales volume of spicy food, fire whirlwind and meatballs exceeded 20000 tons, and the annual sales volume of Shuanghui chopsticks kitchen and chicken sausage exceeded 10000 tons. The sales volume of catering materials business increased by 6% in Q1 catering under the condition of being greatly affected by the epidemic, including pre-processing + 23% year-on-year, and about 500 catering dealers. Facing the multi-point outbreak of the epidemic, the company is expected to give full play to its advantages in capacity distribution and logistics integration, optimize product structure and product portfolio in combination with consumption changes under the new situation, and continue to achieve faster growth.
Investment suggestion: we estimate that the company's revenue from 2022 to 2024 will be 68.79 billion yuan, 73.35 billion yuan and 79.69 billion yuan respectively, and the net profit will be 6.08 billion yuan, 6.63 billion yuan and 7.06 billion yuan respectively. We maintain the investment rating of Buy-A, and the 12-month target price is 38.26 yuan, which is equivalent to the dynamic P / E ratio of 20x in 2023.
Risk tip: the downward trend of pork is less than expected, resulting in cost pressure; The promotion progress of new products is less than expected; Food Safety; The recovery of the epidemic was less than expected.
