\u3000\u30 Guangdong Tengen Industrial Group Co.Ltd(003003) 47 Hangzhou Tigermed Consulting Co.Ltd(300347) )
The company released the first quarter report of 2022. During the reporting period, the operating revenue was 1.82 billion yuan, a year-on-year increase of 101.55%; The net profit attributable to the parent company was 518 million yuan, a year-on-year increase of 13.82%; The net profit after non deduction by the parent company was 378 million yuan, with a year-on-year increase of 65.31%.
Revenue deduction is not higher than expected, and the main business growth is strong: 1) during the reporting period, the company achieved revenue of 1.82 billion yuan (year-on-year + 101.55%), continuing the high growth trend of revenue from January to February (year-on-year growth of more than 100%). We expect covid-19 pneumonia vaccine and treatment project to realize accelerated confirmation. After excluding this part, clinical trial technical services and clinical research related consulting services still maintain rapid growth. 2) At the same time, covid-19 pneumonia vaccine and treatment project handling fees increased more, driving down the overall gross profit margin. Excluding the impact of this part, we expect the gross profit margin to maintain a year-on-year growth level. 3) During the reporting period, the growth rate of net profit attributable to the parent company was lower than that of income, which was mainly affected by the significant year-on-year decrease in the income from changes in the fair value of other non current financial assets. After deducting non current assets, the net profit attributable to the parent company still maintained a strong growth and higher than the growth rate of income, with excellent profitability.
The strong orders are expected to continue, and the rapid growth is expected: the company’s new contract amount in 2021 is 9.65 billion yuan (year-on-year + 74.2%), and the cumulative contract amount to be executed at the end of 2021 is 11.4 billion yuan (year-on-year + 57.1%). At the same time, it was announced recently that the year-on-year growth of new orders from January to February 2022 was more than 65%. It is expected that the strong demand for orders in 2022q1 will continue to further verify the high outlook of the industry, and it is expected to maintain a good growth trend in the future, Inject growth certainty into the company.
Continue to accelerate the international layout and improve the growth ceiling: at the end of 2021, the number of drug clinical research projects carried out by the company increased to 567 (year-on-year + 45.8%), including 385 domestic single regional pilot projects (year-on-year + 40.5%), 132 overseas single regional pilot projects including South Korea, Australia and the United States (year-on-year + 38.9%), including Asia Pacific, North America, Europe 50 multi regional clinical trials were conducted in Africa and Latin America (year-on-year + 150%). At the end of 2021, the total number of employees increased to 8326 (year-on-year + 38.0%), of which the number of overseas employees increased to 1026 (year-on-year + 32.9%), covering 52 countries on five continents, and the clinical operation and project management team in major overseas markets such as Europe and the United States continued to expand.
Profit forecast and rating: we are optimistic about the continuous high-speed growth of the company’s main business under the strong industrial demand and the improvement of global service capacity under the continuous promotion of international expansion. It is estimated that the net profit attributable to the parent company from 2022 to 2024 will be 3.35 billion yuan, 4.09 billion yuan and 4.96 billion yuan respectively, with a year-on-year increase of 16.6%, 22.1% and 21.2%; The corresponding PE is 23, 19 and 16 times respectively, maintaining the “buy” rating.
Risk warning: the epidemic affects the operation risk, the decline risk of pharmaceutical R & D demand, the loss risk of core personnel and the risk of exchange rate change.
