\u3000\u3 Guocheng Mining Co.Ltd(000688) 363 Bloomage Biotechnology Corporation Limited(688363) )
Event:
Bloomage Biotechnology Corporation Limited(688363) released the first quarterly report, achieving an operating revenue of 1.255 billion yuan / + 61.57%, and a net profit attributable to the parent company of 200 million yuan / + 31.07%, which is in line with our previous expectations.
Key investment points:
The revenue driven by skin care products maintained a high growth, and the raw material business achieved steady growth. In 2022q1, the company achieved a revenue of 1.255 billion yuan / + 61.2%, and a net profit attributable to the parent company of 200 million yuan / + 31.1%. From the perspective of Tiktok platform, the Gmv of runbaiyan / kuadi / mibeier / Jihuo under Huaxi banner reached 14103116/164045.9 million yuan respectively, and the proportion of self broadcast + small store broadcast reached 33%/10%/11%/53% respectively. In terms of Amoy platform, in March Bloomage Biotechnology Corporation Limited(688363) ‘s runbaiyan / kuadi / mibeier / BM muscle activity sales were 6154 / 7417 / 5917 / 40570000 yuan respectively, with a year-on-year increase of – 45% / – 8.3% / + 141.1% / + 125.6% respectively. From Q1, the four brands achieved sales of RMB 180 / 145 / 119 / 88 million respectively, with a year-on-year increase of – 17.6% / – 26.2% / 103.5% / 49.6% respectively, and a total of RMB 532 million / the same year-on-year.
The margin of sales expense rate has decreased significantly, and the profitability has stabilized and rebounded. In 2022q1, the company achieved a gross profit margin of 77.1%, down 1.6 percentage points. It is expected that the gross profit margin will be basically the same year-on-year after adding back the amortized expenses of the new factory. From the perspective of expense ratio, the sales / management / R & D / financial expense ratio of 2022q1 company reached 45.1% / 6.3% / 6.5% / – 0.3% respectively, with a year-on-year increase of 1.6/0.8/1.5/0.1pct respectively, of which: 1) the sales expense ratio decreased significantly by 8.6pct month on month compared with 2022q4. In addition to the influence of seasonal marketing launch factors, we believe that the company’s skin care business has changed from the previous pursuit of growth to the current strategy of growth and profitability, It is estimated that the business expense rate of skin care products in 2022q1 will drop to about 56% (more than 60% in 21 years); 2) The R & D expense ratio increased significantly by 1.5pct year-on-year, continuing the company’s idea of emphasizing R & D investment. On April 23, the company’s new raw material “hydrolyzed zinc hyaluronate” was successfully filed. The raw material has the effects of both HA and zinc, and hyaluronic acid can also increase the bioavailability of zinc. It has broad application prospects in the future. The successful filing of the raw material means the compliance of its production and operation in China, and also reflects the strong R & D strength of the company. From the perspective of profitability: in 2022q1, the net interest rate attributable to the parent company is 15.9% / a significant increase of 4.2pct month on month. If the new depreciation and amortization expenses and equity incentive expenses are added back, we expect the net interest rate of the company in 2022q1 to be basically the same year-on-year, and the profitability has stabilized and rebounded.
The layout of synthetic biology has been continuously promoted, and Yierkang has been acquired to enter the collagen industry. Synthetic biology is the key layout direction of the company. In 2021, synthetic technology platforms such as functional sugars, functional proteins, amino acids and natural products have been built. The company recently acquired 51% equity of Beijing Yierkang Bioengineering Co., Ltd. the main products of Yierkang cover consumables (“Beiling” collagen sponge, etc.), pharmaceutical products (nano pharmaceutical product “Ruifu” artificial bone, etc.), skin care products (“Yek” collagen moisturizing facial mask, etc.), and the revenue / net profit from January to November 2021 was 75.68 million /13.09 million yuan. Similar to hyaluronic acid, collagen is also an important material widely distributed in the human body. It is a biomaterial with a wide range of applications. The company has entered the collagen industry through acquisition and has a promising future.
Profit forecast and investment suggestions: the company’s skin care business has achieved cost reduction and cost control while maintaining rapid growth, driving the overall profitability to stabilize and recover. It is expected to continue to verify the logic of cost reduction and efficiency increase in the future. It is estimated that the company will achieve revenue of 6.88/91.5/11.57 billion yuan in 2022 / 2023 / 2024, with a year-on-year increase of 39.1% / 32.90% / 26.50%. The net profit attributable to the parent company is expected to be 997 / 1286 / 1657 million yuan, with a year-on-year increase of 27% / 29% / 29%, maintaining the rating of “overweight”.
Risk Tips 1) the flow cost has increased significantly; 2) Reduce the price and seize the market share of overseas brands; 3) Product quality problems; 4) Stricter supervision leads to the new products being less than expected; 5) The rapid rise of cutting-edge brands intensifies competition; 6) If relevant materials and data are inconsistent with Bloomage Biotechnology Corporation Limited(688363) announcement, the announcement of the company shall prevail.
