\u3000\u3 Shengda Resources Co.Ltd(000603) 755 Qingdao Richen Food Co.Ltd(603755) )
Event: Qingdao Richen Food Co.Ltd(603755) released the annual report of 2021 and the first quarterly report of 2022. In 2021, the revenue was 340 million yuan, with a year-on-year increase of + 28.6%, the net profit attributable to the parent company was 80 million yuan, with a year-on-year increase of + 0.1%, and the revenue of single Q4 was 100 million yuan, with a year-on-year increase of + 24.3%, and the net profit attributable to the parent company was 30 million yuan, with a year-on-year increase of + 13.5%; In 2022q1, the revenue was RMB 80 million, a year-on-year increase of + 7.1%, and the net profit attributable to the parent company was RMB 10 million, a year-on-year increase of – 7.5%.
The epidemic has disturbed catering channels for a short time, and food processing has grown steadily. 1) By channel, the revenue of catering / food processing in 2021q4 was + 23.0% / + 3.7% year-on-year, and the revenue of catering / food processing / brand customization / direct e-commerce / direct business supermarket / distribution in 2022q1 was – 11.4% / + 9.6% / + 60.1% / + 18.2% / – 29.9% / + 76.3% year-on-year. The epidemic had a great disturbance to catering and Ka channels, and the large volume of brand customization and distribution channels partially made up for the decline of catering channels; 2) By product, the revenue of sauce seasoning / powder seasoning / food additives was + 31.8% / + 5.6% / + 37.6% in 2021q4 and + 8.4% / + 1.0% / + 59.3% in 2022q1; 3) In terms of sub regions, the revenue of East / North / Northeast / central / South China in 2021q4 was + 29.4% / – 4.7% / + 17.9% / + 3.9% / + 225.4%, and that in 2022q1 was + 24.3% / – 27.9% / + 12.1% / – 49.4% / + 56.3%.
Short term channel structure changes dragged down earnings performance. 1) 2021q4 gross profit margin was 43.5%, year-on-year +2.1pct, sales / management / R & D / financial expense rate was 5.9%/9.0%/3.1%/4.3%, year-on-year +5.2/-2.2/-0.2/+5.6pct, and the large year-on-year increase in sales expense rate was mainly due to the low base of sales expense due to the centralized adjustment of 2020q4 freight, with a net interest rate of 25.1%, year-on-year -2.4pct; 2) In 2022q1, the gross profit margin was 39.4%, year-on-year -4.2pct, mainly due to the change of channel structure, the proportion of catering customers with high gross profit margin decreased, the sales / management / R & D / financial expense rate was 6.2% / 10.7% / 4.1% / 0.6%, year-on-year + 0.0 / – 1.7 / + 0.2 / + 1.3pct, and the net profit margin was 18.2%, year-on-year -2.9pct.
Optimistic about the elastic release of the company’s performance under the follow-up catering recovery trend. The company’s income in East China accounts for a relatively high proportion (68.7% in 2021). Its short-term income performance pays attention to the rhythm of epidemic development. The company is highly competitive in product R & D, production technology and the first mover advantage of b-end customers. In the follow-up, with the liberalization of epidemic control and the recovery of catering industry chain, the income is expected to release greater elasticity; In the long run, the growth trend of customized seasoning industry remains unchanged. As a leading customized polyphonic enterprise in China, the company is expected to continue to attack.
Investment advice. According to the annual report and the first quarterly report, we adjusted the profit forecast for 20222023 and introduced the forecast for 2024. It is estimated that the operating revenue in 20222024 will be RMB 410 / 530 / 690 million (the value before 20222023 will be RMB 450 / 590 million), with a year-on-year increase of + 21.9% / + 28.1% / + 30.5%, and the net profit attributable to the parent company will be RMB 100 / 130 / 170 million (the value before 20222023 will be RMB 120 / 160 million), with a year-on-year increase of + 17.1% / + 34.2% / + 30.4%, corresponding to pe34 / 26 / 20 times, maintaining the “buy” rating.
Risk tips: repeated epidemics, intensified industry competition and food safety risks.
