\u3000\u3 Jointo Energy Investment Co.Ltd.Hebei(000600) 763 Topchoice Medical Co.Inc(600763) )
Event: on April 27, 2022, the company released the annual report of 2021 and the report of the first quarter of 2022. In 2021, the company achieved a total operating revenue of 2.781 billion yuan, a year-on-year increase of 33.19%; The net profit attributable to the parent company was 703 million yuan, a year-on-year increase of 42.67%; The net profit deducted from non parent company was 671 million yuan, with a year-on-year increase of 41.74%. In 2022q1, the company realized an operating revenue of 655 million yuan, a year-on-year increase of 3.74%; The net profit attributable to the parent company was 166 million yuan, a year-on-year increase of 1.25%; The net profit deducted from non parent company was 163 million yuan, with a year-on-year increase of 0.99%.
In 2021, the epidemic control in China was relatively stable, and the overall growth rate of the company was rapid. In 2021, China’s epidemic control was relatively stable. The company’s main business medical services achieved an operating revenue of 2.632 billion yuan, a year-on-year increase of 31.06%. (1) In terms of subregions, Zhejiang Province is still dominant, and the regional branch hospital has the fastest growth: the income in Zhejiang Province is 2.374 billion yuan, a year-on-year increase of 31%, of which the income of the regional general hospital (hangkou) is 732 million yuan, a year-on-year increase of 21%, and the income of the regional branch hospital is 1.642 billion yuan, a year-on-year increase of 36%; The income outside Zhejiang Province was 259 million yuan, a year-on-year increase of 30%. (2) In terms of business, all businesses developed in a balanced manner, and the growth rate of planting business was the fastest: the income of planting business was 441 million yuan, a year-on-year increase of 38%; The income from orthodontic business was 534 million yuan, a year-on-year increase of 30%; Pediatric business income was 530 million yuan, a year-on-year increase of 32%; The revenue from repair business was 427 million yuan, a year-on-year increase of 25%; The revenue from large comprehensive business was 683 million yuan, a year-on-year increase of 31%.
Since 2022, the epidemic situation in China has been repeated, and the short-term performance of the company has been under pressure. Since 2022, there have been large-scale covid-19 epidemic counterattacks in many places in China. The company has actively cooperated with the changes of local epidemic prevention policies. Some hospitals have stopped or restricted the flow, and the number of patients from other places visiting Hangzhou has decreased significantly. At the same time, the support of experts from the general hospital to branches has also been greatly limited, resulting in the low growth rate of the company’s overall performance in 2022q1. In terms of subregions, the income in Zhejiang Province was 567 million yuan, a year-on-year increase of 4.26%; The income outside Zhejiang Province was 552 million yuan, a year-on-year decrease of 9.50%, of which Cangzhou Stomatology, Nanjing Jinling, Suzhou cunji stomatology and other hospitals stopped for a long time due to the epidemic. In terms of business, the income from planting business was 102 million yuan, a year-on-year increase of 12.71%; Orthodontic business income was 124 million yuan, a year-on-year increase of 4.03%; Pediatric business income was 127 million yuan, a year-on-year increase of 0.32%; The revenue from repair business was 96 million yuan, a year-on-year increase of 2.78%; The revenue from large comprehensive business was 174 million yuan, a year-on-year increase of 0.44%.
The profitability has been steadily improved, and the long-term development trend remains unchanged. In 2021, the company’s profitability increased steadily, with an overall gross profit margin of 46.06%, an increase of 0.89pct year-on-year; The overall net interest rate was 28.27%, up 2.17pct year-on-year. The overall gross profit margin of 2022q1 company is 46.75% and the overall net profit margin is 29.07%, which continues to maintain high profitability. In 2021, the overall period expense rate of the company was 13.15%, of which the management expense rate was 9.30%, a year-on-year decrease of 1.72 PCT, the sales expense rate was 0.89%, a year-on-year increase of 0.05 PCT, and the R & D expense rate was 2.13%, a year-on-year increase of 0.21 PCT. In 2021, the number of dental clinics of the company reached 2.8 million, including 680000 outpatients of regional general hospital (hangkou), with a year-on-year increase of 15%; The number of outpatients in regional hospitals increased by 350000, with a year-on-year increase of 1.75 million; The number of outpatient visits in Zhejiang Province was 370000, a year-on-year increase of 23%.
By the end of 2021, the business area of the company’s oral medical services has exceeded 200000 square meters, and the number of dental chairs has reached 2246. The company has expanded simultaneously inside and outside the province, and the long-term development trend remains unchanged. (1) In the province, the dandelion plan continues to be promoted. There are 43 dental medical institutions, 8 branches under construction and 10 branches to be built in Zhejiang Province; (2) Outside the province, relying on the brand of cunji hospital, the outpatient volume of Wuhan cunji reached 108700 person times in 2021, with a year-on-year increase of 82%, and the operating revenue increased by 63%, which has achieved profit and loss balance. Xi’an cunji has been in business for one year, and the current development situation is better than that of Wuhan cunji in the same period.
Investment suggestion: we estimate that the company’s operating revenue from 2022 to 2024 will be 3.363 billion yuan, 4.372 billion yuan and 5.603 billion yuan respectively, the net profit attributable to the parent company will be 845 million yuan, 1.116 billion yuan and 1.440 billion yuan respectively, the corresponding EPS will be 2.63 million yuan, 3.48 million yuan and 4.49 yuan respectively, and the corresponding PE will be 46.8 times, 35.4 times and 27.5 times respectively, giving the investment rating of overweight-a.
Risk warning: uncertain risk of epidemic prevention and control, medical accident risk, and the risk that the extension expansion is less than expected.
