\u3000\u3 Shengda Resources Co.Ltd(000603) 288 Foshan Haitian Flavouring And Food Company Ltd(603288) )
The epidemic disturbs demand and short-term performance is under pressure
Foshan Haitian Flavouring And Food Company Ltd(603288) released the first quarterly report of 2022, with a revenue of 7.21 billion yuan in 2022q1, a year-on-year increase of 0.7%; The net profit was 1.83 billion yuan, a year-on-year decrease of 6.4%, and EPS was 0.43 yuan. We keep the profit forecast unchanged. It is estimated that the net profit attributable to the parent company from 2022 to 2024 will be 7.47 billion, 8.93 billion and 10.54 billion respectively, with a year-on-year increase of 12.0%, 19.5% and 18.0%, EPS of 1.77, 2.12 and 2.50 yuan respectively, and the corresponding PE of the current stock price is 51.2, 42.9 and 36.3 times. Haitian brand and channel advantages exist for a long time. The company continues to strengthen its competitive strength, multi category development, market share can still be expanded, and has the potential of platform enterprises. We are optimistic about the future development in a long cycle and maintain the “buy” investment rating.
The revenue was in line with expectations, and the net profit was slightly lower than expected
The company’s revenue growth rate in the first quarter was 0.7%, achieving 25.7% of the annual target, and the progress was slightly slower than that in the same period in 2021. The first reason is that the epidemic situation in March affected the terminal demand; Second, the 2021q4 price increase stimulates the channel to prepare goods in advance and divert some spring festival sales. In terms of categories, soy sauce, oyster sauce and sauce decreased by 0.53%, 3.17% and 8.61% respectively, and the small products increased by 9.7%, driving the growth of overall revenue, and the effect of category diversification has been reflected. Regionally, the eastern and southern regions achieved more than 5% growth and contributed more incremental growth. In view of the impact of the epidemic, the company has increased investment in the market terminal to assist dealers in inventory removal.
The cost rose higher than expected and the profit margin fell slightly
In 2022q1, the gross profit margin decreased by 2.8pct to 38.2% year-on-year, mainly due to the rise of raw material cost and the change of product structure (the proportion of low gross profit margin categories increased); The sales expense ratio decreased by 0.3pct year-on-year; The management expense rate and financial expense rate increased by 0.2pct and 0.1pct respectively, with little overall change. Looking forward to 2022, the cost pressure remains, and the gross profit margin may fluctuate slightly; The effective launch of the market can promote the steady decline of the expense rate, and the annual net interest rate is expected to maintain the same level in the same period.
Actively adjust the leading enterprises and accelerate the market transformation
Under the influence of the external impact of the epidemic, the leading Foshan Haitian Flavouring And Food Company Ltd(603288) actively adjusted. On the one hand, it accelerated the layout of new retail channels, strengthened in-depth cooperation with community group buying, and accelerated market transformation; On the other hand, the channel is refined, and the channel competitiveness is further improved. We have observed that vinegar and cooking wine are expected to grow in a relay after the three categories, and zero added soy sauce has been put on the market in the new products. The outlook of cola in the future; Grain and oil products have also been launched into the market and will build a new growth point in the future. Relying on the advantages of the original channel, Haitian continues to graft new categories, and the prototype of platform enterprise has emerged.
Risk tips: raw material cost fluctuation risk, demand decline caused by epidemic situation, market promotion is less than expected, etc.
