\u3000\u3 Shengda Resources Co.Ltd(000603) 939 Yifeng Pharmacy Chain Co.Ltd(603939) )
Event: on April 28, 2022, the company released the annual report for 2021 and the report for the first quarter of 2022. In 2021, the company achieved revenue and net profit attributable to parent company after deduction of non-profit of 15.326 billion yuan and 859 million yuan, with a year-on-year increase of 16.60% and 20.30% respectively. In 2022q1, the company achieved revenue and net profit attributable to the parent company after deducting non-profit of 4.148 billion yuan and 266 million yuan, with a year-on-year increase of 14.29% and 14.12% respectively. The performance growth was in line with expectations.
In 2022q1, the net profit attributable to the parent company increased by 14.12% year-on-year, and the performance growth was in line with expectations: on the revenue side, the company achieved revenue of 15.326 billion yuan and 4.148 billion yuan respectively in 2021 and 2022q1, with a year-on-year increase of 16.60% and 14.29% respectively. Thanks to the steady expansion of stores across the country, revenue has achieved steady growth. On the profit side, in 2021 and 2022q1, the company realized a net profit of 859 million yuan and 266 million yuan respectively, with a year-on-year increase of 20.30% and 14.12% respectively. The performance growth was in line with expectations.
Thanks to the adjustment of commodity sales structure, the company’s profitability continued to improve:
In 2021 and 2022q1, the overall gross profit margin of the company was 40.35% and 40.95% respectively, with a year-on-year increase of 2.37 percentage points and 0.41 percentage points respectively. The continuous improvement of the company’s gross profit margin is mainly due to the adjustment of sales commodity structure, and the proportion of sales of epidemic prevention commodities with low gross profit has decreased.
Store expansion meets expectations and actively expands to consolidate the leading position in the country:
By the end of 2021, the company had 7809 stores (including 932 franchise stores), including 1197 self built stores, M & A stores, 425 franchise stores and 297 franchise stores. The expansion of stores was in line with expectations. At present, the company continues to actively expand its stores. By 2022q1, the company has added 232, 158 and 64 self built stores, M & A stores and franchise stores respectively, and continues to be optimistic about the rapid expansion of the company’s stores in 2022.
Actively promote the construction of new pharmaceutical retail and the sustained and rapid development of Internet business:
Relying on offline stores and members, the company has steadily arranged new pharmaceutical retail based on members, big data, internet medical treatment and health management, and actively promoted chronic disease management, online diagnosis and treatment and other services. At present, the company’s o2o multi-channel and multi platform online direct stores exceed 6600, fully covering the company’s offline major cities. In 2021, the company’s Internet business realized revenue of 1.128 billion yuan (+ 63.91%), of which o2o business realized revenue of 781 million yuan (+ 95.07%), and the Internet business continued to develop rapidly.
Investment suggestion: we expect the company to realize net profits of 929 million yuan, 1124 million yuan and 1363 million yuan respectively from 2022 to 2024, with a year-on-year increase of 20.9%, 21.0% and 21.2% respectively; Give an investment rating of buy-a.
Risk warning: the epidemic situation will affect the expansion progress of stores; The profitability of stores does not meet expectations; The price of drugs exceeded expectations, and the outflow of prescriptions was less than expected.
