\u3000\u3 Jointo Energy Investment Co.Ltd.Hebei(000600) 587 Shinva Medical Instrument Co.Ltd(600587) )
Event: the company released the annual report of 2021. The operating revenue was 9.482 billion yuan, a year-on-year increase of 3.62%, and the net profit attributable to the parent was 556 million yuan, a year-on-year increase of 137.68%, deducting 384 million yuan of non attributable net profit, a year-on-year increase of 97.07%; The company released the first quarterly report of 2022. The operating revenue was 2.113 billion yuan, a year-on-year decrease of 16.05%, and the net profit attributable to the parent was 128 million yuan, a year-on-year decrease of 12.84%. After deduction, the net profit attributable to the parent was 148 million yuan, a year-on-year increase of 21.46%. The performance is in line with market expectations.
Comments:
Optimize the business structure, focus on manufacturing and reduce business. In 2021, the company’s medical device manufacturing revenue increased by 20.07% year-on-year, and the pharmaceutical equipment revenue increased by 16.83% year-on-year. The manufacturing revenue accounted for about 50% of the company’s total revenue, which was significantly higher than 44% in 2020, and the company’s manufacturing industry grew steadily. The revenue of medical trade decreased by 10.90% year-on-year in 2021. Factor company Shanghai Taimei suspended business agency cooperation with Johnson & Johnson on June 30, 21. Affected by this, the company’s 22q1 revenue decreased by 16.05% year-on-year. The difference in the year-on-year growth of net profit attributable to the parent company before and after deduction in 22q1 was due to the investment income of the subsidiary stripped off by the company in 21q1, and affected by the changes in the stock price of the company in the first quarter, the profit and loss from changes in the fair value of Shinva Medical Instrument Co.Ltd(600587) shares held by Sui Yong and other 9 natural persons frozen by the company decreased by 21 million yuan, reducing the net profit of the company. Based on the steady growth of the company’s medical devices and pharmaceutical equipment sector, the net profit deducted from non parent company in 22q1 increased by 21.46% year-on-year, in line with market expectations. Due to the reduction of business in the medical trade and service sector, the company’s net profit margin in 2021 was 5.86%, an increase of 3.24pct compared with 2020, and the net profit margin in 22q1 was 6.14%, an increase of 0.18pct compared with the same period in 21 years. The overall profitability of the company was improved. In addition, the net cash flow from the company’s operating activities in 21 years was 1.402 billion yuan, a year-on-year increase of 27.72%. By the end of the first quarter, the company had contract liabilities of 1.815 billion yuan and abundant orders on hand.
Focus on medical devices and pharmaceutical equipment and strengthen the company’s advantageous fields. According to the company’s plan, it is determined to take medical devices and pharmaceutical equipment as the two core main businesses, focusing on breaking through the fields of hemodialysis, radiation diagnosis and treatment, in vitro diagnosis and biopharmaceutical equipment. In the fields of sensing and control equipment, experimental equipment, surgical instruments and other fields where the company has advantages in the industry, intensive cultivation has stabilized the leading position in the industry. Among them, the market share of infection control product line in China is more than 70%, and the scale ranks first in China; China has the most complete varieties of radiotherapy equipment, and China’s installed capacity will exceed 400, ranking first in China. In addition, the company plans to gradually and orderly withdraw from the fields of medical services, medical trade, traditional Chinese medicine and chemical pharmaceutical equipment. The company will shift from relying too much on medical trade services to focusing on production and manufacturing. As a supplement to the manufacturing industry, medical trade and services will continue to develop businesses with stable profits and less resource occupation.
The introduction of fixed increase and equity incentive plan has helped the company’s long-term development. The total number of shares subscribed by the majority shareholders of the company for the development of high-end manufacturing projects such as precision manufacturing and health devices, which is less than RMB 1.27 billion. The total number of shares subscribed by the majority shareholders of the company for the development of the company’s high-end manufacturing projects such as precision manufacturing and health devices, is less than RMB 2.8 billion. Before the raised funds are in place, the company will first invest its own funds in the investment projects with raised funds. In 2021, the company issued an equity incentive plan, which covers 345 employees at all levels of the company. In addition, the company is studying and promoting the equity incentive project of its subsidiaries to further improve the subjective initiative of employees and help the long-term development of the company.
We will increase investment in research and development and continue to promote technological innovation. The company’s R & D expenses in 2021 were 296 million yuan, a year-on-year increase of 49.84%. 539 first-class R & D projects have been approved, including 98 key projects. Actively undertake national key scientific and technological projects and deepen industry university research cooperation. The “volume image multi-mode guided high-intensity precision radiotherapy system” in the 13th five year plan has completed the clinical trial and entered the final stage. The “high-end diagnostic equipment localization project” in the 14th five year plan of the Ministry of industry and information technology and the “multi-functional 128 row large aperture CT Research and development project” in the key research and development plan of Shandong Province have been approved. It has carried out extensive cooperation with universities, scientific research institutes and other units in the aspects of color energy spectrum CT, CBCT, blood transfusion immunity, P4 biosafety steam sterilizer, etc. In addition, the company added 280 authorized patents in 2021 and obtained two class III new product registration certificates and 15 class II registration certificates.
Profit forecast, valuation and rating: the company is a leading enterprise in medical devices and pharmaceutical equipment in China. Considering the reduction of commercial business and the impact of the epidemic, the forecast of net profit attributable to the parent company in 22-23 years was lowered to 672 million yuan (the original 702 million yuan, down 4.27%) / 814 million yuan (the original 863 million yuan, down 5.68%), the forecast of net profit attributable to the parent company in 24 years was 989 million yuan, and the current price was 10 / 8 / 7 times that of PE in 22-24 years, maintaining the “buy” rating.
Risk warning: the order is not as expected; The investment of raised investment projects is less than expected; Investment losses; The epidemic situation is repeated.
