red weekly: in 2021, Warom Technology Incorporated Company(603855) various businesses developed steadily, and the company achieved an annual operating revenue of 3.027 billion yuan, an increase of 32.62% over 2020; The net profit was 381 million yuan, an increase of 46.19% over 2020. However, in the first quarter of 2022, when the company realized an operating revenue of 663 million yuan, with a year-on-year increase of 28.68%, it only realized a net profit of 600747 million yuan, with a year-on-year decrease of 1.21%. What is the reason why the company increased its income but did not increase its profit?
Qiu Zheng: Warom Technology Incorporated Company(603855) the decline in net profit in the first quarter of 2022 was not caused by the main business factors. In fact, after deducting non recurring profits and losses, the company’s net profit was 810821 million yuan, an increase of 33.54% year-on-year Warom Technology Incorporated Company(603855) is mainly engaged in explosion-proof electrical appliances, which account for about 60% of the company’s operating revenue. Explosion proof electrical appliances refer to special electrical equipment used in places with various inflammable and explosive gases, dust, steam and other substances such as petroleum, chemical industry, coal mine and natural gas. In 2021 Warom Technology Incorporated Company(603855) obtained Sinopec, PetroChina, CNOOC, shenhuaning coal, Xichang Satellite Wenchang satellite and related national defense and military users are honored as the “high-quality supplier” of many users. In the future, the explosion-proof electrical appliance market will gradually move towards high-end, digital and intelligent, Warom Technology Incorporated Company(603855) such a leading enterprise with capital advantages, technical advantages and continuous investment will be more competitive, and the enterprise development will enter a sustainable rising period.
In addition to explosion-proof electrical appliances, professional lighting equipment is also one of Warom Technology Incorporated Company(603855) main businesses. Although the company’s revenue of this business in 2021 is only 325 million yuan, accounting for about 10% of the main business revenue, this industry has the highest gross profit margin among Warom Technology Incorporated Company(603855) all businesses, reaching 68.15%. In 2021, the company invested and established “Huarong Lighting Co., Ltd.” in Huzhou, Zhejiang Province, with a registered capital of 150 million yuan, and completed the construction of phase I production base of about 60000 square meters. In September 2021, the new base was put into use, and the lighting business sector began independent management and entered the track of rapid development, which will become a new profit growth point of the company in the future.
red weekly: main Rabies Vaccine Liaoning Chengda Biotechnology Co.Ltd(688739) in 2021, the operating revenue and net profit were 2.088 billion yuan and 892 million yuan respectively, basically the same as that of the previous year. However, in the first quarter of 2022, the company’s operating revenue and net profit were 366 million yuan and 151 million yuan respectively, with a year-on-year decrease of 38.46% and 46.16% respectively. Why did the company’s operating revenue and net profit both decline?
Qiu Zheng: the short-term factor leading to the decline of Liaoning Chengda Biotechnology Co.Ltd(688739) first quarter performance is that China’s epidemic prevention and control measures are tightened, personnel and pet activities are limited, pet injuries lead to the reduction of possible rabies exposure, and the market demand drops periodically. The long-term factor leading to the decline of the company’s performance is that with other human rabies vaccine manufacturers entering the market, the competition in the human rabies vaccine market is normalized, which has a certain pressure on the company’s sales revenue.
At present, the main competitor of Liaoning Chengda Biotechnology Co.Ltd(688739) is Chengdu Kanghua Biological Products Co.Ltd(300841) . Compared with Liaoning Chengda Biotechnology Co.Ltd(688739) human rabies vaccine (Vero cell), Chengdu Kanghua Biological Products Co.Ltd(300841) human rabies vaccine (human diploid cell) currently has the advantages of the only human cell rabies vaccine, no need to control host cell protein and residual DNA, and exclusive products in the market. In the first quarter of 2022, Chengdu Kanghua Biological Products Co.Ltd(300841) the operating revenue and net profit were 267 million yuan and 135 million yuan respectively, with a year-on-year increase of 12.48% and 34.60% respectively. Compared with Liaoning Chengda Biotechnology Co.Ltd(688739) , the operating revenue and net profit of Chengdu Kanghua Biological Products Co.Ltd(300841) are about 73% and 89% of Liaoning Chengda Biotechnology Co.Ltd(688739) respectively, but the total market value of the company is only 53% of Liaoning Chengda Biotechnology Co.Ltd(688739) at present. Relatively speaking, the current valuation of Chengdu Kanghua Biological Products Co.Ltd(300841) is lower.
From the perspective of R & D, Liaoning Chengda Biotechnology Co.Ltd(688739) has more advantages. In 2021, the R & D expenditure of Chengdu Kanghua Biological Products Co.Ltd(300841) and Liaoning Chengda Biotechnology Co.Ltd(688739) was 79 million yuan and 311 million yuan respectively. The R & D investment of Liaoning Chengda Biotechnology Co.Ltd(688739) was significantly higher than that of Chengdu Kanghua Biological Products Co.Ltd(300841) . At present, Liaoning Chengda Biotechnology Co.Ltd(688739) has more than 20 vaccine projects under development. Among them, in terms of innovative vaccines, 15 price HPV vaccine is the second highest price HPV vaccine under development in the world. In March 2022, it received the implied license notice of approving clinical trials. In addition, the 20 valent pneumococcal conjugate vaccine independently developed by the company with international advanced technology has completed the process validation research and is carrying out pilot sample preparation.
red weekly: in 2021, it was mainly engaged in Pulike Biological Engineering Inc(603566) business performance of veterinary biological products and chemicals, which hit a new record, with an annual operating revenue of 1.099 billion yuan, an increase of 18.31% over the same period of last year; The net profit after non deduction was 185 million yuan, an increase of 21.05% over the same period of last year. Can the performance growth of the company be continued in 2022?
Qiu Zheng: although Pulike Biological Engineering Inc(603566) in 2021, the net profit after deduction increased by 21.05% year-on-year to 185 million yuan, the net profit after deduction in the first three quarters was 198 million yuan, that is, the company had a loss in the fourth quarter. In the first quarter of 2022, the company’s operating revenue and net profit after non deduction both fell, with a decline rate of 20.54% and 59.22% respectively. In fact, it’s not just the fact that it’s not just just about the Pulike Biological Engineering Inc(603566) thebreeding industry continued to decline, once entering a deep loss stage, and the production capacity of fertile sows was reduced Due to the reduction of the number of newborn piglets and other factors, the animal biological products and chemicals industry will hardly improve in 2022.
