\u3000\u3 Guocheng Mining Co.Ltd(000688) 356 Jenkem Technology Co.Ltd(688356) )
Event: the company released the first quarterly report of 2022. During the reporting period, the company realized an operating revenue of 101 million yuan, a year-on-year increase of 44.2%; The net profit attributable to the parent company was 52 million yuan, a year-on-year increase of 45.4%; The net profit deducted from non parent company was 43 million yuan, with a year-on-year increase of 23.1%.
Comments:
Q1 achieved high performance growth and significantly improved profitability month on month. Revenue side: increased by + 44.2% / + 12.8% on a month on month basis, mainly due to the increase in the volume of orders and the income from technical services; In terms of subregions, China achieved revenue of 28.6 million yuan (+ 93.8%), while foreign regions achieved revenue of 61.6 million yuan (+ 25.9%), China achieved rapid growth, while foreign growth slowed down. The latter was mainly due to the large base in the same period last year, and the slowdown in the pace of shipment affected by the epidemic affected revenue recognition. Profit side: the gross profit margin increased by 1.4pct/4.0pct respectively on a month on month basis. It is speculated that it is mainly due to the increase in the proportion of overseas high gross profit products and the significant increase in China’s technical service fee (gross profit margin 100%); The ratio of sales, management and financial expenses was + 4.3pct / – 4.6pct / + 3.73pct year-on-year and – 1.1pct / – 7.1pct / – 1.0pct month on month. During this period, the ratio of expenses decreased significantly month on month, mainly due to the centralized confirmation of equity incentive, bonus accrual and other expenses in 2021q4. The year-on-year increase of the ratio of sales expenses was mainly due to the company’s continuous increase in the construction of sales teams outside China, and the ratio of administrative expenses decreased year-on-year, mainly due to the sharp decrease of equity incentive accrual expenses, The year-on-year increase in financial expense rate is mainly due to the impact of exchange rate.
R & D investment continues to increase and open a new growth curve. The R & D cost in Q1 of 22 years was 19.1 million yuan (+ 213%), and by the end of 2021, the R & D personnel had expanded to 58 (+ 93%). Pegylated irinotecan, the company’s product, completed the phase II clinical treatment of solid tumors on November 16 last year. The first subject is expected to be enrolled. It is expected to be fully enrolled in 2022. The second indication for the treatment of glioma combined with temozolomide will also start the phase II clinical treatment in the near future; Tumor immunosuppressive biological drug jk-1119i and medical American product jk-2122h are expected to enter clinical phase I in 2022.
Profit forecast: we predict that from 2022 to 2024, the company’s revenue will be 469 / 600 / 743 million yuan respectively, with a year-on-year increase of 33.5 / 28.0% / 23.8% respectively; The net profit attributable to the parent company was 237 / 283 / 363 million yuan respectively, with a year-on-year increase of 34.6% / 19.6% / 28.4% respectively. The latest (April 27, 2022) closing price corresponds to 41 / 34 / 27 times of PE respectively. The company is a leading medical peg enterprise with global competitiveness. With the release of new production capacity in Panjin in the second half of this year, the production capacity problem can be effectively solved. In the future, the application of new scenarios, the large volume of orders from old customers and the promotion of self-developed products are expected to bring new growth to the company and maintain the “buy” rating.
Risk tips: market promotion risk, gross profit margin decline risk, core technology iteration risk, polyethylene glycol derivative synthesis technology and products can not meet customer needs, customer order loss and R & D failure risk.
