\u3000\u3 Guocheng Mining Co.Ltd(000688) 026 Guangzhou Jet Bio-Filtration Co.Ltd(688026) )
Event: on the evening of April 30, 2022, the company released its annual report for 2021: the company achieved an annual operating revenue of 856 million yuan, a year-on-year increase of 69.80%; The net profit attributable to the parent company was 171 million yuan, a year-on-year increase of 43.38%; Deduct non net profit of 173 million yuan, with a year-on-year increase of 57.89%. The net cash flow from operating activities was 221 million yuan, a year-on-year increase of 18.03%; The basic earnings per share is 1.71 yuan. It is proposed to distribute a cash dividend of 6.00 yuan (including tax) to all shareholders for every 10 shares, and the capital reserve is converted into share capital, with an increase of 4 shares for every 10 shares.
Among them, the operating revenue in the fourth quarter of 2021 was 223 million yuan, a year-on-year increase of 76.84%; The net profit attributable to the parent company was 20 million yuan, a year-on-year increase of 305.10%; Deduct non net profit of 17 million yuan, with a year-on-year increase of 269.29%. The net cash flow from operating activities was 36 million yuan.
On the same day, the company released the report for the first quarter of 2022. In the first quarter, the company achieved an operating revenue of 190 million yuan, a year-on-year increase of 9.42%; The net profit attributable to the parent company was 41 million yuan, a year-on-year decrease of 14.64%; Deduct non net profit of 40 million yuan, a year-on-year decrease of 15.83%. The net cash flow from operating activities was 21 million yuan, compared with -1228100 yuan in the previous period, with a net increase of 220418 million yuan, mainly due to the increase in loan recovery.
Liquid treatment products grew strongly, and the demand for protective articles decreased significantly
From the perspective of product dimension: thanks to the steady increase of global scientific research funding after the phased control of covid-19 epidemic, the field of life science is an important direction of global scientific research funding, and the continuous growth of life science service market and product market affects the substantial increase of the company’s demand for laboratory consumables. (1) The sales revenue of liquid treatment products was 664 million yuan, a year-on-year increase of 198.99%; The gross profit margin decreased by 4.74pct to 41.38% year-on-year, mainly due to the significant increase in the sales of centrifugal pipe and pipette products, but the structural gross profit margin fluctuated due to the slight decline in the gross profit margin. (2) The sales revenue of biological culture products was 153 million yuan, a year-on-year increase of 124.23%; The gross profit margin increased by 0.78pct to 50.32% year-on-year. (3) The sales revenue of instruments, equipment and other products was 26.8 million yuan, a year-on-year increase of 97.13%; The gross profit margin decreased by 26.72 PCT to 1.87% year-on-year, mainly due to the structural fluctuations caused by the large variety of products included in this category and the large difference in gross profit margin. (4) The sales revenue of protective products was 2.81 million yuan, a year-on-year decrease of – 98.55%, mainly due to the obvious decline in market demand for masks and protective clothing products with the control of covid-19 epidemic outside China.
From the regional perspective: (1) the overseas market achieved a sales revenue of 667 million yuan, a year-on-year increase of 174.93%; The gross profit margin increased by 2.44pct to 41.48% year-on-year. (2) The sales revenue in the Chinese market was 181 million yuan, a year-on-year decrease of 29.38%; The gross profit margin decreased by 11.15pct to 43.02% year-on-year.
The gross profit margin decreased by 4.40 PCT due to the difference of product structure and the degree of production automation
In 2021, the company’s comprehensive gross profit margin decreased by 4.40pct to 41.91% year-on-year, mainly due to the structural difference caused by the sharp increase in the sales proportion of liquid treatment products such as suction heads with low gross profit margin; As well as the increase in personnel wages caused by the company’s rapid production under the condition that the company leases the operating site outside in a short time to meet the market demand and the degree of production automation is still imperfect. Through the implementation of fund-raising projects, the company plans to carry out technical transformation and upgrading of the production lines and production equipment of the company’s existing main products, add new automation equipment and production lines, and improve the production capacity and automation level of bottleneck processes, which is expected to further consolidate the dominant position of market segments.
The sales expense ratio decreased by 1.56pct to 2.85% year-on-year, mainly due to the increase of share based payment expenses and salary expenses; The management expense ratio increased by 1.19pct to 4.13% year on year, mainly due to the increase of share based payment expenses, the increase of depreciation of temporarily idle production equipment related to protective products, and the increase of wage expenses; The R & D expense ratio increased by 0.38pct to 5.12% year-on-year; The financial expense ratio increased by 0.78pct to 0.71% year-on-year, mainly due to the decrease of interest income due to the use of raised funds; Under the comprehensive influence, the overall net profit margin of the company decreased by 3.68pct to 20.00% year-on-year.
In the first quarter of 2022, the comprehensive gross profit margin, sales expense rate, management expense rate, R & D expense rate, financial expense rate and overall net profit rate were 38.91%, 3.27%, 3.82%, 5.09%, 0.98% and 21.55% respectively, with changes of -5.15pct, + 0.62pct, + 0.02pct, + 2.34pct, + 1.83pct and -6.07pct respectively. Among them, the R & D expense rate increased significantly, mainly due to the increase of 2.2643 million yuan in share based payment expenses and the increase in salary related to R & D personnel.
Profit forecast and investment rating: we expect the company’s operating revenue from 2022 to 2024 to be 1.063 billion / 1.377 billion / 1.745 billion yuan respectively, with a year-on-year growth rate of 24% / 30% / 27% respectively; The net profit attributable to the parent company was 234 million yuan / 310 million yuan / 399 million yuan, an increase of 36% / 33% / 29% respectively; EPS is 2.34/3.10/3.99 respectively, corresponding to 21 times PE in 2022 according to the closing price on April 29, 2022. For the first time, give a “buy” rating.
Risk tips: the risk of late impact of novel coronavirus pneumonia; Risks of market expansion in China; Risks related to changes in overseas market environment and trade frictions; Risk of exchange rate fluctuation; Risks of technology upgrading and product upgrading.
