\u3000\u3 Bohai Water Industry Co.Ltd(000605) 108 Tongqinglou Catering Co.Ltd(605108) )
Event:
The company issued the 2021 annual report and the first quarterly report of 2022.
Comments:
Revenue has maintained steady growth, and the performance is still resilient under the influence of the epidemic
In 2021, the company achieved an operating revenue of 1.608 billion yuan, a year-on-year increase of 24.11%; The net profit attributable to the parent company was 144 million yuan, a year-on-year decrease of 22.17%; Net profit deducted from non parent company was 125 million yuan, a year-on-year decrease of 25.1%. Among them, the operating revenue in the fourth quarter was 487 million yuan, a year-on-year increase of 2%; The net profit attributable to the parent company was 65 million yuan, a year-on-year decrease of 17.96%. In 2021, under the repeated epidemic situation, the operating revenue fluctuated greatly during the quarter and did not return to the normal operating level. The net profit decreased due to the impact of store expansion, the increase of food companies, the preparation cost of new stores and the closure and reconstruction of old stores. In the first quarter of 2022, the operating revenue was 424 million yuan, a year-on-year increase of 5.04%, and the net profit attributable to the parent company was 23 million yuan, a year-on-year decrease of 27.67%. Excluding the impact of 6% output tax not deducted from 2021q1 revenue, the revenue increased by 11.34% year-on-year. The decline in profit was mainly due to the trial operation of some stores one after another, the higher opening expenses and decoration amortization expenses, the loss of 8 million yuan, and the income of financial products decreased by 2.23 million yuan compared with the same period last year.
Continuously optimize the operation capacity of stores and the food business develops rapidly
In 2021, the company successively upgraded 7 old stores and 5 new stores, with a total of 63 stores. By the end of 2022, Beicheng Fumao is expected to open at the end of 2022. In terms of food business, the company achieved a revenue of 151125 million yuan in 2021. At present, the company has completed team building, product R & D and calibration, OEM factory cooperation and the establishment of Wuxi Online Offline Communication Information Technology Co.Ltd(300959) sales system. Online channels carry out marketing through e-commerce platform self operation and Tiktok self broadcast + agent operation. Offline, the company operates more than 30 supermarket counters in Hefei and has signed contracts with more than 1200 Yijie convenience stores of Sinopec. At present, five product systems including famous chefs and dishes and self heating rice have been formed, with nearly 30 SKUs. It is expected to further expand to 100 SKUs in 22 years.
Investment advice and profit forecast
The company’s positioning is public catering and banquet wedding services. Large catering + banquet wedding + chain operation ability is prominent, building competitive barriers, and exploring multiple categories of food business, which is expected to contribute to new performance growth points. We estimate that the net profit attributable to the parent company from 2022 to 2024 will be RMB 183 / 232 / 315 million respectively, and EPS will be 0.70/0.89/1.21 respectively, corresponding to pe25x / 19x / 14x. Maintain the “buy” rating.
Risk tips
Food safety risk, repeated epidemic risk, new store operation is less than expected, food business is less than expected, etc.
