\u3000\u3 Shengda Resources Co.Ltd(000603) 317 Sichuan Teway Food Group Co.Ltd(603317) )
Event: on April 25, 2022, Sichuan Teway Food Group Co.Ltd(603317) released the report for the first quarter of 2022. During the reporting period, the company realized an operating revenue / net profit attributable to the parent company of RMB 629 / 100 million, a year-on-year increase of + 20.60% / + 25.27%. Chinese dishes and condiments performed well, and the expansion speed of dealers slowed down slightly.
In the first quarter, the company's revenue was 629 million yuan, a year-on-year increase of 20.60%. 1) In terms of products, hotpot seasoning / Chinese dish seasoning / sausage and bacon seasoning / chicken essence / spicy sauce / others achieved a revenue of 241 / 3.49/0.05/0.19/0.09/05 million yuan, a year-on-year increase of - 3% / + 45% / - 35% / + 87% / + 35% / - 15%. The company's Chinese cuisine seasoning, chicken essence and spicy sauce contributed to the growth of main revenue. 2) In terms of sales channels, dealers / customized meal dispatching / e-commerce / direct business supermarket / foreign trade / others achieved a revenue of 523 / 0.52/0.33/0.11/0.08/01 million yuan, a year-on-year increase of + 23% / + 13% / - 20% / + 91% / + 231% / - 18%. The significant growth of direct business supermarket and foreign trade channels was due to the low base caused by the impact of the epidemic. 3) In terms of regions, the Southwest / Central China / East China / Northwest / North China / Northeast / South China / export realized an operating revenue of RMB 175 / 1.06/1.51/0.58/0.60/0.30/0.43/05 million, a year-on-year increase of + 18% / + 21% / + 21% / + 23.5% / + 43% / - 8% / + 23% / + 111%. By the end of the first quarter of the year, the company had 3368 distributors, 41 fewer than at the end of the year. The reduced distributors were mainly from northeast / South / Central China, with a decrease of 54 / 9 / 8 respectively; There was a net increase of 8 / 8 / 7 / 7 dealers in North China / Northwest / East China / southwest.
Profitability remained basically stable.
The gross profit margin / net profit margin of 22q1 company was 35.95% / 15.93% respectively. After considering the impact of accounting standard adjustment, the gross profit margin was -0.32 / + 0.57pct year-on-year respectively. The decline in gross profit margin was mainly due to the increase in the proportion of raw material cost plus low gross profit business (customized meal adjustment). In terms of expenses, the sales / management expense ratio in the first quarter was 13.01% / 3.39% respectively. After considering the impact of accounting standard adjustment, it was -3.50 / -2.04pct year-on-year respectively. The decrease in sales expense rate is mainly due to the company's more cautious control of advertising and promotion expenses.
The channel continues to improve, and the adjustment rhythm of the company needs to be closely observed.
Last year, the company reformed the channel to keep the channel inventory at a low level. With the recovery of dealer confidence, it will bring a certain demand for replenishment of inventory. In terms of products, the crayfish seasoning in Chinese dishes has performed brilliantly, driving the rapid growth of the category. Looking forward to 2022, after the reshuffle in 2021, some small brands will be cleared out, which is conducive to the head brand represented by Tianwei. On the other hand, the company has adjusted its business pace. At present, it focuses on large single products and continues to empower core dealers. The overall business situation is expected to continue to improve.
Profit forecast, valuation and rating: we maintain the forecast of the company's net profit attributable to the parent company for 22-24 years as 236 / 297 / 356 million yuan, equivalent to EPS of 31 / 39 / 47 million yuan for 22-24 years respectively; The current share price corresponds to 53x / 42 / 35x PE in 22-24 years, maintaining the "overweight" rating.
Risk tips: raw materials fluctuate sharply, the dynamic sales of products are less than expected, and food safety problems.
