China Torch Hi-Tech (600872): Performance meets expectations and puts forward five-year “double hundred” goal to accelerate development
Investment Highlights: Event: The company releases its 2018 annual report.
Revenue for FY 2018 was 41.
66 ppm, an increase of 15 in ten years.
43%; realize net profit attributable to shareholders of listed companies.
07 million yuan, an increase of 34 in ten years.
01%; net profit attributable to non-recurring gains and losses attributable to shareholders of listed companies5.
720,000 yuan, an increase of 37 in ten years.
Among them, the 18Q4 company achieved revenue of 10.
2 billion, an annual increase of 13.
77%, achieving net profit attributable to shareholders of listed companies.
22 ppm, an increase of 23 in ten years.
44%; Realize net profit attributable to shareholders of listed companies in place of non-recurring gains and losses1.
20,000 yuan, an increase of 19 in ten years.
The company plans to distribute a cash dividend of 2 for every 10 shares.
3 yuan (including tax), a total of 1 cash dividend distribution.
Investment Ratings and Estimates: We raise our revenue for 2019-20 to 47.
700 million (previously 46.
4.5 billion), and new revenue forecasts for 202166.
0 ppm, an increase of 14 each year.
2%, 17%, 18.
5%; raise the net profit forecast for mothers in 2019-20 to 7.
22 (previous 7).
07 billion), adding a profit forecast for 202111.
5 ppm, corresponding to EPS prediction of 0.
44 yuan, an increase of 20 each year.
8%, the latest closing price corresponding to 19-20 years PE is 40, 32x, maintain BUY rating.
Continue to be optimistic that the company’s condiment business will maintain steady growth in the dual indicators of revenue under the strategic guidance of regional improvement and regional + channel + category expansion. At the same time, it will benefit from the continuous launch of new production capacity and improved operating efficiency to achieve a steady increase in profitability. The growth rate of condiments in Q4 fluctuated. It is expected that the growth rate will increase in Q19 in 1919, and the contribution of real estate business will increase: the company achieved revenue of 10 in 18Q4.
0.6 million yuan, an increase of 14 in ten years.
3%, an acceleration from the previous quarter.
Among them, the condiment segment realized income 8.
9.9 billion yuan, an annual increase of 6.
6%, which is expected to be a short-term operating change brought about by the change of the actual controller, and will achieve revenue of 38 in 18 years.
1.7 billion, an increase of 10 in ten years.
56%, reached the initial plan, completed in 19 years with the change of the actual controller, short-term, medium- and long-term development plans were successively introduced, at the same time market expenditure will also be changed from conservative to active, overall business promotion continued to improve, 19 years of condiment revenue growthSpeedup from the previous month.
The real estate sector recognized revenue in the fourth quarter of more than 40 million yuan, which has nearly tripled each year, and is expected to remain stable in 19 years.
Soy sauce remained stable, small categories performed well, and the proportion of income outside the southeast coast increased. In terms of products, soy sauce achieved an income of 25 in 18 years.
90 ‰, an increase of 9 in ten years.
1%, sales increase by 7 per year.
8%, continue to maintain the steady development rhythm of both volume and price; oyster sauce and cooking wine in the small category performed well, and in 18 years oyster sauce achieved income1.
400,000 yuan, an increase of 41 in ten years.
8%, cooking wine achieved 57.68 million income, an increase of 68 throughout the year.
At present, the company’s production capacity distribution of non-soy sauce condiments has been completely completed, and the production capacity side is relatively completed, but the effect of continuing to drive the growth of small categories through the kitchen brand and channel advantages has improved.Revenue from non-soy sauce condiments is expected to accelerate growth.
In terms of regions, the income of the eastern, southern, central western, and northern regions increased by 9 in 18 years.
62%, the two regions outside the southeast coast have faster revenue growth than the whole. Under the company’s strategic guidance of a five-level division of the market, 18 new prefecture-level cities and 178 dealers were newly developed in 18 years.However, the current development rate of the company’s prefecture-level cities reaches 77%, and there is still a difference between the distance from the industry leaders. In the future, the development efforts of blank prefecture-level cities and tertiary market districts and counties will continue to expand.It is expected to continue to improve and help the steady progress of nationalization.
The overall profitability has continued to improve, the gross profit margin of condiments has fluctuated slightly due to the impact of costs, and the profitability of the Yangxi base has maintained a high level: the company’s net profit margin in 18Q4.
19%, an increase of one year.
47 points, mainly due to the year-on-year increase in gross profit margin in 18Q41.
83pct, we believe that the improvement in gross profit margin in 18Q4 is related to the revenue structure and the decrease in the cost of raw materials in the current period; in terms of expense ratio, 18Q4 sales expense ratio was 12.
26%, a substantial increase of 3 per year.
64pct, it is expected that the company’s market investment will change from cautious to positive. Looking forward to 19 years, it is expected that the sales expense ratio will continue to slightly increase.
As far as the condiment business is concerned, the gross profit margin for condiments in 18 years was 39.
31%, a decline of 0 per year.
63pct is mainly due to the cost pressure brought by the rising prices of 18H2 raw materials. Although the company responded by improving production efficiency and other methods, it still had a certain impact on gross profit margin.
The delicious fresh subsidiary’s 18-year net margin was 16.
51%, a year up 0.
3pct, 四川耍耍网 18H2 net profit 15.
98%, a decline of 0 every year.
23pct, affected by the decline in gross profit margin and intensified market expansion.
In terms of production bases, the net profit margin of Yangxi base is 18H221.
11%, a decline of 0 per year.
87pct, but still maintained at a high level; Zhongshan base 18H2 net profit 12.
53%, down by 1 every year.69pct, the difference between the net profit margin of Yangxi Base and the expansion to 8.
In the future, as the new capacity of the Yangxi Base is gradually put into operation and the revenue share increases, the overall net profit margin of the condiment business is expected to continue to increase steadily.
The initial plan is positive, the long-term thinking is clear, and the development is expected to accelerate after the mechanism is optimized. In the release of the annual report, the company clearly defined the long-term goal of focusing on the development of the main business of healthy food and the five-year development plan to achieve the “double hundred goals”.The main body of development, supplemented by extensional development, will achieve the goal of tens of billions of revenues and millions of tons of sales by 2023, and the corresponding growth rates of revenue and sales will be 21 respectively.
2% and 15.
We believe that after the company’s transition from a state-owned organization to a private system, the operating efficiency and incentive mechanism are expected to achieve substantial improvements. The gradual establishment of a market-oriented mechanism will fully realize its potential to accelerate development and reduce competition differences with industry leaders.
Catalysts for gradual increase: Condiment business revenue grows faster than expected, synergistic incentives brought about by mechanism change improve the unexpected core risks: increased competition in the industry, higher-than-expected cost rises, and uncertainty in system reform