Renhe Pharmaceutical (000650): The performance is slightly higher than expected
Event: The company released the quarterly report for the year of 19. The income, net profit attributable to mothers and net profit attributable to non-mothers were 11, respectively.
90 billion, 1.
4.2 billion and 1.
4.1 billion, each year +13.
20% and +33.
60%, slightly higher than our expectations, mainly due to the decline in expense ratio.
The opinions are as follows: We estimate that the sales revenue of OTC in 19Q1 will maintain a growth rate close to 20%.
The market was worried that the company may reduce shipments in 19Q1 due to the budget reduction. From the financial report, the company’s shipments are normal.
We estimate that Renhe China continues to maintain a revenue growth rate of more than 20% for ten years, and Jiangxi Renhe Pharmaceutical maintains a revenue growth rate of 15-20% for ten years.
Expense control and the increase in the proportion of self-products have led to higher profit growth than revenue growth.
As Renhe China also increased the speed of selling its own industrial products, the company’s high gross profit ratio of its own products income gradually increased: 19Q1 consolidated statement gross profit margin increased by 0.
67 points, partly due to the increase in the proportion of high 深圳桑拿网 gross profit self-product income.
19Q1 sales expense ratio and management expense ratio were twice respectively.
35 and -0.
With a total of 90, the cost control effect is obvious, and we estimate that it is related to the company’s implementation of incremental income assessment.
The fluctuation of operating net cash flow is related to the business cycle, and we estimate that it will improve in the future.
19Q1 operating net cash flow was 3.84 million yuan, compared with 17.15 million yuan in the same period last year.
The company received sales of goods in 19Q1 and provided cash for labor services of 9.
8.5 billion, compared with 9 in the same period last year.
We estimate that the most cash received by the company in Q1 is related to the cycle of business implementation: 1-2 months of each year make a plan, after the New Year, the business staff arrives, the company starts a large number of shipments, the business is delivered successively, and the Q2-Q3 repayment becomes better.Generally, Q4 repayment is the most because the Q4 repayment will be assessed every year.
Diversified in the industrial cannabis industry.
On April 22, the company and the Qiqihar Municipal Government of Heilongjiang and Fengtai Fuqi signed the “Renheyuan Industrial Cannabis Comprehensive Utilization Industry Demonstration Project Cooperation Framework Agreement”.
The company established a joint venture with Fengtai Fuqi with a total project investment of 10.
800 million, of which 1 investment.
0.8 billion yuan.
According to the framework agreement, the joint venture company will start construction of an industrial cannabis plantation demonstration base in May 2019, and agreed with the municipal government that the 2020 plantable land reserve will exceed 20,000 acres.
Maintain “Highly Recommended-A” rating.
We estimate that the company’s net profit growth attributable to mothers will be 26% / 20% / 17% in 2019-2021, and the corresponding EPS will be 0.
As a leading OTC company, the company has a rich variety and strong brand power. After the formation of the team, we have ushered in the era of OTC terminal control sales, and sales efforts have maintained rapid growth. Since the proportion of product revenue has expanded, profitability has increased significantly.