Tonghua Dongbao (600867): Operating cash flow is good, waiting for third-generation insulin approval
The company released the first quarter report of 2019: the company achieved operating income in the first quarter of 20197.14 ppm, a ten-year increase of -0.70%; net profit attributable to mother 2.74 ppm, a ten-year increase of -0.06%; realized non-net profit attributable to mother 2.70 ppm, an increase of 0 per year.41%. Core business growth picks up, real estate and proprietary Chinese medicines drag down 2019Q1 performance.In 2019Q1, the company’s second-generation insulin achieved a growth rate of about 9% from the perspective of the number of exchange terminals. Taking into account the impact of tender price reductions in the second half of 2018, Q1 revenue in 2019 will increase approximately5%.Accounts receivable and bills for the first quarter of 20186.8.3 billion, which was caused by the beginning of channel stocking in March. The company’s active channel destocking began in 2018Q3, and the accounts receivable and bills in 2019Q1 dropped to 6.02 trillion, the decrease in accounts receivable caused the company’s apparent performance in 2019 to be dragged down.At present, the terminal inventory has been sorted out. We are optimistic that the growth rate of sales in 2019 will pick up.In the first quarter of 2019, the decline in the growth rate of proprietary Chinese medicines was obviously superimposed on the non-income contribution of real estate, which resulted in a slight tilt in the performance in the same period of 2019. The operating cash flow is good, and we are optimistic about the company’s future healthy development.91 ‰, an increase of 130 per year.96%, mainly due to the increase in the company’s second-generation insulin sales. As a whole, the company’s operating cash flow is good, optimistic about the company’s future second-generation insulin sales. The follow-up R & D pipeline is progressing steadily. Immediately after the approval of insulin glargine, the company will continue to optimize its product structure with second-generation insulin as its core, and lay out 1) similar products: insulin glargine, insulin aspart, detemir, and LaiProline four major third-generation insulins; 2) Fourth-generation 无锡夜网 insulin: BC Lispro and BC Combo; 3) GLP-1 agonists: liraglutide and dularglutide; 4) DPP-4 inhibitor: troglitazoneTing and Sitagliptin.5) SGLT-2 inhibitor: englitazone.CDE will inspect the insulin glargine production site from May 5th to June 6th. We expect to be approved in 2019Q3; Asparagus income will be declared for production and it is expected to be approved for listing in 2020. Earnings forecast: We expect the company’s net profit attributable to the parent to be 2019-2021, respectively.6.7 billion, 11.2 billion, 13.6.1 billion, an increase of 15 each year.33%, 15.79%, 21.57%; the company’s EPS for 2019-2021 is 0.48 yuan, 0.55 yuan, 0.67 yuan, maintain “recommended” investment rating. Risk warning: Second-generation insulin sales are not up to expectations; insulin glargine is not on the market; fourth-generation insulin development is not up to expectations; transformation risk.
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