Performance in 2021 is slightly lower than we expected.
The company announced its results in 2021: the income was 8.751 billion yuan, an increase of 20.46% over the same period last year, the net profit of home was 595 million yuan, down 4.86%, and the non-net profit was 557 million yuan, a decrease of 7.04% over the same period last year. The performance was slightly lower than expected. The company's revenue growth is steady, and the profit side is under pressure, mainly because the company continues to improve its competitiveness through product quality + scale advantage + brand effect. Sales increased steadily, but the rise in the price of raw materials affected gross margins and led to a slight decline in profits. The company plans to pay a cash dividend of 1.6 yuan for every 10 shares.
On a quarterly basis, 1Q/2Q/3Q/4Q21 revenue increased by 86.8%, 20.6%, 21.6%, 0.2% respectively. The net profit of homing increased by 227.9% / 7.8% respectively.
Trend of development
1. The traditional business performance is sound, and the wooden door and cloakroom business is growing rapidly. 1) Wood flooring: realized income 6.12 billion yuan, year-on-year increase 14.9%, income accounted for 70.0%, gross profit margin reached 31.3%, 2.2 ppt board 2) medium and high density board: realized income 1.86 billion yuan, year-on-year increase of 25.7%, income accounted for 21.3%, gross profit margin reached 10.4%, year-on-year minus 5.3ppt 3) Bamboo and stone flooring: realized income of 650 million yuan, year-on-year increase of 59.4%, income accounted for 7.4%, gross profit margin reached 17.4%, year-on-year decrease of 5.0 pptX 4) wooden door and cloakroom: realized income of 70 million yuan, year-on-year increase of 1195.0%, income accounted for 0.8%, gross profit margin reached 24.6%, year-on-year increase of 4.2ppt.
2, the rise of raw materials affects profitability, pay attention to the follow-up profit margin repair. The company's gross profit margin in 2021 is 26.1%, minus 3.4ppt, mainly due to the rise in the price of raw materials. In 2021, the sales expense rate is 7.6%, the same increase in 0.5ppt, the same increase in management + R & D expense rate of 9.2%, the same minus 1.3ppt, the same financial expense rate of 0.6%, and the same minus 0.4ppt. Under the combined influence, the company's net interest rate is 6.8%, and the same as minus 1.8ppt.
3. Adhere to the development strategy of green industrial chain, product quality + scale advantage + brand effect to enhance the competitiveness of the company. 1) Brand side: the company will continue to adhere to the green industry strategy, continue to try marketing innovation, and gradually improve the brand value of the company's "Daya" wood-based panel and "icon" floor. 2) product side: the company has in-depth insight into customer needs, active product research and development, and successfully launched new categories such as sports floor, outdoor floor, new decoration wallboard and so on in 2021; 3) Channel end: the company has coordinated layout in retail, enterprise customers, international market and other fields, and new retail is empowered through digital marketing, and it is expected to go hand in hand in the future.
Profit forecast and valuation
Considering that the operation of the company is still being adjusted and the price of raw materials remains at a high level, we reduce the net profit of 2022 by 10% to 690 million yuan, and introduce a net profit of 810 million yuan in 2023. The current stock price corresponds to 8 times the PE of 2022 in 2023, maintaining the industry rating of outperforming, and reducing the target price by 13% to 14 yuan, taking into account the adjustment of profit forecast and the change of market risk preference. Corresponding to 2022 / 2023, the PE is 10 times of 11 prime, with 33% uplink space.
Risk
The price of raw materials fluctuates sharply, and the competition in the industry intensifies.
