2022Q1's performance is in line with expectations. 2022Q1 achieved an operating income of 285 million yuan, an increase of 12.5% over the same period last year, and its net profit was 71 million yuan, an increase of 76.94% over the same period last year. The net profit deducted from non-return was 62 million yuan, an increase of 54.99% over the same period last year. The net cash flow of operating activities was 110 million yuan, an increase of 355.81%. The rapid growth of performance is mainly due to the fact that the company's safety syringe and safety injection needle business is in short supply and in a rapid release period. in addition, the company has turned losses into profits in Boao International Hospital in Hainan, bringing greater performance flexibility.
Strong improvement in profitability. 2022Q1's gross profit margin was 53.58% and its net profit rate was 26.29%, which increased 5.78pct and 10.61pct respectively over the same period last year, both reaching record highs. The sales expense rate, management expense rate, financial expense rate and R & D expense rate of 2022Q1 were 13.07%, 10.18%, 2.67% and 2.75% respectively, down from the same period last year-1.57pct, 0.69pct, 1.23pct,-0.14pct.
Safety syringes and Boao International Hospital bring great opportunities for great-leap-forward development. In 2021, the company's safety syringe and safety injection needle business ushered in rapid growth. As the partner RTI further opened the international market, the company's safety syringe demand increased significantly, and its production capacity continued to expand, from 500 million / year in 2020 to 850 million / year in 2021. It is expected that the production capacity will continue to increase to 1.34 billion in 2022. Boao International Hospital locates high-end, features regenerative medicine, introduces high-end talents at home and abroad, and 2022Q1 turns losses into profits. With the gradual control of the epidemic, the number of hospital visits will rise rapidly, and the performance will usher in rapid growth.
Profit forecast and investment rating: the company's operating income from 2022 to 2024 is expected to be 14.42,17.35 and 2.077 billion yuan respectively, an increase of 31.2%, 20.3% and 19.7% respectively over the same period last year, and its net profit is 2.66,3.26% and 433 million yuan respectively, an increase of 80.4%, 22.7% and 32.7% over the same period last year. Give an overweight rating.
Stock price catalyst: safety syringes enter the medical insurance smoothly in China; pre-filled catheter washers are highly accepted at the hospital terminal; the volume of diagnosis and treatment in Boao International Hospital has greatly increased; the new hospital of Ezhou second Hospital opened smoothly.
Risk factors: the risk of deterioration of Sino-US relations; the risk of product sales falling short of expectations; the risk of intensified competition in the industry; the risk of medical malpractice.
